The MTG Stalk Sheet
January 3, 2008

The MTG Stalk Sheet presents you with the best individual stocks that Morpheus Trading Group is stalking for potential trade entry each day, all in a concise and easy to understand format. Please be sure to read the MTG Stalk Sheet User Guide in order to understand the terminology below and to receive the maximum benefit from your subscription. Enjoy!


"FULL-SERVE" STALK LIST



CF - CF Industries

  • Industry - Chemical Manufacturing
  • Side - Long
  • Shares - 100
  • Stalking since - January 3
  • Timeframe - 5 - 20 days
  • Trigger - 112.26
  • Target - new highs
  • Stop - 107.64
  • Notes -
      • CF broke out to new highs in late December.
      • Has pulled back in a tight range, retracing just 38% of the move up (10% off the highs).
      • CF is a leading stock in the strong agricultural-chemical group (AGU, TRA, POT).
      • Our long is is over the hourly downtrend line, the tight sideways consolidation, and the 20-period EMA.
      • The stop is placed beneath the lows of the range, minus some wiggle room.
      • Trade expectations - Look for CF to resume its uptrend and clear the prior highs of December. We will trail a loose stop as long as the price and volume action remains strong.


    SID - Companhia Siderurgic

  • Industry - Iron & Steel
  • Side - Long
  • Shares - 100
  • Stalking since - January 2
  • Timeframe - 5 - 20 days
  • Trigger - 90.68
  • Target - new highs
  • Stop - 86.94
  • Notes -
      • SID is consolidating in a tight range near the highs.
      • Good relative strength versus the the broad market over the past few sessions.
      • Other stocks within the group are looking strong such as STLD, MTL, NUE, and X.
      • The bull flag pattern triggers a long entry over the high of the past few sessions.
      • The stop is placed beneath the lows of the range, however, if SID fails the breakout on the date triggered, we will cut the position for a small loss.
      • Trade expectations - Look for SID to break through 100 over the next few weeeks. If the price and volume action remains strong we will trail a loose stop and play for a move to 120.
    "SELF-SERVE" STALK LIST - UPDATED EVERY MONDAY (Click here to view the "Self-Serve" Stalk List section of the user guide.)

      LONG WATCHLIST AND TRIGGER PRICES

      Pullback entries - (changes to trigger prices are highlighted in red)

      New setups

    • MTL - 100.11
    • CEDC - 59.11
    • DO - 142.51
    • TRA - 49.01
    • ABV - 74.01
      -----------------------------
    • CF - 112.26
    • ILMN - 61.06
    • ACM - 29.76
    • GOOG - 716.26
    • AKS - 46.86
    • DV - 52.26
    • VMW - 85.52 (triggered 1/2)
    • HOLX - 69.85 (triggered 1/2)
    • WFR - 91.26 (triggered 12/31)
    • MA - 218.00 (triggered 1/2)
    • FWLT - 158.01 (triggered 1/2)

      Breakout entries -

      New setups

    • ATW - 103.81
    • POT - 148.76
    • OXY - 79.51
    • MDR - 60.81
      -----------------------------
    • STLD - 60.85
    • NBL - 80.51 (early entry) & 80.85 (breakout)
    • SID - 90.68
    • WFT - 70.51 (triggered 1/2)
    • SWN - 57.12 (56.36 entry triggered 12/31)
    • VIP - 45.60 (43.01 early entry triggered)
    • UPL - 72.51 (triggered 1/2) - look for second entry at 72.70
    • EOG - 91.76 (triggered 1/2)
    • APA - 109.43 (triggered 1/2)

      SHORT WATCHLIST AND TRIGGER PRICES

    • STJ - 40.74 (triggered 12/31)
    • BA - 87.33 (triggered 12/31)
    • JWN - 35.39 (triggered 1/2)
    • ATI - 86.24 (triggered 12/31)
    • HAR - 72.74 (triggered 1/2)


    Daily Stalk Summary

    Below is an overview of all "full-serve" open positions, as well as a performance report on all "full-serve" positions that were closed only since the previous day's newsletter. Net P/L figures are based on the $100,000 Stalk Sheet model account size. Changes to open positions since the previous report are listed in red text below:

      Open positions (coming into today):

        UPL long (125 shares from Dec. 28) -
        bought 69.91, stop 66.79, target new highs, unrealized points = + 1.54, unrealized P/L = + $191

      Closed positions (since last report):

        RIMM long (100 shares from Jan. 2) -
        bought 115.11, sold 112.87, points = (2.24), net P/L = ($226)

      Current equity exposure ($200,000 max. buying power):

        $8,931


      Notes:

      • Per intraday e-mail alert, we bought RIMM over the 15-minute downtrend line. This was an aggressive entry, so we reduced our position size to keep the loss small (we normally risk $500 per trade).


      Market Conditions / Gameplan:

      Best acting groups are oil & gas drilling and exploration, gold, and agri-chemicals. We still see many quality long setups in strong groups. The best way to outperform the market (when its in a long term uptrend) is to look for quality long setups after a broad market sell-off.


      Market Leaders:

        Monitoring the price action of leading stocks is the best way to gauge the health of the market. This list of leaders is updated every Monday.

          Leaders - BMRN, MOS, HES, VIP, OSIP, APC, FSLR, STP, SPWR, DE, MA, DO, ESRX, MON, MTL, DECK, RIG, ACI, CF, POT, ATW

          Leaders at/near the 50-day MA (a key institutional support level) - GOOG, GRMN, CHL, RIMM, FTI, FCX, EDU, NOK, GLDN, SOHU, DV

          Leading stocks breaking the 50-day MA - SIGM,

        Notes on leaders:

      • Keep an eye on RIMM at the 50-day MA.

      Open Position Detail:

      • UPL - Consolidating near the highs of the range. No change in stop.


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      Edited by Deron Wagner,
      MTG Founder and Head Trader

      DISCLAIMER: There is a risk for substantial losses trading securities and commodities. This material is for information purposes only and should not be construed as an offer or solicitation of an offer to buy or sell any securities. The Company and/or its affiliates, officers, directors and employees may or may not buy, sell or have a position in the securities discussed in The MTG Stalk Sheet and may profit in the event the shares of the companies discussed in The MTG Stalk Sheet rise or fall in value. Morpheus Trading, LLC (hereinafter "The Company") is not a licensed broker, broker-dealer, market maker, investment banker, investment advisor, analyst or underwriter. This discussion contains forward-looking statements that involve risks and uncertainties. A stock's actual results could differ materially from descriptions given. The companies discussed in this report have not approved any statements made by The Company. Please consult a broker or financial planner before purchasing or selling any securities discussed in The MTG Stalk Sheet. The Company has not been compensated by any of the companies listed herein, or by their affiliates, agents, officers or employees for the preparation and distribution of any materials in The MTG Stalk Sheet. Past performance never guarantees future results.

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