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us stock market, trend trading stock
Begin part 2 of 2
TEAM TRADES
OEX: With the indexes hitting resistance and showing doji's on Friday, we were looking at some index puts this week to catch the ride lower when it turned. Well, it did not take long to start selling once things got going Monday. About a half hour into trading the OEX hit our buy point at 488.95. We were not going to wait around long; reason: the ISM came out and it was up, but the market was not reacting positively to it. When a market gets good news and does not even try to rally, it is very sluggish to the upside, and that means the easiest course of action is to the downside. We were looking at August $90 puts. They were still pricey (around 18.30) for the delta (-45), but if the OEX made the 15 to 20 point fall we are looking for, that would not be a real problem. By the time we got the alert issued and got back to placing an order, the options were asking 18.40. We put in a limit order at the ask. That was missed on the downturn but the index bounced up and the fill made. A further rally to the upside turned over at the 15 minute MVA (that would have been the best entry point) and rode down that line the rest of the session with just a minor hiccup to test the line for an hour in the early afternoon. It then rolled over and really plunged lower.
THE PLAYS:
We are keeping the plays to the best of the best and have all plays listed in the summary table to make it easy to follow the action for each session as well as our comments on the action. Our goal is get you onto the best plays and to have a report that is very functional for you to use.
Good movers: BPOP; COCO; HUG; JILL; KSWS; PII; ADS
BONUS PLAYS:
Downside:
IVGN (Invitrogen--$28.83; -3.18; optionable): Biotechnology
http://biz.yahoo.com/p/i/ivgn.html
STATUS: Put. Biotechs continue to struggle, and IVGN Monday broke below the lows of its trading range since March, also the level of its lows in the lat half of 1999. The breakdown on rising, above average volume indicates more downside to come. Money flow is tanking, and distribution leads accumulation during this trading range.
Volume: 1.636M Avg Volume: 1.092M
BUY POINT: $28.65 Volume=1.6M Target=$23.55 Stop=$32.55
POSITION: IUV TG - Aug. $35 p (-77 delta)
http://www.investmenthouse.com/cd/ivgn.html
BGEN (Biogen--$38.95; -2.48; optionable): Biotechnology
http://biz.yahoo.com/p/b/bgen.html
STATUS: Head and shoulders. BGEN is in the continuing biotech struggle, forming a head and shoulders pattern below its 200 day MVA (51.50), ready to take out the neckline in the pattern that opens up more downside action. Now volume the past two weeks during the formation of the right shoulder has been weak. That is okay, but we would have liked to see more volume on the selling. It rose, but it was still below average. We are looking for the breakdown on some strong volume to give the stock a push.
Volume: 3.323M Avg Volume: 4.771M
BUY POINT: $38.25 Volume=5M Target=$32.25 Stop=$42.15
POSITION: BGQ TI - Aug. $45 put (-65 delta) or BGQ TJ - Aug. $50 put (-83 delta)
http://www.investmenthouse.com/ct/bgen.html
Continuing Bonus Plays Update:
Upside:
COL (Rockwell-Collins--$26.55; -0.87; optionable): Defense
Play Date: 06/29/2002
http://biz.yahoo.com/p/c/col.html
STATUS: Cup w/handle. An off day for even defense contractors, but COL held up well on much lower volume. It is in a 2-month cup w/handle base. Volume has been excellent the past two weeks, surging in anticipation of the breakout. Accumulation weeks in the short base lead 3 to 1 distribution.
Volume: 615.6K Avg Volume: 452.909K
BUY POINT: $27.75 Volume=680K Target=$33.45 Stop=$24.85
POSITION: COL JX - Oct. $22.50c (85 delta) and/or stock
http://www.investmenthouse.com/cs/col.html
Downside:
C (Citigroup--$38.28; -0.47; optionable): Sandy Weil
Play Date: 06/29/2002
http://biz.yahoo.com/p/c/c.html
STATUS: Continuing downtrend. Another test over the 10 day MVA on the high and then rolling over again with another doji, closing near the low. Volume fell to average levels, but this is the trend C has been following. Looks good and can still be entered on some further market weakness.
Volume: 14.844M Avg Volume: 13.92M
BUY POINT: New positions on further selling (original $38.60). Volume=1.9M Target=$34.75 Stop=$41.15
POSITION: C TI - Aug. $45p (-80 delta)
http://www.investmenthouse.com/cs/c.html
JCI (Johnson Controls--$81.54; -0.07; optionable): Auto parts
Play Date: 06/25/2002
http://biz.yahoo.com/p/j/jci.html
STATUS: Put. Tested higher above the 200 day MVA, rallying up to the 18 day MVA on the high (82.73) and then rolled back down to close on top of the 200 day MVA. Volume was lower but still above average volume. We think it is going to break down as volume has fallen the entire move higher. Again, given the move over the 200 day MVA, however, we want to see the selling resume with some force, i.e., a sharply down day on continued strong volume.
Volume: 690.8K Avg Volume: 463.318K
BUY POINT: A move below 81 on strong volume. It may come after at test of 82.63. Volume=600K Target=$75 Stop=$81
POSITION: JCI TQ - Aug. $85 put (-69 delta)
http://www.investmenthouse.com/cs/jci.html
PRE-ANNOUNCEMENT
BBBY (Bed, Bath & Beyond--$37.02; -0.72; optionable):
http://biz.yahoo.com/p/b/bbby.html
STATUS: Giving us the pullback to test the recent move, holding 37. That is where we would like it to hold, but volume was higher and it may go to the 10 day MVA at 36.50. We look for it to hold and reverse on some strong volume in a renewed breakout.
Volume: 4.473M Avg Volume: 3.277M
BUY POINT: $37.85 Volume=4.8M Target=$45.45 Stop=$35.25
POSITION: BHQ KG - Nov. 35 call (70 delta) or BHQ KZ - Nov. 32.50 call (80 delta) and/or Stock
http://www.investmenthouse.com/cs/bbby.html
CHBS (Christopher Banks--$41.72; -0.58; optionable):
http://biz.yahoo.com/p/c/chbs.html
STATUS: Holding up very well in a volatile session, closing on the 10 day MVA on below average volume. Very good action on the session, and when the market stabilizes after Friday and Monday, we will look for the breakout.
Volume: 324.8K Avg Volume: 411.954K
BUY POINT: $43.58 Volume=606K Target=$52.35 Stop=$39.50
POSITION: URH IG - Sept. $35c (81 delta)
http://www.investmenthouse.com/cs/chbs.html
PRE-SPLITS BEST PLAYS: Remember, we try to grab Pre-Splits as they break out of good patterns or as they start a run right before the split. Not looking for home runs, but looking for those $3 to $4 moves running into the split, watching for topping signs and potential resistance. Not huge money, but it can be very steady. We set our initial stops at the 7-8% range below the purchase price (or just below obvious support), and move them up on a move to preserve our profits.
Upside:
BER (W.R. Berkley--$55.85; +0.85; optionable): Splits 3:2 on 7-03-02.
http://biz.yahoo.com/p/b/ber.html
STATUS: Not bad action though we would have preferred more volume on the bounce. Will look at further positions Tuesday.
Volume: 588.2K Avg Volume: 141.545K
BUY POINT: New positions on a move over 55.95 (original $55.31). Volume=200K Target=$59.55 Stop=$53.50
POSITION: BER HJ - Aug. $50 c (88 delta, low OI). We are looking at options given the price and target right before the split.
http://www.investmenthouse.com/cs/ber.html
CMC (Commercial Metals--$23.08; -0.39; no options): Split 2 for 1 on 7-1-02.
http://biz.yahoo.com/p/c/cmc.html
STATUS: Testing the breakout. Another great doji, a rising star doji, on the 18 day MVA. We are looking for the stock to move up post split off of this pattern.
Volume: 75.6K Avg Volume: 54.909K
BUY POINT: $24.02 Volume=84K Target=$28.50 Stop=$22.35
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/cmc.html
ERES (Eresearch Tech--$25.11; -0.21; no options): Splits 3:2 on 7-17-02
http://biz.yahoo.com/p/e/eres.html
STATUS: Be careful here. After a decent move ERES showed a doji Monday. It was on very low volume, but it is not far from the target at 26. If the stock gaps up tomorrow and starts to sell, that is a signal this move may be over and we will take some profits and look for the next move.
Volume: 74.5K Avg Volume: 119.363K
http://www.investmenthouse.com/cs/eres.html
CONTINUING CANDIDATES
WEN (Wendys International--$39.69; -0.14; optionable):
http://biz.yahoo.com/p/w/wen.html
STATUS: Holding above the 18 day MVA with a series of doji's. We like the action as the stock recovered and is holding up. We are staying with positions and looking form more on a move over 40.75 on sharply stronger volume.
Volume: 939.8K Avg Volume: 900.409K
BUY POINT: New: 40.78 Volume=1.3M Target=$48 Stop=$39
POSITION: WEN LG - Dec. $35 call (78 delta) and/or stock
http://www.investmenthouse.com/cs/wen.html
POST-SPLITS BEST PLAYS:
Upside
JILL (J. Jill Group--$24.51; -0.78; optionable):
http://biz.yahoo.com/p/j/jill.html
STATUS: Gapped higher but sold back. Volume was strong but it is above the 10 day MVA. Needs to hold 24 on this test and then rebound. Still looks good.
Volume: 331K Avg Volume: 263.59K
BUY POINT: Volume=300K Target=$26.64 Stop=$22.16
POSITION: JUI IF - Sept. $30 call (83 delta)
http://www.investmenthouse.com/cs/jill.html
PENN (Penn National Gaming--$16.53; -1.62; optionable):
http://biz.yahoo.com/p/p/penn.html
STATUS: Not the move we wanted, tanking back below the 18 day MVA and giving back the move. Illusory momentum.
Volume: 280.8K Avg Volume: 304.136K
http://www.investmenthouse.com/cs/penn.html
WATCHLIST/ CONTINUING
On Tuesday, Thursday and Saturday we provide full comments on each continuing play.
We have put all plays in a summary table that contains the date the stock was put on the report (so you can go back and check out the details of the play) and the other pertinent information. This provides more information than the watchlist summaries and still contains comments when appropriate. VIEW THIS IN COURIER NEW, 12 FOR BEST RESULTS. You can also easily print the table from the website (www.investmenthouse.com) from the 'current reports' section. If you just want to print the table you can cut and paste it to a word document setting the font to Courier New size 12. Just left click on the beginning of the table and drag to the table end. After selecting, right click and select 'copy.' Paste into your word processor. Select it all and choose Courier New, font size 12.
Stock Date Play Close +/- Pivot Tgt Vol AvgV Stop
$OEX 06/29 Put 23.08 -0.39 488.95 473 149K 0 502
ABY 06/25 Flat 9.38 +0.15 9.55 11.5 452K 276K 8.55
ACXM 05/30 A Wedge 16.49 -1 17.7 21 621K 623K 16.05
ADS 06/27 cup hdl 25.15 -0.4 25.3 30.35 510K 124K 23.25
ADVP 06/22 Put 22.86 -1.08 25.25 21 1.9M 2.4M 28
AMGN 06/20 Put 38.44 -3.44 40.9 37 16M 13M 44.20
ATK 06/27 Put 62.54 -1.26 64.95 60.25 534K 401K 68.50
AXP 06/19 Put 37.11 +0.79 37.75 34.05 5.5M 4.9M 41
AZO 06/18 Test BO 76.55 -0.75 83.5 99.5 889K 1M 77.66
BAC 06/11 Put 69.25 -1.11 69.9 65 6.3M 6M 73
BBBY 06/27 BO 37.02 -0.72 37.85 45.45 4.5M 3.3M 35.25
BER 06/29 PreSplt 55.85 +0.85 55.31 59.55 147K 142K 53.50
BGEN 07/01 H&S 38.95 -2.48 38.25 32.25 3.3M 4.8M 42.15
BLI 06/11 Test BO 19.02 -0.66 18.5 22 1.4M 665K 17.30
BPOP 06/15 cup hdl 32.88 -0.8 32.35 36.5 118K 113K 30.50
C 06/29 Put 38.28 -0.47 38.6 34.75 15M 14M 41.15
CHBS 06/29 A Wedge 41.72 -0.58 43.58 52.35 325K 412K 39.50
CHRZ 04/16 A Wedge 4.59 -0.27 4.2 5.9 295K 107K 4.10
CHS 05/11 Test 50 34.31 -2.01 37.35 43.98 1.8M 703K 35.95
CLDN 06/26 Test BO 12.1 -0.66 12.93 15.15 93K 97K 11.50
CMC 06/27 Test BO 23.08 -0.39 48.05 57 149K 55K 44.69
CMPC 06/12 Test BO 3.93 +0.05 4.1 5.63 100K 149K 3.55
COCO 06/26 Test 18 33 -0.89 31.35 37.25 961K 450K 29.16
COCO 06/20 cup hdl 33 -0.89 29.59 35.55 961K 450K 27.25
COH 06/22 PreSplt 52.7 -2.2 55.51 60 410K 516K 51.62
COL 06/29 cup hdl 26.55 -0.87 27.75 33.45 506K 498K 24.85
CTX 05/11 Put 58.1 +0.31 53.5 49 1.2M 1.2M 56
CUB 06/27 Put 22.1 -1.6 23.95 20.25 181K 146K 26
CYMI 06/25 H&S 31.55 -3.49 32.95 25.55 2.4M 1.5M 37
DF 06/22 A Wedge 37.16 -0.14 38.76 45 1.1M 585K 36.25
DNR 05/21 cup hdl 9.8 -0.49 9.56 12 102K 109K 8.89
EDMC 06/22 cup hdl 40.5 -0.23 42.05 53 265K 264K 39.50
ERES 06/18 PreSplt 25.11 -0.21 23.06 26 74K 119K 21.20
FITB 05/25 Put 66.7 +0.05 66.1 62.62 2.2M 1.9M 68
FNF 06/25 Test 18 30.59 -1.01 31.05 36 650K 550K 28.88
FNF 05/22 Test 18 30.59 -1.01 30.6 35 650K 550K 28.46
FOE 06/01 A Wedge 29.93 -0.22 30.34 35 213K 209K 28.50
FOSL 06/22 BO 21.17 +0.61 23.42 28 458K 153K 21.65
FOSL 06/04 PreSplt 21.17 +0.61 32.1 24 458K 153K 19.90
FTEK 06/12 Test BO 6.6 0 6.92 8.25 57K 64K 6.37
FTEK 06/01 A Wedge 6.6 0 6.65 8 57K 64K 5.95
GB 05/28 Put 24.49 -0.99 24.9 21.3 107K 89K 27
GGUY 06/15 Test BO 3.03 -0.5 3.95 6 105K 122K 3.67
GISX 06/24 A Wedge 19.09 +0.1 20.85 25.48 153K 161K 18.25
GLYN 05/18 BO 21.67 -1.16 20.66 24 198K 184K 19.12
GRMN 05/14 cup hdl 21.9 -0.15 23.4 28 76K 118K 22.05
HCA 06/26 Test 50 46.84 -0.66 49.6 50 3M 2.3M 47
HCA 06/10 Test BO 46.84 -0.66 49.6 59 3M 2.3M 47.50
HET 06/08 Put 44.5 +0.15 45.5 40 1.2M 1.1M 47.25
HP 06/01 Put 34.86 -0.86 37.45 33 352K 303K 39.80
HUG 06/18 BO 44.98 +0.08 43.09 52 378K 174K 39.50
IVGN 07/01 Put 28.83 -3.18 28.65 23.55 1.6M 1.1M 32.55
JAH 06/19 BO 19.64 -0.16 19.05 23.5 96K 75K 17.25
JCI 06/25 Put 81.54 -0.07 78.3 75 691K 463K 81
JILL 06/22 PreSplt 24.51 -0.78 34.8 39.96 331K 264K 33.25
JPM 06/29 Put 31.36 -2.56 33.2 33.12 10M 7.9M 35.75
KLAC 06/27 Put 41.33 -2.66 44.95 41.5 13M 13M 48
KSWS 06/18 PreSplt 24.67 -1.31 48.25 52.5 197K 87K 44.50
MAR 06/12 Put 36.8 -1.25 38.25 34 1.1M 898K 41
MHP 06/18 Put 58.73 -0.97 59.55 56 718K 594K 61.25
MMC 06/25 Put 47.13 -1.17 93.25 89 1.8M 1M 97
MMSI 06/22 cup hdl 20 -0.63 19.5 23.4 225K 180K 18.14
MNTR 06/15 Put 36.31 -0.39 35.95 32.2 149K 121K 38
NCR 06/24 Put 33.46 -1.14 35.25 31.15 743K 516K 38
NMHC 06/18 cup hdl 10.3 +0.83 13 15.6 42K 28K 11.90
NVLS 06/27 Put 32.13 -1.87 34.95 29.75 7.9M 9.3M 38
NYT 06/19 Test BO 50.2 -1.3 51.1 61 765K 549K 47.80
ODSY 06/05 A Wedge 32.7 -3.55 36.1 42 195K 194K 33.57
OVTI 06/24 BO 14.29 +0.05 14.55 19.48 483K 370K 12.85
PDCO 05/23 Test 50 49.28 -1.05 49 57 341K 324K 45.75
PENN 06/29 Test 50 16.53 -1.62 18.35 21 281K 304K 17.07
PFCB 06/06 Put 30.94 -0.48 32.9 28 406K 559K 35.50
PHM 05/25 Flat 57.94 +0.46 55.95 67.45 776K 676K 52.03
PII 06/25 Put 63.32 -1.68 66.15 62.15 232K 197K 70
PNRA 06/17 PreSplt 33.19 -1.28 35.08 38.38 514K 471K 32.62
QCOM 06/05 Put 26.5 -0.99 31.5 25 12M 15M 33.50
RF 04/16 A Wedge 34.88 -0.27 34.96 40.5 560K 506K 34
SRCL 06/22 Test BO 35.5 +0.09 38.5 45 547K 339K 35.8
STJ 06/25 Put 34.3 -2.62 74.45 70.15 1.8M 701K 76.35
SWFT 06/29 cup hdl 23.26 -0.04 23.58 28.25 2M 560K 21.93
TECD 06/11 Put 37.29 -0.56 39.35 35 645K 782K 41.50
TFX 06/22 A Wedge 56.35 -0.8 58.35 70.1 132K 138K 55.15
THC 06/22 PreSplt 47.4 -0.29 50.36 53.66 2.5M 1.8M 49
THC 06/17 PreSplt 47.4 -0.29 50.36 53.66 2.5M 1.8M 49
THQI 05/23 Put 27.32 -2.5 31.9 25.1 1.3M 1.1M 34
TKR 05/25 Put 23.31 +0.98 23.4 19 317K 283K 25.60
TRBS 06/20 cup hdl 32.16 -0.28 51.25 61.51 118K 64K 47.50
URBN 06/29 Test 50 32.64 -2.08 35.55 42.75 210K 261K 31.75
WB 05/08 Test 50 37.22 -0.96 38.97 45 3M 2.7M 36.45
WEN 06/25 Test 18 39.69 -0.14 40.05 48 940K 900K 39
WEN 06/01 BO 39.69 -0.14 38.6 44 940K 900K 36.90
WM 05/08 Test 18 37.25 +0.14 38.8 44 4M 3.6M 37
WTSLA 06/17 cup hdl 23.92 -0.38 25.34 30.75 372K 326K 22.85
ZQK 06/12 Test BO 25.12 +0.32 27.1 32 189K 248K 25.20
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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