DARK HORSE HEDGE – Shorting Suntrust & BooKS

By Scott Brown at Sabrient & Ilene at Phil’s Stock World

The markets appeared to like the calendar change from August to September today as all three major indexes close with +2.5% gains. The S&P 500 closed the day at 1080, almost exactly on the 50 day MA. This provides a good opportunity for DHH to replace a couple of SHORT positions that were closed to take profits while the market battled the support line at 1040.

We are going to go another round with Suntrust Bank (STI) which already provided us with a +11.2% profit the first time around. STI closed up 5% today at $23.65, earning it a spot on the SHORT list again. Joining STI is bricks and mortar book seller, Barnes & Noble, Inc. (BKS), which closed today at $15.63, up +3.24%, after reporting a wider loss in the second quarter. We are not sure what there is to like about widening losses. Ranking at #9 on the bottom of the Sabrient Outlook rankings provides plenty of reason to recommend adding BKS as a SHORT.

SELL SHORT STI – Again – Thursday, September 2, 2010 at the open.

SELL SHORT BKS – Thursday, September 2, 2010 at the open.

These additions to the DHH virtual portfolio establish the tilt SHORT called for when the S&P 500 trades below both the 50 and 200 day moving averages.