Good evening. Monday was a painfully light volume day in the equity markets as US bond markets and banks were closed for the Columbus Day federal holiday. There was virtually no movement in our model portfolio with the exception of a set-back in our short XLNX position. As a result, I do not have many changes to my weekend comments. I have provided an updated portfolio snapshot, along with a few new comments on each position, plus reprinted comments from the weekend that remain valid. We currently have 4 positions that have not been triggered (LOGI has been dropped). We have come close on all of them and patience should payoff with good entries should we get triggered in the coming days. Please refer to the weekend updates for more details and feel free to email me with any questions.
BULLISH Play Updates
BYD - The stock traded to within 9 cents of our trigger before bouncing more than +2% higher. Let's remain patient and see what BYD gives us in the coming days.
ITRI - The dip was bought again in ITRI. Our trigger remains at $61.00 and suggest we use the dip as a buying opportunity. If triggered, our targets are +4.5% and +6.5% higher. The stock has trend line support along with its 20-day SMA which is rising but not at as rapid of a pace as last week.
TC - TC came within 12 cents of our $11.10 trigger to enter long positions. $11.00 offers solid support so I suggest we remain patient. Please refer to the released play on Saturday for more details.
BEARISH Play Updates
FLIR - My comments from the weekend remain the same. We may have missed the move in FLIR. I can not chase it lower at these levels. Let's see what the stock give us in the next few days. If it can manage a bounce back up towards $26.00 it will find a brick wall at its declining 20-day SMA and prior resistance. Let's adjust the trigger down 5 cents to $25.85.
MSFT - MSFT gained +2 cents today and my comments from the weekend have not changed. The stock is consolidating below its converging moving averages and looks like it wants to turn back down. The stock tends to be a slow mover but if the market corrects it has the potential to go quick. I think our stop is in the right place and suggest we give this some time to work.
QQQQ - QQQQ gained +2 cents today and I suggest we initiate the same strategy to manage the play as today. I remain leery of any gap higher which could be sold into. I am also leery of possible volatility with the FOMC minutes released tomorrow afternoon as it feels like we could get a false breakout. As such, this is how I suggest readers manage the trade. Temporarily remove the stop and wait for Monday's open. If there is a gap higher near our stop, place a new protective stop above the opening range. This provides us the chance to measure the true strength or weakness of QQQQ. Often times this will keep you in the trade and looking for a better exit. At these elevated levels it would not surprise me to see a gap higher and an immediate sell-off so we don't want to have a GTC stop in place that gets taken out if QQQQ is only going to head lower. This is just a scenario. If the markets are surging higher and convincingly break the opening range then we need to get out of the way.
XLNX - The stock closed +2% today on no news that I could find. The whole semiconductor space performed well which may be in anticipation of Intel's earnings tomorrow after the bell. XLNX has resistance at current levels but I think our stop may be too tight. I want to temporarily raise the stop to $27.42 to account for possible volatility tomorrow and Wednesday. This is an aggressive move so conservative traders may want to leave it in place or simply exit positions.
CLOSED BULLISH PLAYS
LOGI - LOGI refused to let us in long positions and broke out, closing nearly +4% higher on the day. As such, we have dropped the play. Playing the breakout is an intraday proposition and I would be using tight stops.