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us stock market, trend trading stock
Begin part 3 of 3
THE PLAYS:
New Post-Split Plays:
Play Date: 07/29/2008
CSX (CSX Corp.--$64.83; +3.01; optionable): Railroads
http://biz.yahoo.com/p/c/csx.html
EARNINGS: Announced 7-24-08
STATUS: Cup. CSX made us money on the strong run to start 2008, and now that it looks to be completing this 10 week base, it looks ready to make us some money again in the near term. Making a higher low at the 50 day EMA (62.14) the past week, bouncing Tuesday on rising volume. Loving the rails right now and looking for CSX to cover some ground quickly on its break higher.
Volume: 4.501M Avg Volume: 4.958M
BUY POINT: $65.34 Volume=7M Target=$74.95 Stop=$62.15
POSITION: CSX KM - Nov. $65c (56 delta) &/or Stock
http://www.investmenthouse.com/ci/csx.html
Play Date: 07/29/2008
SNHY (Sun Hydraulics--$39.92; +1.54; optionable): Industrial electrical equipment
http://biz.yahoo.com/p/s/snhy.html
EARNINGS: 8-5-08
STATUS: Reverse head and shoulders. Neat little 10 week base has formed with SNHY using the recent selling to form the right shoulder of the pattern. This formed to consolidate a larger 10 month base breakout in early May. Very nice setup for the breakout to a new all-time high form a great leader.
Volume: 109.821K Avg Volume: 180.017K
BUY POINT: $40.75 Volume=270K Target=$48.95 Stop=$37.90
POSITION: SQA IH - Sept. $40c (56 delta) &/or Stock
http://www.investmenthouse.com/ci/snhy.html
Play Date: 07/29/2008
WFC (Wells Fargo--$30.46; +2.53; optionable): Big bank
http://biz.yahoo.com/p/w/wfc.html
EARNINGS: Announced 7-16-08
STATUS: Trend reversal. Announced great earnings to get the financial recovery, at least for the big banks, underway. A solid rally through last week, and a test through Monday to the 50 day EMA (26.77) and then a surge back up Tuesday on strong, above average volume, clearing the down trendline and the 200 day SMA (29.46). Nice action and ready to move in as WFC continues higher.
Volume: 62.309M Avg Volume: 46.979M
BUY POINT: $30.88 Volume=60M Target=$35.95 Stop=$28.72
POSITION: WFC JF - Oct. $30c (59 delta) &/or Stock)
http://www.investmenthouse.com/ci/wfc.html
Play Date: 07/29/2008
WSO (Watsco--$50.42; +1.83; optionable): Wholesale electronics
http://biz.yahoo.com/p/w/wso.html
EARNINGS: Announced 7-17-08
STATUS: Test breakout. Raced higher on strong earnings, clearing an 11 week base that formed using the 200 day SMA (40.33) as support. Spent the past week testing, coming back to the 10 day EMA (48.35) Monday, holding, then breaking higher Tuesday. Tuesday volume was nothing to get all excited about, but really like the pattern and the position for a rapid gain higher. Strong money flow leading the way higher. Ready to move in as WSO continues its move higher.
Volume: 243.401K Avg Volume: 320.312K
BUY POINT: $50.77 Volume=450K Target=$59.95 Stop=$48.22
POSITION: WSO KJ - Nov. $50c (54 delta, 104 OI) &/or Stock
http://www.investmenthouse.com/ci/wso.html
New Leader Play:
Play Date: 07/29/2008
EDU (New Oriental Education & Tech--$74.47; +2.08; optionable): Chinese education and training courses
http://biz.yahoo.com/p/e/edu.html
Announced 7-17-08
STATUS: Cup w/handle. Working on a two week handle to its 10 week base, working laterally on low volume as the 10 day EMA (72.35) rises to meet it. Part of a larger 9 month base, making a higher low here setting up for a new breakout. Volume rose to average Tuesday as EDU made the test of the 10 day and bounced. In great position to make the break higher. A very volatile stock, but a very nice base and it can run like the wind when it gets going.
Volume: 673.242K Avg Volume: 657.128K
BUY POINT: $76.88 Volume=986K Target=$86.95 Stop=$72.22
POSITION: EDU JO - Oct. $75c (52 delta) &/or Stock
http://www.investmenthouse.com/cs/edu.html
PRE-ANNOUNCEMENT PLAYS
We consider many stocks for pre-announcement plays every week. We get information regarding upcoming announcements and other data that leads us to conclude a split announcement is coming. Even then, however, we have to be discriminating. We have to see a strong technical pattern as well, and thus we reject many potential candidates based on a weak technical position.
The key today is to find stocks in strong patterns or that are ready to rebound off support. A split announcement will amplify the move higher in these cases as we enjoy moves from strong leaders in position to run higher. We won't chase a stock in a poor technical position even if we know it is going to split; it simply won't do us any good, i.e. it typically won't make us any money to the upside. We could list all stocks we think are going to split, but again, that won't make us any money unless we are in an office pool as to what stocks will or won't announce a stock split.
Current Pre-Announcement Plays:
This is a list of stocks we are looking to announce splits. We are not in all of the potential splits plays but are letting them set up for the next move. In each report we look at the candidates that are in the best patterns ahead of their potential announcements. This focus on leaders in good patterns allows us to make good money even if companies do not announce the split. The key with splits is the pattern and of course the strong earnings growth that put it in the pattern in the first place.
ACL: No announcement with earnings on 7-23-08 but still working well.
APD: Tentatively set for third week of July. Still trying to recover off a 200 day SMA test.
BAX: Setting up for a new buy.
BKE: Forecast 8-21-08
BMI: No announcement on 7-21-08 but excellent move higher
CMTL: Researching date
FCN: Early August
IBM: Setting up for the next breakout move
NCR: Reported earnings but no split. A wild session but still in the pattern.
TMX: Wildcard as it has been a long time since a split but a nice pattern. Nothing from TMX regarding a split this week.
VAR: Forecast third week of July. No split announcement but a big gap higher on strong volume.
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 07/29/2008
BAX (Baxter Intl.--$67.28; +0.24; optionable): Medical instruments
http://biz.yahoo.com/p/b/bax.html
EARNINGS: Announced 7-17-08
STATUS: Test 18 day EMA. Looking to move into BAX as it used the market selling to pullback and consolidate some of its nice gain in July, holding at the 18 day EMA (66.59) on the Tuesday low before rebounding for a gain. Nice breakout from a 6 month base in late June, solid rally. This breakout test is one of our favorite entry points and a great point to move into BAX and take more positions as it continues higher off of the test.
Volume: 2.759M Avg Volume: 3.695M
BUY POINT: $67.77 Volume=4.5M Target=$76.38 Stop=$65.91
POSITION: BAX KM - Nov. $65c (66 delta) &/or Stock
http://www.investmenthouse.com/ci/bax.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 07/26/2008
BKE (Buckle, Inc.--$51.47; +0.78; no options): Apparel stores
http://biz.yahoo.com/p/b/bke.html
EARNINGS: 8-21-08
STATUS: Double bottom w/handle. Nice break higher Tuesday and though it closed off its high still in good position to move even higher. Still a buy on this move. To recap: Strong move higher early last week, trying the breakout from an 8 week base, showing strong volume on Tuesday as it made the break higher. Slipped back on low volume Thursday and Friday, holding over near support at the 10 day EMA (49.39) on the intraday lows. A retailer that is in great shape. Just want some more volume as it makes the next upside break.
Volume: 520.909K Avg Volume: 427.006K
BUY POINT: $52.05 Volume=550K Target=$59.95 Stop=$49.22
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/bke.html
Play Date: 07/26/2008
IBM (International Business Machines--$127.66; +1.41; optionable)
http://biz.yahoo.com/p/i/ibm.html
EARNINGS: Announced 7-17-08
STATUS: Cup w/handle. Testing the 18 day EMA (126.32) and holding nicely. Moved the buy point to accommodate this test and looking for a stronger break higher to give us the buy. To recap: After breaking higher last week on a strong earnings report, IBM is moving laterally just below 130, trading in a flat range. It is forming the consolidation to its 8 week pattern, the handle shakeout at the prior high reached in May as the base started. After this test of the 10 day EMA (127.58) we are looking for a renewed breakout on volume to move into new positions.
Volume: 5.979M Avg Volume: 8.062M
BUY POINT: $128.55 Volume=10M Target=$145.95 Stop=$126.44
POSITION: IBM JF - Oct. $130c (49 delta) &/or Stock
http://www.investmenthouse.com/ci/ibm.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 07/26/2008
APH (Amphenol Corp.--$49.15; +1.35; optionable): Electronics
http://biz.yahoo.com/p/a/aph.html
EARNINGS: Announced 7-17-08
STATUS: Breakout test. Nice bounce off the 18 day EMA on rising, average trade. Good test, good surge, ready to move in as APH continues higher. To recap: APH surged on earnings, breaking out from a short 6 week cup that formed following a 6 month cup with handle base. Strong surge on strong volume, coming back to the 18 day EMA (47.71), holding just above that level Friday, showing a doji on rising volume. Strong move to a new high, testing it back to support, still looks good for a rebound and a new high once more.
Volume: 1.376M Avg Volume: 1.337M
BUY POINT: $48.89 Volume=2M Target=$56.95 Stop=$47.48
POSITION: APH JI - Oct. $45c (69 delta) &/or Stock
http://www.investmenthouse.com/ci/aph.html
Play Date: 07/18/2008
IXYS (Ixys Corporation--$12.22; +0.19; optionable): Power semiconductors, integrated circuits, etc.
http://biz.yahoo.com/p/i/ixys.html
EARNINGS: Late August
STATUS: Double bottom w/handle. Nice tight doji at the 10 and 18 day EMA on low volume, ready to make the move higher. Nice tight range often precedes the breakout move. To recap: After a roaring surge in late May on its last earnings report IXYS has formed the current 6 week base over a rising 50 day EMA that still has some catching up to get to IXYS. IXYS formed this base on top of the October peak that started the 8 month base IXYS jumped out of in May. A nice consolidation that used the market selling in early July to put in the second bottom to the base and lay the groundwork for the next breakout and run higher toward a 3-year high. Very solid. There are a group of semiconductor stocks moving to the fore similar to a cycling team moving to the front of the peloton to position itself for the ending sprint. Okay, a bit heavy on the Tour de France references of late, but when you have a sprinter such as Mark Cavendish taking four sprint stages you tend to get carried away.
Volume: 190.336K Avg Volume: 252.948K
BUY POINT: $12.66 Volume=350K Target=$15.31 Stop=$11.77
POSITION: UXS JV - Oct. $12.50c (49 delta, low OI) &/or Stock
http://www.investmenthouse.com/cs/ixys.html
Play Date: 07/24/2008
JBHT (JB Hunt Transportation--$37.55; +1.47; optionable): Trucking
http://biz.yahoo.com/p/j/jbht.html
EARNINGS: Announced 7-14-08
STATUS: Test breakout. Bouncing off the 10 day EMA Tuesday on rising but still below average volume. That is what kept us out on Tuesday, but if JBHT holds this move and continues higher we can enter into some positions. To recap: JBHT got some mileage out of its earnings announcement and the drop in oil, both combining to break it out of its 10 week base formed from May to early July. That consolidated a larger 9 month pattern starting a year ago; nice large and solid foundation setting up a nice run. It made its first move and how it is testing, falling back Thursday as oil bounced modestly. Held the 10 day EMA on the session low with lower volume as it comes back. That shows few sellers, and after this test we look to pick up JBHT as it makes the bounce higher.
Volume: 2.35M Avg Volume: 2.66M
BUY POINT: New: On a continued move higher (orig. $37.28) Volume=4M Target=$43.95 Stop=$35.77
POSITION: JHQ KG - Nov. $35c (59 delta) &/or Stock
http://www.investmenthouse.com/ci/jbht.html
CONTINUING LEADER PLAYS:
Play Date: 07/24/2008
CMED (China Medical Technologies--$46.56; +0.16; optionable): Chinese medical instruments
http://biz.yahoo.com/p/c/cmed.html
EARNINGS: 8-4-08
STATUS: Double bottom w/handle. Nice doji at the 10 and 18 day EMA Tuesday as CMED tested lower and recovered to flat. Nice set up for the break higher and just waiting for it to make the move. To recap: Seeing this pattern quite a bit of late: a larger double bottom with handle with the handle forming its own little double bottom with handle over the past four weeks. CMED rallied with the market, moving off its second leg in the double bottom. Pulled back some Thursday on low volume, tapping the 10 day EMA (45.27) on the low and then rebounding to recoup some losses, bouncing a big more Friday. It looks ready to test a bit more toward the 10 day EMA and when it bounces off that on solid trade we start picking up some positions.
Volume: 414.238K Avg Volume: 538.123K
BUY POINT: $47.04 Volume=800K Target=$56.95 Stop=$45.12
POSITION: QCY LI - Dec. $45c (58 delta) &/or Stock
http://www.investmenthouse.com/cs/cmed.html
CONTINUING DOWNSIDE PLAYS
Play Date: 07/24/2008
AFSI (Am Trust Financial Services--$13.38; +0.28; optionable): Insurance brokers
http://biz.yahoo.com/p/a/afsi.html
EARNINGS: 7-29-08 after the close
STATUS: Put. Tried to move through the 50 day EMA (13.39) on rising, above average volume, but faded to close just below that level. Announced earnings and did not get a lot of reaction. The MET earnings and guidance may present a problem for AFSI in the morning and thus we are looking for a chance to move in if AFSI turns down from this key level. To recap: After an ugly spiral lower from April to the second week of July, AFSI rebounded the past two weeks, rallying up to the 50 day EMA (13.41) Wednesday and Thursday, reaching through those levels on the intraday highs but unable to close above those levels on the close. The inability to hold a move over those levels shows weakness at that level. Money flow is low and turning down ahead of price. Ready to move in as it continues lower. A move to the target lands a 45%ish gain.
Volume: 296.764K Avg Volume: 338.789K
BUY POINT: $12.98 Volume=350K Target=$11.22 Stop=$13.92
POSITION: QFF UC - Sept. $15p (-63 delta)
http://www.investmenthouse.com/ci/afsi.html
Play Date: 07/28/2008
AGU (Agrium--$85.08; +0.33; optionable): Ag chemicals
http://biz.yahoo.com/p/a/agu.html
EARNINGS: August 6
STATUS: Put. Third doji below the 90 day SMA, trying to rally after the Wednesday dive lower last week. Weak sector even with MOS reporting good earnings after hours (it could only muster less than a point gain on those results). Will see how it opens up on Wednesday after the MOS results; if the sector is weak AGU will give us a good downside buy. To recap: AGU formed a leaning head and shoulders (not really a signature pattern, just looks like that) the past couple of months and tumbled lower last week, crashing the 90 day SMA (88) as it did. Held some support at 80 and bounced, but on low volume. Tried to reach up to that resistance again Monday but it fell short and then slid back. Money flow is in a cliff dive. Looking for AGU to follow it. A move to the target lands a 41%ish gain (roughly $300/contract). There is a gap higher way back in early April near 65; if AGU is falling hard we will try to keep at least some of the positions open for that move.
Volume: 4.1M Avg Volume: 5.11M
BUY POINT: $84.12 Volume=6M Target=$76.55 Stop=$87.15
POSITION: AGU UQ - Sept. $85p (-45 delta)
http://www.investmenthouse.com/ci/agu.html
Play Date: 07/28/2008
JCI (Johnson Controls--$30.29; +0.92; optionable): OEM auto parts
http://biz.yahoo.com/p/j/jci.html
EARNINGS: Announced 7-17-08
STATUS: Put. Rebounded after the Monday rear kicking, but volume was lower and JCI closed near the 10 day EMA, fading from its high to close. Nice bounce higher gives it a good place to stall and roll over with some downside momentum. Moved up the buy point to account for this low volume bounce to near resistance. To recap: Sold off in late June to early July (what's new about that?) then rebounded for a week along with the market, actually making it through the 50 day EMA (31.11) last Wednesday. It didn't last. Next session it tanked, bounced Friday, but could not take out the 50 day on the close, then collapsed Monday on rising average volume. Money flow is diving. JCI is diving. Ready to move in as JCI makes its next run lower toward the July lows. A move to the target lands a 41%ish gain.
Volume: 3.833M Avg Volume: 4.028M
BUY POINT: $29.64 Volume=5.5M Target=$27.05 Stop=$30.65
POSITION: JCI UF - Sept. $30p (-50 delta)
http://www.investmenthouse.com/ci/jci.html
Good Investing!
Jon L. Johnson and the Stock Split Report Staff.
All of the foregoing is commentary for informational purposes only. All statements and expressions are the opinion of Online Investment Services, LP or its paid consultants and are not meant to be a solicitation or recommendation to buy, sell, or hold securities. We are not licensed or registered in the securities industry. The information presented herein and on our related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolio of Partners of Online Investment Services, LP or its paid consultants may, in some instances, include securities mentioned herein and on our web site. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors.
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