New Watch List Entries
JOYG - Joy Global Inc.
RIG - Transocean Ltd.
Active Watch List Candidates
CRS - Carpenter Technology
DRYS - DryShips, Inc.
DO - Diamond Offshore
IRF - International Rectifier Corp.
KBH - KB Home
Dropped Watch List EntriesNone. No stocks were dropped from the watch list.
New Watch List Candidates:JOYG $27.21 +1.71 -- Joy Global Inc.JOYG is one of the major mine-equipment producers and tends to rise and fall with the metal, mining, and commodity stocks. Shares just broke out over resistance in the $25-26 zone late last week. If the U.S. dollar breaks the support it is precariously perched on JOYG could shoot higher with all of these commodity stocks. The rally stalled near $27.50-28.00, which is where JOYG found resistance in early January. Odds are good the stock could pull back and retest the $25.00 region. I am suggesting that readers buy LEAPS call options on a dip in the $25.25-22.50 zone. If triggered our long-term target is $39.00. More aggressive traders could aim for the $45-50 zone. I'm setting a stop loss at $21.45 just under the 50-dma.
Company Info: Buy-the-Dip trigger: $25.25-22.50 zone BUY the 2010 January $30.00 call (symbol: LVC-AF)
Chart of JOYG:
RIG $70.62 +3.15 -- Transocean Ltd.The oil service stocks have been relative strength leaders in this market for weeks now. One of the biggest companies in this sector is RIG. The stock looks like a bullish candidate for short-term traders right now with Friday's breakout over resistance at $70.00. However we don't want to chase this new relative high because earnings are right around the corner. RIG is due to report earnings on May 6th before the market open. Wall Street is looking for a profit of $3.51 a share. More often than not investors tend to sell the news on an earnings report so we want to be ready to buy a dip. Back in January 2009 RIG has resistance near $62.50. The simple 50-dma is quickly rising toward that level. I am suggesting readers buy LEAPS calls on a pull back into the $63.00-60.00 zone. We'll use a stop loss at $57.45. Our long-term target is the $95.00-100.00 zone. Company Info: Buy-the-Dip trigger: $63.00-60.00 zone BUY the 2010 January $90.00 call (symbol: WVX-AR)
Chart of RIG:
Active Watch List Candidates:CRS $20.68 +0.19 -- Carpenter TechnologySteel and metals stocks continued to march higher almost all week long. CRS broke out over resistance at $20.00. Shares are growing more overbought by the day and nearing potential technical resistance at the 200-dma. A 50% retracement of the rally off its March lows would be $16.75. I am suggesting readers buy LEAPS on a dip into the $17.00-16.00 zone. Our new stop loss is $14.75. If triggered we have two targets. Our first target to take profits is $24.85. Our second target to take profits and exit is $29.90. We now have December options to choose from. Buy the dip trigger: $17.00-16.00 zone
BUY DECEMBER 2009 $20 CALL (CRS-LD)
Chart of CRS:
DRYS $8.28 +0.86 - DryShips, Inc.When this global economy does eventually turn around the beaten down shipping stocks could be huge performers. DRYS is already building a nice rally off its lows. Shares are seeing some big volume on the rallies, which is normally bullish. It looks like our plan to buy a dip in the $5.50-5.00 zone was wishful thinking. I am now suggesting readers buy the stock or buy the $10.00 or $15.00 LEAPS on a dip into the $6.50-6.00 zone. We'll raise our stop loss to $5.45. My upside target is the $14.00-16.00 zone. Buy-the-Dip trigger: $6.50-6.00 zone.
BUY the 2010 January $10.00 calls (symbol:KOO-AY)
Chart of DRYS:
DO $74.81 +2.40 -- Diamond OffshoreWe've been watching shares of oil service stock DO for a while now and just can't quite get an entry point. I've probably been too cautious so this week I'm upping our entry point. Broken resistance near $70.00 should be new support. I am suggesting readers open long-term LEAPS call positions on a dip in the $70.25-68.00 zone. We'll move our stop loss to $64.40. The upside target is the $90-100 range.
Buy The Dip trigger: $70.25-68.00 zone
BUY JANUARY 2010 $90 CALL (symbol: KWJ-AR)
Chart of DO:
IRF $16.73 -0.15 - International Rectifier Corp.The SOX semiconductor index came close to breaking out over resistance this past week. If the SOX does manage to break out it could breathe new life into this rally off the March lows. IRF is helping lead the way with its breakout over its 200-dma and resistance in the $15-16 zone. I am raising our entry point to open positions. The new plan is to buy LEAPS calls on a dip into the $15.50-14.50 zone. We'll raise our stop loss to $13.75. Our target is still $24.00. FYI: The Point & Figure chart is bullish with a $28.00 target. Buy-the-dip trigger: $15.50 BUY the JANUARY 2010 LEAPS $20.00 CALLS symbol: YFB-AD
Chart of IRF:
KBH $17.47 -0.60 - KB HomeIt looks like the homebuilders may have bottomed and we want to hop on board. The challenge is waiting for the right entry point. April saw a huge short squeeze in a lot of builders. Eventually these stocks will see a correction. KBH has broken resistance near $15.00 and its 200-dma. I am suggesting that readers buy LEAPS on a dip into the $15.50-15.00 zone. We'll use a stop loss at $12.85. If triggered our target is the $24.00 to $29.00 zone. Buy-the-Dip trigger: $15.50 BUY the 2010 January $25.00 calls (symbol:YAB-AE)
Chart of KBH:
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