Why I’m building a position in Japan iShares
Here are a few
opportunities that I am either eyeballing for action or am already involved
in. On this bright early morning in September markets across the globe are
trading down. The only major market that goes forward is Japan and that market
is relatively flat. A good showing in Japan after yesterday’s solid move to
new highs. EWJ is working out nicely and maintain the position I carry in that
instrument. I intend to build it because the NIKKEI 225 in my estimation is
way far away from the peak it is likely to challenge, that a nice gain will be
manufactured being involved in EWJ over the next several months. With that
said, let’s get right to the stocks I am interested in this morning.
Charlotte Russe Holding Inc
(
CHIC |
Quote |
Chart |
News |
PowerRating) 14.94
CHIC hit the skids
over a year ago and brutally declined. It lost more then half its value before
hitting bottom at 8.84 on 12/7/2004. Its up over 47% this year and will
extended its advance if it can cross 15.25 on a close. That is the alert level
that ought to call to action as the signal to extend the advance comes after
the 15.21 high made in July is crossed. The stock is in a solid advance right
now. A move above 15.25 and the advance has legs. It pays to watch the stock
for a few sessions. If tried, then place the stop at 12.69.
Charles Schwab
(
SCH |
Quote |
Chart |
News |
PowerRating) 13.98
Give this stock
the bullish benefit of the doubt. I am intending to take a position in SCH
only if the recent high is crossed. That happening tells of higher price zones
to come. The high of 14.31 was made on 8/10/05. It’s in a nice advance right
now up over 45% in the last 52 weeks and 16% this year. SCH is in bullish
hands and the grip strengthens on a rise above 14.35 on a close. I will begin
executing as it crosses 14.35 and come at it harder when it closes above that
zone. SCH is a solid performer right now and the good performance will persist
after it crosses 14.35 on a close. Place the stop at 12.99.
Fairchild Semiconductor
(
FCS |
Quote |
Chart |
News |
PowerRating) 17.12
FCS is ready to
test the 18 zone and that is the price to begin buying the shares. I intended
to get involved in the stock if it shows a willingness to penetrate higher
price zones. It is close to the level it has to cross to generate greater
confidence among holders and provide incentive to move more money into it. The
price rises as the demand kicks in and a price above 18 ought to generate
greater demand. The 52-week high 17.99 occurred on 8/2/2005.
Inco Limited
(
N |
Quote |
Chart |
News |
PowerRating) 43.86
I stuck a toe in
the water in N yesterday so I could watch it more carefully. I am interested
in buying the stock crossing 44 and again above 44.65. The chart is to good to
dismiss. The advance has legs. The chart indicates higher price zones to come.
The pattern of trade indicates favorable odds to succeed on the long side. Place the stop at 40.99.
Sinclair Broadcasting
(
SBGI |
Quote |
Chart |
News |
PowerRating) 9.57
I bought some
yesterday. Yes there are lots of stocks to get involved in because the
opportunity presented just cannot be passed on. Why pass on an opportunity to
perform? If the trade fails then so be it. Take the lump and move on. Always
remember to protect with a stop. The market tells you the truth. Opinions are
usually wrong and for the most part worthless. I just let the chart tell the
tale. The stop loss level is typically a level that is below a key inflection
point. Inflection points are as important as support levels. Sometimes the
inflection point is the level of support making it even more important in the
telling of the tale regarding any instrument. So lets get into this specific
instrument and see what the drama is about. There could be serious money made
in this stock if it can persist through the 9.65 level. That is the zone it
has to cross to enable the advance to persist. Lets examine the chart for a
moment and take a close look. Why did I get involved in this in the first
place? It formed its top after peaking in 2003. Then the brutal decline
occurred and the stock finally bottomed at 6.12 about a year ago. It has been
building a base since. The stock indicates that it wants to turn a modest
advance off the bottom of the base into something more serious and having
noticed that I give it my respect and attention and money. I am in it, and
will take more if it can show me some strength. Need to see a price above 9.65
to get excited. This has the potential, just the potential, and somewhat
favorable odds to be a big winner. It is timely. The stock is just up over 3%
this year and 21% over the last 52 weeks. SBGI is at the beginning of an
advance and when is the best time to buy a stock? Place the stop at 8.29
JDA Software GRP
(
JDAS |
Quote |
Chart |
News |
PowerRating) 15.10
The stock hit it’s
52-week high yesterday before backing off. The advance is solid. JDAS is up
10% this year and over 41% in the last 52 weeks. It broke above the top of its
base and odds favor higher prices ahead. The chart indicates a clear path to
higher piece zones. The stock could get into gear to challenge the low 20’s.
It is a new position. More will be bought crossing 15.25.It is good down to
14.80. Place the stop at 12.49
Later in the day the intention is to focus on a few of the positions I have
built and am carrying. I do make some big bets and I will focus in on a few of
those both long and short later today. One of the big bets I have going is in
CY. I intend to make much money in that instrument and I hedge my bet getting
involved in others within the semi space. Right now the bet is that the semi
conductor stocks will continue to flourish. I am making a bigger or shall I
say bolder bet on gold. That is a hedge. Pure and simple. The shorts are a
hedge. The shorts serve to protect the down side when the market turns
negative. Weak stocks tend to weaken further when the market caves. This
current market can go either way. This current bull market is old tired and
near the end of its life. The next bear market will not be as ferocious as the
one experienced in the first three years of the decade. Shorts are looking
good right now. It’s important to have them in place right now. Watch the
lines carefully for indications of a potential turn. A good place to build a
short position right now is in EMC. I will get into some more timely names
that I am betting on later.
Jack S. Rothstein
Rothstein Investment Advisory Services, Inc.
3600 Chain
Bridge Road, Suite 200
Fairfax VA
22030
Phone
888-343-4825 — Fax 703-385-7232
www.jrmoney.com — www.wealthcast.com
Jack Rothstein is the President of Rothstein
Investment Advisory Services, Inc. and is a 20-year veteran stock trader and a
money manager.
Mr. Rothstein also writes Wealthcast, a monthly newsletter about the technical
behavior of the markets. He has been quoted on Bloomberg, CNNFn, the Dick
Davis Digest and the Dow Jones Newswire. Since 1993, Mr. Rothstein also hosted
WealthCast, a radio show in the Washington DC area covering the stock market.
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