Sabrient Select Opportunity Virtual Portfolio

Here’s a sample of our partner Sabrient’s newsletter, the Sabrient Select Opportunity Virtual Portfolio. It’s a "high-performance actionable virtual portfolio," and Sabrient provides weekly updates and trading alerts for subscribers. This is this week’s update. – Ilene

Sabrient Select Opportunity Virtual Portfolio

The Week Ahead

The market continues to search for direction while testing both support and resistance levels. After recapturing its 200-day moving average and looking strong, the SPY instead lost it again to resume its bearish trend. Notice that the 50 and 200 are rapidly converging. The 50 crossing down through the 200 would be quite bearish.

On the other hand, the IWM (Russell 2000 ETF) has held up much better. On Friday, in fact, the RUT was up +1.9% while the SPX was up only +0.3%. The IWM found support at its 200-day moving average after nearly rising above its 50-day. So, small caps are holding up, and that is a promising sign.

Last week, the Select Opportunity Virtual Portfolio took two virtual portfolio actions. After short position USG sold off hard, we harvested 12% profits on 1/3 of the original position. We also entered a new short position in HST.

Open Positions

Going into the week, we have two long positions and four short positions.

LONGS:

We are long Telecom de Sao Paulo (TSP) from $18.25. The stock came very close to my next profit harvest target price of 21.90, but then sold off a bit and closed Friday at $20.66. TSP is now rated HOLD and has a Company Outlook Score of 88 and a Value Score of 90. TSP is now flirting with my mental stop of a closing price below $20.55, so we will watch it closely this week.

We are long Humana (HUM) from $48.75. The stock closed Friday at $48.10. It is rated a STRONG BUY in the Sabrient Ratings Algorithm, and carries an Outlook Score of 99 and a Growth Score of 86. I have a mental profit-protection stop in place below its 20-day exponential moving average at $46.90.

SHORTS:

We are still short 1/3 of the original position in casino firm  MGM Mirage ( MGM) from $12.71. The stock closed Friday at $11.52. MGM is rated SELL by Sabrient and has a Company Outlook Score of 4. I have a mental profit-protection stop above the original entry price of $12.71. After locking in a nice gain on 1/3 of the original position at $11.30 and then stopping out of another 1/3 at $12.57, I don’t want the final 1/3 to turn into a loss.

We are short 2/3 of the original position in homebuilder  Toll Brothers ( TOL) from $20.24. The stock closed Friday at $17.20, for a 15% gain. TOL is rated SELL by Sabrient and has a Company Outlook Score of 4. The homebuilders and related construction materials firms continue to look weak. I have a mental profit-protection stop at $19.20.

We are short building products firm  USG Corp (USG) from $16.30. The stock closed Friday at $14.07, for a 14% gain. USG is rated STRONG SELL by the Sabrient Ratings Algorithm and has a Company Outlook Score of 0. I have a mental stop of a closing price above last Tuesday’s high at $15.20.

We are short Host Hotels & Resorts (HST) from $14.80. The stock closed Friday at $14.42. HST is rated SELL by the Sabrient Ratings Algorithm and carries a Company Outlook Score of 3. I have a mental stop of a closing price above last Tuesday’s high of $15.91.

Watch List

LONGS:

Some stocks that I have on my Buy watch list include the following:

DECK

SNDK

IPXL

HITK

DLTR

STX

AXS

CSH

TRW

GTS

GPRE

LEA

DLX

XRTX

HOGS

SAFM

CTB

JRCC

ABV

CFI

NEM

CACC

PERY

SHORTS:

Some shorts I have on my watch list are the following:

IGT

VMC

NUVA

MWW

TEX

FHN

HGSI

RTI

MON

SKT

SPG

EXR

JOE

AMAG

RECN

DNDN

CCI

BMRN

RAIL

AZPN

KSWS

STI

BOOM

We will be watching the markets for buy and sell opportunities.

Regards,

Scott Martindale
Sabrient Systems

Disclaimer: This newsletter is published solely for informational purposes and is not to be construed as advice or a recommendation to specific individuals. Individuals should take into account their own unique and specific circumstances in acting on any stock selection made by Sabrient. Sabrient makes no representations that the techniques used in these reports will result in or guarantee profits in trading. Trading involves risk, including possible loss of principal and other losses, and past performance is no indication of future results.