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The Oxen Group is a financial analysis and investment opportunities newsletter-based website run by financial analyst David Ristau and features several other traders. Ristau and team have been working in stocks for several years and has developed a knack for identifying winning short-term and... More
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Marketfy - Option Spread Portfolio
  • Family Dollar Earnings: The Real Mover Will Be Dollar Tree 0 comments
    Jul 8, 2009 1:10 AM | about stocks: FDO, DLTR

    The Oxen Group is surprised by how much the market is not thinking about the earnings coming out on Wednesday morning from Family Dollar Stores Inc. that The Oxen Group believes could be a real market mover. The Oxen Group is pretty bullish on Family Dollar earnings, but we have learned our lessons in the past from putting our hopes in earnings only to be disappointed. While we are excited about Family Dollar earnings, what we can say for sure is that Dollar Tree Inc. (NASDAQ:DLTR) will move up or down with Family Dollar. If FDO beats expectations, we can expect Dollar Tree to significantly move up throughout the day. On the other hand, if Family Dollar does not beat expectations Dollar Tree will most definitely be a perfect short sale. What we like about Dollar Tree over Family Dollar is that Family Dollar is going to bounce up or down right into the session that a lot of movement off the morning prices will be less than Dollar Tree. The market really could be moving on Family Dollar's earnings, so if they are positive it could be a nice sign for the market. Further, crude oil inventories are supposed to come out lower than last week, which might be a piece that could actually make the oil market have a real reason to reverse its current direction. The market seems to be almost perfectly following what energy is doing right now, and if inventories are good, it could further help the Dollar Tree move up on a bullish market. Technically, Dollar Tree is in a perfect position to move tomorrow on bullish news, as well. The stock is extremely oversold, way too undervalued, and ready for a technical rise.

    Entry: Recommend buying from 5-20 minutes into session whether short selling or buying.

    Exit: We recommend exiting after a 2-4% increase.

    Stop Loss: We recommend a 3% stop loss on all buy in prices

    Upper Resistance: 43.00 or 39.50

    Disclosure: No Positions


     
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