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Play of the Day (For Monday)
Interactive Chart
Sunday, April 01, 2001

SBUX - Starbucks Corporation $42.44 (+1.56)

Sunday's Comment:

Folks don't just want their Starbucks coffee; they need their Starbucks coffee. It seems that people can't get enough of the stuff and are willing to pay handsomely for the gourmet blends and more exotic concoctions. Starbucks is only too happy to fill this demand. The caffeine pusher continues to expand by placing stores in everything from bookstores to grocery stores. SBUX appears to have built some nice support and is starting to rally on the heels of a split announcement. The 2:1 split will be made payable on April 27th, which is the day after earnings are to be released. This should give us plenty of time to enjoy a potential split and/or earnings anticipation run. Friday's close was just slightly above the important 200-DMA level of $42.28. New positions can be placed if SBUX can stay above this support. Another possible entry strategy would be to go long if SBUX can move above Friday's high of $43.56 on midday volume of over 1.4 million shares. A positive start to this week should cause the MACD to issue a buy signal, which would help confirm SBUX's return to a longer-term rally mode. Additionally, the OBV is starting to recover and the RSI is rising from a level that had previously indicated an oversold condition. SBUX should eventually find resistance at its 50-DMA of $46.09 but this leaves plenty of room for a 10% plus rally in the mean time. Our stops remain at $38.50 to guard against a reversal.

Picked on March 29th @ $41.94
Change since picked +0.50
Stop Loss $38.50

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