Stocks waffled back and forth on Thursday with the indices opening higher, dropping in to negative territory in the early going, and then recovering in the afternoon. All four indices would end up in the black by the end of the day.
The gains were limited across the board with the S&P leading the way with a move of only 0.15%. The Dow moved up 0.10% and the Russell tacked on 0.06%. The Nasdaq eked out a gain of 0.05%.
[hana-code-insert name=’adsense-article’ /]Three sectors moved lower on Thursday, one was unchanged, and six moved higher.The energy sector took the worst loss at 0.48% and it was followed by the consumer discretionary sector with a decline of 0.10%.
The healthcare sector was the one that didn’t change.
The materials sector took top honors on the day with a gain of 0.51% and it was followed closely by the financial sector with a gain of 0.50%.
My scans turned in another positive result last night with 41 names on the bullish list and five on the bearish list.
The barometer moved in to positive territory once these results were added in to the equation. Thursday’s reading came in at 8.3 after a reading of -21.8 on Wednesday.
With the abundance of stocks on the bullish list and so few on the bearish list, it should come as no surprise that today’s trade idea is another bullish one. Oracle (NYSE: ORCL) appeared on the bullish list and has strong fundamental ratings. The EPS rating is at 81 and the SMR rating is an A.
The chart shows how the stock pulled back in July and early August, but has since moved higher. A trend channel has formed and the stock just hit the lower rail of the channel. We see that the daily stochastic readings are in oversold territory and made a bullish crossover last night.
Buy to open the January 52.50-strike calls on ORCL at $3.25 or better. These options expire on January 17. In order for these options to double the stock will need to reach $59. The stock was higher than this level in July and the upper rail will be above this level in the next few weeks. I suggest a target gain of 100% with a stop at $53.90.
— Rick Pendergraft
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