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us stock market, trend trading stock
Begin part 3 of 3
THE PLAYS:
Looked all across the market to find some additional plays in position to bounce on a market rebound rally.
New Pre-Announcement Play:
Play Date: 10/10/2008
USNA (Usana Health Science--$40.50; -0.37; optionable): Drug products
http://biz.yahoo.com/p/u/usna.html
EARNINGS: 10-14-08
STATUS: Cup w/handle. Earnings are next week and USNA is set up pretty well going into the number with this 10 month cup with handle base. USNA has come back to end September and thus far in October, but it found and held the 50 day EMA (37.34) this week, holding that level as support on the lows and bouncing off of that level intraday. Was flat Thursday on low trade as USNA ignored the market selling. In excellent shape to break higher, and ready to move in as it does.
Volume: 149.593K Avg Volume: 259.159K
BUY POINT: $42.11 Volume=400K Target=$48.48 Stop=$39.16
POSITION: UNX AH - Jan. $40c (54 delta, 141 OI) &/or Stock
http://www.investmenthouse.com/ci/usna.html
Former leaders trying to reverse their recent hard selling.
Play Date: 10/10/2008
AGU (Agrium--$37.62; -0.65; optionable): Agriculture chemicals
http://biz.yahoo.com/p/a/agu.html
EARNINGS: 11-5-08
STATUS: Trend reversal. Working laterally this week after the bit late September to early October drop that took AGU out of a decent 13 week base. Good upside volume and lower on the downside as it works laterally. In great position to make a bounce higher on a market bounce. Rather modest initial target, but with these market conditions that would be a great start.
Volume: 11.49M Avg Volume: 5.876M
BUY POINT: $40.21 Volume=10M Target=$49.75 Stop=$37.40
POSITION: AGU AH - Jan. $40c (48 delta) &/or Stock
http://www.investmenthouse.com/ci/agu.html
Play Date: 10/10/2008
MANT (Mantech Intl.--$49.07; -3.38; optionable): Business software
http://biz.yahoo.com/p/m/mant.html
EARNINGS: 10-29-08
STATUS: Test 200 day SMA. Held up very well in the selling and it finally gave in this week, but in doing so MANT tapped the 200 day SMA (48.92) on the Wednesday low and bounced though Thursday it dumped back down. It did close at the 200 day SMA again so no further breakdown. This is the point where the big money steps in or steps out of the stock. Still in very good shape, especially when you consider the market.
Volume: 348.271K Avg Volume: 254.514K
BUY POINT: $51.36 Volume=385K Target=$58.88 Stop=$48.77
POSITION: UUN BJ - Feb. $50c (50 delta, low OI) &/or Stock
http://www.investmenthouse.com/ci/mant.html
Play Date: 10/10/2008
MOS (Mosaic Company--$36.52; +0.77; optionable): Ag chemicals
http://biz.yahoo.com/p/m/mos.html
EARNINGS: No confirmed date
STATUS: Trend reversal. Another stock that plunged lower in late September and early October, turning a pullback into a major selloff. It found support this week and is working laterally in a rather narrow range. With the market sold out we are looking for rips higher from these stocks and MOS is another one in position to make such a move. Look at all of that volume as it works laterally in a tight range. That is an indication of buyers stepping in as fast as the sellers are selling, indicating the momentum on this stock has changed.
Volume: 24.689M Avg Volume: 9.926M
BUY POINT: $39.65 Volume=20M Target=$49.31 Stop=$36.87
POSITION: MOS AH - Jan. $40c (48 delta) &/or Stock
http://www.investmenthouse.com/ci/mos.html
CONTINUING 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.
CELG: Forecast January 2009. Fell through the 200 day SMA and now trying to hold at some support at 55
CHTT: Forecast early October. Still heading lower on this leg. At some support at 65.
CNMD: Possible late October but looking more toward early 2009. No bounce at the 200 day SMA
MVL: Early November. Pretty ugly.
PNRA: Bounced some Thursday off of support at 40. Straight down and looking to see how it recovers.
CONTINUING POST-SPLIT PLAYS:
Play Date: 10/08/2008
SNDK (Sandisk--$17.03; -0.90; optionable): Semiconductor memory chips
http://biz.yahoo.com/p/s/sndk.html
EARNINGS: Third week of October but unconfirmed
STATUS: Test 50 day EMA. Testing the 50 day SMA on the Thursday close as volume fell further below average. Still strong money flow. Still in position to make the break higher. Moved the buy point somewhat to account for this further test. To recap: SNDK formed a double bottom in July and September then gapped higher in mid-September as Samsung made an offer to buy it. It has come back to test that gap over the past three weeks, closing at the August and early September peaks. Strong money flow is leading the way higher as SNDK hangs in and sets up one of the better patterns to rally off of. Looking for some solid volume as SNDK breaks higher off of this test.
Volume: 7.48M Avg Volume: 11.938M
BUY POINT: $18.88 Volume=18M Target=$22.95 Stop=$17.56
POSITION: SWQ AS - Jan. $19c (63 delta) &/or Stock
http://www.investmenthouse.com/ci/sndk.html
Index Plays:
Play Date: 10/06/2008
DIA (Diamonds Trust (DJ30 EFT)--$85.55; -5.85; optionable)
STATUS: Trend reversal. Another dive lower but we are just following it down now and waiting for the bounce. Could be a ripper when it is triggered.
Volume: 44.456M Avg Volume: 27.357M
BUY POINT: $88.32 (orig. $95.88) Volume=35M Target=$99.75 Stop=$8.85
POSITION: BQD LJ - Dec. $88c (50 delta)
http://www.investmenthouse.com/ci/dia.html
Play Date: 10/06/2008
IWM (Ishares Russell 2000--$49.99; -4.47; optionable)
STATUS: Rebound. Similar to DIA, we are just following IWM lower, waiting for it find bottom and reversing so we can ride the rebound. To recap: Another stock that sold unmercifully, breaking it down from its 9 month trading range, gapping lower Monday and selling all the way down to 56.38 before reversing on high volume. Ready to rebound, fill the gap, and test the breakdown from the 65ish level at the bottom of the range.
Volume: 154.54M Avg Volume: 122.143M
BUY POINT: 50.44 (orig. $56.55) Volume=155M Target=$59.89 Stop=$49.45
POSITION: IQX LX - Dec. $50c (44 delta)
http://www.investmenthouse.com/ci/iwm.html
Play Date: 10/08/2008
SPY (S&P Depository Receipts--$90.70; -6.81; optionable)
STATUS: Trend reversal. Looking to catch SPY as SP500 makes its break off of the harsh selling the past two weeks. Gapped lower Monday and gapped lower Wednesday, showing a hammer doji on the candlestick chart. This is pure rebound play given the market action Wednesday and all of the indicators, technical and sentiment.
Volume: 530.107M Avg Volume: 323.532M
BUY POINT: $91.31 (orig. $98.89) Volume=500M Target=$103 Stop=$90.11
POSITION: SWG LL - Dec. $90c (57 delta) &/or Stock
http://www.investmenthouse.com/ci/spy.html
Trend reversal:
Play Date: 10/04/2008
MU (Micron Technology--$3.88; +0.01; optionable): Memory chips
http://biz.yahoo.com/p/m/mu.html
EARNINGS: Announced 10-1-08
STATUS: Trend reversal. Sold back some more Tuesday but still holding its lateral range, not selling off further even as the market dove. Maybe sold out. Will see if it can give us the break higher over resistance at the 50 day EMA (4.71). To recap: MU did not scare anyone short the stock with its earnings report last week, but it bounced modestly on the news as it continues working on hammering out a bottom after a long, long decline. Very solid upside volume the past three weeks as MU bounced up and down in a range from 4 to 5. It tapped at the breakout Friday but faded. In excellent position to make the reversal and break higher, following some newly rejuvenated money flow. A longer shot, but if this market is ready to bottom here then MU is one of the few chips forming up and in position to make a nice break higher.
Volume: 30.689M Avg Volume: 22.255M
BUY POINT: $4.71 (orig. $4.95) Volume=30M Target=$7.94 Stop=$4.60
POSITION: MU AH - Jan. $4.00 (73 delta) &/or Stock
http://www.investmenthouse.com/ci/mu.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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us stock market
trend trading stock
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