|
|
yahoo stock, us stock market
Begin Part 2 of 2
THIS WEEK
A pretty big week of economic reports once again. After the 'disappointments' of the Philly Fed and the LEI, new and existing home sales, durable goods orders, consumer confidence (Conference Board and Michigan), final GDP, Chicago PMI, and personal spending will get a close eye. Investors will want to see the reports give some upside surprises once again.
The S&P and Dow are set up to make a move higher after the late-week test of the bottom of their trading ranges. Yes things got a bit hairier at the end of last week, but again, the price/volume action has remained solid as the two indexes test lower in the handles of their cup with handle patterns. That is more like classic shakeout action than a breakdown.
Of course, we were looking for a breakout last week but it was thwarted with the GE and INTC comments that helped some of the selling Wednesday and Thursday. The fact that it was shaken by that news showed it was not ready to make the move. It was able to recover, getting rid of some more investors that were ready to sell and keeping the pattern as well. It is set up, but as we said two weeks back, until the breakout occurs, it is nothing more than another pretty picture (or in this case, chart).
Support and Resistance
Nasdaq: Closed at 1851.39.
Resistance: 1875, the bottom of the November consolidation, stopped the move higher Thursday and the intraday high Friday. The simple 50 day MVA (1868.77) and then the 200 day MVA (1888.16) is next and what stopped the recent rally attempt. The top of the November consolidation at 1934 to 1941. After that is 1980 (the December gap up point) and some minor resistance at 2000. Then the January top at 2098.88.
Support: 1850 was broken Wednesday, but the index jumped right back over it and it held again Friday. 1840, the early November gap up point, has provided little help. After that, it is pretty sparse down to 1800 to 1775.
S&P 500: Closed at 1148.70.
Resistance: The December high (1173.62) and the January high (1176.97). That point also marks roughly the lows of summer 2001 consolidation that runs up to 1240. Before that point there is some resistance at 1183 from March 2000.
Support: 1150 down to the 200 day MVA (1144.18). After that, 1125 is the hump in the double bottom, and the simple 50 day MVA (1127.95) and exponential 50 day MVA (1136.04) are converging. 1100 has acted as support as well.
Dow: Closed at 10,427.67
Resistance: The top of the June, July, and August 2001 trading range at 10,600 (10,679 intraday high), is still holding it back. 10,800 represents some resistance. That is followed by resistance at 11,000 on its way to the May 2001 high at 11,345.72.
Support: 10,400 held on the close once again, though it was again violated intraday. That is followed by the January high at 10,300. Then the 200 day MVA (9995.19) and 10,000 teaming up together.
Weekly Economic Calendar (All times Eastern). The figures are the consensus expectations, not ours.
3-25-02
Existing Home Sales, February (10:00): 5.50M versus 6.04M prior.
3-26-02
Durable Orders, February (8:30): 1.0% versus 2.6% prior.
Consumer Confidence, March (10:00): 98.0 versus 94.1 prior.
3-27-02
New Home Sales, February (10:00): 880K versus 823K prior.
3-28-02
Initial Claims, 3/23 (8:30): 375K versus 371K prior.
GDP-Final, Q4 (8:30): 1.4% versus 1.4% prior.
Chain Deflator-Final, Q4 (8:30): -0.2% versus -0.2% prior.
Mich Sentiment-Rev., March (9:45): 95.0 versus 95.0 prior.
Chicago PMI, March (10:00): 54.0 versus 53.1 prior.
Help-Wanted Index, February (10:00): 47 versus 47 prior.
Personal Income, February (8:30): 0.2% versus 0.4% prior.
Personal Spending, February (8:30): 0.4% versus 0.4% prior.
TEAM TRADES
LOOK: As we have been doing for the past few months, we have been trolling for smaller cap stocks in patterns that can give us good moves higher. LOOK is way off of its former high, but it has received a surge of buying over the past two months and formed a beautiful ascending wedge above the 50 day MVA. Its trading range was narrowing as volume fell well below average. The only time it jumped up was on slight up sessions with big volume spikes. Really good signs. Friday LOOK opened flat, but an hour into the session it zoomed up right to the breakout point on a huge volume spike. Then it moved laterally for two hours in a very tight range just below the 2.94 pivot point. Then it made the move and we sent off the alert. We were able to catch the play right over $3. The stock then banged around in a range from $3 to $3.10 for the next two hours before its next leg up carried it over 3.40. Huge volume on the break.
THE PLAYS:
Reading the Plays: Please note that when we reference the 10, 18, and 50 day moving averages (MVA), those are exponential moving averages (EMA). The 200 day moving average is always simple (SMA). We will note when we reference a particular MVA differently, e.g., a simple 50 day MVA. Please click on the Yahoo and chart links for company and charting information. A "prior high" refers to the high at the start of a base.
For conserving space on listings of stop losses, the symbol (7%) indicates that the stop is 7% below the buy point.
Good movers: You sure would not have known the market was down looking at many of the stocks on the report. As we say, good patterns with accumulation hold up better when the market gets a bit sloppy.
LOOK exploded from the pennant, ASL from its ascending wedge, and IMH hit our aggressive buy point in the pennant/wedge on strong volume! Others on the report that looked good Friday were MVL (great move), bouncing on huge volume from its 10 day MVA and JH, finally making its move from the 18 day MVA! NWK looked super Friday, moving up from the 50 day MVA on strong volume and looking ready for a breakout from the pennant. See the 3-09 report (aggressive buy point is 5.50).
Stocks/Indexes from Thursday's report:
CMX: Continued its pullback in the test of the breakout, volume remaining below average. Looks good!
YHOO: Showing a tight doji above support in the handle to its double bottom; volume lower as the handle continues to firm up.
LOOK: Super breakout from the pennant! Volume was just huge. Looking for a pullback because it is well above 5% over the buy point.
CACOA: Pulled back down on lower volume to test support at 23 in the test of the breakout.
GAP: Strong volume and an attempt to break out, but pulled back down below resistance. A hold for positions taken at the pivot (28.10).
HB: That was a nice move Thursday but HB pulled back on lower volume next day; held some support at 60 on the move for a loss of $0.46.
Continued Plays: Still like SYXI, SBUX, ISSX (put); all from 3-20. Also, INVN (3-05), PLCM (put).
ADBE: Up on rising volume on a bounce from the 18 day MVA. A hold for buys at 38.
BBX: Testing the breakout from its ascending wedge as volume decreases. A hold and we are looking at more on another move up on strong volume!
CHPC: Continued higher in the handle to its cup base!
NSC: Getting ready for a 50 day MVA bounce but may need another 1-2 days to consolidate.
NVLS: Forming an ascending wedge above its 10 day MVA. Setting up, then, for another rally in the chip sectors.
PETM: Tight lateral move on low volume. New buys over 13.40!
SPF: Nice bounce from the 50 day MVA on Friday! Volume high though slightly lower, and the stock closed just above the 18 day MVA. From there, a buy over 30 for stock and/or June $25 calls.
UNTD: Testing the breakout from the flying plateau. A hold for buys at 7.20; new buy point from here is over 7.75 for stock.
SUBSCRIBER'S CHOICE:
FAX (Aberdeen Asia-Prime--$4.23; +0.01; no options): Closed-End Fund
http://biz.yahoo.com/p/f/fax.html
STATUS: In a 7-month cup base and moving up the right side in a very nice uptrend since early this year (lows at the 3.80 range). The cup is part of a 15-month rolling range between 3.80 and 4.40. Earlier this week FAX broke through some resistance at the October and November tops (4.19-4.18 respectively) in a strong volume move that broke the stock to a new March closing high at 4.24. It pulled back slightly, testing and holding support at 4.20; volume was down Friday to 751,900 (avg. 654,000). Looks like a handle to the cup is forming here; the best action is for volume to continue to fall back below average, and the stock consolidate further in the handle showing declining prices, ahead of the breakout. Can look at taking partial positions on the breakout for the initial move up to the 4.40 range where it may form another handle before breaking out of the rolling range. Money flow strong, buying excellent. Target: 5
BUY POINT: Breakout from here: 4.34 on volume of 981,000 or higher. Stop Advisory (7%): 4.04
POSITION: Stock.
http://www.investmenthouse.com/cd/fax.html
Best Plays:
1) SNIC: Blasting higher!
2) LQI: Looks ready to try a breakout.
3) DGX: Ready for upside now.
New plays:
SNIC (Sonic Solutions--$7.55; +0.86; no options): Business Software
http://biz.yahoo.com/p/s/snic.html
STATUS: SNIC is making a big move off of its 18 day MVA (6.61), blasting up on a surge in volume to 264,600; average is 315,454 on a breakout from a 10-week pennant pattern. No news to back up the move, but a strong bounce following a nice low-volume shakeout. Looking for a move up to breakout, eyeing aggressive entry points if volume continues to ramp up. Huge money flow and good buying. Target: 9.75
BUY POINT: Aggressive: 7.65 on volume in the range of 320,000 or higher. Stop Advisory (7%): 7.11. Breakout: 8.30 on volume of 426,000 or higher. Stop Advisory (7%): 7.72
POSITION: Stock.
http://www.investmenthouse.com/cd/snic.html
LQI (La Quinta--$7.11; +0.13; no options): Real Estate: Diversified/Industrial
http://biz.yahoo.com/p/l/lqi.html
STATUS: LQI looks ready to break out of a shallow, 7-week cup base it formed after breakout out of double bottom with handle in January. The stock formed a little ascending wedge since the first of this month, and bounced up from support at the 18 day MVA (6.79) on a strong shot of volume, 507,900 (avg. 390,181) Friday. Looks like it will try for a breakout here! Shows excellent money flow and high relative strength. Target is 9.45.
BUY POINT: 7.27 on volume of 527,000 or higher. Stop Advisory (7%): 6.76
POSITION: Stock.
http://www.investmenthouse.com/cd/lqi.html
PORTFOLIOS: Each report, we look at these to see which is in a buy position. We don't cover them all each time, just the ones that look ready to pick up a few shares.
THE LEADERS: DGX, FRX, LLL, MIK.
FRX (Forest Labs--$83.43; +0.66): Drug Manufacturers
http://biz.yahoo.com/p/f/frx.html
STATUS: A decent run off of the 50 day MVA earlier this month, topped at 85 and fell back to test the 18 day MVA, tested on Friday's low of 82.17. Volume has been well below average on the pullback, down Friday to 650,100 (avg. 1.25 million), so with the hold at support we expect FRX to make another run from here. The low volume bounce was weak from the 10 day MVA, so unless volume rolls in right away the stock can test the 10 day range (82.62). Target: 91
BUY POINT: Aggressive: 83.75 on volume in the range of 750,000 and higher. Stop Advisory (7%): 77.89.
POSITION: Stock and/or August $75 calls to buy (FRX HO).
http://www.investmenthouse.com/cd/frx.html
DGX (Quest Diagnostics--$79.31; +0.51): Health Services
http://biz.yahoo.com/p/d/dgx.html
STATUS: We did not get a big move out of the covered call play; target was the 10 day MVA (where the stock is now holding support for the second day), which moved up a point from where it was when we wrote the play (sell point was 80.50; 10 day MVA is at 78.19). About even on the play, so closing it out and looking for more upside. DGX broke out of an ascending wedge earlier this month for a nice breakout run (high at 81.70) which set up the covered call, but now after the test it looks ready to head back up. The pullback was on steadily, decreasing volume - a very nice pattern. Friday's volume was lower at 245,200 (avg. 522,000). Looking for a bounce. Money flow is strong. Target: 85.80
BUY POINT: Aggressive: 80.45 on volume of 550,000 or higher. Stop Advisory (7%): 74.82
POSITION: Stock and/or August $75 calls to buy (DGX HO).
http://www.investmenthouse.com/cd/dgx.html
APPB ($36.09; +0.77): Tried to move higher in an ascending wedge the stock formed since mid-February. Volume rose Friday just above average, with APPB hitting at upper resistance (37.15) before pulling back down into a loose doji at the 18 day MVA. Still a decent pattern, the wedge tucked into a two-month base with a high at 38.12. Buy point is 37.42 for a breakout, stock and/or August $30 calls to buy.
MIK ($38.00; -0.66): Hit the sell point for the covered call (38.40) Thursday, then showed some selling with volume rising on the price decline. Looking for a move down to the 18 day MVA, the initial target (when the play was first written it was at 36; now it is at 36.52).
LLL ($109.63; -1.63): Headed lower again for the covered call play after making that lower volume double top and starting down on rising volume. Target is the 50 day MVA at 106 (was at 105 when the play was written). Volume was lower and below average, but the stock remains beneath its 18 day MVA at 111.71.
UP & COMERS PORTFOLIOS: BBBY, SRCL
SRCL ($63.62; +0.12): Still below the 18 day MVA (64.34) with volume very low, the stock showing a doji after Thursday's bounce back up from a test near the 50 day MVA. That is a hold above the most recent tops from December (62.85), and it would be positive for SRCL to continue to keep that support. If it doesn't, the 50 day MVA is likely support (61.76).
BBBY ($32.01; -0.30): BBBY remains in the lateral consolidation, but since the first of March is in a descending wedge pattern. That does not mean that it will break down from it, but the stock continues to be pressured from the up trendline and upper resistance at the 50 day and 18 day MVAs (the former at 32.78). Volume is low; if it heads down, the 200 day MVA is at 30.59, and to the upside it will have resistance up to 35 (overhead supply in the flat base).
MEMBER PORTFOLIO: CSCO, SEBL, EMLX, BRCM, HDI, BRCD, BUD, AMGN, WMT, ORCL, HB, NOC
WMT ($62.05; -0.15): Closed below its 18 day MVA (62.18), but was showing a pretty tight hammer doji on low volume. The low tapped support at a short term up trendline (Feb/Mar lows) and the low volume didn't allow a move back over resistance. WMT is showing resilience, but it may not be able to hold up and make the drop to the 50 day MVA (60.40).
HDI ($54.51; +0.23): The stock remains in the ascending wedge pattern, so far relatively unphased by the news that the EU is considering putting tariffs on the motorcycles. Volume was higher Friday and the stock was up nicely, selling back mildly after lunch. The pattern still looks good (3-12). The Europeans want to place tariffs on hawgs. The nerve.
Good Investing!
Jon L. Johnson and The Daily 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.
|
yahoo stock
us stock market
|
