Monday, September 7, 2009

Cypress Semiconductor-CY

CY (Cypress Semiconductor--$9.77; -0.23; optionable): Semiconductors
Company Profile
After Hours: $9.76
EARNINGS: 07/16/2009
STATUS: Double top/rollover. Semiconductors enjoyed a nice recovery last week, but not CY. It is tied extensively to the solar area, and solar stocks are getting pounded and look more like refried beans at this point than cutting edge energy technology they are supposed to be under the stimulus plan. That pretty much shows you how much faith the market has in the stimulus package vaulting the US into widespread solar power usage. But, I digress. CY rallied nicely from November 2008 to the end of July; it didn't suffer no stinking selloff in March. Indeed it rallied from $5 to $7 that month. A victim of its success for now, however, as it surged in late July but reversed intraday. Tried to hold the line after selling back in early August, but its gap higher again failed to stick and it gapped back down; that is an island reversal. It fell to some support at the 50 day EMA (10) and tried to hold that level to end August. CY did a decent job. Then September started and it undercut that support. It rebounded to close at the 50 day on Thursday but rolled back over Friday . . . as the entire market rallied. Curious action, eh? Volume was up and moved back above average as well. Even more curious. MACD made a lower high on that second peak. Okay, okay. All of this adds up to what looks to be a further selloff ahead. CY made a peak at 8 in early May and tested that level on the June and early July intraday lows, snapping back quickly from that level both times. That is support and also our initial target. A move to that level lands a 64%ish gain.
Volume: 5.99M Avg Volume: 4.659M
BUY POINT: $9.68 Volume=6M Target=$8.11 Stop=$10.18
POSITION: CY XB - Dec. $10p (-49 delta)

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