Amazon.com - AMZN - close: 84.93 change: +1.88 stop: 76.35 AMZN continues to out perform but we still don't want to chase it especially not now with the market not seeing much follow through on Monday's bullish breakout. AMZN is nearing potential resistance at its late April highs in the $85-87 zone. Our plan is to buy calls on a dip in the $80.50-78.00 zone. We're starting with a stop loss at $76.35 just under Friday's low. Our first target is $89.00. Our second target is $97.50. The P&F chart has produced a new buy signal with a $101 target. My time frame is about seven to eight weeks.
BHP Billiton Plc - BBL - close: 51.52 change: +0.35 stop: 46.40 BBL did a pretty good job of holding its gains today. I'm not suggesting new positions at this time. BBL gapped open above our first target at $49.90. We're now aiming for $54.00. The Point & Figure chart is bullish with a $62 target.
Flowserve - FLS - close: 78.39 change: -0.19 stop: 69.20 Target achieved. FLS rallied to $80.09 midday. Our first target to take profits was $79.90. Volume was pretty strong today but shares failed to break resistance at $80.00. This could be a signal of investors selling into resistance. I would not chase new entries at this time. Wait for a dip back toward $75.00 or $73.50 near Friday's close. FLS has hit our first target. We're now aiming for $84.40. More conservative traders may want to raise their stops toward the $72.00-73.00 zone.
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iShares China ETF - FXI - close: 38.71 change: -0.81 stop: 35.75 The Chinese markets ran into some profit taking after some recent gains. This prompted the FXI to pull back about 2% on Tuesday. If the FXI does correct we can look for possible support near $36.00. More conservative traders may want to consider taking profits early right now! Shares have exceeded our first target and came close to hitting our final target at $39.90.
SPDR Gold Trust - GLD - close: 96.36 change: +0.63 stop: 89.90 The U.S. dollar plummets to new lows but the rally in gold is seeing a slow down in its momentum. The GLD hit $96.96 intraday. I am not suggesting new bullish positions at this time. The GLD has already exceeded our first target to take profits at $94.75. We're currently aiming for $97.45 as our final exit.
Intl.Bus.Mach. - IBM - close: 106.83 change: -1.54 stop: 101.90 IBM gave up a large chunk of yesterday's gains but it hasn't hit our entry point yet. I am suggesting readers buy calls on a dip in the $106.25-105.00 zone. We'll try and use a relatively tight stop at $101.90. More aggressive traders may want to keep their stop under the simple 50-dma. There is potential resistance near $110 but I'm setting our first target at $113.50. Our second target is $118.50. My time frame is seven to eight weeks.
iShares Fincl.Srvcs - IYF - close: 43.61 change: -0.50 stop: 41.20 The banks were under performers yesterday and they really under performed today. It may have been due to investors reacting to another round of secondary stock offerings or it could have been a reaction to a foreign wealth fund selling a large stake in Barclays. This is an aggressive trade on the IYF and we need to play defensively. If you're looking for an entry point I would wait for another dip or bounce near the 30-dma around $41.60. We'll take some money off the table at $46.00 but we'll also have a second target at $49.85. I want to repeat this is an aggressive trade and I'm suggesting readers only trade half (or less) than their normal option position.
Mastercard - MA - close: 168.39 change: -5.34 stop: 158.90 Now I'm really starting to grow concerned over our play in MA. The stock produced a failed rally pattern on Monday and the stock continues to under perform today with a 3% decline and new close under its 50-dma. The stock has produced a lower high. I now expect a dip toward the 200-dma near $164.00. More conservative traders may want to abandon ship. I would still be tempted to buy calls on a dip near $160 but a bounce from the $160 region would be preferred. 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.
Mobile Telesys - MBT - close: 44.08 change: -0.22 stop: 37.40 MBT came really close to hitting our target with an intraday high of $44.88. I am STRONGLY suggesting that more conservative traders take some profits off the table right now. We're not suggesting new bullish positions at these levels. Our first target to take profits is $44.95. We do have a second target at $49.00 but that could take a while to reach. Broken resistance in the $39-40 zone should offer new support. I'm raising our stop loss to $37.40.
Precision CastParts - PCP - close: 86.03 change: -0.68 stop: 79.85 PCP produced a minor pull back after yesterday's big gain. Broken resistance should become new support in the $85-84 zone. Our first target to take profits is $89.90. Our second target is $97.50. Currently the P&F chart is bullish with a $104 target.
Visa - V - close: 66.81 change: +0.15 stop: 65.45 Visa is performing slightly better than its rival MA but it's still not going anywhere and remains in a trading range. There is no change from our previous comments. We have two different entry points listed. One entry point to buy calls is at $69.00 with a stop at $65.45. Our second entry point is at $60.50 with a stop at $57.40. Edit: I would use the July or September calls. Our first target, if triggered at $69.00, is the $74.00 level. The P&F chart is very bullish with a $95 target.
MDC Holdings - MDC - close: 31.06 change: +0.58 stop: 33.55 The better than expected pending home sales figures this morning fueled a rally in the homebuilders. Yet MDC under performed its peers with a 1.9% gain. The trend is still bearish for this stock. A failed rally near $32.00 can be used as a new entry point for puts. Our first target is $27.75. Our second target is $25.15.
Northrop Grumman - NOC - close: 48.28 change: -0.29 stop: 50.85 The defense sector indices edged higher thanks to strength in stocks like Boeing (BA) but shares of NOC under performed. The stock lost 0.5%. I'm not suggesting new put plays here. Our first bearish target is $45.51. Our second target is $42.75.
Regional Bank HOLDRs - RKH - close: 66.16 chg: -2.45 stop: 70.16 The RKH regional bank holders faded lower after yesterday's failure to breakout over $70.00. Shares look poised to retest support near the $64.00 region soon. I'm not suggesting new bearish put plays at this time but a breakdown under $64.00 can be used as a new bearish entry point. Look for possible support at the 50-dma or the $60 level. Our first target is $58.50 and then at $54.00.
Silgan Holdings - SLGN - close: 45.31 change: -0.09 stop: 46.01 I remain defensive on SLGN with the stock above $45.00. More conservative traders may want to exit early here. No new positions at this time.
Toll Brothers - TOL - close: 19.53 change: +0.73 stop: 20.21 The better than expected pending home sales data lifted the homebuilders but the trend is still down for the sector index. Bulls can probably make a better case for TOL, which managed to break its trendline of lower highs today and close above its 50-dma. Look for a failed rally near $20.00 and it 200-dma or a new decline under $19.00 before considering new bearish positions. Please note: TOL is expected to report earnings tomorrow morning before the opening bell. 99% of the time we always exit before an earnings report but I'm not expecting any good news out of this report. Wall Street is expecting a loss of 44 cents a share. Our target is $16.25.
(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.) Gold ETF - GLD - close: 96.36 change: +0.63 stop: n/a The GLD spent most of the day trading sideways but it still managed another gain. I am not suggesting new positions at this time. We only have three weeks left before June options expire. 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.
Eaton - ETN - close: 48.25 change: +1.09 stop: 48.11 I was expecting some profit taking in ETN today after yesterday's 8.4% rally. That didn't happen. The short covering continued and ETN broke through resistance at its 200-dma and at the $48.00 level. Shares hit our stop loss at $48.11.
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United Parcel Service - UPS - close: 52.56 chg: +0.00 stop: 53.55 UPS ended the day unchanged but the stock showed some intraday strength with a spike to $54.12. That spike now looks like a failed rally and a new lower high but it was enough to hit our stop loss at $53.55 closing the play.
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