New Watch List Entries
Active Watch List Candidates
MOS - Mosaic Co.
POT - Potash Corp.
PPDI - Pharmaceutical Product Development Inc.
Dropped Watch List Entries
DSX graduated to the play list.
New Watch List Candidates:
In the new plays section tonight I discussed my reluctance to open new positions with the market looking fragile. As long-term traders we need to be patient and wait for the entry point. Stay disciplined.
Active Watch List Candidates:
MOS - Mosaic Co. $61.56 +0.72
Whoa! I thought MOS was due for a correction but I wasn't expecting it so quickly. Shares found support near the rising 30-dma. Unfortunately MOS hasn't been able to produce much of a bounce. I suspect the correction is not over yet.
We want to be cautious about launching new positions with the wider market still looking overbought. Therefore we are adjusting our trigger on MOS. Instead of buying LEAPS at $60.50 I'm moving our trigger down to $56.00. The low last week was $60.62 so we're still untriggered.
We will also lower our strike price for the 2011 January calls. Instead of the $70s we'll use the $65s. We'll keep the stop loss at $49.00.
Our long-term target is the $90-100 zone. (Readers might want to consider the 2012 LEAPS too).
NOTE: In 2009 MOS issued a special cash dividend of $1.30 per share payable back on December 3rd, 2009. The CBOE issued a new LEAPS symbol to account for the dividend. The old 2011 LEAPS have a root symbol of ZHX. The LEAPS we want to use are the ZXW root symbols.
Buy-the-Dip trigger: $56.00
BUY the 2011 January $65 call (symbol: ZXW-AM)
Chart of MOS:
POT - Potash Corp. $115.39 +0.08
POT saw a similar decline with a gap down last Tuesday following the January 11th bearish reversal. Shares are struggling to hold short-term support near $115. I think it will break. This is a very volatile sector and stock and I suspect that POT will overcorrect to the downside. I am adjusting our entry point to buy LEAPS from $111.00 to $106.00. We'll keep our stop loss at $98.50. This can be a very volatile stock so keep your position size small. Our long-term target is $160 or higher.
FYI: The Point & Figure chart is bullish and points to a $168 target. POT is due to report earnings on January 28th and should report before the opening bell. More conservative traders may want to wait until after the earnings report before opening new bullish positions even if POT hits our trigger before then.
Buy-the-Dip trigger: $106.00
BUY the 2011 January $120 calls (symbol: VPT-AD)
Chart of POT:
PPDI $22.88 -0.52 -- Pharmaceutical Product Development Inc.
PPDI tried to bounce but shares ran out of steam under $23.50. This level was resistance all week long. I suspect that shares will correct back toward $22.00 and its 50-dma. If that level breaks then we're probably looking at a correction toward $20.50-20.00. Our plan is to wait for a breakout over significant resistance near $24.00. We have a trigger to buy LEAPS at $24.25.
If triggered we'll use a stop loss at $21.90. Our first target is $29.25.
Breakout trigger: $24.25
BUY the 2010 July $25.00 calls (symbol: PJQ-GE)
Chart of PPDI: