Symantec Corp. (SYMC)
(2/5/07)

SYMC caught my eye, as it had achieved a 21-day Put/Call ratio reading of 2.01 just a week and a half ago, and has begun to fall.  A falling Put/Call ratio that is still relatively high is often a sign of accumulation starting to develop.  While it's no guarantee that the ratio can't start ticking up again, short interest in the stock also reduced by over 3 million shares between December and January, an indication that the "smarter money" has been pairing down shorts.   At any rate, we think at least a near-term upside opportunity is being indicated.

Our Elliott Wave model for SYMC suggests two possible courses for the stock to take since its 14 low of July. One would be a simple ABC corrective rally, which offers upside potential of 22 to 24, possibly 26 or 29 from current levels. A more bullish interpretation would be a Wave (5) rally that would retrace and exceed the stock's $34 high of December 2004. This latter scenario would be nice, although we would need to see a very compelling recovery towards the lower price targets before we entertain that prospect. At any rate, these are the two possibilities suggested by the current technical pattern.  The 17 area is a strong level of price support, and we'd suggest 18.50 as an entry, with a stop at 16 level.

For an option play, you can consider the July 2007 $17.50 Call (symbol SYQGW), currently selling for $1.90 with a healthy Delta of 0.65.  

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