Locking in Your Big Bull Market Profits

Global stock markets closed a mixed week: the S&P 500 fought to a 0.71% gain, while the Nasdaq retreated 0.35%. The MCSI Emerging Markets Index rose 0.86%.

Last week’s Bull Market Alert recommendation WellPoint, Inc. (WLP) ended the week 1.64% higher. The Ultra Gold Proshares (UGL) also jumped 1.58%.

After booking 59.55% gains is Stratasys (SSYS) last Tuesday, you were stopped out of Stratasys stock for about a 10% gain.

After several weeks of gains, the stock market is looking slightly overbought.

Stocks struggled Friday, after several weak quarterly reports from Apple (AAPL), Google (GOOG) and Microsoft (MSFT). The latter company tumbled 11% on Friday after a particularly bad quarter.

So far, the Nasdaq’s problems appear to be concentrated in these three stocks. As long as the trouble doesn’t spread, you should give the uptrend time to prove itself.

That said, this is a week to lock in some of your recent big gains by making sure your stops are in the right places.
You have big gains locked in with your current stops in Delphi (DLPH) — up 30.43% — and Jazz Pharmaceuticals (JAZZ) — up 23.35%. You will lock in 25% and 20% gains with these positions, even if you hit your current stops.

Also, today I am recommending that you raise your stop in the Ultra Gold Proshares (UGL) to $45.00 and in Sony Corp (SNE) to $21.00 to ensure that these remain profitable bets.

The bottom line? Keep a close eye on the market in the coming week. This is not a time to go on a mental vacation. If stocks pull back further, be prepared to play defense.

On a personal note, this week I am writing to you from the shadows of the infamous “Checkpoint Charlie” on the former border of East and West Berlin — the site of countless face offs between the United States and the Soviet Union during the Cold War.

With both a McDonald’s and a Starbucks now firmly ensconced right along the border, the former leaders of the East German dictatorship must be turning in their graves.

Portfolio Update

Bank of Ireland (IRE) dipped 1.55% last week. Standard & Poor’s reaffirmed its “BB+/B” rating for IRE last Tuesday and revised the outlook to “Stable.” The future for IRE signals “clear sailing ahead.” Trading just under the 50-day moving average (MA), IRE is a HOLD.

Delphi Automotive (DLPH) closed the week perfectly flat. DLPH dipped early last week, after hitting a new 52-week high the week prior. However, investors bought DLPH on the dip, moving the stock right back up to its high. Goldman Sachs also raised its DLPH price target to $58.00 last week. DLPH will report earnings on July 31, before markets open. DLPH is a BUY.

Jazz Pharmaceuticals (JAZZ) fell back 1.68% last week after hitting a new 52-week high the week prior. JAZZ currently holds a best-possible Composite Rating of “99” by Investor’s Business Daily. JAZZ is scheduled to report earnings on Aug. 7, after markets close. JAZZ is a BUY.

Sony Corporation (SNE) was flat last week. China announced yesterday that it would lift a 13-year long ban on foreign video game consoles. This means Sony will soon gain access to the largest untapped gaming console market on Earth. This development may prove very profitable for Sony’s gaming division. SNE will report earnings on Aug. 1, before markets open. SNE is a BUY.

iShares Dow Jones US Home Construction (ITB) dipped 1.48% last week, trading sideways after nearly touching its 50-day MA. Although appearing somewhat trapped between its 50-day MA and 200-day MA, these lines are on-track to meet in the weeks ahead. This will likely be a powerful catalyst for bullish days ahead. ITB is a BUY.

ProShares Ultra Gold (UGL) rose 1.58% over the past five trading days. Behind the bounce in gold are a multitude of factors including the recent turn in the Federal Reserve’s “tapering” stance, a strong chart and technical support and the recent volatility in the yields of the 10-year U.S. Treasuries. UGL is a BUY.

WellPoint, Inc. (WLP) added 1.64% for its first week in your portfolio, continuing its upward trend. Both Deutsche Bank and Jefferies recently increased their price targets for WLP — likely in preparation for WLP’s upcoming earnings report. Jefferies increased its price target to $98.00, 13% above Friday’s close. WLP will report earnings on Wednesday this week, before markets open. WLP is a BUY.

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