Tuesday, December 4, 2012

Daily Analysis and Stock Ideas for 12/05/2012

Daily Analysis
We saw a down day in the market as expected from the reversal day yesterday.  That said, the selloff wasn't as extreme as I had expected so I started taking some long positions which worked out very well. Chinese stocks led the decline triggered by news of widespread fraud and SEC investigating the big accounting firms tied to the Chinese companies. I think this is a overreaction especially for large cap Chinese stocks like BIDU. BIDU traded over 12.5M shares which is about 2.5x the average volume. I'm looking to for more weakness to take an entry into BIDU or perhaps QIHU which has been the leader amongst Chinese stocks.

SPY support or resistance levels.
SPY resistance - 141.68, 142.25 142.75 (gap-fill), 143.09, 143.55, 144.40
SPY support - 140.90,  140.40 139.05, 138.50, 137.55, 136.66

Sector watch -
Technology - Weak today led by AAPL and GOOG. I'm looking for a bounce in both these stocks.
Financials – Still look weak, but looked resilient today. C stayed green for most of the day.
Homebuilders - I still see signs of reversal. TOL after a nice pop this morning faded all day to end the day in red.

Trades today -
NFLX – Got a nice pop on this one. It was green all day in a red tape so I had my eyes on it. Luckily my entry was triggered by news that they signed exclusive license deal with Disney. Stock ended up 14% higher on the day. Looks set for gap fill from March which will take it back to being $100 stock soon. I took $4 profit on first 1/2. Holding the second 1/2 from 78.80 entry.

GMCR – Anther great pick today. Entered long at 38.40 and exited at 39.30 level. It ended up running into 40s. Looks set for gap fill from May at $48.

FSLR - What a great run this stock has had. I have been calling this from 23-24 level. I closed 1/2 position long (+4.80)  and Dec $25 options for very nice gains. Wish I had held it little long as it continued to run into 29s.

CLF - Entered long at 29.25. Added to my April $30 calls. Had nice volume today on the bounce.
OXY - Entered long at 73.60
AAPL - Added to my long stock position and also added  Jan $600 calls at 15.40. I'm 1.5x my size on this one now.
FB - Entered short at 27.35 with stop at 27.75.
ESRX added to my position at 53.75. Full position now.
AMZN - Closed short position for 0.50 gain. Was deeper in the money but let it sit too long.

Swing Trade update -
TNGO - Still holding long. It needs to break 13.43 area.
AAPL Long stock and options
TSLA - Still holding 1/2.
FSLR - Holding 1/2 from 23.80.
SRPT - Entry at 29.70.
ESRX - Entered long at 53.75.
SHLD - Entered 1/2 pos long at 41.65. Stop 40.
CLF - Long April $30 calls from $2.80.

Some of the old ideas -
MLNX short idea continues to work well.
GMCR continued the nice run.

Trade ideas: -
NFLX - Look for continuation to 90 and above.
SWKS - Looks set for 24s. Strong all day.
CIEN - Look set for 16s. Strong all day.
OCZ - Hate trading this stock but has looked good recently. Over $2 this could easily run to $3 on gap-fill.


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