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stock split, stock research
Begin Part 2 of 3
TEAM TRADES
These sessions are difficult. What looked to be the return of selling was snuffed with some upside war news that sent stocks higher. A little covering became more short covering, and then some more on top of that. We closed out some new and old downside positions while at the same time keeping an eye on those upside patterns that had formed up well during the selling: those stocks that can hold up and complete their patterns during selling are showing uncommon relative strength and support. They set themselves for a move higher when the buyers come in. One example today (and there were a few) was ADLR. The stock was in a 5-month base, spending the last month moving laterally, forming the handle. It was tedious, but the accumulation was good and the pattern held. Tuesday when the market started back up it made the breakout. ADLR was up all session on some good volume, but with just over 1.5 hours left it made the breakout move, surging on strong volume. The stock hit the buy at 14.74, moved to 14.82ish and moved laterally. The volume was good, the action was solid on the breakout, so it was time to buy. With the stock holding laterally, it was fairly easy; it gets trickier when the stock is running up fast. With this rest we were able to put in a limit order near the ask and see if it would pullback and hit it. We got a partial fill and then needed to bump up the limit a bit to get the full fill. The stock then moved up another 20 cents or so in the last 15 minutes. Not a bad move at all.
THE PLAYS:
NEW BONUS PLAYS:
Upside:
BCGI (Boston Communications--$10.4; +0.08; optionable): Wireless communications
http://biz.yahoo.com/p/b/bcgi.html
STATUS: Cup w/handle. Forming up a handle to a 5.5-month base after making a strong move late last week on some rising, above average volume. As BCGI tests back the last three sessions, volume dropped below the strong volume last week on the explosive move higher to complete the base. Accumulation is solid at 6 up weeks on rising volume to 3 down weeks on rising volume. Money flow is excellent and relative strength broke on the move up. Wireless is one of the best performing sectors in tech recently as it shows the most demand.
Volume: 219.8K Avg Volume: 135.545K
BUY POINT: $10.93 Volume=250K Target=$14 Stop=$9.96
POSITION: QGB LB - Dec. $10 c (63 delta) and/or Stock
http://www.investmenthouse.com/cs/bcgi.html
UHS (Universal Health Services--$51.09; -0.06; optionable): Hospitals
http://biz.yahoo.com/p/u/uhs.html
STATUS: Cup w/handle. UHS is forming its handle to its 3.5 month base after it surged late last week on a good jump in volume to complete the base. You could argue it formed the handle in the mid weeks of September and made the breakout move the last few days of that month. Either way there is a good test of the move ongoing right now just below the pre-orrection high at 52 back in June. Volume was a bit strong Tuesday, but it held up. We want to see the stock move laterally and lower toward 50 the next couple of sessions and then provide the breakout move.
Volume: 817.8K Avg Volume: 556.136K
BUY POINT: $51.79 Volume=800K Target=$58.25 Stop=$49.35
POSITION: UHS AJ - Jan. $50c (66 delta) and/or Stock
http://www.investmenthouse.com/cs/uhs.html
Downside:
CYN (City National--$48; +1.23; optionable): Regional bank
http://biz.yahoo.com/p/c/cyn.html
STATUS: Testing the 18 day MVA. After tanking from 50, CYN has mounted a comeback from 45, regrouping Monday off of that level. It is now at some resistance at 48, but we suspect it will try a move up toward 49 to 50. Volume is lower on the move up, classic reflex bouncing. If it continues up on that low volume and fails, that is the point we enter to the downside.
Volume: 189K Avg Volume: 252K
BUY POINT: After a test of 49 to 50, 48.94 on the move back down. Volume=295K Target=$45.25 Stop=$51
POSITION: CYN WJ - Nov. $50p (-55 delta)
http://www.investmenthouse.com/cs/cyn.html
CONTINUING BONUS PLAYS
Downside:
Play Date: 09/10/2002
ACAS (American Capital--$18.43; -0.41; optionable): Financial services
http://biz.yahoo.com/p/a/acas.html
STATUS: Put. Testing the 10 day MVA (18.48). ACAS sold back to 18 and rallied to close right at the 10 day MVA. The doji at that resistance level indicates ACAS may be ready to continue lower though it may test the 18 day MVA at 19 first. 18 is support, and that is why we want to see it move through that level as it tested it again today.
Volume: 962.541K Avg Volume: 895.09K
BUY POINT: $17.97 Volume=900K Target=$14.95 Stop=$19.22
POSITION: DQS WX - Nov. $22.50p (-69 delta) or DQS WD - Nov. $20p (-57 delta)
http://www.investmenthouse.com/cs/acas.html
Play Date: 09/25/2002
CLX (Clorox--$41.52; +1.34; optionable): Consumer cleaning products, etc.
http://biz.yahoo.com/p/c/clx.html
STATUS: Put. CLX bounced down Monday but found support at 40 and bounced Monday with the market. Volume backed way off and was below average on the move back up as CLX closed below a wad of resistance (the 50, 18 and 10 day MVA all stacked up just below 42). Looking for that roll back down from here in continued selling as the lower volume rally is not the sign of long term investors piling back in.
Volume: 884.3K Avg Volume: 1.112M
BUY POINT: $41.25 Volume=1.2M Target=$37.25 Stop=$42.35
POSITION: CLX MI - Jan. $45p (-69 delta)
http://www.investmenthouse.com/cs/clx.html
JCI (Johnson Controls--$77.8; +0.98; optionable): Auto parts
http://biz.yahoo.com/p/j/jci.html
STATUS: Put. JCI started back down Monday after testing the 18 day MVA at 79. Tuesday it moved up to the 10 day MVA (77.82) and stalled, showing a doji on rising, above average volume. Doji on higher volume at resistance can signal a move back down.
Volume: 742K Avg Volume: 573.818K
BUY POINT: $77.05 Volume=625K Target=$73.55 Stop=$80
POSITION: JCI WP - Nov. $80p (-59 delta)
http://www.investmenthouse.com/cs/jci.html
Upside:
APPX (American Pharmaceutical--$16.65; +0.32; no options): Drug manufacturer
Play Date: 09/19/2002
http://biz.yahoo.com/p/a/appx.html
STATUS: Cup w/handle. We still like this pattern. It did not partake in Tuesday's festivities, instead testing lower again toward the 18 day MVA on the low (15.75) on lower volume. Accumulation is solid at 8 up weeks on rising volume to just 4 down weeks on rising volume. Looking for that breakout here.
Volume: 198.1K Avg Volume: 157.409K
BUY POINT: $17.11 Volume=225K Target=$20.55 Stop=$15.85
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/appx.html
DL (Dial Corp.--$22.03; +0.57; optionable): Don't you wish everyone used it?
http://biz.yahoo.com/p/d/dl.html
STATUS: Cup (w/handle?). Did not wait long in the 4.5 month cup as it started up Tuesday, moving up to the buy point. Problem is, volume did not move up with it. Need to see the volume ramp up a bit more for further positions, but note that it has been solid for almost a whole week, moving up last week on strong volume. Thus we had some confidence to take some positions on today's move. Accumulation is solid at 7 up weeks on rising volume to 3 down weeks on rising volume.
Volume: 507.8K Avg Volume: 538.727K
BUY POINT: New positions: 22.25 (orig. $21.84). Volume=712K Target=$25.55 Stop=$20.31
POSITION: DL AD - Jan. $20c (74 delta) and/or Stock
http://www.investmenthouse.com/cs/dl.html
Play Date: 09/26/2002
IDXX (Idexx Labs--$31.49; +0.54; optionable):
http://biz.yahoo.com/p/i/idxx.html
STATUS: Cup w/handle. After testing the 50 day MVA again Monday (29.90), IDXX was up Tuesday on solid, above average volume, moving toward the breakout. Very close to the breakout from the pattern and money flow just started to take off again. Looks ready for the breakout.
Volume: 360.881K Avg Volume: 286.681K
BUY POINT: $32.11 Volume=468K Target=$36.75 Stop=$29.86
POSITION: IQX LF - Dec. $30c (61 delta) and/or Stock
http://www.investmenthouse.com/cs/idxx.html
PRE-ANNOUNCEMENT PLAYS
CECO (Career Education--$51.04; +3.03; optionable): Forecast to announce a split on 10-31-02 in conjunction with earnings. At this time the company cannot confirm a date but based upon our research this is the date for the release.
http://biz.yahoo.com/p/c/ceco.html
BACKGROUND: Last announced a 2 for 1 split on 7-31-01 in conjunction with earnings. The stock price was $61. The annual shareholder meeting was on 5-17-02 at which time no additional shares were authorized. The company has sufficient shares for 2 for 1 split.
STATUS: No problem moving Tuesday. After a test of the 18 day MVA Monday, CECO blasted off Tuesday on massive volume to another all-time high. Excellent accumulation in the pattern at 7 up weeks on rising volume to just 3 down weeks on rising volume. New positions can be taken on a test back toward 48 and then a move up from there.
Volume: 11.311M Avg Volume: 672.09K
BUY POINT: New buys: A test of 48 that holds and starts back up (48.25; orig. $46.55). Volume=700K Target=$53.53 Stop=$43.29
POSITION: CUY AH - Jan. $40c (70 delta) and/or Stock
http://www.investmenthouse.com/cs/ceco.html
EDMC (Education Management--$46.06; +1.79; optionable): Education and training. Forecast to announce a split on 10-24-02 in conjunction with earnings. At this time the company cannot confirm this date, but based upon our research this is the date for the announcement.
http://biz.yahoo.com/p/e/edmc.html
BACGROUND: Last announced a 2 for 1 split on 12-2-98 at a stock price of $46. The annual shareholder meeting was on 11-8-01 at which time no additional shares were authorized. The company has sufficient shares for a 2 for 1 split.
STATUS: Reverse head and shoulders/ascending wedge. Making the breakout on strong volume as education stocks were on fire. Solid breakout after the test of the 18 day MVA. Still a buy at this point but not much further.
Volume: 1.067M Avg Volume: 328.545K
BUY POINT: New positions: 46.25 (prior 44.03). Volume=520K Target=$49.45 Stop=$40.95
POSITION: UKN LH - Dec. $40c (65 delta, low OI) and/or Stock
http://www.investmenthouse.com/cs/edmc.html
CONTINUING CANDIDATES
Play Date: 08/24/2002
AZO (Autozone--$81.28; +2.42; optionable): Auto parts
http://biz.yahoo.com/p/a/azo.html
STATUS: AZO formed a very short, 2-day handle that tested the 10 day MVA on the low Monday. Tuesday it was up and running again on stronger, above average volume. Looking at new positions over 82.
Volume: 1.983M Avg Volume: 1.254M
BUY POINT: New positions: 82.05 (orig. $75.69) Volume=1.5M Target=New positions: 92 (orig. positions $82.55) Stop=$77.45
POSITION: AZO LP - Dec. $80c (58 delta) and/or Stock
http://www.investmenthouse.com/cs/azo.html
PRE-SPLIT
EASI (Engineered Support--$56.7; -0.34; optionable): Defense. Splitting 3:2 on Oct. 31 (Boo!)
http://biz.yahoo.com/p/e/easi.html
STATUS: Testing the breakout. Tested a bit lower one more session, showing a doji right below the 18 day MVA (57.50). This stock had a huge run up and needed this test. 56 is a decent support level to push it up for the next run.
Volume: 207.222K Avg Volume: 207.227K
BUY POINT: More aggressive: 58.25. New positions: 60.05 (orig. $58.95). Volume=304K Target=$66 Stop=$56.25
POSITION: UFE KL - Nov. $55c (70 delta) and/or Stock
http://www.investmenthouse.com/cs/easi.html
RMCI (Right Management--$24.69; +0.05; optionable): Splits 3:2 on 10-16.
http://biz.yahoo.com/p/r/rmci.html
STATUS: Started up off the 50 day MVA Monday, but then could not participate in Tuesday's move, closing just over the 10 day MVA after testing the 18 day MVA on the low (24.05). Volume backed off, but the action was not bad. Still looking for the next move to start up to jump on new positions.
Volume: 116.75K Avg Volume: 148.681K
BUY POINT: $25.05 (orig. $25.75). Volume=225K Target=$29.75 Stop=$23.65
POSITION: UHU AD - Jan. $20c (74 delta) and/or Stock
http://www.investmenthouse.com/cs/rmci.html
POST-SPLIT
COCO (Corinthian Colleges--$38.43; +0.69; optionable): Education
http://biz.yahoo.com/p/c/coco.html
STATUS: Ascending wedge. Finally getting some volume as the stock moved up to the breakout and actually held it through the close. We wanted to make sure it did hold the move as it tested intraday again down to the 10 day MVA (37.33) several times during the session. Now it looks ready to continue the move higher.
Volume: 1.014M Avg Volume: 786.454K
BUY POINT: Breakout: $38.11; new positions on a continued move up. Volume=809K Target=$42.75 Stop=$35.44
POSITION: UCS BF - Feb. $30c (74 delta) and/or Stock
http://www.investmenthouse.com/cs/coco.html
Play Date: 09/07/2002
ERES (Eresearch Tech--$19.35; +0.9; no options): Medical labs
http://biz.yahoo.com/p/e/eres.html
STATUS: Breakout. ERES has been bouncing up the 50 day MVA (16.45), making its last test last week and rallying from there. It stopped and tested the 18 day MVA (17.50) Monday, and then made a higher volume breakout move to an all-time high. It looks ready for an add to positions at this point.
Volume: 437.444K Avg Volume: 168.818K
BUY POINT: New positions: 19.45 (orig. $17.35). Volume=200K Target=New positions: 22.25 (orig. positions $19.95). Stop=$17.25
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/eres.html
GTK (Gtech Holdings--$25; +0.18; optionable): Business software
Play Date: 09/19/2002
http://biz.yahoo.com/p/g/gtk.html
STATUS: Tested the 200 day MVA on the low once again (24.30) and closed positive on a strong shot of above average volume. Looks ready now to make the move.
Volume: 1.212M Avg Volume: 756.409K
BUY POINT: $25.95 Volume=1.3M Target=$30 Stop=$24.04
POSITION: GTK CX - Mar. $22.50c (87 delta) and/or Stock
http://www.investmenthouse.com/cs/gtk.html
UOPX (University of Phoenix Online--$33.44; +1.29; optionable): Online education
Play Date: 09/23/2002
http://biz.yahoo.com/p/u/uopx.html
STATUS: Cup w/handle. Made the price move, but again did not deliver on the volume. Need to see that come in; one of the few education stocks that did not have the volume Tuesday. Excellent accumulation in the base at 7 up weeks on rising volume to just 3 down weeks on rising volume. Money flow is leading way out ahead of price and relative strength has broken out.
Volume: 94.858K Avg Volume: 162.09K
BUY POINT: $32.15 Volume=262K Target=$37 Stop=$29.85
POSITION: UBY CF - Mar. $30c (65 delta) and/or Stock
http://www.investmenthouse.com/cs/uopx.html
End Part 2 of 3
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stock split
stock research
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