Active Watch List Candidates
BEAV - BE Aerospace Inc.
CELG - Celgene Corp
DBC - PowerShares Commodity Index
MICC - Millicom Intl. Cellular
PEP - PEPSICO Inc.
VOD - Vodafone Group
Dropped Watch List Entries
DO and RIG have both hit our triggers and moved to the play list.
New Watch List Candidates:
I am not adding any new watch list candidates tonight. After looking through hundreds of stocks there was nothing that looked attractive at least not in the shadow of a potential breakdown in the S&P 500 index.
If the market corrects I do believe that money managers will buy the dip. The only question is where, at what level? Stocks will look a lot more attractive if the S&P 500 is trading near 850 or 800 but we need to be patient.
Active Watch List Candidates:
BEAV $12.80 -1.41 -- BE Aerospace Inc.
BEAV is a high-beta name and I think it's correction will overshoot to the downside, especially with the S&P 500 poised to breakdown. I am moving our entry point to open long-term positions from $12.50 down to $10.50. We'll move our stop loss under the late April low and place it at $8.85.
Buy-the-Dip trigger: $10.50
BUY the 2010 January $15.00 calls (symbol: BQV-AC)
Note: At $10.50 you could just buy the stock instead but the $15 calls will allow you more leverage on your investment.
Chart of BEAV:
CELG $46.73 -1.37 -- Celgene Corp.
CELG is holding up reasonably well and performed better than the BTK biotech index did last week. We are still waiting for a dip to $43.00. We'll use a stop loss at $39.00. Our target is $59.50.
Buy-the-Dip trigger: $43.00
BUY the 2010 January $50 call (symbol: LQH-AJ)
Chart of CELG:
DBC $22.03 -0.50 -- PowerShares DB Commodity Index (ETF)
DBC is getting closer to our entry point. Investors have been taking profits in commodity names and the DBC is nearing support. Our plan is to buy LEAPS on a dip in the $21.50-20.00 zone.
Our long-term target is $30.00.
Buy-the-Dip trigger: $21.50
BUY the 2011 January $20 (VCZ-AT)
BUY the 2011 January $25 (VCZ-AY)
Chart of DBC:
MICC $56.54 -0.75 -- Millicom Intl. Cellular
A pull back toward the $50-49 zone would be a 50% retracement of MICC's March-June run. I'm suggesting readers buy LEAPS at $50.50 but you could wait and launch positions anywhere in the 50.50-45.00 zone and in this environment I'd definitely wait for signs of a bounce first.
We'll use a stop loss at $44.80. Our target is the $75-80 zone.
Buy-the-Dip trigger: $50.50
BUY the 2010 January $60 call (symbol: CQD-AL)
Chart of MICC:
PEP $56.35 -0.17 -- PEPSICO Inc.
PEP has continued to show relative strength. The stock broke out to new multi-month highs last week and profit taking was minimal on Thursday. Given the current environment I'm inching our trigger to buy LEAPS from $57.05 to $57.25 for a little more confirmation. If PEP corrects I would seriously consider buying a bounce near $52.00.
Our long-term target is the $65-70 zone. We'll use a stop loss at $51.50. This is an 18-month bet.
Breakout trigger: $57.25
BUY 2011 JAN $60 CALL (symbol: VP-AL)
Chart of PEP:
VOD $19.06 -0.63 -- Vodafone Group
VOD remains stuck in its trading range. The plan is to either buy LEAPS on a breakout or buy LEAPS on a dip near the bottom of its trading range. We'll use a stop loss at $16.90. Our target is the $27.50 region.
Buy-the-Dip trigger: $18.25 -or- Buy-the-breakout trigger: 20.75
BUY the 2010 January $20.00 call (symbol: VOD-AD)
Chart of VOD: