Sector Scan: Retail and Leisure Stocks

With Black Friday, Small Business Saturday and Cyber Monday coming up, it’s not just investors who have retailers and leisure stocks on the brain.

My Power Options system identifies the most volatile and liquid stocks for option trading or short-term stock trading, and this week it’s telling me that there are only a few retail and leisure stocks that are looking strong enough to buy. Of course, you can still put or short the laggards.

Use the following information to help you with your own options or short-term stock trading program.

Guarded Stocks

These computer stocks are in a downward trend, with huge downside potential. Plenty of opportunity for puts here.

• Wal-Mart Stores (NYSE:WMT)
• Disney (NYSE:DIS)
• Activision Blizzard (NASDAQ:ATVI)

Drifting Stocks

These stocks are in a downward trend like the guarded stocks, but have not broken down yet.

• Nike (NYSE:NKE)
• Costco (NASDAQ:COST)

Sell Watch

Sell these stocks on any further weakness—they’re not worth the heartache. Sirius and Best Buy in particular are among the weakest stocks in downward trends. Sell on any continued weakness.

• Nordstrom (NYSE:JWN)
• J.C. Penney (NYSE:JCP)
• Sirius (NASDAQ:SIRI)
• Mattel (NASDAQ:MAT)
• Best Buy (NYSE:BBY)
• Amazon (NASDAQ:AMZN)

Excellent Buys

These stocks are in upward trends and show the greatest upside potential. Buy or play calls on these.

• Brunswick (NYSE:BC)
• Take-Two Interactive Software (NASDAQ:TTWO)
• Gamestop (NYSE:GME)

Ken Trester is editor of the popular Maximum Options program. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.