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Begin part 3 of 3

THE PLAYS:

Upside:

Play Date: 10/27/2008
FINL (Finish Line--$7.44; +0.34; optionable): Sports apparel stores
http://biz.yahoo.com/p/f/finl.html
EARNINGS: Announced 9-25-08
STATUS: Double bottom. FINL is making its first test of the trend reversal that started at the beginning of 2008. Nice reversal and rally through August, then selling back September to early October, finding support at the key 200 day SMA (7.14). It held and has worked laterally the past three weeks, forming something of a double bottom at that level. After falling off to below average during that test, volume has started to swell the past three sessions. Strong money flow is out ahead of price and working higher as it tests. Very positive divergence and FINL looks ready to leave the starting blocks.
Volume: 1.065M Avg Volume: 1.342M
BUY POINT: $7.92 Volume=2M Target=$10.00 Stop=$7.08
POSITION: IUL BU - Feb. $7.50c (53 delta) &/or Stock
http://www.investmenthouse.com/ci/finl.html

Play Date: 10/27/2008
RAH (Ralcorp Holdings--$64.33; -1.52; optionable): Processed & packaged food, beverages
http://biz.yahoo.com/p/r/rah.html
EARNINGS: 11-11-08
STATUS: Test 50 day EMA. RAH broke out from a 16 month base in September, rallying nicely into the start of October. That is when the market selling hit and RAH faded with the market. It fell to the 200 day SMA (58.27) and bounced, just to come back last week to test again intraday and bounce to hold the 50 day EMA (63.76). Nice double bottom test of the 200 day SMA and holding the 50 day Monday, setting up for the continued move higher off this support. Low volume for the past 2.5 months since the breakout, so looking for some trade to show up as RAH makes its next move higher.
Volume: 756.943K Avg Volume: 1.568M
BUY POINT: $66.77 Volume=2M Target=$75.95 Stop=$63.55
POSITION: RAH LM - Dec. $65c (61 delta) &/or Stock
http://www.investmenthouse.com/ci/rah.html

Play Date: 10/27/2008
VZ (Verizon Communications--$27.61; +2.53; optionable): Telecom wireless
http://biz.yahoo.com/p/v/vz.html
EARNINGS: Announced 10-27-08
STATUS: Double bottom. VZ announced earnings and gapped higher off the second leg in its short double bottom formed this month. Some good upside volume during the pattern showed there was some accumulation even before earnings. Nice strong move up to the 18 day EMA (28.04) on Monday, and looking for VZ to continue the move on more good trade. May not want to get married to VZ but the pattern is nice and it can give us a nice rally higher to the 34 level where it consolidated in a flat, lateral move for 3 months. That is fine as we can make good money off of it without having to crack through that ice.
Volume: 33.249M Avg Volume: 18.722M
BUY POINT: $28.45 Volume=25M Target=$33.75 Stop=$26.46
POSITION: VZ AY - Jan. $27.50c (54 delta) &/or Stock
http://www.investmenthouse.com/ci/vz.html

Play Date: 10/27/2008
WPI (Watson Pharmaceuticals--$22.45; +0.84; optionable): Generic drugs
http://biz.yahoo.com/p/w/wpi.html
EARNINGS: 10-29-08 before the open.
STATUS: Double bottom. Some good action and upside volume during this 2.5 week pattern, setting up for a breakout move with earnings coming Wednesday morning. It is always aggressive in this kind of market to move in before an earnings report, but if WPI gives us a good upside start on solid trade we can move into some positions and then see how the earnings come out. We have seen that even with some good earnings results that we can get an entry point even if we wait for the earnings to come out so it is a matter of your risk tolerance. Like the pattern and the volume it is showing.
Volume: 1.898M Avg Volume: 1.34M
BUY POINT: $23.55 Volume=1.8M Target=$27.77 Stop=$21.94
POSITION: WPI AX - Jan. $22.50c (54 delta) &/or Stock
http://www.investmenthouse.com/ci/wpi.html

Continuing still looking good:

Took some positions on DDM and SSO and if DJ30 and SP500 hold and bounce we will look at some more.

CELG
DIG
EBS

Good Investing!
Jon L. Johnson and your IH Alerts Team

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 in 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. Good Investing!

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