Retail Chances

Retail looks to have put in a bottom last week and we will look to play a short term bounce with KSS.

Entry under $59.25, stop at $54, target close to $80 - UD slightly under 4

75 shares will be added to the model portfolio if executed.

Overall Market Comments

By now, you realize that when there is talk of the overall markets on this blog, it relates to the Bullish Percent Charts. There has been a fairly significant turn of events in those charts back to bullish in certain industries - Financials and Energy in particular. However, the major market BP charts are still mixed (S&P 500, Dow and Nasdaq Comp).

Since the turn has been from outright bearish toward the neutral end, we are going to search for buys now more so than short sales. That being said, the housing industry charts are still a problem and as a result we may initiate a short in that group this week.

Position Updates

The Bullish Percent chart of the financials has turned back up and the CFC charts appears to have put in a bottom, at least temporarily. Our target of $15 proved a tad too aggressive for the panic that set in on Thursday the 16th. We will monitor this position closely and aim to close it out on Monday around the $21 mark.

SYY - This will be the week where we either declare victory on this one, or wave it goodbye. There is clearly resistance at the $34 level but usually when a stock knocks this many times on that proverbial door, it is going to bust through. Stick with the short trade until $35 is hit.

MEDX looks ready to bust out to the upside.

JPM Short Executed, then stopped out

On Wednesday 8/15, the JPM short position was forced on at 43.45. While in the back of my head I was violating one of my trading rules to NOT chase trades, I did so anyway. 2 days later, we were stopped out at $48. The trading on that day was extremely volatile to the upside and the $48 level has not been approached since, but it is best to put this one behind us with a small loss.

See next posts - the financials have repaired themselves to the point where they are now buyable.

Executions and another JPM miss

On Monday two of the targets were hit, resulting in short positions on SYY and PMI. PMI played out as expected an the position was initiated at 41.25. SYY released solid earnings and gapped open higher at the opening and allowed for an entry price of 33.75.

We narrowly missed out on JPM again, the tarrget short price being 45.50. The stock traded to 45.40 and backed right off - right strategy, needed to be more aggressive. Need to get more aggressive with this one and put out the short anywhere above $43 a the downside risk in this stock is palpable.

IBM holding strong in the chaos.

Ideas for This Week

Since all of the Bullish Percent Charts are still screaming defense and shorts, the following situations will be monitoring and executed if the target entry points are hit:

JPM (Short) - Financials remain the weakest group, had this on the radar to put out at $47 but missed the opportunity. However, this still remains a tasty short option at an entry of $45.50. The stop point would be 48 and the target is 35 for a UD of 5.2. Will short 150 shares in the model portfolio if hit.

SYY (Short) - Sysco is releasing earnings on Monday morning so this stock may have an interesting open point. However, the chart is weak and the trade setup is sweet should we get executed at $31.50 or higher. Assuming an entry of $31.50, with a stop point of 35 and a target of 16, the UD is a solid 5.4. Will short 150 shares in the model portfolio if hit.

PMI (Short) - Financial and mortgage exposure - ouch. This trade setup is sweet should we get executed at $30 or higher. Assuming an entry of $30, with a stop point of 35 and a target of 14, the UD is a solid 4.2. Will short 125 shares in the model portfolio if hit.

IBM (Long) - Tech remains the lone bright spot in this market. OK, maybe it is not so bright, just a dim light at this point, but the IBM chart is set up for a run above $150. The stock needs to trade a little more at these levels to provide a very clear downside exit point and will be one of the first considered when the Bullish Percent charts tick up.

Position Comment CFC

While the CFC short position is yielding a minor profit at the current time, the fact that the market cannot break this stock and that the most recent candles are all white are leading to the opinion that the profits in this trade will not be as easy as originally thought. Will keep monitoring.

Portfolio Updates

Quite a volatile week - there were some close calls and a violent reversal, but for the most part the portfolio remains intact and in good shape.

SNHY - Somebody said something they should not have on their earnings conference call because all of the momentum players turned and headed for the hills. Stop executed at $25.75. We will keep an eye on this one as the fundamentals remain really strong.

Lots of positions are close to the stop levels (NBR, ADBE, DELL), but they held and remain open for now.

TBSI - since the stock has run up quite a bit and the P&F chart has issued a 'high pole warning', the stop level on this position is being moved up to $33 as we need to play some defense.

Bye to TXRH

Earnings on Monday evening for Texas Roadhouse did not excite Wall Street. Our stop was executed at $12 on Tuesday.