contributors are in the business of trading and investing all day on the basis of ongoing news flow. Below, we offer the top five ideas that
contributors posted today and how they played those ideas.
brings you the news all day, and with
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1. Holy BIDU, Batman!
By Timothy Collins
8:54 a.m. EST
Black swan for
here? More like my boxer dog giving birth to a monkey. The big question on everyone's mind is what happens next for BIDU and
. As far as BIDU goes, if you are holding January calls (I wish I were, but I am not), then congratulations.
Will it go higher or lower from premarket? I have
idea. I suspect the stock will test the $440 level, but with a substantial short interest and this being a momentum name, this one may be wild. If I were holding calls, I'd stick with the mantra "Pigs get fat. Hogs get slaughtered." I will look at the stock on the open, and I am considering a straddle play since I expect volatility, and I do not think pinning will be an issue due to this major move.
Google looks to open below its 50-day simple and exponential moving average, but I don't care about that number. It hasn't really mattered in the past several months. However, look at the 30-day SMA and EMA. Chart it. Go ahead, I'll wait.
You'll find that the break below $600 was the key, and it also acted as resistance on that last spike. I think for GOOG, we need to look at the weekly chart now, and I use a 14-week MA here. Whether you are looking SMA or EMA, it would put support somewhere between $575 and $579, right where we are now. If it holds, it is an attractive entry, based on the weekly, so adjust your time frame for recovery accordingly. I am still long GOOG volatility, with $580 being my home-run number. I will post any adjustments or trades, but I will be looking very closely at both names this morning.
Long GOOG volatility.
2. Stuff That's Working
By Alan Farley
10:14 a.m. EST
- Pfizer (PFE) - Get Report breakout over $19.
- Smart Modular (SMOD) triangle breakout.
- Also leaning into Cypress Semiconductor (CY) - Get Report pullback.
Long PFE, SMOD, CY.
3. Trade Update
By Brian Gilmartin
10:39 a.m. EST
continues to look wobbly as it nears its 200-day moving average near $50. We were buying at $54-$55 and won't hold with a high-volume penetration and close below $50.
is looking better. We have a 7% to 15% gain on the position. We were buying in late November, early December between $25 and $27. The stock hit a high just above $34 in the third week of October. We think it gets back there.
is approaching max oversold on the daily chart, but the gross margin continues to weigh on the stock. That being said, we recently updated our internal spreadsheet with the filing of the 10-Q, and free-cash-flow as a percentage of BBY's market cap is now 10%, and the four-quarter trailing cash-flow is over $6 per share. The stock is getting very cheap on a cash-flow basis.
Our latest addition to client portfolios continues to be
. It is very oversold on the daily chart, and I think there is a lot of bad news baked into the stock as we approach the earnings report in late January. CVX didn't drop much on yesterday's negative preannouncement.
Long KSS, WFMI, BBY, XOM, CVX.
4. Nibbling on QLogic
By Gary Morrow
11:18 a.m. EST
is backing off quite a bit today after
. Despite an
from Goldman, the stock is off over 4% and has dipped below yesterday's open. The loss has dropped it down to support near the November highs. I am a small buyer today below $19.70 and will scale in on continued weakness down to the $19 area. A close back below $18.40 will stop this long position out.
5. Always Two Sides to Commodity Coin
By Howard Simons
11:34 a.m. EST
Whether or not the lower corn and soybean prices seen yesterday and today hold -- and as I noted
, it is way too soon to tell -- commodities always have winners and losers.
The winners include the major grain buyers for livestock and poultry feeding operations, such as
. Once again, this is very early in the year, and these are historically high feedgrain prices, so don't go whole-hog. Or whole-chicken.
The symmetry of profit in commodities is one reason why the regulatory philosophies of the
and CFTC cannot mesh. The winners when stock prices fall include the shorts,
, and propsective buyers. On balance, everyone seems happier with higher stock prices, even when they have to pay more.
Higher and lower commodity prices simply shift the balance between buyer and seller in an industry. Lower corn hurts taxpayers -- if you think it hurts farmers in an election year, see me immediately -- but it helps feedgrain buyers.
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This article was written by a staff member of RealMoney.com.