The MTG Stalk Sheet
February 7, 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

Nasdaq futures are trading down more than 1% this morning, which bodes well for our AAPL short. There are no new setups pre-market due to the wild volatility. We will look to enter new positions via intraday e-mail alert.



UTHR - United Therapeutics

  • Industry - Biotechnology & Drugs
  • Side - Long
  • Shares - 100
  • Stalking since - February 6
  • Timeframe - 2 - 5 days
  • Trigger - 88.05
  • Target - 93.75
  • Stop - 84.25
  • Notes -
      • UTHR broke the downtrend line of a month long correction on 2/4.
      • Has basically traded in a tight horizontal range over the past eight sessions.
      • The entry is over yesterday's high plus some wiggle room.
      • Trade expectations - Look for UTHR to confirm the break of the downtrend line by closing above 88. We expect a quick pop in price with a target just below the 50% retracement level of the move down. The mimimum target is the 38% retrace level.
    "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 - (changes to trigger prices are highlighted in red)

      Pullback entries -

      New setups

    • RTN - 65.41
    • AEM - 61.86
    • CMO - 16.20
    • MCD - 54.63
      -----------------------------
    • ALXN - 69.32
    • ALNY - 32.15
    • HRL - 39.40
    • TEVA - 47.01
    • UTHR - re-entry 88.05 (false triggered at 87.60 on 2/5)
    • MER - 59.35 (triggered 2/4)
    • FXI - 151.51 (gapped above entry)
    • KSS - 45.51 (rolled over after gapping above the entry)
    • HME - 49.55 (triggered 2/4 on weak action)

      Breakout entries -

    • CNX - 77.51
    • APOL - 81.80
    • IMCL - 44.51
    • DBC - 32.76
    • FXE - 149.68
    • NLY - 20.33 (triggered 2/5)

      SHORT WATCHLIST AND TRIGGER PRICES

    • RS - 49.15 (gapped below trigger on 2/5)
    • GOL - 18.99 (triggered 2/5)
    • DRIV - 30.27 (triggered 2/5)
    • CIEN - 25.48 (triggered 2/5)
    • PCLN - 101.99 (triggered 2/5)

      Note - Be sure to check for earnings dates before entering setups from the self-serve list over the next few weeks.


    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):

        AAPL short (100 shares from Feb. 6) -
        sold short 129.44, stop 133.20, target 122.30, unrealized points = + 7.44, unrealized P/L = + $743

        DE short (125 shares from Feb. 5) -
        sold short 86.41, stop 89.68, target 75.15, unrealized points = + 3.11, unrealized P/L = + $388

        CCJ long (200 shares from Feb. 5) -
        bought 32.64, stop 30.94, target 35.50, unrealized points = + 0.79, unrealized P/L = ($160)

      Closed positions (since last report):

        (none)

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

        $28,983


      Notes:

      • Per intraday e-mail alert, we shorted AAPL on the breakdown from a tight consolidation at the lows. We plan to exit our position on the open into weakness (lookout for an intraday alert before the market opens).
      • Per intraday e-mail alert, we bought CCJ for a short term momentum pop off the lows due to the early morning reversal action.
      • Please note the changes to the UTHR setup (in red).
      • CCJ was a long entry for us due to its relative strength and high volume on the open. These type of setups are traded in bear markets only, as we attempt to find stocks that have good potential to push higher for a 1-3 day pop.


      Market Conditions / Gameplan:

      We are watching the 61.8% fibo retracement levels for support in the S&P 500 and the Dow. The Nasdaq sliced through this support level yesterday and appears to be headed to the January low. With the broad market pulling back around 5% or so over the past few days, we want to avoid establishing new short positions until we see a bounce or some sideways consolidation.


      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 - ABX, AEM, ACI, ADM, APOL, BMRN, BVN, CNX, DBC, FDG, FCL, FXE, GOLD, GG, GLD, ILMN, PPDI, SID, SLV, WLT

          Leaders at/near the 50-day MA (a key institutional support level) - BYI, DV, IBN, PBR, PPDI, TRA

          Leading stocks breaking the 50-day MA (last week) - none

        Notes on leaders:

      • Coal stocks are showing great relative strength

      Open Position Detail:

      • DE - Closed near the lows of the day. No change in stop.
      • AAPL - Sold off sharply yesterday afternoon, looking good. No change in stop.
      • CCJ - Opened strong, but faded in the afternoon. 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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