BHP Billiton Plc - BBL - close: 45.29 change: -0.62 stop: 41.90 Ding! BHP retested the $44.00 level as expected and hit our trigger to buy calls at $44.50. The stock bounced back and almost closed in positive territory. We have a stop loss at $41.90. More conservative traders may want to consider a stop near $43.00 or just under $44.00. Our first target is $49.90. Our second target is $54.00. The Point & Figure chart is bullish with a $62 target.
Dominos Pizza - DPZ - close: 8.69 change: -0.25 stop: 8.20 DPZ pulled back toward $8.50 and bounced a bit. Yesterday I suggested waiting for a dip near $8.50 as our next entry point. If you aren't comfortable buying a dip then wait for a new rise over $9.00 again. Our target is the $11.50-12.00 zone. FYI: The Point & Figure chart is bullish with a $20 target.
Factset Research - FDS - close: 54.72 change: +1.18 stop: 51.90 *new* FDS is giving us another chance to exit over $54.50. The stock displayed relative strength with a 2.2% gain. Fueling the move was news that FDS raised their cash dividend by 11%. I am raising our stop loss to $51.90. We're not suggesting new positions at current levels. FDS has exceeded our first target and we're currently aiming for $59.00. The Point & Figure chart is very bullish with a $79 target.
Currencyshares British Pound - FXB - cls: 152.51 chg: +1.40 stop: 147.25 The British Pound continues to climb as the U.S. dollar weakens. The intraday high today was $152.99. Our target is $157.00. More conservative traders could buy longer-dated options. The Point & Figure chart is bullish with a $176 target.
iShares China ETF - FXI - close: 34.37 change: +0.01 stop: 31.45 It looked like the FXI was going to break short-term support at $34.00 today and it did on an intraday basis but the market's afternoon bounce saved it. I'm not suggesting new positions at this time. Wait for a dip near the $33.00-32.50 area before initiating new call positions. We have two targets. Our first target to take profits is $36.45. Our second target is $39.45.
Intl. Bus. Mach. - IBM - close: 103.94 change: +1.04 stop: 99.65 It looks like investors are buying the dip in IBM. Shares tested the $100 level two days ago and now it's back to challenging resistance at $104. If you're looking for a new entry point buy another dip or bounce in the $102-101 zone. Currently our target is $109.40.
Lockheed Martin - LMT - close: 81.61 change: +1.26 stop: 78.95 *new* LMT delivered a decent bounce after rebounding from another higher low in its bullish trend. We're inching up our stop loss to $78.95. More conservative traders might just want to go ahead and take profits right now. Our exit target is $82.50. Aggressive traders could aim for resistance in the $85 region.
Mastercard - MA - close: 178.20 change: -2.78 stop: 159.90 MA broke the $180 level although it's worth noting that volume has been very light the last couple of days. I don't see any changes from yesterday's comments. There is some support in the $176-175 zone but I would look for a dip near $170.00 and its 200-dma before buying calls again. We have two targets. We want to take some money off the table at $198.50 since the $200.00 mark could be round-number resistance. Our second target is $218.50. The Point & Figure chart is bullish with a $218 target.
ProShares UltraShort - SDS - close: 58.34 change: +0.29 stop: 58.40 The SDS failed at the $60.00 level, which probably equates to the S&P's bounce from the 900 level. I'm lowering our entry point to buy calls again. The new entry point to buy calls is at $62.65. If triggered our first target is $69.95. Our second target is $74.40. FYI: Don't forget that the SDS is the ultra-short or double-short inverse ETF so it should see twice the volatility of the S&P 500
Visa - V - close: 65.22 change: -0.71 stop: 65.45 Shares of V, much like MA, under performed on Tuesday. V looks like it's breaking down from the sideways trading range. Currently we have two triggers to buy calls. Our first trigger to buy calls is at $69.00 with a stop loss at $65.45. Our second trigger to buy calls is at $60.50 with a stop loss at $57.40. Our first target, if triggered at $69.00, is the $74.00 level. The P&F chart is very bullish with a $95 target.
Becton Dickinson - BDX - close: 64.08 change: +1.54 stop: varies The bounce in BDX continues. Will it break technical resistance at its 50-dma? We're still waiting for an entry point. Hopefully it will be the $66.50 entry point. I am suggesting readers use the June or September puts if we are triggered. I am listing two different entry points and exit strategies for this stock.
Entry point #1.
Entry point #2.
Harman Intl. - HAR - close: 18.76 change: -1.43 stop: 20.55 Thankfully we didn't have to wait very long for HAR to hit our entry point. The stock has broken down from its bullish channel and in the process hit our trigger to buy puts at $18.99. If you missed the entry point look for a bounce back toward the $19.50 zone. More conservative traders might be able to get away with a stop loss closer to $20.00. Our target is $16.05. This should be considered a higher-risk play. I would only trade a small position.
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Nike Inc. - NKE - close: 50.98 change: -2.16 stop: 54.55 Shares of NKE were downgraded to a sell and had its earnings estimates lowered for 2009 and 2010 by one analyst firm this morning. Concerns over currency exchange rates and building inventory levels spurred the downgrade. The stock lost 4% on the session and broke support at $52.00. Our trigger to buy puts was at $51.85. If you missed the entry point you can wait for another bounce toward $52.00. After the bell NKE declared a quarterly cash dividend of 25 cents a share payable on July 1st to shareholders of record on June 8th. Our downside target is $48.15.
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Northrop Grumman - NOC - close: 49.40 change: +0.11 stop: 50.85 NOC managed a minor bounce but remains under the $50.00 level and its 200-dma. The trend is suggesting the rally is over but more conservative traders might want to consider a slightly tighter stop. I would still consider new puts here or wait for a new decline under $48.00 as your entry point. Our target is $44.25 or the 50-dma, whichever one NOC hits first.
Volatility Index - VIX - close: 31.80 change: -1.07 stop: 40.55 The market was weak again this morning and yet the VIX barely budged. The S&P 500 broke 900 intraday and yet the VIX failed to rally. Investors do not seen concerned and the VIX eventually lost another 3%. I am not suggesting new positions on the VIX. The VIX has surpassed our first target to take profits at $35.00. We have a second target to exit completely at 31.00. Initially we suggested the May puts but readers might want to use July or August puts instead due to the SEC's plan to re-instate the up tick rule is more than two months away. FYI: The May 2009 vix options are set to expire on Wednesday, May 20th.
(What is a strangle? It's when a trader buys an out-of-the-money (OTM) call and an OTM put on the same stock. The strategy is neutral. You do not care what direction the stock moves as long as the move is big enough to make your investment profitable.) Apple Inc. - AAPL - close: 124.42 change: -5.15 stop: n/a Wow! AAPL is finally seeing some profit taking. The stock fell to $123.25 intraday. The market's afternoon bounce helped back above $127 only to see it crash lower into the closing bell. The bad news is that with AAPL back under $130 we don't have any hope of recouping our capital now. There are three days left before May options expire. I am not suggesting new strangle positions at this time. The options we suggested were the May $130 calls (APV-EF) and the May $110 puts (QAA-QB). Our estimated cost was $5.12. We want to sell if either option hits $5.12 or higher.
Gold ETF - GLD - close: 90.70 change: -1.01 stop: n/a The U.S. dollar continues to sink and it's starting to show up with strength in gold. The GLD finally broke the $90.00 level of resistance. We're not suggesting new strangle positions at this time. The options we suggested were the June $95 calls (GLD-FQ) and the June $80.00 puts (GLD-RB). Our estimated cost was $1.95. We want to sell if either option hits $4.85 or higher.
Google - GOOG - close: 399.01 change: - 8.97 stop: n/a It was a bad day for tech stocks especially the high-flyers. First AAPL and now GOOG. Shares of GOOG rallied to $411 and then plunged toward its bullish trendline of higher lows. Today's move paints a bearish engulfing candlestick pattern. This may have been the last nail in the coffin for this strangle play. I am not suggesting new positions at this time. The options we suggested were the May $420 calls (GOP-ED) and the May $340 puts (GGD-QE). Our estimated cost was $18.10. I'm adjusting our target toward breakeven. We want to sell if either option hits $18.10 or higher
Flowserve - FLS - close: 70.01 change: -2.14 stop: 69.85 Shares of FLS were a little too volatile for us today. The stock spiked to $73.68 at the open and then plunged to $67.66 before barely bouncing back to the $70.00 level. The stock hit our stop loss at $69.85. At this point I would keep FLS on your watch list for a dip near $65.00, which should be support.
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