Most retail investors don't know how to fade an opening, trade a gap down or short a gap up. Nor do they care to learn how.

Due to capital constraints, time limitations or merely life getting in the way, most people simply cannot trade as frequently as necessary to make these strategies work. That is why I started writing this weekly Rocket Stocks column.

My main goal is to find stocks that can rise in the coming week, no matter how the market moves. I love to look for snapbacks, earnings plays and other trades that have real catalysts behind them.

This week's Rocket Stocks for the Week of Oct. 29-Nov. 2 portfolio focuses on snapback plays as well as earning plays.

But before I make any new recommendations, let's quickly review how last week's Rocket Stock picks performed.
  • Apple (AAPL) crushed earnings estimates last week and in my midweek update I recommended cashing in on the quick 10% gain.
  • Amazon (AMZN) ran up 8% ahead of earnings, prompting me to recommend ringing the register this stock as well in my midweek update. That turned out to be a good move as the stock ended up sinking.
  • AK Steel (AKS), up 8.5% for the week as profit quadrupled.
  • Kohl's (KSS), up as much as 6% and ending the week up 3%.
  • Lockheed Martin (LMT), up more than 5% at one point last week but ending with a 3% increase. The stock also made our Top Stocks With Insider Buying and Buybacks list.
  • XTO Energy (XTO), up 4.5% for the week, as it reported good earnings and hedged out weak natural gas prices.
  • (FLWS), down 1.2% for the week.
  • F5 Networks (FFIV) was totally killed, down 20% for the week on lowered guidance and the departure of a senior sales chief. Ugh.
  • Zimmer Holdings (ZMH) shocked me. Down 14% for the week as the company lowered its fourth-quarter outlook. However, I'd still be a buyer of this name.
  • Level 3 Communications (LVLT) was also a disaster. It posted horrible earnings and plummeted, ending the week more than 25% down.
  • Rackable Systems (RACK), a midweek rocket stocks addition, beat earnings but traded down 2.5%.

Now on to the Rocket Stocks for the Week of Oct. 29-Nov. 2 portfolio.

My first pick this week is Boeing ( BA), which posted a solid third-quarter earnings beat last week. Analysts were looking for net income of $1.24 a share, but the jetmaker delivered $1.44. The stock has a price-to-earnings (P/E) ratio of 18, a P/E-to-growth (PEG) ratio of 1.2 and a yield of 1.5%, and that alone makes it very attractive.

Right now there is a lot of debate as to whether Boeing can deliver the 787 on time and that has kept pressure on the shares as of late. I do not believe it matters if Boeing can deliver the 787 by December or April. The fact of the matter is that Airbus, its main competitor, is so far behind that Boeing has some wiggle room.

Boeing is one of the holdings of the Vice Fund, which invests in a lot of other good "bad" companies by earmarking 80% of its assets in companies that are considered "socially irresponsible." The fund has generated an average annual return of 18% for the last three years.

Boeing did give a weak fourth-quarter outlook last week, and that hurt shares. But with $295 billion in backorders, earnings per share is locked in for some time. I believe Boeing could trade to $100 this week.

Also worth a look is Merck ( MRK), which is breaking out to a four-year high after reporting great quarterly earnings last week and raising guidance for the fourth time this year.

The drugmaker's third-quarter profit soared more than 60% on higher sales of vaccines and drugs for asthma and diabetes. Sales declined for its former star drug, Zocor, for which Merck lost exclusivity last year, but this shows investors that a decline in market share has not hurt Merck's bottom line. The stock also boasts a 2.7% yield.

For the more speculative traders, there's Longtop Financial ( LFT), which made its debut on the NYSE in an initial public offering last Wednesday. The China-based financial software provider is active in two-thirds of China's provinces, and the fact that China has a middle class the size of the population of the U.S. creates additional demand for such technology. The American depositary shares priced at above range at $17.50 but continued climbing, closing Friday at $29.55.

FreightCar America ( RAIL) has been on a horrible slide ever since it posted subpar earnings back in July. The stock is down some 33% from those July highs, making the stock worth a look.

With a short position of 16% leaning on the stock, it's no wonder FreightCar America has had trouble moving, but with investors such as Warren Buffett and other large hedge funds investing in the rail space, shorting such stocks will back fire. My guess is that Buffett is indirectly playing international growth via the rails; it is the safest way for him.

FreightCar America manufactures, rebuilds, repairs and sells freight cars that are used for hauling coal, and other commodities and it seems like a great way to indirectly play the current transition back into the rails.

With a book value of $17.50 a share and $1.3 billion in annual revenue and zero debt, look for the stock to move higher this coming week.

As for the rest of the this week's picks, I take a look at Stevie Cohen of SAC Capital's top holding, Cabot ( CBT), which reports this week. I also analyze U.S. Steel ( X) Lundin Mining ( LMC) and Nastech Pharmaceutical ( NSTK) can rally into earnings.

For more detailed analyses and the rest of this week's picks, check out the Rocket Stocks for the Week of Oct. 29-Nov. 2 portfolio at

To find the snapbacks and potential breakouts on a regular basis, check out these Stockpickr portfolios, which I use in my own research each week:
  • Today's Hot List: This daily list is a must-view every midday to see what stocks are making the biggest moves and why.
  • Always check the Biggest Percentage Losers, a list of stocks that lost big the day before, because they can snap back hard.

    When you check this list on Stockpickr, you can see which stocks are owned by the quality hedge funds and mutual funds. Pay attention to those. They will be buying at the lower prices, so you should be also.
  • Ditto for the 52-week-low list. You must check the above two lists every day if you hope to find volatile stocks.
  • Biotech Short Squeezes: Dendreon (DNDN) and others can often be found in this category.
  • Stocks Rising on Unusual Volume: These are potential breakout stocks.
  • Stockpickr's System Trades of the Day: These are trades triggering that day in various backtested trading systems we've developed.
  • Stocks With Unusual Option Activity: Perhaps someone knows something?
  • Latest Activist Situations: These are beaten-down stocks that hedge funds are accumulating shares of and demanding change in. Believe me, these hedge funds piggyback each other. And once they start rocking the boat, things happen quickly. This should be on your must-view list.

One final place to frequent is the Answers section on Stockpickr, where ideas such as those presented in this article are thrown around daily.

At the time of publication, Altucher and/or his fund had no positions in stocks mentioned, although positions may change at any time.

James Altucher is president of Stockpickr LLC, a wholly owned subsidiary of and part of its network of Web properties, and a managing partner at Formula Capital, an alternative asset management firm that runs a fund of hedge funds. He is also a weekly columnist for The Financial Times and the author of Trade Like a Hedge Fund, Trade Like Warren Buffett and SuperCa$h. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback; click here to send him an email. has a revenue-sharing relationship with Trader's Library under which it receives a portion of the revenue from purchases by customers directed there from

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