The Play Of The Day
08:34 EST 09-01-99
Good Morning Stock Fans!
Today's Play of the Day is: Bed Bath and Beyond (NASDAQ:BBBY)
Stock Fans! Bed Bath and Beyond (NAADAQ:BBBY) Looks to me as if it hit its bottom yesterday on trading volume 1,791,100. It would hit a low yesterday of $25.50 over $9.25 dollars less where it had started the month of August. The low it achieved yesterday was as low as (NASDAQ:BBBY) has been since 11/11/98.
It is interesting to point out that (NASDAQ:BBBY) did not close anywhere near that $25.50 low yesterday and also that (NASDAQ:BBBY) did not reach that low on the majority of its total volume yesterday. It did what I call "washed out" yesterday as it dropped right through a triple bottom this past month of $26.75 a share.
After it dropped as low as $25.50 it saw the majority of its volume yesterday. In fact that $1.25 drop from Monday's close of $26.75 took place on only 135,000 shares of the 1,791,000 total shares that (NASDAQ:BBBY) traded yesterday. I was amazed when looking at how (NASDAQ:BBBY) traded after it hit that low of $25.50. (NASDAQ:BBBY) would move all the way back up close almost at it high of the day up to $27.50. If that is not a stock finding it low and bouncing off of it I am not sure what is.
Holding true to the pattern I look when calling quality stocks off the bottom it has indeed traded LESS VOLUME over the past few days of trading as it dropped to what I believe is as far as it is going yesterday of $25.50. I am very BULLISH on shares of (NASDAQ:BBBY) to have found it low right here.
I also like the area that (NASDAQ:BBBY) put between it low yesterday and its close of $27.50. It tells me that (NASDAQ:BBBY) has established strong near term support at $25.50. Taking all of this information into account I am looking for shares of (NASDAQ:BBBY) to break back up and over $32.25 dollars or so a share over the next 10 to 14 trading days as (NASDAQ:BBBY) makes its way back to its 200 day moving average of $32.18750 a share. It has even got some help to make that move as 2 brokers over the last 2 days have come out and began coverage of shares of (NASDAQ:BBBY) with a BUY.
Buy Area: $26.50 to $26.93750
Sell Stop: $25.43750
TARGET: $30.50 - $32.25
"RUN THE OPTIONS!"
Sept $30.00 and $32.50 Call Options
BONUS PLAY: FAT BRAIN (NASDAQ:FATB)
Stock Fans! It was fun to run shares of (NASDAQ:FATB) up on NEWS yesterday. Sure the news was positive for the future of (NASDAQ:FATB) for the future but what about now? Was the news worth a move of $6.81250 per share off of it open and low of the day of $17.25? Furthermore was the yesterday's news on (NASDAQ:FATB) so good that it has validated today's opening indication price of $26.50 over $2.50 dollars more then yesterdays close of just over $24.00 dollars a share?
My answer to these questions is I think not! I am very positive about the news that made (NASDAQ:FATB) trade over 10 million shares on the NASDAQ yesterday and trade up as high as it did. However I must point out that I venture to guess that a vast majority of yesterday's investors in (NASDAQ:FATB) bought yesterday on momentum and where buying now and asking questions later.
All those investors start asking questions today. They are not going to have to wait long in my opinion to see their questioned answered as shares of (NASDAQ:FATB) gives up over half of it gains yesterday and goes to $20.00 or so a share. After all to prove the news from yesterdays worth it must retrace back down and trade on much less momentum. The Key SHORT shares of (NASDAQ:FATB) right off the open today!
Sell Short area: Off the open
Cover for loss: $27.50
Have a great day
More to come...