BMC Software Inc. - BMC - close: 40.26 change: +0.31

Stop Loss: 39.30
Target(s): 44.00
Current Gain/Loss: unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Shares of BMC were showing relative strength on Thursday. Traders bought the dip right off the bat this morning. The stock pushed past its recent highs and closed at new multi-month highs. In the last few days BMC has been trying to breakout past resistance near $40.00 and its simple 200-dma.

I want to see a little bit more confirmation. Thus I am suggesting a trigger to open bullish positions at $40.55 with a stop loss at $39.30 (under the 10-dma). Our multi-week target is $44.00. We'll have to keep a wary eye on potential resistance at the 300-dma (currently 43.30). FYI: The Point & Figure chart for BMC is bullish with a $57 target.

Trigger @ 40.55

Suggested Position: buy BMC stock @ 40.55

- or -

buy the May $40 call (BMC1219E40) current ask $2.10

Annotated chart:

Entry on March xx at $ xx.xx
Earnings Date 05/02/12 (unconfirmed)
Average Daily Volume = xxx million
Listed on March 29, 2011