yahoo stock, top stock pick

Begin Part 2 of 2

Weekly Economic Calendar (All times Eastern). The figures are the consensus expectations, not ours.

5-7-02
Productivity-Prel., Q1 (8:30): 7.0% versus 5.2% prior
Wholesale Inventories, March (10:00): -0.4% versus -0.7% prior
FOMC Meeting (2:15)
Consumer Credit, March (Consumer Credit): $6.0B versus $7.1B prior

5-9-02
Initial Claims, 5/4 (8:30): 407K versus 418K prior
Export Prices es-ag., April (8:30): NA versus 0.2% prior
Import Prices ex-oil, April (8:30): NA versus 0.0%
FOMC Minutes, 3/19 (2:00)

5-10-02
PPI, April (8:30): 0.4% versus 1.0% prior
Core PPI, April (8:30): 0.1% versus 0.1% priorAuto Sales, April (00:00): 6.0M versus

SUBSCRIBER QUESTIONS

Q: You often mention trading channels and I know you use TC2000 for charting. Could you share your settings for these channels? (envelope channels in TC?) And, do you ever use Bollinger Bands?

A: The channels we discuss are not generated by any charting service tools. What we are doing on these and what we teach in the online seminars is to draw a trendline for the stock or index. It could be an up trendline or a down trendline depending upon which way the stock or index is trending. If it is an uptrend, that means connecting the predominant lows in the trend. The more you can connect, the better. In a downtrend we would connect the predominant highs; we can toss out an aberration where the stock or index makes a sharp move that quickly reverses. We then draw the other trendline that forms the channel. On an uptrend that means we draw a trendline connecting the predominant tops. Again, that is a trendline that touches the most tops on the rise. If a stock breaks above that channel by 2 to 3%, we need to be cautious of a larger drop toward the lower trendline. On a downtrend we draw a trendline connecting the predominant lows, with the line drawn to hit the most lows. When you look at a trending stock or index, you can almost eyeball it when you get more experience. These channels are very reliable indicators of stock movement. We look at but do not really use Bollinger bands either, preferring to have the straight trendlines being our guide. In our experience, trendlines keep us in good plays and out of trouble in the vast majority of the trades. As taught in the seminars, simply using the trendline analysis we teach will help make you a better investor immediately by getting you into good positions and getting you out of decaying positions.

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 Saturday report:
TYL: Continued the 50 day MVA bounce, tapping near recent resistance (6 range) as volume fell back sharply.
HTRN: Test of breakout. Broke above 14.20 (previous breakout high) on huge volume, pulling off an intraday high of 15.28.
AGY: Put. Thrust down from the 50 day MVA; volume maintaining levels just above average.
BRCM: Doji and a $0.06 loss, slowing down the selling though volume was higher and above average (put play).

Good moves: OATS in a major breakout! Other upside plays: TENT, HTRN. Puts: AGY, PHTN, OEX, FDC.

Continued Plays:
ABCW: Pulling back on the breakout from the ascending wedge.
AMI: Made the pullback we noted it might on the weekend report. Testing the 10 day MVA at 4.
ASL: Showing some topping action; a doji on stronger volume (churning). Can test the 5.50 range.
CAT: Heading down again Monday; 200 day MVA is close (51.45). Initial target was tapped on the low (52.20; target is 52), where we will look at closing the play.
CAO: Sold back after Friday's nice move higher.
COCO: Testing its recent run off the 50 day MVA, closing with a doji off a bounce from its 18 day MVA.
COL: Pulling back on lower volume after hitting the Friday high (27.55). Holding above recent highs for now.
DANKY: Pulled back to the 18 day MVA on decreased volume over the last week.
FDC: Put. Continuing lower (almost a point) on lower volume.
GMRK: Finally may be showing signs for a pullback, with a doji on even higher volume.
HUM: Tried a strong move today off the 10 day MVA but pulled off a high at 17.45.
KEY: Fell back as Friday's tombstone doji suggested.
NUE: Still looks ready to make the move down for the put play, moving down from the 50 day MVA; volume continued to fall, however.
PKG: Moved higher on rising volume.
PMSI: After Friday's strong volume slump, the stock is holding the 18 day MVA on sharply lower volume.
SSRI: Tried to extend its breakout attempt, but pulled off 3.28 on rising volume.
TENT: Broke out over the April highs on big, big volume! No news on the move.
UCI: Looked good Friday, but broke the 18 day MVA on higher volume.
WLT: Popped up with a little gap higher; volume was strong so the stock looks ready to make a higher move after testing the 50 day MVA late April.

Best Plays:
1) HLT: Getting ready for a bounce.
2) LBIX: Strong volume and a nice move.
3) ENC: A tight pullback.
4) MATK: Heading lower.

New plays:

HLT (Hilton Hotels--$15.90; -0.11; optionable): Leisure
http://biz.yahoo.com/p/h/hlt.html
STATUS: 18 MVA bounce. HLT has had a stellar run up from the September 2001 low just above 6. After breaking above its 200 day MVA in January and from an ascending wedge in late February, HLT has used the 18 day MVA for two bounces that propelled it to the April high at 17.01. On decreased volume price has pulled back to the 18 day MVA again and looks ready to make another bounce after showing three consecutive dojis. Volume shot up to average levels Monday, the stock tapping down to the 18 day and showing another doji. Looking for a bounce to follow through with this volume. Money flow is ahead of price, as is relative strength.
BUY POINT: Aggressive: 16.25 on volume of 2.7 million or higher. Target=19. Stop=15.50
POSITION: Stock and/or July $12.50c to buy (HLT GV)

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

LBIX (Leading Brands--$1.87; +0.17; no options): Wholesale foods
http://biz.yahoo.com/p/l/lbix.html
STATUS: Flat base. LBIX lunged off of the $1.00 level in January, near the 200 day MVA at that time, and raced up in three big leaps to the February high at 1.99. Since, the stock has made a gradual pullback spanning 2.5 months on overall low and below average volume that did spike up a few time in March and April. The 18 day MVA served as support Monday when LBIX popped up on a huge spike in volume 338,700 (avg. 61,227); news was that the stock was to begin trading on the Toronto stock exchange as well. We are looking for a breakout from this base, and like the good accumulation (2 weeks of accumulation over 1 week of distribution) in addition to money flow and relative strength breaking out ahead of price.
BUY POINT: Aggressive: 1.95 on continued strong volume. Target=3.50. Stop=1.58

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

ENC (Enesco Group--$7.03; +0.03; no options): Basic materials wholesale
http://biz.yahoo.com/p/e/enc.html
STATUS: Reverse head and shoulders. The stock has completed the right shoulder and has pulled into a tight "handle" that has pulled into the short term MVAs (10 day MVA=6.97; 18 day MVA=6.92). Volume was screaming in late April when the stock moved off its 50 day MVA (at the 6.50 range at the time) but has fallen off sharply in the pullback, down Monday to 24,300 (avg. is 38K). We like the price/volume action in the pullback and in the base, which shows 5 weeks of accumulation to 3 of distribution. Relative strength has moved out ahead of price as well. Looking for a breakout over the April high (7.20).
BUY POINT: 7.30 on volume of 57K or more. Target=9.50. Stop=6.80
POSITION: Stock.

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

Put play:

MATK (Martek Biosciences--$27.55; -0.65; optionable): Biotechnology
http://biz.yahoo.com/p/m/matk.html
STATUS: Put. MATK moved up to the 50 day MVA (29.21) last week in a "kiss good-bye", then started moving back down Tuesday. The stock peaked at that resistance in the right shoulder to a forming head and shoulders. Volume continued to fall, but Monday spiked up to 252,600 (avg. 227K) with the stock moving below the April closing low (27.75). It looks ready to head lower, and as volume picks up on the downside action, we are looking for MATK to fall to the 200 day MVA at the 24 range.
BUY POINT: 27. 40 on continued rising volume (300K or higher). Target=24. Stop=29.50
POSITION: June $35p to buy (KQT RG; delta -0.73; 0 OI).

http://www.investmenthouse.com/cd/matk.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. New: ICUI; RMCI

MIK (39.87; -0.73): Fell back Friday and continued to hold above the 18 day MVA Monday, showing a doji on slightly higher volume (just above average daily numbers). MIK is testing its move out of the mid-March through late April consolidation, and we want to see it hold the 18 day here.

ICUI (39.01; -2.96): Friday's nice move retraced with volume falling back below average. The stock will try to hold the 38 level (18 day MVA). The stock reached our new 42.50 buy point for adding to positions, but the low volume held us back. That is what targets (for volume, in this case) are for.

DGX (94.68; -0.23): Moving laterally for the third day after a nice pop from the 10 day MVA, showing a tight doji. Volume continues to fall.

UP & COMERS PORTFOLIOS: BBBY, SRCL

BBBY (36.01; -0.69): Was holding the 10 day MVA since early April, but broke that support to test the 18 day MVA on rising volume. Want to see it hold here, above the highs in the flat base (35.50 range) from which the stock broke out in April.

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

HB (63.02; -0.84): Broke its 18 day MVA on continued below average volume. Can test the 50 day MVA (62) if a more recent April low at 62.80 does not hold it up.

WMT (53.99; -1.26): Tried to move back over the 200 day MVA (broken Friday) but fell to a new low for the year on rising, average volume. It closed right in the range of the possible support at the 54 range that was noted in the weekend report.

NOC (119.63; -2.75): Still pulling back after breaking out of the ascending wedge; it closed just under the most recent high in the pattern but volume was lower as the stock bounced from its 18 day MVA. Good place to buy back any calls that were sold at the top of the breakout run.

HDI (51.61; -1.13): Slid over a point lower Monday; volume was rising and this one is headed for the 200 day MVA at 50.75 after breaking support at 52.

BUD (53.60; -0.29): In a lateral-type pullback above the April highs (above which the stock broke last Wednesday from a month-long flat base). Volume wasn't stellar on that leap up, and is falling off in the pullback, which suggests BUD can possibly hold support in the 53 range.

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
top stock pick