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New Trades - 12/20/08 -



NEW BULLISH Plays

symbol: BAP -( Credicorp Ltd. )-

closing price: 46.69, today's change: +1.14, stop loss: 43.90

Picked on December 20 at $46.69 
Change since picked:     + 0.00
Average Daily Volume:       379 thousand       			
Earnings Date          02/05/09 (unconfirmed)    

Strategy notes:
Shares of Peruvian bank BAP are out performing its U.S. rivals. The stock has broken out from a pennant formation of lower highs and higher lows. BAP has managed to hold on to most of its post-breakout gains, which is another way of saying the stock is showing some relative strength.

We are suggesting bullish positions now or on a dip back toward prior resistance and what should be new support near $44.00. We'll use a stop loss at $43.90 to close the play should BAP turn south. There is potential resistance at $50.00 but we're aiming for the $52.50 mark, underneath technical resistance at its descending 100-dma. Technical trades will be interested to note that the Point & Figure chart is bullish with a $66 target.

-chart-


symbol: CMI -( Cummins Inc. )-

closing price: 26.51, today's change: +1.15, stop loss: 24.15

Picked on December 20 at $26.51 
Change since picked:     + 0.00  
Average Daily Volume:       4.1 million     			
Earnings Date          01/30/09 (unconfirmed)    

Strategy notes:
News that the American automakers are going to receive some bailout money failed to really inspire the market but it should help put a floor under many of the auto-related stocks. CMI has developed a bullish trend of higher lows. Friday's session saw the stock breakout over technical resistance at its 50-dma. The Point & Figure chart is also bullish with a $39.00 target.

The stock looks poised to drift higher and if we see any Christmas rally it might move fast. We're suggesting bullish positions here or on a dip back toward $25.00. Please note that we're listing a wide (about 10%) stop loss since CMI appears to have support near its 20-dma. We're setting two targets. Take some money off the table at our first target of $29.90. Our second target is $32.45. Readers may want to consider a higher target. The 38.2% Fibonacci retracement of its sell-off is close to $40.00.

-chart-


symbol: IYR -( iShares Real Estate )-

closing price: 37.25, today's change: +1.76, stop loss: 34.90

Picked on December 20 at $37.25 
Change since picked:     + 0.00   
Average Daily Volume:        49 million     			
Earnings Date          00/00/00 

Strategy notes:
ETFs and iShares are a great way to trade a sector without the risk of owning an individual stock that might be subject to downgrades, earnings warnings, and other company-specific events. That doesn't mean we're immune to such news but their affects are muted. The IYR is a way to gain exposure to the REIT industry. The sector has been somewhat volatile but definitely stepping higher. Investors have been buying the dips and they just bought the dip on Thursday-Friday last week.

We're suggesting new bullish positions now or on a dip back toward $36.00. We're listing a stop loss under last Thursday's low. We're setting two targets. Our first target is $39.90 since the IYR failed at $40.00 last week. Our second target is $43.25 near the early November high. More optimistic traders may want to aim higher. The Point & Figure chart is bullish with a $58 target.

-chart-


symbol: LMT -( Lockheed Martin )-

closing price: 80.01, today's change: +1.37, stop loss: 77.49

Picked on December 20 at $80.01 
Change since picked:     + 0.00 
Average Daily Volume:       3.0 million       			
Earnings Date          01/22/09 (unconfirmed)    

Strategy notes:
The DFI defense index broke out over technical resistance at its 50-dma last week. Now it looks like LMT is poised to do the same with Friday's late day rebound back above the $80.00 mark. Not only is LMT breaking out over resistance at the 50-dma and the psychological $80.00 mark but the stock is being added to the S&P 100 index starting Monday. That should put a bid under the share price as funds that track the S&P 100 buy shares of LMT. The Point & Figure chart is bullish with a $90.00 target but it also shows potential resistance near $83-84.

We are suggesting bullish positions in LMT now or on a dip back toward $78.00. We're initiating the play with a stop loss at $77.49. We're listing two targets. Our first target is $84.85. Our second target is $88.00.

-chart-


symbol: PFG -( Principal Fincl. Group )-

closing price: 20.31, today's change: +1.37, stop loss: 17.99

Picked on December 20 at $20.31 
Change since picked:     + 0.00  
Average Daily Volume:       4.9 million     			
Earnings Date          02/09/09 (unconfirmed)    

Strategy notes:
Last week was a mixed bag for the financial stocks. The banks were starting to drift lower after their post-Fed meeting rally. PFG out performed the financial sector on Friday with a strong 7% gain. I did not see any specific news to account for the rally but seeing traders buy the dip at short-term support is definitely a plus. The Point & Figure chart is bullish with a $31.00 target but it also shows some resistance in the $24-25 zone.

I am suggesting bullish positions now or on a dip back toward $19.50. We'll start with a stop loss under Friday's low. Our target is $24.75. More aggressive traders may want to aim higher.

-chart-


symbol: PJC -( Piper Jaffray )-

closing price: 36.93, today's change: +1.68, stop loss: 33.95

Picked on December 20 at $36.93 
Change since picked:     + 0.00 
Average Daily Volume:       274 thousand      			
Earnings Date          01/21/09 (unconfirmed)    

Strategy notes:
The broker-dealers on Wall Street were crushed in 2008 but the survivors are poised for significant rebounds. PJC could be a survivor. The stock actually suffered some heavy losses in 2007 and 2008, while volatile, was mostly sideways.

Shares of PJC just broke out over a three-month trendline of resistance in addition to its simple 200-dma and exponential 200-dma. We are suggesting readers buy PJC here or on a dip back toward $36.00 or $35.00. We'll use a stop loss at $33.95, which is relatively wide (almost 10%) and thus a bit more aggressive. Chart readers will note that PJC is facing some resistance near $38.00. Traders may want to wait for a rally over $38.00 or a dip and bounce first before initiating new positions.

The Point & Figure chart is bullish with a $53 target. We're not quite that optimistic. We're using two targets. Out first target is $39.95. Our second target is $43.50.

-chart-




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