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us stock market, top stock pick
Begin Part 2 of 3
THE PLAYS:
Lots of stocks have rallied, leaving many extended for new positions. The market is set to pullback with the Intel news, and if the selling is localized and not distribution many stocks will test their recent moves and then be ready to head back up. That is where many of the plays are right now. Need to be patient at this point.
Good moves: AG; APPX; HCA; IGT; PFGC; QCOM
NEW BONUS PLAYS: Looking around for some non-tech that should continue to do well.
Upside:
CCE (Coca-Cola Enterprises--$23.27; +0.87; optionable): Soft drinks of all kinds
http://biz.yahoo.com/p/c/cce.html
STATUS: Cup w/handle. Starting the breakout from a 4-month cup with handle pattern sporting accumulation at 4 accumulation to just 1 distribution week. Very solid and very strong volume Tuesday as CCE started toward the breakout. Even if techs have some problems the economic basics should continue to perform.
Volume: 2.387M Avg Volume: 1.192M
BUY POINT: $23.38 Volume=1.6M Target=$28 Stop=$21.74
POSITION: CCE BD - Feb. $20c (74 delta) and/or Stock
http://www.investmenthouse.com/cs/cce.html
CONTINUING BONUS PLAYS
Upside:
Play Date: 10/05/2002
CHD (Church & Dwight--$34.84; -0.06; no options): Consumer cleaning products
http://biz.yahoo.com/p/c/chd.html
STATUS: Cup w/handle. Started the breakout move Monday but had no volume. Tuesday it shot higher on some tremendous volume. Looked great. Hit 35.96 on the high and then gave it all back. Never wild about this type of action, and CHD may test back toward 34 before trying again. Solid accumulation at 5 up weeks on rising volume to 2 down weeks on rising volume.
Volume: 727.2K Avg Volume: 153.136K
BUY POINT: $34.35 after a test of 34. Volume=225K Target=$39.75 Stop=$31.95
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/chd.html
LBIX (Leading Brands--$3.1; -0.03; no options): Wholesale food
http://biz.yahoo.com/p/l/lbix.html
STATUS: Cup w/handle. Similar action to CHD, LBIX raced up on strong volume. We moved in pretty early and enjoyed the ride higher until it topped out at 3.32 and rolled over. Managed a comeback toward the close but still finished a hair lower. Volume was huge. May have to test back toward 3, but as with CCE, this is a food stock and should be able to withstand any tech selling. Excellent accumulation at 4 up weeks on rising volume to one down week on rising volume.
Volume: 380.352K Avg Volume: 85.636K
BUY POINT: $3.22 Volume=145K Target=$4.35 Stop=$2.99
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/lbix.html
Play Date: 10/10/2002
QCOM (Qualcom--$35.34; +2.59; optionable): Telecom equipment
http://biz.yahoo.com/p/q/qcom.html
STATUS: Trading range. Gapped over the 200 day MVA (33.45) and rallied further on strong volume. After hours it fell to 34 on the Intel news. Looking for a test of the 200 day MVA and then new positions as it starts back up. One tech stock that may overcome the Intel news.
Volume: 26.491M Avg Volume: 15.196M
BUY POINT: New positions: test of 34 and move up from there (orig. $31.10). Volume=20M Target=$35 Stop=$28.92
POSITION: AAW AY - Jan. $27.50c (67 delta) or AAW AE - Jan. $25c (77 delta) and/or Stock
http://www.investmenthouse.com/cs/qcom.html
NEW PRE-ANNOUNCEMENT PLAYS
UNH (Unitedhealth Group--$96.47; +1.72; optionable): Forecast to announce a split on 10-17-02 before the market opens in conjunction with earnings or on 10-23-02 in conjunction with a board meeting. The company would not confirm the board meeting date, but based upon our research this is the date for the next board meeting
http://biz.yahoo.com/p/u/unh.html
BACKGROUND: Last announced a 2 for 1 split on 10-25-00 at a stock price of $106. The annual shareholder meeting was on 5-15-02 at which time no additional shares were authorized. The company has sufficient shares for a 2 for 1 split.
STATUS: Cup. Gapped higher Friday on continued above average volume, but could not take out the former high in June that started the cup at 97.50. What the stock needs is to form a good handle along the 95 level. That is what we are anticipating; we will see if fall back and then look to pick it up on the way back up, initially at 95.35, but if there is a handle the buy point would be 97.
Volume: 2,.83M Avg Volume: 2.00M
BUY POINT: After a pullback to test 95, $95.35. Volume=3M Target=$106.88 Stop=$92.25
POSITION: UHB AS - Jan. $95c (74 delta) and/or Stock
http://www.investmenthouse.com/cs/unh.html
PRE-ANNOUNCEMENT PLAYS
Play Date: 09/07/2002
EDMC (Education Management--$44.33; -1.17; 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: Gave us a head fake Tuesday, gapping higher and holding up, then falling to give it all back and more. It tapped the 18 day MVA on the low (43.71) and recovered to close at the 10 day MVA. Little consolation. Volume jumped as it reversed, not great action and a quick little double top here to watch carefully.
Volume: 684.56K Avg Volume: 366.227K
BUY POINT: After a test lower to 44-43, a move back over 44. 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
Play Date: 10/05/2002
IGT (International Game Technology--$69.85; +1.2; optionable): Gaming electronics. Forecast to announce a split 10-23-02 in conjunction with earnings (company has not confirmed this date).
http://biz.yahoo.com/p/i/igt.html
BACKGROUND: IGT has never announced a stock split, but the gaming sector is performing well and the stock is near an all-time high, a leader in the market.
STATUS: Cup w/handle. Gapped over 70, coming just shy of the breakout. Sold back to close, but held most of the gain on strong volume. May try to fill the gap back down to 69 and then move again. That is where we will look at positions. Accumulation in the pattern is positive at 9 up weeks on rising volume to 8 down weeks on rising volume.
Volume: 1.214M Avg Volume: 990.5K
BUY POINT: Breakout: $70.95 Volume=1.2M Target=$80 Stop=$66.45
POSITION: IGT DN - April $70c (51 delta) or IGT AM - Jan $65c (61 delta) and/or Stock
http://www.investmenthouse.com/cs/igt.html
PRE-SPLIT
Play Date: 10/12/2002
CPBI (CPB Regional Bank--$47; +0.6; no options): Regional bank. Splits 2:1 on 11-12-02
http://biz.yahoo.com/p/c/cpbi.html
STATUS: Gapped up and just stayed there. We watched it but decided to wait for a test of 46 or a further move up from the close. Tough to play those gaps that go nowhere.
Volume: 14.1K Avg Volume: 26.363K
BUY POINT: After a test of 46, $46.41 Volume=25K Target=$52.45 Stop=$43.16
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/cpbi.html
Play Date: 09/10/2002
SPW (SPX Corp.--$105.5; +7.46; optionable): Auto parts. Splits 2:1 on 10-25-02
http://biz.yahoo.com/p/s/spw.html
STATUS: SPW blew past the 50 day MVA (103.51) Tuesday on some excellent volume, capping off a nice move off the lows last week. What we look for now is a test of the 50 day MVA, and then pick it up on the way back up.
Volume: 820K Avg Volume: 497.045K
BUY POINT: Test the 103.5 level, $105.15 Volume=425K Target=$110 Stop=$102.55
POSITION: SPW KA - Nov $105 c (70 delta)
http://www.investmenthouse.com/cs/spw.html
CONTINUING CANDIDATES
Play Date: 10/01/2002
AZO (Autozone--$83.5; +1.05; optionable): Auto parts store
http://biz.yahoo.com/p/a/azo.html
STATUS: Breakout. AZO gapped over 82.50 Tuesday on some stronger, above average volume. It sold back most of the session but held onto most of the move. We are looking for a test of support at 82.50 in some general market testing and then pick it up on the way back up.
Volume: 1.705M Avg Volume: 1.295M
BUY POINT: 82.65 after a test of 82.50 (orig. $81.55). Volume=1.5M Target=$92 Stop=$77.45
POSITION: AZO LN - Dec. $70c (64 delta) and/or Stock
http://www.investmenthouse.com/cs/azo.html
POST-SPLIT
Play Date: 10/12/2002
APOL (Apollo Group--$45.05; +0.61; optionable): Education and training
http://biz.yahoo.com/p/a/apol.html
STATUS: Testing the short term MVA. Gapped over the buy point Tuesday on some strong volume, but it sold lower all session and we held off entering. Looking for it to test 44 once more, and when it starts back up we will then enter positions.
Volume: 3.16M Avg Volume: 2.47M
BUY POINT: After a test of 44, $44.24 Volume=3.3M Target=$50.88 Stop=$42.05
POSITION: OAQ BH - Feb. $40c (67 delta) and/or Stock
http://www.investmenthouse.com/cs/apol.html
Play Date: 10/12/2002
LAND (Landair--$12.3; -0.1; no options): Trucking
http://biz.yahoo.com/p/l/land.html
STATUS: Breakout. LAND anticipated the good economic news, moving up last week. This week it has held its ground, but we expect a pullback to test near 11.50 before it starts back up. When it does that we will let it bounce and then move in.
Volume: 30.5K Avg Volume: 6.227K
BUY POINT: After a test of 11.50 to 12. Volume=25K Target=$14.85 Stop=$11.49
POSITION: Stock (no option chain)
http://www.investmenthouse.com/cs/land.html
Play Date: 10/12/2002
PFGC (Performance Food Group--$37.24; +1.02; optionable): Wholesale food
http://biz.yahoo.com/p/p/pfgc.html
STATUS: Testing the 200 day MVA (34.58). Rallied hard Tuesday and we moved in after the volume started to build in the afternoon. PFGC cleared some interim resistance at 37 on the move. Food is one sector that will continue to do well in the economy despite what techs do. Accumulation is positive at 7 up weeks on rising volume to 6 down weeks on rising volume.
Volume: 659.425K Avg Volume: 448.772K
BUY POINT: New positions: on a test of 37 that holds (orig. $35.25) Volume=500K Target=$38 Stop=$33.75
POSITION: PGU LF - Dec. $30c (82 delta, 73 OI)
http://www.investmenthouse.com/cs/pfgc.html
Play Date: 10/12/2002
SHFL (Shuffle Master--$21.08; +0.13; optionable): Card shufflers
http://biz.yahoo.com/p/s/shfl.html
STATUS: Breakout ascending wedge. SHFL continued the move up Tuesday, but it gave it all back as volume continued to rally. From here looking for the stock to test lower toward 20.50 in some market testing and then start back up. That will be the point for new positions or add-to's. Accumulation in the pattern was positive at 6 up weeks on rising volume to 5 down weeks on rising volume. This wedge is part of a larger 6-month cup base.
Volume: 783.568K Avg Volume: 290.636K
BUY POINT: New positions: after a test of 20.50 (orig. $20.38). Volume=375K Target=$24 Stop=$18.75
POSITION: SFQ BW - Feb. $17.50c (74 delta) and/or Stock
http://www.investmenthouse.com/cs/shfl.html
Play Date: 10/12/2002
THC (Tenet Healthcare--$50.4; +1.39; optionable): Hospitals
http://biz.yahoo.com/p/t/thc.html
STATUS: Testing the 50 day MVA. Solid bounce on rising volume as THC moves off the 50 day. Still a buy on this move. Accumulation in the 4-month cup base is solid at 4 up weeks on rising volume to 2 down weeks on rising volume.
Volume: 3.824M Avg Volume: 2.755M
BUY POINT: New positions: 50.55 (orig. $50.05). Volume=4M Target=$55 Stop=$48.55
POSITION: THC AI - Jan $45c (70 delta) and/or Stock
http://www.investmenthouse.com/cs/thc.html
Play Date: 10/05/2002
XRAY (Dentsply--$40.99; -0.11; optionable): Dental supplies and instruments
http://biz.yahoo.com/p/x/xray.html
STATUS: Cup w/handle. Still in the handle formation to the 8-week base. Volume has been declining even as the market rallied. It is just sticking to its business and we will wait for the breakout. Accumulation is positive at 2 to 0 in this short base.
Volume: 613.89K Avg Volume: 670.181K
BUY POINT: $42.28 Volume=900K Target=$48.75 Stop=$39.32
POSITION: XEQ DH - April $40c (64 delta) and/or Stock
http://www.investmenthouse.com/cs/xray.html
End Part 2 of 3
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us stock market
top stock pick
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