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Sabrient Select Opportunity Portfolio

|Includes:ABEV, AMAG, AXS, AZPN, BMRN, BOOM, CACC, CCI, CFI, CSH, DECK, DLTR, DLX, DNDN, EXR, FHN, GPRE, GSK, GTS, HITK, HOGS, HST, HUM, IGT, IPXL, JOE, KSWS, LEA, MGM, MON, MWW, NEM, NUVA, PERY, RAIL, RECN, RTI, SAFM, SKT, SPG, STI, STX, TEX, TOL, TRW, TSP, USG Corporation (USG), VMC, WDC, XRTX

Here's a sample of our partner Sabrient's newsletter, the Sabrient Select Opportunity Portfolio. It's a "high-performance actionable portfolio" and Sabrient provides weekly updates and trading alerts for subscribers. This is this week's update. To learn more about Sabrient, click here.

Performance Year-to-Date (as of 4/16/10): +12.0%
Average Gain Per Trade: +2.75%

- Ilene 

Sabrient Select Opportunity Portfolio

The Week Ahead

The market continues to search for direction while testing both support and resistance levels. After recapturing its 200-day moving average and looking strong, the SPY instead lost it again to resume its bearish trend. Notice that the 50 and 200 are rapidly converging. The 50 crossing down through the 200 would be quite bearish. 

  
  
On the other hand, the IWM (Russell 2000 ETF) has held up much better. On Friday, in fact, the RUT was up +1.9% while the SPX was up only +0.3%. The IWM found support at its 200-day moving average after nearly rising above its 50-day. So, small caps are holding up, and that is a promising sign.
 
 
Last week, the Select Opportunity Portfolio took two portfolio actions. After short position USG sold off hard, we harvested 12% profits on 1/3 of the original position. We also entered a new short position in HST.
                                                                                                                                                              
Open Positions
 
Going into the week, we have two long positions and four short positions. 
  
LONGS:
   
We are long Telecom de Sao Paulo (NYSE:TSP) from $18.25.  The stock came very close to my next profit harvest target price of 21.90, but then sold off a bit and closed Friday at $20.66.  TSP is now rated HOLD and has a Company Outlook Score of 88 and a Value Score of 90.  TSP is now flirting with my mental stop of a closing price below $20.55, so we will watch it closely this week.
 
We are long Humana (NYSE:HUM) from $48.75.  The stock closed Friday at $48.10.  It is rated a STRONG BUY in the Sabrient Ratings Algorithm, and carries an Outlook Score of 99 and a Growth Score of 86. I have a mental profit-protection stop in place below its 20-day exponential moving average at $46.90. 
 
SHORTS:
 
We are still short 1/3 of the original position in casino firm  MGM Mirage ( MGM) from $12.71. The stock closed Friday at $11.52. MGM is rated SELL by Sabrient and has a Company Outlook Score of 4. I have a mental profit-protection stop above the original entry price of $12.71. After locking in a nice gain on 1/3 of the original position at $11.30 and then stopping out of another 1/3 at $12.57, I don’t want the final 1/3 to turn into a loss. 
  
We are short 2/3 of the original position in homebuilder  Toll Brothers ( TOL) from $20.24. The stock closed Friday at $17.20, for a 15% gain.  TOL is rated SELL by Sabrient and has a Company Outlook Score of 4. The homebuilders and related construction materials firms continue to look weak. I have a mental profit-protection stop at $19.20. 
  
We are short building products firm  USG Corp (NYSE:USG) from $16.30. The stock closed Friday at $14.07, for a 14% gain. USG is rated STRONG SELL by the Sabrient Ratings Algorithm and has a Company Outlook Score of 0. I have a mental stop of a closing price above last Tuesday’s high at $15.20. 
  
We are short Host Hotels & Resorts (NYSE:HST) from $14.80. The stock closed Friday at $14.42. HST is rated SELL by the Sabrient Ratings Algorithm and carries a Company Outlook Score of 3. I have a mental stop of a closing price above last Tuesday’s high of $15.91.
  
Watch List
  
LONGS:
Some stocks that I have on my Buy watch list include the following: 
 
DECK
SNDK
IPXL
HITK
DLTR
STX
AXS
CSH
TRW
GTS
GPRE
LEA
DLX
XRTX
HOGS
SAFM
CTB
JRCC
ABV
CFI
NEM
CACC
PERY
 
SHORTS:
Some shorts I have on my watch list are the following: 
  
IGT
VMC
NUVA
MWW
TEX
FHN
HGSI
RTI
MON
SKT
SPG
EXR
JOE
AMAG
RECN
DNDN
CCI
BMRN
RAIL
AZPN
KSWS
STI
BOOM 
 
We will be watching the markets for buy and sell opportunities. 
  
Regards,
  
Scott Martindale 
Sabrient Systems