NEW BEARISH Plays
OSI Systems, Inc. - OSIS - close: 60.14 change: -1.79
Stop Loss: 62.05
Target(s): to be determined
Current Gain/Loss: unopened
Entry on March -- at $--.--
Listed on March 26, 2014
Time Frame: exit PRIOR to earnings in late April
Average Daily Volume = 155 thousand
New Positions: Yes, see below
Why We Like It:
OSIS is in the industrial goods sector. The company designs and builds electronics systems for multiple industries.
A quick look at the daily chart and you'll notice the huge declines in December 2013. The move was a reaction to news that OSIS had lost a TSA contract for airport scanning machines. On December 5th the stock closed at $71.72. Intraday on December 9th OSIS tagged the $39.00 level before bouncing. That's a pretty rough two days of trading. Since then OSIS has slowly worked its way higher until it ran into resistance at its 200-dma earlier this month. Now the rebound is reversing.
OSIS underperformed today and broke down below its 50-dma but managed to hold at the $60.00 mark. If this weakness continued we could see OSIS fall toward $55 or lower. The recent pullback has generated a new sell signal on the point & figure chart.
Tonight we are suggesting a trigger to open bearish positions at $59.75. We're not setting an exit target yet but the $55.00 level could be a good short-term target.
Trigger @ 59.75
Suggested Position: short OSIS stock @ $59.75