yahoo stock, us stock market

Begin Part 2 of 2

SUBSCRIBER QUESTIONS

Q: Last week you described seeing a buy program kick in. How do you know when a buy program is initiated?

A: Many times in a dull market that is trending steadily in one direction you will suddenly see a spike in activity in the other direction. There are normally the usual bumps up or down in an intraday downtrend or uptrend, but when a big spike comes in from nowhere, that is something that indicates a possible buy or sell program. When we see that we take a look at sectors; are there certain sectors that are being bought? Are there certain baskets of stocks being bought, e.g., all Dow stocks, stocks of certain market caps? Are there lots of block trades on those stocks or sectors? We can look at our real time service to get these answers and we always give our brokers a call for any word they have and what they are seeing on the Bloomberg terminals. There is no reporting requirement for initiating a buy program; it is something you determine by the attributes the market is showing.

TEAM TRADES

Broad rally gave us a lot to choose from. Again the urge is to chase old favorites, but we have to stick to the game plan and go with the stocks with the good patterns and the proper fundamentals.

AMGP: Insurance is a leading sector. The President's terror insurance initiative has not hurt at all. AMGP is a 5.5 month old issue. It broke out of a cup in March (first correction) and then formed a flat base for the last month. Combination patterns are patterns we like a lot. It was showing some good price/volume action in the base, and today it made its move to an all-time high. The buy point was at 29.70. It ran up to the breakout point in the first 45 minutes, then moved laterally. It spiked at 9:38, then pulled back. Volume picked up; we were on the alert. Then after the quick high trade the stock started up on solid volume. Not huge, but an increase. That was the point we pulled the trigger and issued the alert. The spread was pretty high for a stock at 33 cents. The spread was 29.67 by 30; we put in a limit order at 29.88 to slice it some. The spread narrowed by a few cents, a few more cents, then the ask hit 29.85. Did we get a trade? No. The fill came at the limit price of 29.88. A bit of treachery there from our point of view, but not that bad. The stock moved sideways and then right before noon CT it took off on an explosion of volume. It ran to 31 on the high but backed off t close at 30.49 on solid volume. New high, good volume, good sector. Let it run.

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.

Stocks from Monday's report:
RITA: Raced to a breakout and then closed with a doji. Not the best action, but still looks solid.
SNS: Making the bounce we were looking for on continued strong volume.
NBTY: Making the breakout on rising volume.
HFK: Tried to make the move, but stalled on below average volume.

Continued Plays:
SCIO: All right! Making the start of a good move on sharply higher, above average volume (1.64 million).
GBBK: Making the breakout. Volume not huge, but raising sharply.
CHK: Making a bound off the 18 day MVA on rising, above average volume (2.01 million).
CHGO: Make that pizza to go! CHGO exploded on the move today on massive volume (759K; Tuesday 230K).
NCC: Still no volume on the move.
HLYW: Strong breakout but flashed a doji today. Not the best action; indicates a test toward 18.
LNY: Nice bounce and on great volume Right at the breakout point; may take a breather here and form something of a handle. Breakout is over 26 on continued strong volume.
CHPC: Working in a good handle on continued below average volume. Money flow continues to run up on this smaller memory chip company. Breakout is over 10 on volume of 700K or better.

SUBSCRIBERS CHOICE

QSFT (Quest Software--$13.72; -0.53; no options): Business software
http://biz.yahoo.com/p/q/qsft.html
STATUS: From a high over 90 in early 2000, it has been a long drop. Each rally attempt over the past year and more had been sold off to lower lows. It is now close to its all-time low hit back in September (9.70), but it is not looking all that fired up about holding above it. It is in business software, and as we know that has had a lack of market for quite some time. SEBL's news today did not help the stock as it did not partake in the rally. If there is something up with the stock, the price/volume pattern is not showing it. Money flow has been moving up over the past 6 months, but has tailed off as the stock price moved lower.

http://www.investmenthouse.com/cd/qsft.html

Best Plays:
1) UDI: Looking for a new high
2) OMX: Nice flat base.

New plays:

UDI (United Defense--$28.75; +0.95: no options): Defense products (aerospace)
http://biz.yahoo.com/p/u/udi.html
STATUS: A new issue in December, UDI has rallied after its IPO and has formed its first correction the past 7 weeks in a shallow cup with handle that twice found support at the 50 day MVA back near 26. Today it bounced up on sharply higher volume (275K; avg. is 274K). Money flow is strong and turned sharply higher recently. It is ready for an all-time high (hith intraday at 29.85.
BUY POINT: 29.95 on volume of 350K. Target=35.94. Stop=27.50.
POSITION: Stock (no option chain).

http://www.investmenthouse.com/cd/udi.html

CFBX (Community First Bancshares--$26.41; +0.76; no options): Regional Pacific bank
http://biz.yahoo.com/p/c/cfbx.html
STATUS: In an 8.5 months ascending wedge that has been riding up the 200 day MVA on the lows (now at 24.75). Today CFBX made a strong jump with many of the regional banks. Volume rose but was still below average (105,800; avg. is 126K). Money flow has been solid for some time, and relative strength is getting ready for a breakout.
BUY POINT: 27.10 on volume of 150,000 or better. Target: 32.52. Stop=25.20
POSITION: Stock (no option chain).

http://www.investmenthouse.com/cd/cfbx.html

Revisited:

OMX (OfficeMax--$5.80; +0.02; no options): Business supplies
http://biz.yahoo.com/p/o/omx.html
STATUS: OMX blasted out of a cup with handle in early March, and has now spent the last 6 weeks moving slightly lower on mostly below average volume. It showed a couple of big volume spikes over the past two weeks as it formed the lateral base. Today it showed a doji right above the 18 day MVA (5.72) as volume rose to average levels (625K). Money flow has remained strong. Retail continues to be supported by strong consumer buying. OMX is a consumer/small business store mainly.
BUY POINT: 6.25 on volume of 950K or better (it can do it easily). Target=7.88 (initial). Stop=5.50
POSITION: Stock.

http://www.investmenthouse.com/cd/omx.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 (79.86; -0.50): Could not make it over the 50 day MVA, falling back on sharply higher, above average volume (2.05 million). It could bang down to 78 where there is support, and even 76. We are looking at selling some April 75c (5 x 5.30 on the close) and buying them back at 78 or lower. With a 92 delta, they should drop nicely on a fall in price.

UP & COMERS PORTFOLIOS: BBBY, SRCL

SRCL (63.51; +3.65): Whatever trouble it was going to have at 61 it did not. Strong move on strong volume (603,800) put it back in the game. Not an add to right now, but nice move.

MEMBER PORTFOLIO: CSCO, SEBL, EMLX, BRCM, HDI, BRCD, BUD, AMGN, WMT, ORCL, HB, NOC

HB (63.80; +2.15): Beautiful breakout on super volume (357,900)! New high and a great point for an add to!

BUD (52.77; +0.89): Could not end the night without a Bud. Breaking to a new high, but volume not moving with it. On a move over 52.90 on volume of 3 million or better, it is an add to.

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