Agrium Inc. - AGU - close: 46.05 change: +1.56 stop: 43.40 AGU tried to rally this morning and made it to $47.14 but the market weakness was too much. Shares pulled back toward support near $44.00. If the S&P 500 breaks down under 875 I expect AGU to break support and hit our stop loss at $43.40. If on the other hand the S&P 500 bounces from 875 look for AGU to bounce in the 43.50-44.00 zone and we can use the move as a new entry point to buy calls. FYI: AGU gapped down and opened at $45.48. We have adjusted our entry point. More aggressive traders may want to use a stop under $42.00. Our first target to take some money off the table is $49.95. Our second target is $54.00. The Point & Figure chart is bullish with a $59 target. FYI: Traders need to know that AGU is currently trying a hostile takeover of rival CF Industries (CF). CF believes that AGU's offer is too cheap. In the meantime CF is trying a hostile takeover of Terra Industries (TRA). One of our biggest risks by trading AGU is that AGU might raise its offer to buy CF. The company did so in late March and the stock gapped down on the news. AGU raised its offer a second time yesterday, which may have accounted for the spike down toward $43.50. AGU raised the cash portion of their offer by $5 to $40 a share in cash and one share of AGU stock for CF.
BHP Billiton Plc - BBL - close: 42.41 change: -2.88 stop: 41.90 European markets were clobbered today. Financials and material stocks led the decline. BBL falls in the material category. When the U.S. markets open BBL gapped lower to adjust for trading overseas. The stock fell toward support near $42.00. You could argue that BBL now looks a little short-term oversold. I would be tempted to buy calls on this dip as long as the S&P 500 is above 875. Our first target is $49.90. Our second target is $54.00. The Point & Figure chart is bullish with a $62 target.
Factset Research - FDS - close: 54.55 change: -0.17 stop: 51.90 FDS is still holding up pretty strong. Considering this market weakness I strongly suggest that if you have not taken profits yet do so now. More conservative traders may just want to exit completely or raise their stop again. 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: 151.28 chg: -1.23 stop: 147.25 Comments out of Britain today that England's economic rebound would be slower than expected weighed on the British Pound. Combine that with a bounce in the U.S. dollar and the FXB gave up about 0.8%. I don't see any changes from our previous comments. 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: 33.58 change: -0.79 stop: 31.45 Investors are still worried about the slow down in China's export numbers. The FXI lost 2.29% and broke short-term support at $34.00. I am suggesting readers look for a dip near the $33.00-32.50 zone before considering new bullish positions. We have two targets. Our first target to take profits is $36.45. Our second target is $39.45.
SPDR Gold Trust - GLD - close: 91.09 change: +0.39 stop: 87.75 A bounce in the U.S. dollar, like the one today, would normally be bearish for the GLD. It looks like the weakness in stocks may have produced a little "safe haven" buying in gold. The GLD hit a new relative high at $91.50 and closed up 0.4%. If you are looking for a new entry point to buy calls I would watch for a pull back near $90.00 or $89.00. Our first target is $94.75. Our second target is $97.45.
Intl. Bus. Mach. - IBM - close: 102.26 change: -1.68 stop: 99.65 I do not expect IBM to be immune to any profit taking. If the S&P 500 breaks down under the 875 region we can expect IBM to follow it lower. Some of the momentum indicators on IBM have already turned bearish. More conservative traders might want to go ahead and exit early right now. I'm not suggesting new positions unless we see a strong bounce by the S&P near 875. Currently our target is $109.40.
Lockheed Martin - LMT - close: 80.53 change: -1.08 stop: 78.95 The MACD on LMT's daily chart has finally produced a new sell signal. More conservative traders may want to exit now! I am not suggesting new bullish positions. Actually if LMT trades under $78.50 nimble traders might want to consider short-term bearish trades. Our exit target is $82.50. Aggressive traders could aim for resistance in the $85 region.
Mastercard - MA - close: 170.76 change: -7.44 stop: 159.90 The volatile shares of MA are acting true to their nature. The stock gapped open lower at $174.00 and plunged toward what should be support near $170.00. This should be a new bullish entry point. The only reason I would hesitate to open positions now is the S&P 500 at 883. Odds are good the S&P will dip to 875 (maybe 870) tomorrow. MA could break $170 on another decline tomorrow. The 200-dma is near $168 and the 50-dma near $165. If we see a dip toward $165 jump on it with one caveat. Keep a close eye on the S&P 500. If it closes under 875 or 870 it's probably a sign we're due for a larger correction. 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: 61.13 change: +2.78 stop: 58.40 The SDS is starting to bounce. Is this the start of a new leg higher? The close over $60.00 is bullish for the SDS (and bearish for the market). Our 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: 64.47 change: -0.64 stop: 65.45 Visa is still slipping lower but has a way to go yet before hitting either entry point. 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: 65.33 change: +1.25 stop: varies The relative strength in BDX is a little surprising. The stock gained 1.9% and closed above resistance at $65.00 and its 50-dma. Shares are quickly approaching our $66.50 entry point to buy puts. 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: 16.77 change: -1.99 stop: 20.05 *new* HAR lost more than 10% with today's market meltdown. The next stop looks like it could be the 50-dma and 100-dma near $15.50. I'm lowering our stop loss to $20.05. More conservative traders may want to use a stop near $19.50 instead. Our target is $16.05. This should be considered a higher-risk play. I would only trade a small position.
Nike Inc. - NKE - close: 49.52 change: -1.46 stop: 54.05 *new* NKE continued to fall as well. Shares broke support at $50.00 with a 2.8% decline. We're adjusting our stop loss to $54.05. More conservative traders could move their stop near $52.50 or $52.00 instead. Our downside target is $48.15.
Northrop Grumman - NOC - close: 48.38 change: -1.02 stop: 50.85 Technicals on NOC continue to worsen. I would consider new positions here or you could look for another failed rally in the $49.00-49.50 zone. Our target is $44.25 or the 50-dma, whichever one NOC hits first.
Volatility Index - VIX - close: 33.65 change: +1.85 stop: 38.55 *new* The recent weakness in the market is not a good sign for our VIX put play. The VIX came pretty close to our second target at 31.00 but now it's poised to bounce especially if the S&P 500 breaks down under the 875 region. More conservative traders will want to seriously consider an early exit right here. I'm not suggesting new positions. Please note our new stop loss at $38.55. The VIX has surpassed our first target to take profits at $35.00. 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: 119.49 change: -4.93 stop: n/a The sell-off in AAPL has now begun in earnest. The stock lost another 3.9% and closed under the $120 mark. Unfortunately we only have two days left before May options expire. It looks like our strangle will expire worthless. 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: 91.09 change: +0.39 stop: n/a Safe-haven buying in gold outweighed the bounce in the U.S. dollar. The GLD gained 0.4%. 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: 389.54 change: - 9.47 stop: n/a Two days to go before May options expire. This play is essentially dead. We're just running out the remaining 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
Dominos Pizza - DPZ - close: 8.14 change: -0.55 stop: 8.20 Our buy-the-bounce play in DPZ has been stopped out. Shares rolled over. There was no follow through higher. The market weakness on Wednesday quickly pushed DPZ under the $8.50 level. The next level of support would appear to be the $7.50-7.00 zone.
Chart:
 |
