NEW BEARISH Plays
International Game Technology - IGT - close 18.35 change -0.11 stop 19.26
International Game Technology (IGT) is a global gaming company specializing in the design, manufacture, and marketing of electronic gaming equipment and systems products. IGT maintains an array of entertainment-inspired gaming product lines. In addition to its United States production facilities in Nevada, it manufactures gaming products in the United Kingdom, and through third-party manufacturers in Japan and China. The Company derives its revenues from the distribution of electronic gaming equipment, systems, services and licensing. It operates in two segments: North America and International. North America consists of its operations in the United States and Canada, comprising 77% of consolidated revenues during the fiscal year ended October 3, 2009 (fiscal 2009). International consists of its operations in all other jurisdictions worldwide, comprising 23% of consolidated revenues during fiscal 2009.
Target(s): 17.70, 17.30, 16.80
Key Support/Resistance Areas: 19.00, 18.75, 18.09, 17.55, 17.25, 16.60
Time Frame: 1 to 2 weeks
Why We Like It:
IGT is in a solid downtrend and I expect it to continue. The stock is making lower highs and lower lows. The stock is below all its SMA's and a downtrend line that it recently touched on Tuesday 6/15 before a big gap down. All of this should provide plenty of resistance and if the overall market reverses lower anytime in the coming days IGT will be one of the first stocks to go. Ideally I would like to see IGT test $18.75 before initiating short positions which is Friday's highs and within the prior three day's trading range. But I'm not so sure we will see a bounce this high. I suggest we use a trigger of $18.50 to initiate short positions. Our stop is above the 100-day, 20-day, and 200-day SMA's and the recent downtrend line. This is a wide stop for now to account for volatility and will be adjusted when a better price is determined. I've provided three targets which are good places to tighten stops if IGT continues lower from our entry.
Suggested Position: Short IGT stock if it trades up near $18.50
Option Traders: Buy July $19.00 PUTS, current ask $1.15, estimated ask at entry $1.05
Entry on June xx
Earnings 7/22/2010 (unconfirmed)
Average Daily Volume: 4.8 million
Listed on June 19, 2010