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trade stock, stock recommendation
Begin part 3 of 3
THE PLAYS
Upside:
Play Date: 09/10/2008
BIG (Big Lots--$32.56; -0.25; optionable): Discount bargain lot stores
http://biz.yahoo.com/p/b/big.html
EARNINGS: Announced 8-26-08
STATUS: Ascending base. BIG turned a break of the 90 day SMA in late August after earnings into a higher low, forming up an 11 week base that is the right shoulder of a much larger 15 month reverse head and shoulders base. After the surge higher Monday it has tested back very lightly, tapping the 10 and 18 day EMA on the Wednesday low and rebounding to flat. Looks very good after this higher low and a break higher on strong trade again is a buy.
Volume: 3.019M Avg Volume: 3.303M
BUY POINT: $33.32 Volume=4.6M Target=$39.95 Stop=$31.11
POSITION: BIG AZ - Jan. $32.50c (54 delta) &/or Stock
http://www.investmenthouse.com/ci/big.html
Play Date: 09/10/2008
MTH (Meritage--$25.86; +0.90; optionable): Residential construction
http://biz.yahoo.com/p/m/mth.html
EARNINGS: Announced 7-28-08
STATUS: Breakout test. Gapped higher Monday on the Treasury takeout of the mortgage market, clearing a 5 month cup with handle base of sorts with a big swoosh higher. Faded Tuesday as did most everything, but started back up MTH on rising, above average volume. As noted in the market summary, one of the homebuilders that is part of the early cycle economic moves. After this test looking for a resumption of the move higher.
Volume: 1.659M Avg Volume: 937.4K
BUY POINT: $26.11 Volume=1.5M Target=$31.35 Stop=$23.91
POSITION: MTH LE - Dec. $25c (68 delta) &/or Stock
http://www.investmenthouse.com/ci/mth.html
Play Date: 09/10/2008
NNI (Netnet, Inc.--$15.42; +0.39; optionable): Education planning and financing
http://biz.yahoo.com/p/n/nni.html
EARNINGS: Announced 8-11-08
STATUS: Double bottom w/handle. Nice easy pullback the past 7 sessions, forming a handle to its 10 month base. Strong rally in August formed the right side of the pattern and this is a very nice pullback to near support at the 18 day EMA (14.72). Good upside volume shows some nice buying continues. Very nice and ready to move in as NNI completes this test and starts back to the upside.
Volume: 321.707K Avg Volume: 268.995K
BUY POINT: $16.11 Volume=400K Target=$19.45 Stop=$14.98
POSITION: NNI LC - Dec. $15c (51 delta, 142 OI) &/or Stock
http://www.investmenthouse.com/cd/nni.html
Downside:
Play Date: 09/10/2008
GDI (Gardner Denver--$40.48; +2.86; optionable): Compressors, vacuum products, fluid transfer products
http://biz.yahoo.com/p/g/gdi.html
EARNINGS: 10-22-08
STATUS: Put. Struggling. Gapped lower in late July after earnings, falling to the 200 day SMA (42.10). Held and bounced into August, but stalled at near resistance at the 10 and 18 day EMA. Broke sharply lower Tuesday through the 200 day SMA on the strongest volume in over a month. Rebounded with the market Wednesday on lower, below average volume, a pretty modest relief bounce that is setting up another downside leg for GDI. It may come up further and actually test the 200 day; all the better. If it does we will follow it up, and when it turns back over and starts to sell we will look to move in and ride the next leg lower. A move to the target lands a 90%ish gain.
Volume: 738.706K Avg Volume: 715.851K
BUY POINT: $39.94 Volume=900K Target=$37.00 Stop=$41.21
POSITION: GDI VH - Oct. $40p (-69 delta)
http://www.investmenthouse.com/ci/gdi.html
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.
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trade stock
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