We've been seeing a fair bit of bottom-bouncers running across our desks this week, and CGI is the latest to grab our attention. What we've got here is a very enticing chart with just about everything we look for in a potential bottom play.
The stock is beginning to come off of being massively oversold, has set higher lows and higher highs for each of the last three sessions, and has a sizable gap to fill to the upside. We also have a MACD that appears as if a bullish cross could be forthcoming, so we'll definitely want to keep an eye on CGI this week.
Two other stocks on our bottom watchlist, California Resources Corp. and CRCUni-Pixel, Inc. UNXL will remain there. We signaled these two just yesterday, and despite recording only marginal gains on the day, we still want to leave them a spot on our radar as well.
Valeant Pharmaceuticals, Inc. VRX – Options Idea
Speaking of bottom-bouncers, VRX recently rebounded off of new 52-week lows, and is hitting our scanners this morning. With a pleasing Q1 earnings call which included solid boosts in profits for the quarter as well as reinforced guidance for the remainder of the year, VRX is gapping up considerably in the premarket.
We want to formulate an options idea to coincide with the increased activity and expected price action in a stock in this position. We've seen this sort of pattern many times before, and if things play out similarly here, the VRX Weekly $10.50-12 Calls could be in line to see considerable gains.
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