Todays Big Stock: AuRico Gold Inc. (NYSE: AUQ)

It can be challenging to know what trade to make and when to make it, but there are those trading opportunities that are clear and somewhat obvious. Usually, the “keep it simple stupid” trades tend to be the best anyway. Keep in mind that regardless of simple or not, that doesn’t necessarily mean the trade will always work out in your favor. One stock that appears to have a “simple” trading opportunity would be that of Aurico Gold, Inc.

AuRico Gold is a mining company, which also engages in the exploration for, and development of, gold and silver deposits in Mexico. Through its subsidiaries, Aurico owns and operates the Ocampo gold-silver mine in Chihuahua State, Mexico, and the El Cubo gold-silver mine in Guanajuato State, Mexico, both of which are producing gold and silver. Through its subsidiaries, Aurico also owns the Guadalupe y Calvo gold-silver exploration project in Chihuahua State, Mexico, and leases the Las Torres gold-silver mine in Guanajuato State, Mexico, which is also producing gold and silver.

Before discussing potential trading opportunities, please take a look at the 1-year chart of AUQ (Aurico Gold, Inc.) below with my added notations:

Pretty straightforward trade, isn’t it? AUQ has been holding a very important level of support in the area of $9 (navy) for the last 8 months. No matter what the market has or has not done this year, AUQ has not broken below that general area of support.  If the market should move lower, ACTG will most likely retest its support level for a potential trade. On any rallies, do not forget about the $11 level (purple) as a potential resistance.

The Tale of the Tape: AUQ has held a very important support level at $9 since May. If the stock were to approach that level again, a trader could enter a long position with a stop under that level. If AUQ were to break that support, a short position could be made with a stop above the $9 level.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT

Todays Big Stock: Sotheby’s (NYSE: BID)

No surprise, stocks are starting to break down again. With the market selling we’ve seen over the past week or so, a lot of stocks are breaking below key areas of support.  However, these breaks simply provide new trading opportunities. One stock in particular that broke down yesterday would be that of Sotheby’s.

Sotheby’s is an auctioneer of authenticated fine and decorative art, jewelry and collectibles. Sotheby’s operations are organized under three segments: Auction, Finance and Dealer. Sotheby’s Auction segment functions principally as an agent by offering authenticated works of art for sale at auction and by brokering private sales of artwork. Sotheby’s also operates as a dealer in works of art through its Dealer segment, conducts art-related financing activities through its finance segment and is engaged, to a lesser extent, in brand licensing activities. Sotheby’s Finance segment provides certain collectors and art dealers with financing, secured by works of art it either has in its possession or permits borrowers to possess.

Before discussing potential trading opportunities, please take a look at the 1-year chart of BID (Sotheby’s) below with my added notations:

BID has commonly found support at the $30 level (green). At the end of September, BID broke that support and proceeded to fall down to $25 (navy).  Since then, BID has broken back above the $30, went higher as expected, and found support at the $30 level again. Yesterday BID broke the $30 once more. The stock should be moving overall lower from here, probably back down to the $25 level.

The Tale of the Tape: BID has broken its level of support at $30 and the stock should be moving lower. A short position could be entered on a rise back up to $30 with a stop placed above that level. If the stock makes it down to $25, or breaks back above $30, a long trade could also be made with a stop below the level of entry.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT

Todays Big Stock: BlackRock Kelso Capital (BKCC)

BlackRock Kelso Capital Corporation is an externally managed, non-diversified closed-end management investment company. The company’s investment objective is to generate both current income and capital appreciation through its debt and equity investments. It invests primarily in middle-market companies and target investments throughout the capital structure. The term middle-market refers to companies with annual revenues typically between $50 million and $1 billion. Its targeted investment typically ranges between $10 million and $50 million. The company seeks to invest in companies that operate in a variety of industries and that generate positive cash flows. It provides middle-market companies with flexible financing solutions, including senior and junior secured, unsecured and subordinated debt securities and loans, and equity securities. 

Before discussing the potential trading opportunities with BKCC (BlackRock Kelso Capital Corporation), please review the 1 yr. chart of BKCC that I have outlined below, with my added notations:

Over the last 4 months, BKCC has created (2) very important price levels in which to trade off of: First, the $9 resistance (navy), which was also previous support (blue). Second, the $8 level has been both support (green) and resistance (red) several times since August. BKCC is currently trading in between those (2) levels.

The Tale of the Tape: BKCC is trading between (2) important price levels at $9 and $8. A rise to the $9 resistance would be a great opportunity to enter a short trade, while a break above that $9 could be a nice long trade. A trader could also enter a long trade on a pull back down to the $8 support, or a short trade on a break below the $8.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT

Todays Big Stock: Buckle, Inc. (NYSE: BKE)

The Buckle, Inc. is a retailer of casual apparel, footwear, and accessories for men and women. The Buckle operates approximately 400 retail stores in 41 states throughout the continental United States under the names Buckle and The Buckle. The company markets a selection of casual apparel including denims, other casual bottoms, tops, sportswear, outerwear, accessories, and footwear. The company offers denims from brands such as Big Star, Big Star Vintage, Miss Me, MEK, Rock Revival, Silver Jeans and Buffalo Jeans. Other brands include Hurley, Billabong, Affliction, Sinful, Archaic, Obey, Roar, RVCA, Fox, and Fossil. The Buckle, Inc. purchases products from manufacturers within the United States, as well as from agents who source goods from foreign manufacturers.

Before discussing potential trading opportunities, please take a look at the 2-year chart of BKE (The Buckle, Inc.) below with my added notations:

Since I have followed BKE for quite a while, I knew of important prices that were not only important now, but also went back more than a year. I chose the 2 yr chart so that you could see the long-term importance of (2) specific prices on BKE. First, please notice the $40 level (blue-resistance/red-support). Underneath the $40, you will notice that BKE has a long-term support at $35 (green).

The Tale of the Tape: BKE has an important level at $40, which is where the stock is currently sitting. A long play could be made at this $40 level, or a short trade if the stock were to break that level. If a trader takes a small loss on a long play at $40, the next long play could be made on a drop to the $35 level. A break below the $35 could mean a significant drop for BKE and another short should be made.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT

Todays Big Stock: Sify Technologies Limited (NasdaqGM: SIFY)

As I stated in the ACTG article I wrote, trading in the stock market can at times be complicated, confusing and challenging to know what trade to make and when to make it. However, there are those trading opportunities like ACTG that are clear and somewhat obvious. Keep in mind that clear, obvious or not, that doesn’t necessarily mean the trade will always work out in your favor. Another stock that appears to have a “simple” trading opportunity would be that of Sify Technologies Limited.

Sify Technologies Limited (Sify) is an integrated Internet, network and electronic commerce services companies in India, offering end-to-end solutions with a range of services delivered over a common Internet backbone infrastructure. Sify’s services enable its business and consumer customers to communicate, transmit and share information, access online content and conduct business remotely using its private data network or the Internet. Sify’s segments comprised: corporate network/data services, which provides Internet, connectivity, security and consulting, hosting and managed service solutions; Internet access services, from homes and through cybercafes, online portal services and content offerings, and other services, such as development of e-learning software.

Before discussing potential trading opportunities, please take a look at the 1-year chart of SIFY (Sify Technologies Limited) below with my added notations:

Although I don’t normally look at stocks below $10, I know a lot of traders do. Well, isn’t the trade on SIFY relatively obvious? SIFY had been holding a very important level of support at $4 for several months. After breaking lower, the stock rallied back above that $4 level at the end of October. Now that SIFY is back above $4, traders would expect that level to start acting as support again if the stock were to ever come back down to it.

The Tale of the Tape: SIFY has a very important support level at $4. If the stock were to approach that level again, a trader could enter a long position with a stop under that level. However, if SIFY were to break that support, a short position could be entered with the expectation of a fall down to the $3 area.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT