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us stock market, trade stock
Begin Part 2 of 3
THE PLAYS:
NEW BONUS PLAYS:
Upside:
IDPH (Idec Pharmeceuticals--$40.73; -0.83; optionable): Biotech drugs
http://biz.yahoo.com/p/i/idph.html
STATUS: Testing the 50 day MVA. IDPH has enjoyed some recent success with other biotechs as the Nasdaq has tried to form up more of a bottom for an interim bounce. It broke above the 50 day MVA (40.18) Wednesday on strong volume, and then tested that move Thursday on lower, slightly above average volume. It may need another day or two to consolidate this move up off of 30 over the past two weeks, but we want to be ready for when it does as there is some more upside room. Initial target is just over 45, but if it moves with the volume it did the past two weeks it can reach 50.
Volume: 6.502M Avg Volume: 5.806M
BUY POINT: $41.25 Volume=7M Target=$45.25 Stop=$39.12
POSITION: IDK JG - Oct. $35 call (74 delta) and/or stock
http://www.investmenthouse.com/cs/idph.html
Downside:
AET (Aetna--$43.66; -2.29; optionable): Health care plans
http://biz.yahoo.com/p/a/aet.html
STATUS: Put. Even with all of the money they suck from our company's coffers, AET has broken below its 50 day MVA (46.25). After some good earnings news in the sector that popped the stocks higher, they turned over on some strong volume; AET was no exception. The stock is now near its recent lows around 43, and if it slips below those it opens the door down to the 39 level.
Volume: 2.448M Avg Volume: 1.451M
BUY POINT: $43.17 Volume=2M Target=$39.04 Stop=$46
POSITION: AET TJ - Aug. $50 put (-67 delta)
http://www.investmenthouse.com/cs/aet.html
MHK (Mohawk--$49.09; +1.32; optionable): Carpets
http://biz.yahoo.com/p/m/mhk.html
STATUS: Put. One of those home related stocks: new homes need carpet. It is hurting as are those stocks, tanking Tuesday on huge volume. The next two sessions MHK rallied back up but volume dropped significantly as the moves became smaller. That was a reflex bounce higher and the bounce is running out of steam. Now we won't see the $11+ drop of earlier in the week, but MHK could easily fall back toward 43 as this bounce rolls over.
Volume: 1.505M Avg Volume: 814.09K
BUY POINT: $48.65 Volume=1.2M Target=$44.25 Stop=$50
POSITION: MHK TK - Aug. $55 put (-66 delta)
http://www.investmenthouse.com/cs/mhk.html
Continued bonus plays:
Upside:
FLEX (Flextronics--$8.53; -0.02; optionable): Contract manufacturer
Play Date: 07/11/2002
http://biz.yahoo.com/p/f/flex.html
STATUS: Broke over the 18 day MVA last Friday and is now consolidating above that level (8.35). It is a nice lateral move with some rising volume the past two sessions. We thought it was going to break down below the 18 day MVA as it reversed Tuesday, and we let it chase us out. Thursday it showed a hammer doji on that level It can give us a nice bounce up from here again, and we would like to take part.
Volume: 14.524M Avg Volume: 11.657M
BUY POINT: $8.65 Volume=12M Target=$10.69 (initial) Stop=$7.82
POSITION: QFL JU - Oct. 7.50 call (70 delta) and/or stock
http://www.investmenthouse.com/cs/flex.html
PDLI (Protein Design Labs--$12.29; -0.55; optionable): Biotechnology
Play Date: 07/15/2002
http://biz.yahoo.com/p/p/pdli.html
STATUS: Testing the 50 day MVA. PDLI broke over its 50 day MVA (11.66) Monday, rallied higher, and is now testing that move on very low, below average volume. Thursday it tested to 11.90 on the low and moved up to close. This is just what a stock should do on a test, and we are looking PDLI to rally again higher after this rest. The biotechs are showing some of that relative strength with the big techs.
Volume: 1.609M Avg Volume: 2.93M
BUY POINT: $12.45 Volume=3.5M Target=$15 (initial) Stop=$11.51
POSITION: PQI KB - Nov. $10 call (74 delta) and/or stock
http://www.investmenthouse.com/cs/pdli.html
Downside:
AVY (Avery Dennison--$57.58; -0.90; optionable): Paper
Play Date: 07/17/2002
http://biz.yahoo.com/p/a/avy.html
STATUS: Put. Covered just Wednesday, but it started to make the fall on rising volume, and it is still a buy at this point. Closing on its low as the consumer sector continues to take it on its chin, AVY looks ready to fall down and test those recent lows after the failed test of the 200 day MVA.
Volume: 557.6K Avg Volume: 433.5K
BUY POINT: New positions: 57.45 (orig. $57.95). Volume=605K Target=$53.88 Stop=$59.95
POSITION: AVY TM - Aug. $65 put (-71 delta) OR AVY VM - Oct. 65 put (-57 delta)
http://www.investmenthouse.com/cs/avy.html
PRE-ANNOUNCEMENT STOCKS
As indicated earlier in the week, the past two weeks have been brutal on many market leaders including those primed for splits (classic example: TSCO below). Many of the stocks that were working toward their split have been hit hard and are not in buy positions. We are going to see if they can rebuild, but we need to give them time after strong selling before we are ready to look at re-entering the stocks.
TSCO (Tractor Supply--$57.9; +1.1; no options): Semi-rural and rural supplies
Play Date: 07/13/2002
http://biz.yahoo.com/p/t/tsco.html
BACKGROUND: Announced the split Thursday. 2 for 1 payable 8-2-02.
STATUS: Announced the split three sessions after earnings. Before earnings TSCO did not give a good entry point, tanking down through the 50 day MVA (62.18) Tuesday after the earnings were announced. It tested 55 Wednesday and bounced up Thursday. Low volume, however. It is not in a great buy point, but this is one that we want for the longer term. We will not, however, just dive in because the price is lower. As we have seen of late, sellers are taking the leaders out and BOOM. We don't want to step in front of that. Instead we will let it try to work sideways and then see if it starts a run toward the actual split. Then we will move in and capture that move and then get the benefit of the split.
http://www.investmenthouse.com/cs/tsco.html
PRE-SPLIT STOCKS
Kind of a lull in the pre-splits right now as they try to regroup after the recent selling. We will need to let some get closer to their split dates, but if there is an oversold bounce after this selling, the pre-splits will move well. After Friday's trade we should have a better idea of which ones are ready.
HBHC (Hancock Holding--$67.26; -0.24; no options): Regional banks; Splits 3:2 on 8-6-02
http://biz.yahoo.com/p/h/hbhc.html
STATUS: A very nice bounce up off of the 50 day MVA, but now HBHC is stalling at the late June high. Thursday it gapped a big higher and started to sell; that is a classic topping sign for pre-split moves though HBHC did bounce up off of 66.51 to close. On any further weakness tomorrow we will go ahead and take this gain. We were looking for this level as the first resistance on the way to 73. Looks as if it could stop it and with a pre-split, we don't want to take chances.
Volume: 23.1K Avg Volume: 28.818K
http://www.investmenthouse.com/cs/hbhc.html
CONTINUING CANDIDATES
LSTR (Landstar--$95.45; +1.05): Trucking
STATUS: LSTR was looking strong as were many consumer related stocks, then it broke its 50 day MVA last week and fell hard. Thursday it announced its first 2:1 stock split as well. It is not in position to buy right now other than a momentum play up to 100; without options that makes the move difficult percentage wise. Thus we will wait for a better entry point less susceptible to reversing on us and then move in, most likely before the actual split.
POST-SPLIT
JAH (Jarden--$20.45; -0.16; no options): Rubber
Play Date: 07/11/2002
http://biz.yahoo.com/p/j/jah.html
STATUS: JAH hit our buy point several sessions back and has since moved in just about the flattest flying plateau it could. Volume has been solid most of the way, but backed off Thursday as the stock pulled back a hair. Now it is either going to use this consolidation to make a nice breakout or it is going to tank. On its move higher it has used these patterns for more gains; in this market, however, we have to be very careful. We have the stops pretty tight, but you could even move them up to 19.55 or so. On a break higher on stronger volume, we can take some more positions.
Volume: 71.3K Avg Volume: 84.681K
BUY POINT: New positions: $20.70 Volume=115K Target=$24.22 Stop=$19.25
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/jah.html
End Part 2 of 3
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