The VRTrader.com VR Platinum Newsletter Monday 6/27/05
"Tools for the High Performance Trader"
Copyright © 2005, All rights reserved.
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PORTFOLIO UPDATE | by Mark Leibovit
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VR Platinum Portfolio Update
Monday, June 27, 2005
Pre-Market
New Changes
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GLFD - Changed Target From 3.25 To Market
GLFD - Note: Downside volume Friday nearly 7 times average daily volume.
Sell and stand aside.
AWA - Changed Stop From 4.05 To 5.45
STEM - Changed Entry Range From 3.89-3.91 To 4.20-4.20
STEM - Note: Missed entry by 4 cents on Friday. Still think it is
tradeable to 5.00 and ultimately to new highs (above 6.75) , so raising
buy point slightly.
TZOO - Changed Stop From 32.50 To 33.80
TZOO - Changed Target From 43.00 To 34.70-34.90
New Fills
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BHP - Long @ 26.80
New Exits
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MU - Exited @ 10.48
New Cancels
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WYNN - Cancelled
WYNN - Note: Volume slowed to the downside Friday, but market conditions
suggest watching. Still may be a buy around 47.00, but alternate buy zone
is 45 area with a stop at the lows. Watching for now.
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LEIBOVIT FILES | by Mark Leibovit
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Leibovit Files
Monday, June 27, 2005
Opening Comments
Economic Events and Data June 27-July 1:
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MONDAY, June 27:
Treasury auctions 3&6-month bills
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TUESDAY, June 28:
Weekly Chain Store Sales (8:55 am ET)
Consumer Confidence Index for June (10 am ET)
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WEDNESDAY, June 29:
Gross Domestic Product for Q1 (8:30 am ET)
Corporate Profits for Q1 (8:30 am ET)
EIA Petroleum Status Report (10:30 am ET)
Treasury auctions 2 year notes
2-day FOMC Meeting Begins (2:30 pm ET)
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THURSDAY, June 30:
Personal Income and Spending for May (8:30 am ET)
Weekly Initial Jobless Claims (8:30 am ET)
Chicago PMI for June (10 am ET)
Help Wanted Index for May (10 am ET)
FOMC policy announcement (2:15 pm ET)
Weekly Money Supply (4:30 pm ET)
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FRIDAY, July 1:
U. of Michigan Consumer Sentiment for June (9:45 am ET)
ISM Index for June (10 am ET)
Construction Spending for May (10 am ET)
Auto Sales for June
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We are now hearing and reading everywhere about the impact of the 'Summer
Solstice' and especially how others 'called' the top based on this very
basic cyclical phenomenon. Interesting! Though we can try and pat
ourselves on the back for making the call at the beginning of May, we
won't. We're just happy we were able to supply with you a fairly unique
insight into cyclical analysis - a subject Wall Street (along with
technical analysis and contrary opinion) generally shoves into the closet
as not to upset any fundamental or promotional information at its
disposal. Friday was an example of conflicting fundamental input. A
stronger than expected May Durable Goods Report and a strong New U.S. home
sales report did little to stem the tide of the market rout which began
midweek coincident with the Solstice. The blame was placed directly on
Crude Oil climbing to $60.25 a barrel intra-day. Now, we all know
attributing that blame is nonsense, especially when Crude Oil had been
hovering above $58.00 since six days earlier. Was it suddenly $59.00 or
$60.00 a barrel that triggered downside panic? Was it simply coincidence
that Crude Oil spiked coincident with the Summer Solstice? We will never
know. But, we know the market peaked on the previous Friday's option
expiration and was acting sloppy before the creampuff hit the fan on
Thursday accompanied by sharply increasing downside volume (Negative
Volume Reversals tm) and negative breadth. Speaking of volume, Friday's
composite volume in the Nasdaq Composite exceeded 3 billion shares and Big
Board composite volume exceeded 2.5 billion shares. This action, of
course, raises the very serious question of whether the 'Summer Rally' has
indeed ended now setting the stage for weakness (perhaps substantial
weakness) into the Fall. If it has, it has come historically early, even
though herein in our commentary we had previous speculated the Summer
Rally could very well end on the Solstice. Other cyclical analysis,
however, suggests that a 'change point' or low is due any time from this
coming Tuesday (tomorrow) thru the following week, so we have to be
prepared for a bounce phase. Since were are currently short indexes (see
Current Porfolio) it may be wise to take profits over the next couple of
days from a trading perspective. Also, we have the potential of end of
the month 'window dressing' coming into play over the next few days, not
to mention new market funds via 401Ks entering the market on July 1
forward. And, speaking of history, the market tends to act more positive
than negative around the Fourth of July - but we need to consult with Yale
Hirsch's Stock Traders Almanac for more specific confirmation. Stepping
back there is no doubt this market has been awfully resilient to date in
view of the rise in Crude Oil prices - surprisingly so! Indeed, to date
the market has been climbing that proverbial Wall of Worry!
Wall Street has been carefully and diligently trying to rationalize the
rise by couching the economy's ability to absorb the increase. Whether
this is true or not we do not know, but common sense tell us that this tax
on our economy cannot have a serious impact. The bond market has been
telling us for months (and despite repeated by upcoming increases in
short-term interest rates (this coming Thursday) by Fed Head Greenspan)
that there is something rotten in Denmark. Has the bond market seen a
slowing in the economy all along and is this related to the rise in Crude
Oil prices?
If we could construct a hypothetical scenario for the months ahead, we
would offer you the thought that the market may indeed find support and
regroup and rally again this summer (possibly into new relative highs)
with the ultimate top coming closer to September. After that point, the
market may suffer a more substantial setback. In the meantime we are
keeping our eye out for opportunities in gold shares which we feel should
be a strong beneficiary of current inflationary forces. In addition, gold
should benefit due to the tug of war going on between nations to keep
their currencies low to stimulate trade. This debasing of currencies will
ultimately (if not sooner) force investors worldwide to seek a safe haven
away from paper currencies. We suspect there is a good chance gold will
cross above $450.00 an ounce in the weeks ahead and possibly reach $500 by
year-end. Stay tuned.
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As we mentioned last week, we have been extended an invitation to attend a
tribute to our friend, Louis Rukeyser, on the floor of the New York Stock
Exchange this afternoon. Ahead of that tribute, Lou, we would like to
wish you the peace that comes from knowing that you've inspired,
entertained and helped so many millions of people in teaching them to
invest wisely and achieve their life-long goals. It has been an honor and
a privilege to have worked with you as an Elf.
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WATCHLIST
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[Available for Subscribers Only]
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LONGS
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PTF - Petrofund Energy Trust 14.62
COMPANY PROFILE:
WHY WE LIKE IT:
This is a Canadian trust that pays out well on dividends. It averaged
about a .12/share monthly dividend in 2004. It has bounced sharply higher
after finding support at its 200 day moving average.
Petrofund Energy Trust (formerly NCE Petrofund) is an open-ended
investment trust whose primary source of income is from 99% net royalty
interests granted by its two wholly owned subsidiaries, PC and PVT
(formerly Ultima Ventures Trust). PC acquires, manages and disposes of
petroleum and natural gas rights and royalties and related property rights
and interests located primarily in western Canada. PC also holds the legal
interest to all properties beneficially owned by PVT. PVT receives 99% of
the net revenue from these properties, which it in turn pays out to
Petrofund in the form of the 99% net royalty noted above. In addition, PC
may acquire royalties or other property interests or securities of other
resource issuers. The Trust may also purchase directly or indirectly
securities of oil and gas companies, oil and gas properties and other
related assets. On June 16, 2004, PC acquired Ultima.
POTENTIAL TRIGGER:
Buy at market with a stop below the March 30 low at 13.40. This is one
that could provide good income AND price appreciation.
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WJCI - WJ Communications Inc 1.91
COMPANY PROFILE:
WHY WE LIKE IT:
WJCI has been rattling around its May 13 low for almost two weeks now. It
tested the low on May 25 and closed higher on above average volume. It is
also in the vicinity of a low made in October 2004. Momentum indicators
are showing a bullish divergence as well. WJCI could take off soon.
WJ Communications, Inc. is a radio frequency (RF) devices company
providing radio frequency products worldwide to communications equipment
companies and service providers. The Company designs, develops and
manufacture products for both current and next-generation wireless and
wireline networks, defense and homeland security systems and RF
identification systems (RFID). Its products comprise highly functional RF
semiconductors, components and integrated assemblies that seek to address
the RF requirements of these various systems. The portfolio of RF
technology products offered by the Company includes amplifiers, mixers,
transistors and multi-chip modules, and RFID readers and reader modules.
The Company sells its products principally to distributors and original
equipment manufacturers, including their manufacturing subcontractors.
POTENTIAL TRIGGER:
Buy at market with a stop below the May 25 low of 1.76. Target 3.50.
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DPII - Discovery Partners International 3.00
COMPANY PROFILE:
WHY WE LIKE IT:
DPII put in a bullish outside day on June 2 with high volume after a
prolonged decline. We are looking for a solid move to the upside here.
There are bullish divergences on momentum indicators also.
Discovery Partners International, Inc. (DPII) engages in the development
and provision of libraries of drug-like compounds, instruments, consumable
supplies, drug discovery services, computational tools to generate
compound libraries, and testing and screening services for various drugs.
It offers instruments and consumables that automate the process of making
and storing collections, or libraries of chemical compounds; and chemistry
services, that include compounds, medical chemistry, drug discovery
informatics, and compound repository services. DPI also provides screening
services. In addition, the company designs and conducts assays or tests
that generate information about the effect of chemical compounds on a drug
target. DPI sells its products and services to pharmaceutical and
biopharmaceutical companies in the United States, Europe, Japan, and
India. The company was founded as IRORI in 1995 and changed its name to
Discovery Partners International, Inc. in 1998. Discovery Partners
International is headquartered in San Diego, California.
POTENTIAL TRIGGER:
Buy at market with a stop below the June 2 low of 2.81. Target $4.00.
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ALDN - Aladdin Knowledge Systems 21.46
COMPANY PROFILE:
WHY WE LIKE IT:
With the repeated announcements of credit card information theft from
companies charged with protecting our information, we took a look at the
most promising companies that might be contracted if the data storage
companies sought outside electronic security help. Aladdin Knowledge
Systems has a bullish looking chart formation and has been consolidating
at a high level for the past seven months. We are expecting a breakout
and this one should provide a handsome return over the long term. ALDN
gapped down yesterday but recovered nicely on high volume in what looks
like a shakeout move.
Aladdin Knowledge Systems, Ltd. provides solutions for software digital
rights management and Internet security. Its products include the
universal serial bus-based eToken device for user authentication and
e-commerce security; eSafe, a line of integrated content security
solutions that protect networks against malicious, inappropriate, and
nonproductive Internet-borne content; and HASP (hardware against software
privacy), HASP DocSeal, and Hardlock that includes both software and
hardware to protect its customers’ software against unauthorized copying
and illegal use. The company products also include Privilege, a software
licensing and protection platform that enables secure software
distribution via compact disk, electronic software distribution, or
peer-to-peer networks. It offers its products primarily to software
developers and distributors. The company markets its products primarily in
Israel, the United States, Europe, and southeast Asia. Aladdin Knowledge
Systems was founded by Jacob Margalit in 1985. The company is
headquartered in Tel Aviv, Israel.
POTENTIAL TRIGGER:
Buy at market with a stop at 13.00. We are looking for ALDN to challenge
the March 2000 high of 44.75.
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SHORTS
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[Available for Subscribers Only]
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TIMER DIGEST MARKET SIGNALS
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For Friday, June 24, 2005
STOCKS: Neutral
BONDS: Neutral
GOLD: Neutral
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CURRENT PORTFOLIO
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Click here to see our Current Portfolio
http://www.vrtrader....lays/stocks.asp
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NEW PICKS
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Based on either Bullish or Bearish technical signals and the
Volume Reversal™ methodology, these stock picks look
primed to make a move. No trading system is 100% accurate and
care should be taken to consider market conditions before
entering any trade. Not all trades are suitable for all
investors and each investor should consider their own risk
profile before making a decision.
Format:
Symbol - Company Name
Buy @ = this is the strategic range picked by the VR staff.
Target: = estimated destination of equity during life of play.
Stop: = recommended* stop loss considering equity volatility.
*stop losses should be placed according to your own risk
tolerance.
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RISK MANAGEMENT STRATEGY
When a stock declines/rallies 1 point or more from the price at
which bought or sold short, we will raise/lower stop to cost. This
will limit the potential loss on a trade. For each additional 1
point move, a further adjustment is made.
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CURRENT BULLISH STOCK PICKS
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[Available for Subscribers Only]
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CURRENT BULLISH INDEX PICKS
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[Available for Subscribers Only]
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CURRENT BEARISH STOCK PICKS
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[Available for Subscribers Only]
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CURRENT BEARISH INDEX PICKS
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[Available for Subscribers Only]
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EXITED BULLISH STOCK PICKS FOR THE PREVIOUS 30 DAYS
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LUV - Picked(5/5/05): 15.10 Exited(6/10/05): 14.40 Result: -0.70
KO - Picked(5/16/05): 43.75 Exited(6/23/05): 43.34 Result: -0.41
ALVR - Picked(5/19/05): 9.50 Exited(5/31/05): 9.20 Result: -0.30
FBR - Picked(5/19/05): 13.47 Exited(6/23/05): 14.20 Result: 0.73
AWA - Picked(5/20/05): 5.35 Exited(6/8/05): 6.44 Result: 1.09
ASA - Picked(5/24/05): 34.69 Exited(5/31/05): 35.60 Result: 0.91
AEM - Picked(5/25/05): 11.58 Exited(5/31/05): 11.70 Result: 0.12
COMS - Picked(5/25/05): 3.45 Exited(6/8/05): 3.66 Result: 0.21
FLML - Picked(5/25/05): 18.20 Exited(6/8/05): 18.82 Result: 0.62
NEM - Picked(5/25/05): 36.29 Exited(5/31/05): 36.75 Result: 0.46
UIS - Picked(5/25/05): 7.24 Exited(6/8/05): 6.90 Result: -0.34
HMY - Picked(5/31/05): 7.25 Exited(6/23/05): 8.25 Result: 1.00
SIRI - Picked(6/1/05): 5.81 Exited(6/10/05): 5.81 Result: 0.00
NEM - Picked(6/2/05): 38.09 Exited(6/17/05): 40.33 Result: 2.24
PAL - Picked(6/2/05): 4.90 Exited(6/23/05): 4.90 Result: 0.00
CDE - Picked(6/10/05): 3.30 Exited(6/23/05): 3.55 Result: 0.25
BGO - Picked(6/13/05): 2.29 Exited(6/23/05): 2.40 Result: 0.11
SWC - Picked(6/13/05): 7.20 Exited(6/23/05): 7.80 Result: 0.60
WYNN - Picked(6/13/05): 53.10 Exited(6/20/05): 52.80 Result: -0.30
N - Picked(6/16/05): 39.60 Exited(6/23/05): 39.60 Result: 0.00
X - Picked(6/16/05): 40.61 Exited(6/20/05): 40.61 Result: 0.00
LLY - Picked(6/17/05): 58.52 Exited(6/23/05): 58.38 Result: -0.14
AA - Picked(6/20/05): 27.70 Exited(6/23/05): 27.70 Result: 0.00
NEM - Picked(6/20/05): 38.90 Exited(6/23/05): 39.49 Result: 0.59
MU - Picked(6/23/05): 10.85 Exited(6/24/05): 10.48 Result: -0.37
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EXITED BULLISH INDEX PICKS FOR THE PREVIOUS 30 DAYS
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N/A
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EXITED BEARISH STOCK PICKS FOR THE PREVIOUS 30 DAYS
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MTH - Picked(5/26/05): 72.61 Exited(6/1/05): 75.25 Result: -2.64
BRCM - Picked(5/31/05): 35.99 Exited(6/13/05): 35.26 Result: 0.73
AAPL - Picked(6/1/05): 39.90 Exited(6/3/05): 37.96 Result: 1.94
GOOG - Picked(6/9/05): 284.72 Exited(6/14/05): 279.47 Result: 5.25
INTC - Picked(6/10/05): 27.12 Exited(6/13/05): 27.03 Result: 0.09
AAPL - Picked(6/13/05): 36.40 Exited(6/16/05): 37.92 Result: -1.52
BRCM - Picked(6/15/05): 34.66 Exited(6/16/05): 35.45 Result: -0.79
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EXITED BEARISH INDEX PICKS FOR THE PREVIOUS 30 DAYS
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DIA - Picked(6/1/05): 104.64 Exited(6/1/05): 105.45 Result: -0.81
OIH - Picked(6/1/05): 93.28 Exited(6/1/05): 93.60 Result: -0.32
IWM - Picked(6/5/05): 123.46 Exited(6/7/05): 124.85 Result: -1.39
RTH - Picked(6/5/05): 94.35 Exited(6/7/05): 95.65 Result: -1.30
BBH - Picked(6/6/05): 168.95 Exited(6/9/05): 165.95 Result: 3.00
EFA - Picked(6/6/05): 156.62 Exited(6/7/05): 157.30 Result: -0.68
QQQQ - Picked(6/8/05): 37.88 Exited(6/13/05): 37.87 Result: 0.01
SMH - Picked(6/8/05): 34.52 Exited(6/9/05): 35.25 Result: -0.73
EFA - Picked(6/9/05): 52.18 Exited(6/15/05): 52.34 Result: -0.16
BBH - Picked(6/22/05): 169.19 Exited(6/23/05): 167.91 Result: 1.28
XLE - Picked(6/22/05): 45.10 Exited(6/23/05): 45.48 Result: -0.38
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DISCLAIMER
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This newsletter is a publication dedicated to the education
of stock traders. The newsletter is an information service
only. The information provided herein is not to be construed
as an offer to buy or sell securities of any kind. The
newsletter picks are not to be considered a recommendation
of any stock but an information resource to aid the investor
in making an informed decision regarding trading in stocks. It
is possible at this or some subsequent date, the editors and
staff of VRTrader.com may own, buy or sell securities
presented. All investors should consult a qualified professional
before trading in any security. The information provided has
been obtained from sources deemed reliable but is not
guaranteed as to accuracy or completeness. VRTrader.com
staff makes every effort to provide timely information to its
subscribers but cannot guarantee specific delivery times due to
factors beyond our control.
Copyright © 2005 VRTrader.com.
