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PLAY >New Updates Thursday, May 03, 2001
New Split Updates   New Candidate Updates   New Momentum Updates
(We update our stop losses daily at the CURRENT PLAYS page.)

New Split Updates

SOTR - SouthTrust Corporation $46.36 +0.34 (-2.24)

SouthTrust Corporation posted a small gain on Thursday despite a generally weak market. Shares of SOTR hit an intra-day high of $46.95 before pulling back to a close of $46.36 on light volume of 721,000 shares. Volume has declined over the past two days. What's more, the stock has tested the 20-dma in each of the last three sessions and it held every time. SOTR may be able to rally, as we are now just 6 trading days away from the 2:1 split, payable on May 11th. Until then, support is the 20-dma at $46 with stronger support at $45.45, the April 23rd intra-day low. Resistance has moved up to the 5-dma at $47.01 and then the April 26th intra-day high of $48. A bounce off of $46 or a move above $47.01 on midday volume of at least 500,000 shares may be possible entry points. Our stops remain at $44.


Picked on April 19th @ $46.96
Change since picked -0.68
Stop Loss @ $44.00
 
Interactive Chart Quote News First Call on SOTR
 

New Candidate Updates

ACS - Affiliated Computer Services $72.00 -0.70 (+0.61)

ACS was curiously ignored during this very volatile week in technology stocks. Although ACS did pull back a bit today, the good news is that the volume of 341,300 shares was noticeably light. This indicates that the selling was relatively tepid. Perhaps traders are holding on in the hopes that ACS is on the verge of announcing a split. The last split occurred in November of 1996 when the stock was trading at $57.50, which is decidedly below today's closing price. The stock is enjoying a nice long term uptrend and the MACD is indicating that this trend should continue. That said, the short term may see a bit of a pullback now that the stock has closed below its 5-DMA of $72.19. A weak opening tomorrow could result in the execution of our trailing stop of $71.00. However, ACS may issue a buy signal if it can reverse course and establish a new high tomorrow above $74.00 accompanied by midday volume exceeding 300,000 shares.


Picked on April 26th @ $69.34
Change since picked +2.66
Stop Loss $71.00
 
Interactive Chart Quote News First Call on ACS
 


AYE - Allegheny Energy, Inc. $49.92 -0.44 (-0.68)

Allegheny Energy has been under pressure over the past two days along with the rest of the energy sector. On Tuesday, the company announced that its unregulated generation subsidiary, Allegheny Energy Supply Company, LLC, has completed the purchase of 1,710 megawatts of generating capacity from Enron Corp. (ENE). Shares of AYE traded to an intra-day low of $49.60 on volume of 516,000 shares following the news. Volume has cooled off over the past two days, so the stock may spend some time consolidating in the $49-$52 range. On the positive side, the AYE is having its Annual Meeting on May 10th, and we are looking for a possible split announcement. Going forward, support is the 10-dma at $49.29 with additional support at $48.75, the April 27th intra-day low. Resistance has fallen to the 5-dma at $50.68 and then Wednesday's intra-day high of $51.20. Traders may consider starting new plays on a bounce off of $49.29 or a move above $51.20 on volume greater than 300,000 shares by noon. We are keeping our stops at $47 to limit potential losses.


Picked on April 29th @ $50.60
Change since picked -0.68
Stop Loss @ $47.00
 
Interactive Chart Quote News First Call on AYE
 


HRB - H & R Block Inc. $53.00 -0.78 (-1.60)

H & R Block continues to move in the wrong direction. After peaking at $55 on Monday, this tax preparer to the masses has accumulated three-consecutive losing sessions to close below support at the 10-dma at $53.86 and below its April upward trendline. Moreover, the sell-off has caused HRB's MACD to go negative, which means it may have lost momentum. Fortunately, though, the three-day exodus has been accompanied by weak volume, so it doesn't appear traders are sprinting for the exits. As it now stands, HRB has strong support at its 40-dma at $51.12 and immediate resistance at $55.00, so the risk/reward tradeoff is probably even. Traders considering a position in HRB should look for strong volume, 250,000 shares or more traded by noon EDT, on a move through resistance at $55.00 or a bounce off the 20-dma at $52.61 before placing their trades.


Picked on April 18th @ $52.85
Change since picked +0.15
Stop Loss @ $49.25
 
Interactive Chart Quote News First Call on HRB
 


JEC - Jacob's Engineering $64.75 -1.05 (-1.52)

JEC, a major construction engineering services provider, received two notable new contracts yesterday. The first contract, awarded from the Federal Aviation Administration, is for 8 years and worth $404 million. The terms of the contract call for JEC to provide a wide variety of design and building services for the FAA, which is looking to update its aging facilities across the country. Meanwhile, Sverdrup Technology, a subsidiary of JEC, received a potential $308 million contract to provide Technical and Engineering Acquisition Support (TEAS) for conventional weapons systems development and testing for the Air Force. These new contracts add to JEC's already impressive backlog of $5.9 billion in future business. Unfortunately all of this good news was not enough for JEC to push forward during today's market pullback. JEC did find some support just above its 10-DMA of $64.06 (our stop is slightly lower at $64.00). If JEC starts to rally tomorrow, one possible entry point may present itself if the stock can establish a new high above $66.95. The Money Flow and OBV have begun to retreat from their lofty levels but the RSI is no longer signaling a severely overbought condition.


Picked on April 24th @ $62.00
Change since picked +2.75
Stop Loss @ $64.00
 
Interactive Chart Quote News First Call on JEC
 


TTC - Toro Company $46.54 +0.55 (+0.29)

If April showers (or in the case of Denver today, snow showers) bring May flowers, then demand for Toro's huge line of lawn and gardening equipment should be strong. This fact may have helped the stock brush off the broad market selling today. Technically speaking, TTC is knocking on the door of a significant breakout. If the stock can push through the $46.85 resistance, it could move very quickly to test its 52-week high of $47.65. The MACD, which recently turned positive and has been slowly climbing all week, is telling us that a test and subsequent break through the old high could come soon. The Money Flow has also been excellent, indicating there are more buyers than sellers. We also like the fact that the RSI has plenty of room to run before indicating an overbought condition. The 10-DMA, which closed today at $45.38, has been providing the support. In the event of a pullback, a bounce off $45.38 may provide traders with a good entry point. If not, a move above today's intra-day high of $48.85 may provide another entry point.


Picked April 29th @ $46.25
Change since picked +0.29
Stop Loss @ $43.50
 
Interactive Chart Quote News First Call on TTC
 

New Momentum Updates

GTK - GTECH Holdings Corp $33.76 +0.01 (+1.52)

Shares of this lottery systems supplier made a valiant effort to establish a new high during a quick round of lunchtime buying. However, the broad market weakness likely curbed the enthusiasm and GTK finished the day pretty much unchanged. Tomorrow could bring another round of broad market selling depending upon the April unemployment rate due to be released before the market opens. If GTK happens to rally tomorrow, it may be a compelling buy once it crosses its old high of $34.30. Momentum traders could start buying the stock in earnest if a new high is established accompanied by midday volume exceeding 150,000. If GTK gaps up $1.50 or more one may want to wait for a bit of a pullback before going long. If GTK pulls back right from the start of trading, look for a bounce off the $32.50 support as another possible entry point. The longer term picture for GTK is quite bullish. This theory is supported by a solid MACD and On Balance Volume. Our one concern is the RSI, which is indicating an overbought condition that may have to be eased through a short term pullback before GTK can resume its ascent.


Picked on April 22nd @ $29.79
Change since picked +3.97
Stop Loss $32.00
 
Interactive Chart Quote News First Call on GTK
 


LEA - Lear Corp. $36.40 -0.05 (+0.42)

The trend is your friend, at least according to automotive supplier Lear. In Tuesday's write-up we were whining (ever so slightly) that LEA's stock was consolidating between $35 and $36, which had us a little concerned that it may be ending its recent strong run despite being ensconced in a bullish pennant formation. However, on Wednesday LEA closed above $36, as it did today. At this point, LEA is supported by its 10-dma at $35.88, followed by the bottom of its recent consolidation range at $35.00. Overhead, LEA has immediate resistance at Wednesday's intra-day high of $36.55. After that, there is little to slow it down until the April 1999 highs of $50 (though it could hit mild resistance at the psychologically-significant $40 level). Traders considering a position in LEA should look for strong volume, 250,000 shares or more traded by noon EDT, on a move through $36.55 or a bounce off support at $35.00 before placing their trades.


Picked on April 24th @ $36.20
Change since picked +0.20
Stop Loss @ $33.88
 
Interactive Chart Quote News First Call on LEA
 


WSM - Williams Sonoma Inc. $31.86 +0.16 ($2.66)

For most of the Thursday, we thought that WSM's winning streak would end at six. But then in the final few minutes of trading, WSM got its act together to extend the winning streak to seven. WSM appears to be running into its earnings release on May 15, which means it could have room to run higher. To that end, we think that WSM's technical indicators look favorable. The stock has taken out resistance at $30, so it appears to have a clear shot to $40. On the downside, WSM has a first level of support at $30, followed by the 10-dma at $29.17. Traders considering a position in WSM should look for strong volume, 250,000 shares or more traded by noon EDT, on a move through today's intra-day high of $32.14 or a bounce off support at $30.00 before placing their trades.


Picked on May 1st @ $31.10
Change since picked +0.76
Stop Loss @ $27.75
 
Interactive Chart Quote News First Call on WSM
 

Play Updates Index

 


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