Wild Oats Markets (OATS)

Company

"Wild Oats Markets, Inc. is a nationwide chain of natural and organic foods markets in the U.S. and Canada. The Company currently operates 108 natural food stores in 24 states and British Columbia, Canada. The Company's markets include: Wild Oats Natural Marketplace, Henry's Farmers Market, Sun Harvest and Capers Community Market. " (company website)

Buy

24-Mar-05. OATS has crossed above both the 50- and 200-day moving averages in the past two weeks. The trend has picked up strength (ADX). I had decided yesterday that I would buy a position and put in a buy order. To my astonishment, OATS was up over a dollar this morning, and before I could stop it, my order had partially executed. It's not clear what is driving the rapid price advance, but it is unsustainable, which is why I stopped the order. A much more reasonable entry price would be about $8.75, the 200-day average.

26-Apr-05. For the past month, OATS has been consolidating around $10, and since my earlier purchase the 50-day moving average has crossed above the 200-day average. Yesteday OATS bumped up against the upper Bollinger band and began to stretch it out today. There has been a nice uptick in buying pressure (+DI) and the trend is strengthening again (ADX). There's also been an uptick in price momentum (PPO).

I'm hedging my bets a little, though. I bought only enough to bring my stake up to 500 shares, half of what I would normally buy.

Sell

4-May-05. Hedging my bet was good. After I added shares, OATS went back to $10. Today it got back up to $10.90, and for a while it looked like there might be a strong finish. That didn't work out, and when it dropped back to $10.80, I put in an order to sell. Overall, I have a modest profit.

I got into OATS at a much-too-high price, and then I added shares without waiting to make sure the rise would stick. Earnings are due out Friday before the market opens. Since anything could happen then, it's probably best that I take the available profits now. If the earnings report is stupendous, I can always jump back in again.