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world stock market, us stock market
Begin part 3 of 3
THE PLAYS:
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Each play contains an additional link to a VIDEO that discusses the play in terms of the CHART PATTERN it is currently showing. Patterns, buy points, and targets are discussed along with other points that make the play a good one as well as what areas to watch for. *********** *************
Upside:
Play Date: 06/26/2010
CAT (Caterpillar--$64.71; +1.34; optionable): Heavy equipment
http://biz.yahoo.com/p/c/cat.html
After Hours: $64.72
EARNINGS: 07/22/2010
STATUS: Flag/Double bottom w/handle. CAT is setting up very nicely. Good kitty. It too sold in May and early June but it formed a double bottom at roughly the 200 day SMA and rallied nicely . . . into last week. Then it sold, but that is okay as it came back to the 50 day EMA that is coincident with the 'hump' in the double bottom as well as the 38% Fibonacci retracement of the last upside run from the early June low. Nice setup and if CAT continues higher from here then we are ready to move in.
VIDEO: http://investmenthouse1.com/ihmedia/CAT.wmv
Volume: 12.069M Avg Volume: 10.022M
BUY POINT: $64.81 Volume=14M Target=$72.11 Stop=$62.41
POSITION: CAT 10K62.50 - Nov. $62.50c (69 delta) &/or Stock
Play Date: 06/26/2010
CTRP (Ctrip.com International--$44.07; +0.59; optionable): Chinese travel
http://biz.yahoo.com/p/c/ctrp.html
After Hours: $43.94
EARNINGS: 08/02/2010
STATUS: Flag. Nice strong breakout the second week of June as CTRP cleared a 4 month trading range. Solid volume propelled it higher through Monday as it gapped higher that session. We had given up on that initial move but not the run. Sure enough it looks as if we are going to get our chance to play with CTRP. Last week it sold with the market, but it held at the 38% Fibonacci retracement level Friday, bouncing off of that level and showing a doji on the candlestick chart. That is good enough at the 38% level as a lot of momentum remains in the move. Thus as CTRP continues that Friday bounce higher we are ready to move in with some new positions and catch the momentum.
VIDEO: http://investmenthouse1.com/ihmedia/CTRP.wmv
Volume: 1.17M Avg Volume: 2.251M
BUY POINT: $44.44 Volume=2.8M Target=$49.94 Stop=$41.33
POSITION: CTRP 10L44.00 - Dec. $44c (54 delta) &/or Stock
Play Date: 06/26/2010
FCX (Freeport McMoran--$66.57; +3.13; optionable): Copper mining
http://biz.yahoo.com/p/f/fcx.html
After Hours: $66.71
EARNINGS: 07/19/2010
STATUS: Reverse head and shoulders. FCX is showing us a lot of things we like right now; I love it when a plan comes together. After peaking with a lower top in early April, FCX sold off through early June. Slower Europe, slower world economies, less need for copper, right? Well it broke the upper range of its support as shown on the video, but after breaking the lower range of support FCX bounced right back up. Something of a false breakdown and indeed that action created an inverted head and shoulders, a pattern we are quite fond of when it occurs after a selloff, and particularly a selloff to a support level. Looks to be finishing the right shoulder, and as FCX breaks higher we are ready to move in.
VIDEO: http://investmenthouse1.com/ihmedia/FCX.wmv
Volume: 17.015M Avg Volume: 15.683M
BUY POINT: $66.91 Volume=20M Target=$76.94 Stop=$62.48
POSITION: FCX 10K65.00 - Nov. $65c (59 delta) &/or Stock
Play Date: 06/26/2010
GDI (Gardner Denver--$48.80; +1.57; optionable): Machinery
http://biz.yahoo.com/p/g/gdi.html
After Hours: $48.80
EARNINGS: 07/22/2010
STATUS: Cup w/handle. The past 8 weeks GDI has put in the work to form the current cup with handle base. Last week while the market sold back GDI instead moved laterally hover the 50 day EMA, forming a very nice handle. This pattern was preceded by a nice February to April rally and the pullback in the base held the Fibonacci 61% retracement level, showing a small double bottom that broke it higher. Just what you want to see, and now it is testing that move. Volume was elevating even ahead of the Friday rebalance trade, and it look as if GDI has some real support here wanting to push it higher. As it continues this upside move we are ready to move in.
VIDEO: http://investmenthouse1.com/ihmedia/GDI.wmv
Volume: 6.367M Avg Volume: 466.992K
BUY POINT: $48.96 Volume=700K Target=$57.95 Stop=$46.08
POSITION: GDI 10J45.00 - Oct. $45c (74 delta) &/or Stock
Play Date: 06/26/2010
LSCC (Lattice Semiconductor--$4.74; +0.14; optionable): Semiconductors
http://biz.yahoo.com/p/l/lscc.html
After Hours: $4.94
EARNINGS: 07/19/2010
STATUS: LSCC is in a 9 week flag or pennant formed after a solid February to early May run. The test to form the pattern posted a double bottom at the 50% Fibonacci retracement level; you look for a pattern such as that double bottom to play off of the 50% level to regenerate the upside momentum and keep the stock running. It did in fact rally off of that second bottom into Monday last week where it peaked near the early June high and then slid back to the gap up point from late April. Good test of that initial move off the 50% Fibonacci double bottom. If LSCC continues higher on some decent trade through the buy point we will look at starting up the play. Looking for a run up toward the 127% Fibonacci extension though our target is a bit shy of that.
VIDEO: http://investmenthouse1.com/ihmedia/LSCC.wmv
Volume: 7.484M Avg Volume: 2.553M
BUY POINT: $4.93 Volume=2.8M Target=$6.38 Stop=$4.48
POSITION: LSCC 10L2.50 - Dec. $2.50c (88 delta) &/or Stock
CONTINUING PLAYS READY TO MOVE:
Play Date: 06/24/2010
BHP (BHP Billiton--$67.99; +0.01; optionable): Industrial metals
http://biz.yahoo.com/p/b/bhp.html
After Hours: $67.98
EARNINGS: 08/25/2010
STATUS: Breakout test. Reached a bit lower Friday, tapping the early June peak and then bouncing to close flat on a nice volume surge. No Russell rebalance trade here. BHP looks locked and loaded. To recap: BHP peaked in April and sold into May, making a second and double bottom in early June. BHP then rallied with the market, but a stronger move, taking it over the late May peak, the 'hump' in the double bottom formed off those twin lows. Monday BHP gapped over the 50 day EMA after a week long handle that formed just below that level. It is testing that gap now, tapping the 50 day on the Wednesday low and rallying to post a gain on rising, above average volume, the first above average trade in two weeks. Thursday it sold with the market, but volume was lower and the losses were modest relative to the market. If BHP rebounds and can hold the move through the buy point that is our trigger to enter for a run up to the March consolidation level.
VIDEO: http://investmenthouse1.com/ihmedia/BHP.wmv
Volume: 6.024M Avg Volume: 5.214M
BUY POINT: $70.11 Volume=6.2M Target=$78.94 Stop=$67.68
POSITION: BHP 10K70.00 - Nov. $70c (55 delta) &/or Stock
Play Date: 06/20/2010
JOYG (Joy Global--$55.94; +1.28; optionable): Farm and construction machinery
http://biz.yahoo.com/p/j/joyg.html
After Hours: $56.10
EARNINGS: 08/30/2010
STATUS: Reverse head and shoulders. A great test lower this week that formed a doji Thursday right over the 50 day EMA. Undercut the support intraday Friday and then took off higher. Showing exactly what we want, and now if it continues Monday it hits our buy point. To recap: JOYG is in a short flag as it tests the breakout from a 6 week reverse head and shoulders pattern. Good volume on the upside break and now a test back to near support over the 10 day EMA. Nice break higher, and this easy test is giving us the opportunity to move in. Just want to see it hold then make the break higher and hold that move into the close. That is when we move in.
VIDEO: http://investmenthouse1.com/ihmedia/JOYG.wmv
Volume: 2.673M Avg Volume: 2.954M
BUY POINT: $56.23 Volume=4M Target=$63.62 Stop=$53.77
POSITION: JOYG 10J55.00 - Oct. $55c (58 delta) &/or Stock
Play Date: 06/23/2010
KLIC (Kulicke & Soffa--$7.50; +0.03; optionable): Chip equipment
http://biz.yahoo.com/p/k/klic.html
After Hours: $7.48
EARNINGS: 07/26/2010
STATUS: Double bottom w/handle. Slid back quickly early in the week, but started to slow down at the 50 day EMA. It held that support with a doji both Thursday and Friday, also getting a long intraday test and reversal off the lows to finish the week. Signaling it is ready to bounce? Think so. Now if KLIC clicks higher, we look to move in. To recap: KLIC is another chip equipment stock that is setting up nicely for an upside move . . . as long as it can complete this current pattern and show us the goods, i.e. a breakout. Nice rally into April but it peaked and needed a base to rest. It has put in some good work, forming a double bottom at the 200 day SMA and then rallying over the past two weeks on some decent upside volume. The past week a lateral move to form the handle, and though Tuesday was a bit rocky in terms of how much it tested, it is still above the 18 day EMA and the February and March peaks, a logical support area for the handle test. Watching for KLIC to hold this general area and then make an upside break through the buy point that sticks to the close. If it can do that, and it may take another day or two or three, then we are ready to move in with the buy
VIDEO: http://investmenthouse1.com/ihmedia/KLIC.wmv
Volume: 1.902M Avg Volume: 2.185M
BUY POINT: $7.75 Volume=2.5M Target=$9.38 Stop=$7.21
POSITION: KLIC 10J7.50 - Oct. $7.50c (64 delta) &/or Stock
Play Date: 06/20/2010
KWR (Quaker Chemical--$29.03; +0.03; optionable): Chemicals
http://biz.yahoo.com/p/k/kwr.html
After Hours: $29.03
EARNINGS: 07/28/2010
STATUS: Double bottom w/handle. This one was flat as a pancake this week, but considering the general sag in the market the past several sessions that is worth something. It is doing just fine as it sides steps from doji to doji, and is nicely positioned to jump up from the 10 day EMA. It is very ready for the move higher, and when it can show that step higher that sticks, we will be ready. To recap: The 'usual' February through late April rally, then the May selling, the bottom at support and then a rebound the past two weeks. Nice hold at the 200 day SMA on the lows, forming the double bottom. After bouncing off the 200 day SMA two weeks back it broke through the 50 day EMA last week and then moved laterally over that support, consolidating. Looks primed for a continued break upside. Looking for a break through the buy point and a hold into the close to give us the buy.
VIDEO: http://investmenthouse1.com/ihmedia/KWR.wmv
Volume: 344.084K Avg Volume: 140.317K
BUY POINT: $28.56 Volume=200K Target=$34.94 Stop=$26.72
POSITION: Stock - (no option chain)
Play Date: 06/23/2010
NVLS (Novellus Systems--$26.89; +0.08; optionable): Semiconductor equipment
http://biz.yahoo.com/p/n/nvls.html
After Hours: $26.92
EARNINGS: 07/12/2010
STATUS: Breakout test. A pretty substantial test this week overall and may be ready to start back higher now. After fading for most of the week, NVLS whipped back up off the lows Friday to form a doji right at the 18 day EMA. Could be letting us know it is ready to start bouncing, so we keep a close watch on it for the strong upside early next week that gives us the entry. To recap: NVLS was one of those chip stocks that took off like a shot in early June, exploding off something of a triple bottom in that May pullback/selloff in the market. Kind of a ragged cup, but it worked for NVLS and it exploded higher last week to a new rally high. This week it is testing, sliding back toward the 10 day EMA and the April peak (marking the top of NVLS' run since its 2009 low) on nice, low volume. Unlike the market overall, NVLS' run upside was on solid, above average trade and thus this pullback shows few sellers, just some profit taking. Looking for NVLS to hold in the 10 day EMA range (27.45) and post the rebound for a continued breakout move. That is when we move in.
VIDEO: http://investmenthouse1.com/ihmedia/NVLS.wmv
Volume: 2.834M Avg Volume: 3.5M
BUY POINT: $27.96 Volume=4.2M Target=$32.00 Stop=$27.21
POSITION: NVLS 10I27.00 - Sept. $27c (57 delta) &/or Stock
Play Date: 06/22/2010
WBMD (WebMD Healgh Holdings--$47.14; +0.59; optionable):
http://biz.yahoo.com/p/w/wbmd.html
After Hours: $47.19
EARNINGS: 07/26/2010
STATUS: Flag. You can't ask for a better pullback. This one faded for seven sessions on very light trade, showing a doji each day. It settled at the 50 day EMA Thursday, undercut it early Friday, and then a solid rebound finished this one in the green. With a continued press higher Monday this one is a good buy. To recap: After a good February to April run WBMD tested, and over the past 9 weeks has consolidated, forming a reverse head and shoulders from may to mid-August. Broke higher just over a week back, then a nice, easy pullback the past week on low volume to the 10 day EMA. Excellent test of near support is setting up a new move higher. If WBMD can bounce and make the move stick we are ready to move in.
VIDEO: http://investmenthouse1.com/ihmedia/WBMD.wmv
Volume: 393.715K Avg Volume: 329.066K
BUY POINT: $47.22 Volume=450K Target=$54.95 Stop=$46.44
POSITION: WBMD 10I45.00 - Sept. $45c (67 delta) &/or Stock
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.
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