Consolidations Leading to Upside Breakouts?

Commentary

Tickers in this Article: HAL, DLB, CBOE, TEL

During a strong trend, many traders wait for a big pullback to enter because it feels like a “better deal.” Unfortunately, during a strong trend, these deeper pullbacks may not occur (or not frequently enough for active traders). Instead, a more sideways consolidation often develops. These four stocks are currently in relatively small consolidations, so a breakout to the upside signals the trend is continuing. Typically these trades can be initiated with relatively low risk and with price targets quickly achieved.
Halliburton (NYSE:HAL)

Halliburton (NYSE:HAL) is in a long-term uptrend and has had another nice run higher since the start of February. The price is currently consolidating, beyond the former 52-week high, between $59.69 and $57.36. If the price breaks higher, it indicates this current up-leg is continuing. Target is $62 to $62.40. A drop back below $57.36 warns of short-term selling pressure. A drop below $54.57 signals a larger correction into trendline support near $52–a region longer-term traders may wish to monitor for buying opportunities.
SEE: Beginner’s Guide To MetaTrader 4

Dolby Laboratories (NYSE:DLB)
Dolby Laboratories (NYSE:DLB) had a near-vertical rally in early March, but has moved sideways since March 10. The high of the consolidation is $45.16, and the low is $43.27. The stock did something similar in January and February, moving within a range, with a number of false breakouts. Therefore, waiting for a daily close outside the range may help avoid the false breakouts. The trend is up, so a long could also be initiated anywhere in the range, with a stop below $43.20 and the expectation of a breakout higher. Upside target is $47.10 to $47.60.
CBOE Holdings (Nasdaq:CBOE)
chart
CBOE Holdings (Nasdaq:CBOE) has formed a small triangle pattern off the 52-week high at $59.28. A break above $57.60 could spark enough buying interest to kick start another price wave higher. Target is $60.50 to $61.10. Recent lows at $55.32 provide support for the triangle, so place a stop below. If the triangle breaks to the downside, more short-term selling could be forth coning. Trendline support is near $52, providing another area to watch for buying opportunities.
Tyco Connectivity (NYSE:TEL)
Tyco Connectivity (NYSE:TEL) has been trending very strong for the last year and half, and is currently trading just below the 52-week high of $61.14. A breakout of a small correction channel may provide advance warning of a run at the high, and potentially beyond. If price moves above $60, another re-test of $61.14 is anticipated. There is minor resistance at $60.40, so the price will need to also climb through that. If the price advances beyond the 52-week high, the next target is $62.50. Once the breakout occurs, a stop can be placed below $59.
The Bottom Line
Consolidations during strong trends provide opportunities to get in on swing trades. This is because, when the consolidation breaks, it provides evidence of the near-term direction of the stock. Risk can be managed by using a stop loss order, placed below the consolidation (in the case of an upside breakout) or inside the consolidation if the breakout is strong and therefore less likely to pull back into the consolidation. The latter increases the reward relative to risk on the trade, but has a slightly higher chance of being prematurely stopped out. By controlling risk and position size, a losing trade shouldn’t have a significant negative impact on overall trading capital.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

Stocks with the Strongest Uptrends

Commentary

Tickers in this Article: HP, GNW, ETFC, HAR

While the S&P 500 remains in an uptrend, despite more of a sideways pause last week, these four stocks are in “super-trends.” Respecting moving average support levels and continually pushing to new highs, these are stocks to keep on the watch list for buying opportunities.

Helmerich & Payne (NYSE:HP)

Helmerich & Payne (NYSE:HP), which was already in strong trend, has accelerated to the upside in February and March. Since May, the stock has been doing a pretty good job of respecting the 50-day moving average. Therefore, a pullback to the average presents one option for an entry point. A rising trendline intersecting near $90 presents another. If the price falls below the recent low at $96.51, watch for a decline into the trendline. Assuming the uptrend continues, the target will be beyond the high (yet to be determined). If the price drops below $85, a large correction is underway, and can thus be used as a stop. The stop can be moved up as new lows form.
SEE: Beginner’s Guide To MetaTrader 4

Genworth Financial (NYSE:GWN)
Genworth Financial (NYSE:GNW) has seen a strong surge in March, and has more than doubled since the start of 2013. The price has been respecting the 100-day moving average since late 2012. Pullbacks to the average therefore provide a buying opportunity, and the average also aligns with a trend channel. If the price pulls back to the lower portion of the channel/100-day moving average, the top of the channel provides the target. $15 should provide adequate support, so a stop could be placed below there and moved up as new lows form.
E*Trade Financial (Nasdaq:ETFC)
chart
E*Trade Financial (Nasdaq:ETFC) has been flying higher over the last seven weeks, creating a number of support levels which can be used for structuring trades. The 50-day moving average has been providing support, so a pullback to the average provides one potential long entry. A larger support region is between $20 and $19. A drop below $18.86 penetrates a major low, signaling potential problems. This level can therefore be used as a stop, and moved up as higher lows form. If the price pulls back to the entry areas, the target is between $25 and $26.
Harman International (NYSE:HAR)
Harman International (NYSE:HAR) has seen multiple short burst higher followed by extended periods of more sideways movement. This pattern has still resulted in a very strong uptrend. Pullbacks toward the 50-day moving average–just above $100–may provide advantageous pricing, as well the $95 to $90 region which is the site of a former gap higher. Look for a target beyond recent highs with a stop not much below $90.
The Bottom Line
These stocks are currently very strong, and have been for some time. Trading strong stocks is one of the best strategies for trading an overall market uptrend. That said, strength comes and goes. It is still important to wait for favorable entries and control risk. Create a plan for how you will trade the stock, and stick to it. Keep the position size manageable–a single loss shouldn’t have a large negative impact on trading capital.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

Stocks Close to Triangle Breakouts

Commentary

Tickers in this Article: AAPL, BSX, V, WFM

Triangles are a common chart pattern. Often viewed as a continuation pattern, the breakout direction ultimately determines if the prior trend is continuing or reversing. These four stocks have all experienced strong trends recently, so the breakout direction will help determine if that trend continues or reverses.

Apple(Nasdaq:AAPL)

After a nice run higher through the last half of 2013, Apple(Nasdaq:AAPL) has been consolidating in 2014 below the $575.14 high. A downside breakout occurred on March 14 when the price broke triangle support near $528. Further selling during the week of March 17 will confirm the signal. Place a stop loss above $535 (triangle) or $540 (recent swing high) with a target at $458. The target is attained by taking the height of the pattern and subtracting it from the breakout price. If price reverses course and breaks above $540, it’s an upside breakout and the height of the pattern is added to the breakout price for a target of $605.
SEE: Beginner’s Guide To MetaTrader 4

Boston Scientific(NYSE:BSX)
Boston Scientific(NYSE:BSX) doesn’t have the prettiest triangle, but the consolidation still likely provides a trading opportunity. When the price broke below $13 on March 12 it broke the original triangle support. This trade calls for a target of $11.50 and a stop above $13.80. A bounce on March 14 has created another way to draw the triangle. For the new pattern to break, the price needs to drop below $12.60, with a target at $11.10 and a stop above $13.80. Shorting near the original breakout point of $13 provides a better risk to reward ratio, but goes against the dominant uptrend with little downside confirmation. If the price continues a rally, the upside break occurs at $13.80, providing a target of $15.30 and a stop near $12.60 or $13.
Visa(NYSE:V)
chart
Visa(NYSE:V) is consolidating below a high of $235.50. A downside break occurred on March 13 when the price moved below $223.Target is $201 with a stop above $227.50. The price has also been moving in a small horizontal channel though; waiting for continued selling pressure below the March 14 low at $218.56 will help confirm the downside break. If the price rallies, a break above the recent swing high at $228.39 breaks both patterns, putting the target at $250 with a stop near $220.
Whole Foods(Nasdaq:WFM)
Whole Foods(Nasdaq:WFM) has been in a downtrend since putting in a October high at $65.59. The actual triangle (black lines) has very similar highs and lows, making it more of a range than a triangle. A break below $50.40 indicates the downtrend is continuing. The target is $45.40 with a stop above $55.75. The downside break is a ways away, so if the price breaks above $55.75 first, it signals a further rally. Target is $60.75 with a stop near $50.40. This pattern is not narrowing very much (more range like), so the reward to risk ratio is not ideal. Placing a stop behind behind a recent swing high or low (yet to be determined) following breakout can improve the reward relative to risk.
The Bottom Line
Triangles are a useful chart pattern because they provide an entry, stop loss and target. The main draw back to any chart pattern is false breakouts. A false breakout occurs when a trade occurs in one direction, then proceeds to reverse and break in the other direction, or just fails to trend at all (moves sideways). Keep position size in line with account size and risk tolerance, so if a trade doesn’t work out, very little damage is done to the overall trading account.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

Financials and Industrials on the Radar This Week

Commentary

Tickers in this Article: XLF, BRK-B, XLI, DAL

The financial and industrial sectors led the S&P 500 to a new high last week, as the uptrend continues. These sectors are led by stocks performing very strongly, having seen aggressive runs higher. While it’s tempting to jump in and avoid missing more of the move, taking a step back, analyzing the situation and waiting for solid entry points is always the more prudent play over the long run.

Financial Select Sector SPDR (ARCA:XLF)

Financial Select Sector SPDR (ARCA:XLF) was up 3.09% last week, by far the strongest performer. The price just reached a former target of $22.50, which means there may be some short-term resistance near the March 7 close. A further upside target is at $23.15, although a pullback may occur before this is reached. $22 to $21.75 should now act as support on pullbacks, providing a buying area with stop losses below $21.25.
SEE: Beginner’s Guide To MetaTrader 4

Berkshire Hathaway (NYSE:BRK-B)
Berkshire Hathaway class B shares (NYSE:BRK-B) broke aggressively above the $119 resistance level which had quashed multiple rallies over the last 10 months. In early February, the price broke below strong support at $111, but the breakout quickly failed. That failure to go lower was an early indication the price was likely to re-test $119. The next upside Fibonacci target is $123.85 followed by $126. Those looking for a better entry point can wait for a re-test of $120 to $119, which should now act as support.
Industrials Select Sector SPDR (ARCA:XLI)
chart
Industrials Select Sector SPDR (ARCA:XLI) had stalled at $52.35 resistance, but blew through it this week, putting in a 1.81% gain. $52.35 to $52 is now likely to act on short-term support. A pullback between $51 and $50 also presents a buying opportunity, but the trade becomes less compelling the closer it gets to $50, since that would mean some decent selling strength has developed. Therefore, a stop can be placed below $50 for trades lasting multiple weeks, while short-term traders will likely prefer using the $51 region. The next targets are $53.90 followed by $55.90.
Delta Airlines (NYSE:DAL)
Airlines was the leading Industrial industry last week, with Delta Airlines (NYSE:DAL) one of the top performers, moving up 6.47%. Fibonacci targets are at $35.71 (already touched) and $37.00, indicating the price is entering a potential short-term topping area. If a pullback occurs, $33 to $32 is a support region which aligns with a short-term trendline and provides a good entry location. A stop can be placed just below $30 with a target–based on a continued uptrend–between $38.75 and $39.75 (or at both levels). Hawaiian Airlines (Nasdaq:HA), a much smaller company, has also seen a very strong rally, up 17.94% last week.
The Bottom Line
The overall stock uptrend continues, as indicated by new weekly highs in the S&P 500. Strong surges in many stocks tends to build emotional pressure to “Purchase now!” before it goes up further. Pullbacks always occur though, so analyzing the situation and waiting for an entry that makes sense and provides a good risk to reward ratio is a better long-term trading plan. The downside of this is that it may occasionally mean missing out on a trade, but trading with a clear objective far outweighs emotional impulse trades.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

Sectors and Stocks to Watch This Week

Commentary

Tickers in this Article: GSK, WFT, XLB, XLK

The S&P 500 SPDR (ARCA:SPY) put in a new high on February 28, aligning with March’s pattern for being a strong month for stocks. Over the last 20 years, March has finished higher than where it started 74% of the time (reference 1), though the last twenty years have been bullish overall, so that will bias the number. Here are the sectors to watch this week.
GlaxoSmithKline (NYSE:GSK)

GlaxoSmithKline (NYSE:GSK) has a similar pattern to the technology ETF. After a strong surge of more than 10% off the February low, the price has consolidated between $56.73 and $55.46. If the price breaks above that consolidation, it signals another, likely sharp, advance. Targets are $59 and and $61.25. Support is present from $55.50 down through $54. A drop below $54 put the price back in a former range. Support for that long-term range is near $51.
SEE: What The Market Open Tells You

Weatherford (NYSE:WFT)
Weatherford (NYSE:WFT) declined from a major trend high of $17.38 in November, to $13.07 in early February. Since that low, the stock has seen a more than 25% jump, closing at $16.67 on February 28. As the price rises, the $17 region is likely to act as strong resistance, creating an inflection point. Weakness in this area presents a shorting opportunity; with a stop just above the high (yet to be determined) in the resistance area. Downside targets are just above $15, $14 and $13. A continued strong rally above the area means another uptrend is in place, and buying opportunities occur on pullbacks.Â
Materials Select Sector SPDR (ARCA:XLB)
chart
Materials Select Sector SPDR (ARCA:XLB) pulled ahead of its former high ($46.57) last week, putting in a new high at $47.25. This follows the breakout of a pennant formation which occurred in the vicinity of that former high. The first upside target is at $47.85. The target is within reach this week, as the average weekly range is $1.21. A further target, which could take a number of weeks to hit, is $49.20. If the price proceeds lower from current levels and drops below $45.50, it indicates the potential for a double top and a false upside breakout.
Technology Select Sector SPDR (ARCA:XLK)
Technology Select Sector SPDR (ARCA:XLK) is consolidating just above the former high of $36.05. This consolidation has taken the form of a flag, with the strong run-up representing the flag pole. This is typically a continuation pattern, providing targets of $37.25 and $38.15. With a weekly average range of $0.81 it may take a week or two for the first target, and multiple weeks for the second, to be reached. If the price drops below $35.75 a potential double top could be forming
The Bottom Line
These sectors have already broken above former highs, and are therefore current leaders. Leadership often changes though, especially in the short-term; what was strong last week may not be strong this week. Despite making new highs, these sectors (and the S&P 500) and stocks are still in proximity to former highs, which means if the price falls from here, there is potential for a double-top topping pattern. Risk can be managed using stop losses and assuring position sizes are not too large for the account or personal risk tolerance.

1. http://ow.ly/ubLd8 – -adjust to 20 years, then change chart type to Histogram.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

Fatti ed Effetti by Websim 12/02/2014

FATTO
Astaldi (AST.MI) ha riaperto il collocamento del bond senior emesso a fine novembre per ulteriori 150 milioni di euro. Il titolo con scadenza 2020 prevede una cedola del 7,125% e un rendimento del 6,21%.

EFFETTO
L’emissione sarà destinata al rimborso di parte del debito in corso con la finalità di allungare la durata media e ridurre la dipendenza dai finanziamenti bancari.

Confermiamo la nostra visione positiva sul titolo, giudizio INTERESSANTE con target price a 8,15 euro.

FATTO
Iren (IRE.MI) ha completato ieri un collocamento privato di un’obbligazione per un ammontare di 100 milioni di euro con la durata di 5 anni e cedola pari al 3% annuo. Le obbligazioni, quotate sulla Borsa Irlandese, sono state interamente sottoscritte da Morgan Stanley.

EFFETTO
Notizia positiva in quanto l’emissione contribuisce a migliorare ulteriormente il profilo dell’indebitamento del gruppo (costo medio del debito attuale 3,9%) anche attraverso un allungamento della scadenza media ed un maggiore grado di differenziazione delle fonti di finanziamento.

Confermiamo la raccomandazione NEUTRALE e il target price a 1,15 euro.

FATTO
Moody’s ha deciso di abbassare il corporate rating di Fiat (F.MI) a B1 da Ba3 ed ha alzato l’outlook (giudizio sulle prospettive future) a stabile da negativo. La decisione è giustificata principalmente dall’andamento peggiore del previsto delle attività in America Latina, che mette a rischio il raggiungimento dei target di redditività per il 2014.

EFFETTO
La decisione di Moody’s era attesa e non ci aspettiamo avrà un impatto rilevante sul titolo e sulla capacità di Fiat di accedere ai mercati finanziari, come ampiamente dimostrato dalle recenti emissioni per 5 miliardi di dollari concluse da Chrysler negli scorsi giorni.

La raccomandazione è NEUTRALE, il target price è 7,70 euro.

FATTO
Diasorin (DIA.MI) ha annunciato il lancio del test “Liaison” per la determinazione qualitativa del Rotavirus su campioni di feci, disponibile sul mercato al di fuori degli Stati Uniti e del Regno Unito.

Il nuovo test del Rotavirus è il quinto del menù Liaison su campioni di feci. La soluzione CLIA su campioni di feci di DiaSorin ha lo scopo di migliorare la tecnica con cui il test viene eseguito, permettendo di ottenere risultati rapidi su grandi volumi di campioni.
Secondo recenti stime il test del Rotavirus viene eseguito in ogni parte del mondo. Oggi l’Europa da sola conta circa 6 milioni di test all’anno con un valore di mercato stimato oltre i 10 milioni di euro.

EFFETTO
Il lancio di questo nuovo test, seppur non implicando un cambio materiale nelle nostre stime, va a supportare le nostre attese in termini di crescita a doppia cifra per la tecnologia CLIA al netto dei test sulla Vitamina D (ricavi attesi in crescita del 16% in 2014).

Reiteriamo il nostro rating NEUTRALE con target price a 33,6 euro.

FATTO
Unicredit (UCG.MI) (UCG.MI) sta lavorando con Intesa Sanpaolo (ISP.MI) alla creazione di una “bad bank”. Lo ha detto ieri l’amministratore delegato Federico Ghizzoni parlando con i giornalisti chiamati ad assistere all’inaugurazione della nuova sede del gruppo, il grattacielo progettato da Cesar Pelli.

“Bad Bank” viene definita una banca, o un fondo, nel quale un istituto di credito colloca gli impieghi in sofferenza o deteriorati.

La decisione finale sul piano di dismissione dei crediti problematici in un veicolo sarà presa non oltre la metà dell’anno. Ghizzoni ha escluso che si tratti di un progetto che coinvolga tutte le banche italiane, messo a punto con la regia di Banca d’Italia.

Sullo stesso tema, il presidente del Consiglio di Sorveglianza di Intesa (ISP.MI), Giovanni Bazoli, ha precisato che nel veicolo al quale stanno lavorando le due banche saranno collocati anche crediti in bonis e ristrutturati fino a un miliardo di euro.
Maggiori dettagli verranno comunicati da Intesa in occasione della presentazione del piano industriale, il 28 marzo.

EFFETTO
Per il momento, non sembra emergere un coinvolgimento dello Stato nella gestione delle sofferenze, si tratta di iniziative private.

FATTO
Marco Fossati, socio con il 5% di Telecom Italia (TIT.MI), ha mandato una lettera al consiglio di amministrazione nella quale chiede una modifica in senso proporzionalista dei meccanismi di voto per la nomina del board: oggi i membri sono eletti con un metodo che, a suo parere, lascia poco spazio alle minoranze.

Nella lettera, che ricalca quanto è stato anticipato in recenti interviste, Fossati sollecita un cambio di statuto che garantisca la presidenza della società ai soci di minoranza.

Secondo quanto riferiscono alcuni quotidiani, Telco (primo azionista di Telecom Italia) non ha nessuna intenzione di fare proprie le istanze di Fossati: grazie agli attuali meccanismi di voto, la finanziaria controlla il consiglio di amministrazione di Telecom Italia avendo solo il 22,4% del capitale.
Un compromesso in grado di accontentare Fossati potrebbe essere la presentazione, da parte di Telco, di una propria lista di membri indipendenti, che ovviamente sarebbero di suo gradimento.

Fossati non demorde e, secondo Il Sole 24 Ore, lavora a raccogliere sostegno tra i fondi, soggetti normalmente poco interessati a partecipare al governo dell’azienda.

Sono da segnalare anche i movimenti all’interno di Telco, sui quotidiani viene rilanciata la possibilità che i soci italiani (Generali, Intesa e Mediobanca) possano abbandonare la compagine azionaria avvalendosi delle clausole di uscita previste per giugno.
Infine, per chiudere la puntata odierna della telenovela, il Tar del Lazio discute oggi il ricorso contro la multa di 103 milioni inflitta a Telecom Italia dall’Antitrust italiano per abuso di posizione dominante nella fornitura di servizi di accesso all’ingrosso alla rete e alla banda larga.

EFFETTO
Il negoziato in atto tra soci di controllo e soci che aspirano ad entrare negli organismi di controllo della società dovrebbero portare, prima o poi, ad un consiglio d’amministrazione con più membri indipendenti: non ci aspettiamo rivoluzioni, solo piccoli cambiamenti.

Confermiamo la nostra raccomandazione INTERESSANTE, per altri motivi e non per eventuali cambiamenti della governance. Il target price è 1,0 euro.

FATTO
In un’intervista al Sole 24 Ore, l’amministratore delegato di Mondadori (MN.MI), Ernesto Mauri, anticipa che nel 2013 Mondadori sarà in perdita a causa di circa 50 milioni di euro di oneri di ristrutturazione.

Dal 2014 ci sarà invece un netto miglioramento dei conti, con l’obiettivo di arrivare al 2016 con tutte le divisioni in utile, anche grazie al piano di taglio costi da 100 milioni, di cui 70 quest’anno.

Non saranno cedute le attività in Francia, anche se sono possibili alleanze. Anche le radio non saranno vendute, mentre saranno venduti asset non strategici come gli immobili. Mauri ribadisce l’obiettivo di crescere nel digitale, anche tramite acquisizioni mirate e arrivare con queste attività a realizzare il 13-15% del fatturato complessivo nel 2016.

EFFETTO
Le indicazioni sono in linea con le attese e con le precedenti indicazioni, anche se i costi di ristrutturazione da noi stimati sul 2013 sono leggermente inferiori (40 milioni di euro)

Confermiamo la nostra raccomandazione NEUTRALE e il target di 1,65 euro.

FATTO
Piaggio (PIA.MI) archivia il mese di gennaio in India con vendite in crescita dell’1,9% rispetto allo stesso periodo dell’anno precedente, a 15.347 unità.

Bene il comparto 4 ruote a 620 unità (+900%) e l’export in crescita del 114% a 1.742 unità.

In calo dell’8,5% le vendite dei 3 ruote (gli Ape) a 12.985 unità, penalizzati dall’andamento negativo di mercato che ha registrato un calo del 25%. La quota di mercato di Piaggio nei 3 ruote quindi cresce al 36% rispetto al 29,2% dello scorso anno.

Debole Vespa con 2.000 unità vendute rispetto a 4.000 dello scorso anno.

EFFETTO
I dati di gennaio sono ancora deboli in valore assoluto ma con indicazioni positive sull’andamento di Piaggio rispetto al resto del mercato.

Per quest’anno prevediamo una crescita del 10% delle vendite in India, obiettivo che potrebbe essere ottimistico se il mercato continuerà la fase di rallentamento registrata degli ultimi mesi.

Confermiamo la raccomandazione NEUTRALE con target price a 2,15 euro. Nelle nostre stime è previsto un recupero dei ricavi ne corso dei prossimi mesi.

FATTO
Recordati (REC.MI) ha annunciato i risultati dell’esercizio 2013, chiuso con un utile netto di 133,7 milioni di euro, in crescita del 12,6% (nostra stima 135 milioni). I ricavi sono saliti del 13,7% a 941,6 milioni, in linea con la nostra stima. L’Ebitda è risultato pari a 230,1 milioni (+20%) con un’incidenza sui ricavi del 24,4%. Positivo il dato del debito netto pari a 261 milioni di euro (la nostra stima era di 303 milioni).

Per il 2014 Recordati prevede di realizzare ricavi di oltre 1 miliardo di euro (senza tenere conto di eventuali acquisizioni) , un utile operativo di oltre 220 milioni con Ebit margin del 22% e un utile netto di 150 milioni.

EFFETTO
I risultati 2013 e le indicazioni sul 2014 sono in linea con le nostre attese. In aggiunta, la società ha rivisto al rialzo le indicazioni sul 2015 alzando l’obiettivo di fatturato a 1,05-1,10 miliardi di euro (dalla precedente indicazione di 1,025-1,075 miliardi) e confermando che anche nel 2015 l’utile netto sarà pari al 15% dei ricavi. Nel complesso alziamo la nostra stima di utile per azione 2015 del 2,2%.

Ribadiamo la nostra raccomandazione NEUTRALE mentre portiamo il target price 13,20 euro per effetto dell’aumento delle stime.

FATTO
Alenia Aermacchi (gruppo Finmeccanica (FNC.MI)) ha siglato con Boeing un nuovo accordo che ridefinisce il contratto per la fornitura di componenti di fusoliera dell’aereo Boeing 787. Il nuovo patto di durata decennale prevede una gestione della fornitura basata sui risultati.

EFFETTO
Buona notizia per Finmeccanica, che dimostra ancora una volta la qualità dei prodotti del gruppo.

Confermiamo la nostra raccomandazione sul titolo Finmeccanica: INTERESSANTE con target price a 8,50 euro

SAIPEM – Risultati quarto trimestre 2013 sotto le attese, prospettive 2014 deboli 12/02/2014 10:06 – WS

FATTO
Saipem ha registrato nel quarto trimestre 2013 un utile netto di 70 milioni e un Ebit di 161 milioni di euro. Le attese erano per un utile netto di 123 milioni e un Ebit di 237 milioni. Per quanto riguarda le proiezioni, Saipem prevede per l’intero 2014 un Ebit tra 600 e 750 milioni di euro su ricavi tra 12,5 miliardi e 13,6 miliardi. L’utile netto è stimato tra 280 e 380 milioni.
Le previsioni del consensus degli analisti erano posizionate più in alto.

EFFETTO
Si tratta di risultati inferiori alle nostre attese e del consensus. Abbassiamo le stime.

Confermiamo la raccomandazione NEUTRALE con target price che passa a 15,50 euro.

SAIPEM – L’Analisi Tecnica di Websim 12/02/2014 10:34 – WS

FATTO
Saipem (SPM.MI) ha subito un brutto colpo dopo la pubblicazione dei risultati trimestrali ieri pomeriggio. Il titolo ha perso il 3,5% e oggi cerca faticosamente di rimbalzare (+0,7% a 16,05 euro).

Malgrado la caduta, la performance da inizio 2014 è ancora positiva (+2,5%). Il 2013 si era chiuso con un pesantissimo -47%.

EFFETTO
Graficamente, la fase di recupero avviata lo scorso luglio da quota 12 euro ha perso consistenza in queste ultime settimane.

Segnali negativi sono arrivati con il fallito tentativo di riportarsi sopra la media mobile a 200 periodi e con il fallito tentativo di riportarsi sopra la prima fascia resistenziale in area 19/20 euro.

Ad oggi il titolo si muove all’interno della zona neutra tra 15 e 19 euro.

Massima allerta in caso di cedimento di quota 15 euro perché si avrebbe l’elevato rischio di un nuovo avvitamento verso i minimi dello scorso anno in area 12 euro.

Operativamente, scegliamo la prudenza e saremo nuovamente compratori solo verso quota 12 euro.

SAIPEM

FATTO
Mediobanca (MB.MI) guadagna lo 0,6% a 7,18 eu. I prezzi sono tornati sui top dell’anno (15 gennaio scorso), avendo così recuperato la perdita del 10% circa da tali valori.

Da inizio anno guadagna il titolo guadagna il 13% contro il +5% dell’indice FtseMib.

EFFETTO
Graficamente, i prezzi rimangono saldamente nell’uptrend partito da area 2,5 eu a metà 2012.

Gli obiettivi “naturali” per quest’anno transitano in area 8 eu, ma non si possono escludere estensioni anche verso 9/9,5 eu (allerta sotto 6,2 eu).

Sopra 7,2 eu si apre una nuova strategia di trading: maggiori dettagli nella scheda di Analisi Tecnica sul titolo.

MEDIOBANCA

FATTO
TripAdvisor (TRIP.O), leader nelle recensioni di ristoranti e alberghi, ha battuto ieri le stime di consensus sia sull’utile sia sulle vendite. Nonostante ciò, il titolo ha chiuso senza grandi variazioni a 84,20 usd.

Da inizio anno TripAdvors guadagna il 2%, rispetto al -2% dell’SP500. A 12 mesi segna +82%, rispetto al +20% dell’indice.

Oggi sono arrivati diversi aggiustamenti di target verso l’alto. I più generosi arrivano a valutare l’azienda 92/94 usd per azione.

EFFETTO
Graficamente, dalla quotazione nel 2011 i prezzi hanno inanellato continui nuovi massimi, con pause di breve durata.

Negli ultimi mesi l’uptrend ha perso un po’ di smalto ed ha iniziato una fase di consolidamento nel range 70-90 usd.

Operativamente, è lecito entrare sulla forza in caso di nuovi massimi (sopra 91 usd) per primi target verso 100 usd. Sulla debolezza, suggeriamo acquisti verso 74/72 usd per target 88/90 usd (stop su chiusure sotto 68 usd).

TRIPADVISOR INC

FATTO
Deere & C. (87,4 usd, +0,1%), tra i leader globali nella produzione di macchine utilizzate in agricoltura e nelle costruzioni, ha comunicato la trimestrale, i dati sono sopra le attese grazie al taglio costi ma le indicazioni sull’anno sono prudenti.

EFFETTO
Graficamente, i prezzi stanno consolidando ormai da mesi tra 80-86 usd. Una simile configurazione, a ridosso dei top assoluti, ci fa propendere per una fase distributiva, propedeutica a nuovi ribassi piuttosto che ad una fase di bottom.
Sotto 80 usd (lecite operazioni short) la nuova fascia supportiva si sposta verso 74/70 usd e poi 60 usd.

Seguiremmo al rialzo il movimento solo in ottica di trading e in seguito ad una chiusura sopra 92 usd per target verso 95/100 usd e stop sotto 88 usd.

DEERE

FATTO
Ford (F.N) guadagna l’1% a 15 usd nel a Wall Street.

La performance da inizio anno è sostanzialmente invariata (-1%), il 2013 si è chiuso in guadagno del 20%.

EFFETTO
Graficamente, da luglio in poi il titolo si è mosso in un ristretto range compreso tra 16 e 18 usd.

A ridosso della forte barriera a 18 usd il titolo ha completato un “triangolo” di natura distributiva, che ha prodotto una correzione protrattasi varie settimane sino al raggiungimento a inizio febbraio dell’importante sostegno verso 14,3 usd.

Operativamente, sono scattati gli acquisti verso 14 usd, come indicato in occasione dell’ultimo Fatti & Effetti del 28 gennaio scorso.

Manteniamo le posizioni per target verso 16 usd e stop loss sotto 14 usd.

FORD

FATTO
Procter & Gamble (PG.N) perde l’1,6% a 77,56 usd, peggior blue chip del Dow Jones, dopo aver tagliato le previsioni di vendite e utili per l’anno in corso a causa della svalutazione in diversi Paesi emergenti.

Il gruppo è leader mondiale nella produzione e vendita di prodotti di largo consumo, molti dei quali notissimi anche ai consumatori italiani: Dash, Mastro Lindo, Viakal, Duracell, Gilette, Pringles.

EFFETTO
Graficamente, il trend di lungo periodo è chiaramente al rialzo e ha fornito un rinnovato segnale positivo in occasione del superamento (lo scorso anno) di quota 75 usd, precedente massimo storico.

Il quadro di breve periodo si presenta invece in fase di stallo, cioè di trading range tra 75 e 86 usd.

Dopo aver corretto per diverse settimane, i prezzi stanno provando a reagire dai supporti in area 75 usd.

Operativamente ci collochiamo quindi in acquisto all’interno dell’area 76/74 usd per target verso i massimi storici a 82/86 usd.

Lo stop di sicurezza va messo sotto 73 usd. Sotto tale livello si può tentare qualche Short per target 66 usd.

PROCTER & GAMBLE

FATTO
L’indice FtseMib, che raggruppa le prime 40 blue chip di Piazza Affari, oggi ha chiuso in rialzo dell’1,3% a 20.144 punti.

A quota 20.253 ha segnato un livello che non vedeva dal luglio 2011.

La borsa italiana si conferma pertanto la migliore in Europa da inizio 2014 con un guadagno del 6,5% che si confronta con il -0,5% registrato dall’indice Eurostoxx 50.

EFFETTO
Graficamente, dall’area dei minimi a 12mila punti, segnati nel 2012 ha avviato un solido movimento di recupero, ben descritto dal canale crescente (evidenziato nel grafico) che ne descrive il ritmo.

L’indice si è nuovamente riportato nella nostra area obbiettivo di breve 20mila/20.500 punti dove transita una importante resistenza dinamica che potrebbe generare qualche presa di profitto.

Ribadendo la strategia precedente: si possono sfruttare gli strappi al rialzo per vendere in attesa di un consolidamento.

La nostra visione di più lungo periodo resta tuttavia improntata all’ottimismo. Pertanto suggeriamo (come nel recente passato) di sfruttare le flessioni per comprare.

Al rialzo, una volta superata l’area 20mila/20.500 si potrà cominciare a guardare ad un più ambizioso obbiettivo per l’anno in corso posto in area 21.500 punti, monitorando sempre con attenzione il comportamento degli altri indici principali.

Al ribasso prima allerta sotto 19.500 e primo sostegno di rilievo è in area 18.800 punti.

FTSE-MIB

Hardest Hit Sectors and Stocks to Avoid

Commentary

Tickers in this Article: XLY, XLE, XLU, PBR, PII

With the broader market declining in recent weeks, Consumer Cyclicals and Energy have seen the largest declines. While there are no guarantees these will continue to be the weakest sectors this week, recent price action warrants caution. Investors are leaving the sectors, at least in the short-term, for more conservative sectors such as the Utilities Select Sector SPDR (ARCA:XLU) as uncertainty continues. These weakened sectors may also provide shorting opportunities for short-term traders should selling continue this week.

Consumer Discretionary Select Sector SPDR (ARCA:XLY)

Consumer Discretionary Select Sector SPDR (ARCA:XLY) is down 6% over the last month, making it the worst performing sector over that time frame. The ETF recently broke below a rising channel in place for the last seven months, and is challenging former swing lows at $62.25. A breach of that levels indicates a broader decline is still underway. While a pullback to the upside could occur before the target is reached, the next downside target is $60 to $59. If the price holds above $62.25 buyers may have enough strength to push the price back into the $65 area, before hitting resistance. A move back above the $66.85 indicates the uptrend is still intact, but should be followed by a higher swing low as well.
SEE: Are You Investing Or Gambling?

Polaris (NYSE:PII)
Polaris (NYSE:PII), a consumer discretionary stock, was performing very well until the start of 2014. Shortly after putting in a high of $146.99 the stock began it’s recent decline. Weak volume on the final stages of the rise forewarned of potential weakness. The January 28 low at $122.25 is short-term support, but if tested it is likely to fail as the price continues to decline. The next support area, or downside target is $117 to $114. A raise back above $130 could trigger some short-term buying into $135. If looking for longer-term long positions, bulls should wait for the price to bounce and then form a higher swing low before speculating the price will re-test or exceed the $146.99 high.
Energy Select Sector SPDR (ARCA:XLE)
chart
Energy Select Sector SPDR (ARCA:XLE) made little upward progress since late October, but recently broke definitively through support in the $85 region. If the price bounces from here, $86 to $87 is likely to provide significant resistance. A drop below $83 on the other hand indicates another leg down is probable, with a target just above $81.
Petroleo Brasileiro (NYSE:PBR)
A hard hit stock in the energy space is Petroleo Brasileiro (NYSE:PBR) which has continually made new 52-week lows over the last week. Fibonacci targets are at $11, which is near the January 31 close, as well at $10.50. Those are necessarily potential bottoms, just targets based on recent price moves. Overall there isn’t much for the bulls to get excited about. The price needs to get back above $14 before any sort of bullish case can be made, and then the rally should also be followed by a higher swing low.
The Bottom Line
The S&P 500 SPDR (ARCA:SPY) closed out near a support zone last week, indicating the trend is still up, but could turn if selling continues. With that uncertainty currently looming, and already having shown relative weakness and breaching support, the Energy and Consumer Cyclical sectors warrant particular caution in the present environment.

Cory Mitchell is a proprietary trader and Chartered Market Technician specializing in short to medium-term technical strategies.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

How Will Last Year’s Top Turnaround Stocks Perform in 2014?

How Will Last Year’s Top Turnaround Stocks Perform in 2014?
Commentary

Tickers in this Article BSX, BBY, GNW, NFLX, DIA

2013 is in the books, with the Dow Jones Industrial Average ETF (ARCA:DIA) returning just under 30%. While many stocks continued to trend higher from earlier gains in 2012, others saw massive turnarounds after weak 2012 performance. These four stocks were hit hard in prior years but surged to upside, more than 100%, in 2013. With a solid year in the books, here’s the technical outlook for these stocks going forward.
Boston Scientific Corp (NYSE:BSX)

Boston Scientific (NYSE:BSX) was struggling to get above $6 at the start of 2013, but closed out the year at $12.02 after reaching a high of $12.48. Since mid-September the stock has been moving predominantly sideways. A shallow head and shoulders pattern occurred late in the year, broke lower, but failed to follow through to the downside, indicating buyers still have the upper hand. A rally above $12.50 is likely to attract additional buyers with targets at $13 and $13.50. The rallies in late 2013 weren’t as strong as the earlier waves higher, so it’s possible the stock is losing steam. A drop below $11 creates a topping pattern, with a downside target of at least $9.50.
SEE: Introduction To Stock Trader Types

Best Buy (NYSE:BBY)
Best Buy (NYSE:BBY) was up nearly 400% when it hit $44.66 in November, from trading below $12 in late 2012. The stock fell off the high late in 2013, indicating some short-term weakness but is still in an overall uptrend. If the price drops below $38 look for extension to $36. Some traders may be viewing the drop through the $39 to $38 area as a breach of a head and shoulders pattern, indicating a longer-term decline into the $30 region. On the other hand, if the price holds above $38, and then rallies above the $42, it is likely to test the high. A move beyond $44.66 indicates another wave higher and a target of $47.50.
Netflix (Nasdaq:NFLX)
chart
Netflix (Nasdaq:NFLX) was below $100 at the start of the year, and proceeded to hit a high of $389.16 in October on a price spike. Since then the price has been clawing back toward that high, closing out the year at $368.17. Overall there aren’t reversal signals yet. The trend remains up, moving in small waves since November. In the short-term a drop below $351 indicates a deeper correction. For the uptrend to remain strong pullbacks ideally should stay above $320, and a drop below $307 signals a topping pattern is likely in place. Next upside target is the high, followed by $410 assuming support is broken first.
Genworth Financial (Nasdaq:GNW)
Genworth Financial (NYSE:GNW) more than doubled in 2013, continuing a rally which began in late 2012. Closing out the year at $15.53, just off the $15.78 yearly high, indicates buying is still strong and the trend remains up. Currently there aren’t signs of a weakness, although a drop below recent lows at $14.65 indicates a small consolidation (expectation is still up) or a short-term correction is underway. If the price pullbacks to $13.60 it could still be a larger consolidation (expectation still up), but if it drops much below $13.60 a deeper pullback is likely into the $11.60 area. Upside target are at $16.50 and $17.15 for the next waves higher, assuming support isn’t broken first.
The Bottom Line
2013 is done and it was a very strong year for the major stock indexes. These four stocks saw massive turnarounds and aggressive buying in 2013. Each presents unique opportunities and risks heading into the new year. While these stocks (and the indexes) have seen a strong run, risk should always be managed and an objective approach taken instead of getting involved in hype.

Cory Mitchell is a proprietary trader and Chartered Market Technician specializing in short to medium-term technical strategies.
Disclosure – At the time of writing, the author did not own shares of any company mentioned in this article.

Quartz Daily Brief—US-Afghanistan security deal, EU-China trade talks, Baidu founder climbs rich list, paying alcoholics with pints

Quartz - qz.com

Good morning, Quartz readers!

What to watch for today

Europe and China talk trade. At a summit in Beijing, ministers will try to patch up a testy relationship after recent disputes over Chinese solar panels and European wine. The EU is likely to push for greater access to China’s financial sector.

Mexico returns to growth—just about. Mexico’s economy is expected to expand 0.7% after the country’s first contraction in four years. It has suffered from the sluggish US economy and a dip in remittances from Mexicans abroad, more of whom are going home.

Afghanistan votes on a US security deal. US troops will be allowed to remain in Afghanistan after 2014 with immunity from Afghan’s courts if the Loya Jirga, Afghanistan’s grand council, signs the deal today. The bill will still need an okay from parliament.

Can Target hit the bullseye? Analysts expect Target to post third quarter earnings per share of $0.63 on revenues of $17.36 billion—and investors will be watching the US retail chain’s same-store sales, which were weaker than expected in the last quarter, climbing just 1.2%.

Pandora plays music to shareholders’ ears. The online radio service is set to report earnings of 6 cents a share for the third quarter, up from 5 cents last year, on revenues of $177 million. Expectations are high after Pandora said its October listening hours grew 18% from the same month in 2012.

While you were sleeping

Brits aren’t immune to NSA spying. A new Edward Snowden leak showed that the US spy agency was authorized to snoop on citizens of “5 Eyes” allies Great Britain, Australia, New Zealand, and Canada.

Baidu founder is now China’s second-richest man. Robin Li’s net worth advanced to $11.9 billion thanks to rising shares in his search engine company; he now trails only Wang Jianlin, founder of property and entertainment conglomerate Dalian Wanda Group.

US, European agreement on Bangladesh labor. Groups representing giants like Walmart, Gap, and H&M agreed on joint inspection standards to improve worker safety in Bangladesh following the Rana Plaza disaster. 

The Bank of Japan held steady. As expected, policy rates and its asset-purchasing program remain unchanged as the bank said Japan’s economy “has been recovering moderately” and “exports have generally been picking up.”

Chinese workers protested outside a Nokia plant. Hundreds gathered outside a factory in Southern China, angry about new contracts they were forced to sign after Microsoft bought Nokia’s mobile phone unit.

China manufacturing is slowing. The preliminary reading of 50.4 for this month’s Purchasing Managers’ Index was lower than expected, declining from October’s 50.9 and presenting a challenge to policymakers embarking on new reforms.  

The Fed’s new mantra: Keep calm and carry on. Minutes from the US central bank’s October rate-setting meeting shed some light on how it might act if lawmakers push the country into default next time there’s a debt ceiling standoff. (The answer: Continue to treat US debt as if it were undefaulted.)

Quartz obsession interlude

Ritchie King on the uncomfortable racial preferences of online dating. “All men except Asians preferred Asian women, while all except black women preferred white men. And both black men and black women got the lowest response rates for their respective genders. Perhaps most surprising is that among men, all racial groups preferred another race over their own.” Read more here.

Matters of debate

We need nuclear power to tackle climate change. Japan’s broken promise to meet emissions targets shows that alternative energy—unlike nuclear—is no match for fossil fuels.

Pop music has a race problem. White performers like Macklemore and Lorde profit from tone-deaf critiques of hip hop.

The mancession’s female victims. Men suffered most conspicuously from the economic crisis, but the toll on women can’t be denied.

The 1% threaten our society. The implications of diverging incomes on political and economic stability are severe.

Surprising discoveries

TV that snoop on their owners. An LG customer says the company is collecting data from customers every time they change the channel, even if they opt to disable data sharing.

Ancient DNA revelations. Tests done on the body of a boy buried in Siberia 24,000 years ago shows he shared genes with living Native Americans.

Skim milk isn’t that good for you. The darling of anti-obesity campaigns might not actually help people lose weight.

Beefing up safe sex. The next generation of condoms could be made of cow tendons instead of latex.

Payment in pints. Amsterdam wants clean streets—and it’s paying alcoholics with beer to do the cleaning.

Our best wishes for a productive day. Please send any news, comments, condom designs and ancient DNA theories to hi@qz.com. You can follow us on Twitter here for updates during the day.

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No further easing measures out of either Norges Bank or BOE for the rest of the year

Quotes from Societe Generale Cross Asset Research:

-We expect no further easing measures out of either the Norges Bank or the BOE for the rest of the year. On the other hand, we expect the ECB to ease further, with a 25bp cut in the refi rate at the turn of the year. Apart from an actual rate cut, the ECB needs to provide more targeted liquidity to the Euro area periphery. Bank lending to the private sector in the periphery continues to fall. M3 money supply growth remains depressed relative to the ECB’s own reference target of 4.5%.

-The ECB’s need to maintain monetary accommodation will keep downward pressure on the euro. We go long equal-weighted NOK (50%) and GBP (50%) against EUR. While each leg of the trade could stand by itself, the combination of NOK and GBP into a basket trade introduces a diversification benefit to a medium-term trade. We sell EUR/GBP at spot rate of 0.8555, and sell EUR/NOK at 7.8900.