Sterling Investment Services for all your stock and options trading needs. Stock Tips

Stock and Option Trading Ideas
 
Loading

Market Data and Free Tools

Markets Overview
Market Momentum
Nada
Commodities
52 Week Highs
52 Week Lows
Volume Leaders
Price Advances
Price Declines
Percent Advances
Percent Declines

Symbol Lookup
Custom Quotes
Custom Portfolio


 

Free Newsletter

Join our mailing list
and receive our FREE Weekly Newsletter!

subscribe unsubscribe

Interested in reselling the Sterling Investment Services Prime Stock Newsletter or referring subscribers and earning extra income?? (more)

New Features - Coming Soon

Daily Market Commentary Daily Long or Short Stock Recommendation and our option recommendation. Select Fundamental Info. Our Technical Analysis of the Stock!

If you think traders & investors find this information useful then you should be one of our affiliates!


Sterling Weekly for October 17th, 2005

Well it is Tuesday afternoon, and prior to today's comments from one the Fed governors regarding interest rates the overall market looked as if a rally was starting. Whether today's comments and what is looking like a down day will cause the rally to fail or whether it follows through remains to be seen. But it does provide a good starting point for this week's topic; the need to use trailing stops to protect a position as you never know when it will turn. For those of you who are unfamiliar with the term; a "trailing stop" is a stop order that is automatically adjusted as a position increases in profitability and typically executes at a set distance from the maximum gain. Its purpose is to allow a position to increase in value and yet close out the position as it turns.

A good example of a trailing stop in action would be the trading of Trans Ocean 'RIG' last Friday's recommendation in the Sterling Prime Stock Newsletter. I recommended a short sale on the shares of 'RIG'. The shares of 'RIG' open opened at $53.76/share, and moved lower for the 1st hour of trading reaching a morning low of $52.62/share. This is a decline of over $1.00/share. Typically I will look to protect my profits in a position once it has gone profitable by a quarter. It depends upon the stock, but I'll typically set my stops to trail by $0.15/share. Under this scenario, if I would have been able to go short at the opening price, I would have then set my stop on 'RIG' once its price dropped below $53.51/share. With a trailing stop set at $0.15/share, the stop price would have continued to move lower as the price of the shares dropped to $52.62/share. After reaching this price the shares of 'RIG' began to rally. At $52.77/share my stop would have triggered and the shares of 'RIG' would have been automatically been bought back in order to cover the short. This would have given me a profit of $0.99/share minus commissions.

I believe that with every trade you must know your potential exit points. You should also realize that you never know when a trend will reverse itself. My number 1 Rule of Trading is to never let a profit turn into a loss. The proper use of a trailing stop is a good way to help ensure that the 1st Rule of Trading isn't violated.

Sterling Calendars for the Week of October 17th, 2005
Economic Calendar
Date Est. Time Release For

Briefing.com

Consensus Prior
10/17
8:30am
NY Empire State Ind. Oct 22.0 20.0 17.0
10/18 8:30am PPI Sep 1.2% 1.1% 0.6%
10/18 8:30am Core PPI Sep 0.2% 0.2% 0.0%
10/19 8:30am Housing Starts Sep 1,975k 1,950k 2,009k
10/19 8:30am Building Permits Sep 2,075 2,050k 2,138k
10/19 10:30am Crude Inventories 10/14     n/a
10/19 2:00pm Fed's Beige Book        
10/20 8:30am Initial Claims Sep 350k n/a 389k
10/20 10:00am Leading Indicators Sep (0.7%) (0.5%) (0.2%)
10/20 12:00pm Philadelphia Fed. Oct. 15.0 10.0 2.2

  Misc. Calendar
Date: Comments:
Oct. 17 American Electric Power 'AEP' announces earnings. Time not sup. Est. $0.74
Oct. 17 Citigroup 'C' announces earnings before the open. Est. $0.99
Oct. 17 Eaton 'ETN' announces earnings before the open. Est. $1.33
Oct. 17 General Motors 'GM' announces earnings at 8:30am Est. ($0.87)
Oct. 17 'IBM' announces earnings after the close. Est. $1.13
Oct. 17 MDC Holdings 'MDC' announces earnings after the close. Est. $2.56
Oct. 18 3M Company 'MMM' announces earnings before the open Est. $1.08
Oct. 18 Intel Corp. 'INTC' announces earnings. Time not supplied. Est. $0.33
Oct. 18 Johnson & Johnson 'JNJ' announces earnings before the open. Est. $0.86
Oct. 18 Merrill Lynch 'MER' announces earnings. Time not supplied Est. $1.19
Oct. 18 National City 'NCC' announces earnings before the open Est. $0.77
Oct. 18 Yahoo, Inc. 'YHOO' announces earnings. Time N/A. Est. $0.14
Oct. 19 Abbott Labs. 'ABT' announces earnings before the open. Est. $0.58
Oct. 19 Amgen 'AMGN' announces earnings after the close. Est. $0.82
Oct. 19 Bank of America 'BAC' announces earnings before the open. Est. $1.02
Oct. 19 Continental Airlines 'CAL' announces earnings. Time n/a Est. $0.20
Oct. 19 E*Trade 'ET' announces earnings after the close. Est. $0.27
Oct. 19 eBay, Inc. 'EBAY' announces earnings after the close. Est. $0.20
Oct. 19 Netflix, Inc. 'NFLX' announces earnings. Time n/a Est. $0.15
Oct. 20 JetBlue 'JBLU' announces earnings before the open. Est. ($0.01)
Oct. 20 McDonalds 'MCD' announces earnings before the open Est. $0.54
Oct. 20 Sandisk Corp. 'SNDK' announces earnings after the close. Est. $0.35
Oct. 20 Southwest Airlines 'LUV' announces earnings before the open. Est. $0.17
Oct. 21 Caterpillar 'CAT' announces earnings at 7:30am. Est. $1.06
Oct. 21 Schlumberger 'SLB' announces earnings before the open Est. $0.86

Prime Update:

Sterling Investment Services is an investment research and money management firm publishing the Prime Stock Newsletter. The Prime Stock Newsletter is a daily comprehensive newsletter that is useful for investors and traders alike. Whether you are looking for short term trading opportunities ranging from day trading to a couple of weeks or if you looking to acquire a long term portfolio at smart entry points. Subscriptions are $50/month. A Free 2 Week Trial is currently being offered.

Highlights from Recent editions of the Prime Stock Newsletter
Recommendation Date Entry Point Recent Close or Exit Price Profit* Note
Autodesk 'ADSK' Aug 16 $37.75/share $46.85 intra day high on October 3rd $9.10  
Amgen 'AMGN' Shorted Sep. 27 $82.00 $74.53 intra day low on Oct. 6th $7.47 This positions should be closed.
Pride International 'PDE'

Sep. 28

$27.30 $29.54 intra-day high on October 3rd. $2.24 Should move higher.
* The per share PROFIT is a theoretical calculation based upon the opening price the day the recommendation is published and the intra day high (or low for short sales) on the exit day. The exit day is determined based upon the application of our "Rules for Trading", the implementation of "stops" within our stated policy, and may not reflect the complete or full movement of the underlying recommendation.

Dow Jones Industrial Average (INDU)

Current Opinion: Closed @ 10,348.10 Last Signal: Called higher on October 18th with the previous day's close of 10,348.10 Current Expectations: I am expecting the Dow Jones Industrial Average to move higher and test 10,378.03 and then 10,441.11 on a closing basis.

The S&P 500

Current Opinion: Closed @ 1,190.10 Last Signal: Called higher on October 18th with the previous day's close of 1,190.10 Current Expectation: I am expecting the S&P 500 to move higher and test 1,205.10 and then 1,210.20 on a closing basis.

The NASDAQ 100 (NDX)

Current Opinion: Closed @ 1,549.88 Last Signal: Called higher on October 18th with the previous day's close of 1,549.88 Current Expectations: I am expecting the NDX move higher and test 1,558.84 and then 1,568.96 on a closing basis.

CBOE Ten Year Treasury Index (TNX)

Current Opinion: Closed @ 4.489% Last Signal: Called higher after the close of trading on September 12th at 4.169% Current Expectations: This index should continue to move higher and test then 4.624%

Disclaimer: The Sterling Investments series of newsletters is produced by Sterling Investment Services, Inc. All information used in the production has been obtained from sources believed to be reliable and accurate. Sterling Investment Services does not warrant or assume any liability for inaccuracy of the information used to produce our publications. To receive further information on these services please visit our web page at: www.sterlinginvestments.com If you would like to contact us our fax # is (404)-816-8830 Email address is: enelson@sterlinginvestments.com Sterling Investment Services may hold positions in the securities recommended or may be providing consulting services to the companies mentioned within this report.
Last Week's Edition of the Sterling Weekly 
1999 - 2005 Copyrighted, All Rights Reserved