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Market Shadows: Group of writers and investors: Paul Price, Lee Adler, and Ilene.
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Market Shadows & Cycle Editing
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Market Shadows
  • Sabrient Select Opportunity Portfolio 0 comments
    Jun 28, 2010 1:43 PM | about stocks: USG, HST, MGM, HUM, TSP, IGT, VMC, NUVA, MWW, TEX, FHN, GSK, RTI, MON, SKT, SPG, EXR, JOE, AMAG, RECN, DNDN, CCI, BMRN, RAIL, AZPN, KSWS, STI, BOOM, DECK, TOL, SNDK, IPXL, HITK, DLTR, STX, AXS, CSH, TRW, GTS, GPRE, LEA, DLX, XRTX, HOGS, SAFM, CTBQ, ABEV, CFI, NEM, CACC, PERY

    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
     

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