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Two Ways To Play: Nintendo Plays the Competition


Strengthen your portfolio in good times and bad.


Nintendo Going for the Kill

Nintendo (NTDOY) is showing its killer instinct. According to Bloomberg, the company is using a strategy of adding accessories to its Wii console and upgrading the DS player rather than cutting prices to match competitors Sony (SNE) and Microsoft (MSFT).

Wii's $250 price tag has remained unchanged since its debut; by adding products and not cutting the cost customers won't feel buyer's remorse. Analysts at Pali said Nintendo President Satoru Iwata will likely unveil the changes tomorrow at a press conference.

From the Bull Pen: Even bad stocks can have their days. Sony, sitting at multi-year support ($30) recently registered DeMark buy signals on the daily chart hinting that selling may be exhausted. Sell stops can be set below that mark.

From the Bear Cave: Good company, but tough market. Former support for Nintendo at $55 is now resistance. Bears can test the downside if the stock can rally to that level.

GameStop Shops in France

From Cantor News, GameStop (GME) will acquire French video-game retailer Micromania from private equity fund L Capital. The deal is for $700 million and GameStop will fund the transaction with cash, as well as draw on a credit line and a $150 million term loan. Micromania's 332 locations in France will bring GameStop's worldwide locations to almost 6000. The acquisition is expected to close in November and the company sees it being accretive to both fourth quarter 2008 and fiscal 2009 earnings.

From the Bull Pen: Going with the gaming and entertainment theme, bulls can look to Hasbro (HAS) for the upside. Note the importance of $34 support. Sell stops can be set below that level.

From the Bear Cave: Is GameStop headed for the $30 strike? Those bearish can attempt the downside with buy stops above $35.

For more ideas in real time throughout the trading day, check out Minyanville's Buzz & Banter.

Quick Check Around the World

Asian trading closed with the Nikkei +0.96%, Sensex +1.51%, Taiwan +0.78% and Shanghai -0.16%.

Quickly checking Europe, we see the CAC +0.12%, DAX -0.52%, FTSE +1.42%

As of 8:10 a.m. EST, S&P Futures are trading -12 points to 1156 and Nasdaq futures are down -15 points to 1589.

A Look At Commodities

Commodities are mixed. Crude oil is trading -0.94 to 99.69. Gold is -4.10 to 876.90. Silver +0.110 to 12.385, and copper -1.55 to 287.25.

The dollar index is -0.036 to 79.402.

On the Radar


7:00 MBA Mortgage Applications
8:15 ADP Employment Change: -50 k cons.
10:00 ISM Manufacturing: 49.8 cons.
10:00 Construction Spending (m/m): -0.5% cons.
10:00 ISM Prices Paid: 72.3 cons.

Click here for the full trading radar.

Is it only Wednesday? Good luck today!

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No positions in stocks mentioned.

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