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Begin Part 2 of 2
Economic Calendar
1-06-03
ISM services, December (10:00): 55.8 expected, 57.4 prior.
1-07-03
Factory Orders, November (10:00): -0.6% expected, 1.2% prior.
1-08-03
Consumer credit, November (2:00): $3.8B expected, $1.5B prior.
1-09-03
Wholesale inventories, November (10:00): 0.2% expected, -0.3% prior.
1-10-03
Non-farm payrolls, December (8:30): 21K expected, -41K prior.
Unemployment rate, December (8:30): 6.0% expected, 6.0% prior.
Hourly earnings: 0.3% expected, 0.3% prior.
Average workweek: 34.2 expected, 34.2 prior.
SUBSCRIBER QUESTIONS
Q: A question regarding revisted stocks. When a stock that was a previous play that hit the buy point, if we already purchased this stock the 1st time and it comes up as a revisited play, would that be an add to point if it hits the buy point listed on the revisited play. Would that be a strong stock that is testing the breakout?
A: Good question. There is more than one point to buy a good stock. Contrary to what some investment advisors think, a great stock will give you more than one entry point. Stocks run higher then test the moves continually. They breakout, run, test back, run some more. We can use those tests as entry points as long as the stock continues to show good action, i.e., making higher lows and showing good price/volume action as it does (rising on the move up, falling overall on the move back down). We like to focus our money in stocks that are doing well, stocks that are showing accumulation and winning attributes. That way we get more money into winners as opposed to spreading our money too thin in so-so stocks. That is why we were selling several positions before year end to free up money and also book any loss so we could write it off.
For revisited plays that have already hit the buy point we are viewing that as a good entry point for add-to positions or new positions. It is showing continued good action, something we want to take a greater part in. In that sense it is one of the stronger stocks because it continues to show good performance and it is at a point where it is a natural buy. If it continues its ways it will be a solid entry point. At the current time we are riding several stocks well past their target price simply because they are showing very good continued action. We have been letting them run and averaging into more and more positions in the stock as the opportunity is presented.
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THE PLAYS
Good movers: AGU; AVID; GRMN; NTES; SINA; STK
Friday Plays:
COGN: Held steady at the 10 day MVA, still looking ready.
BBBY: Had to rest after the strong Thursday move.
EUNI: Moving higher but not quite breakout power.
STK: Making the breakout!
Best Plays:
1) BRCM: Tested the 50 day MVA and looks ready for a bigger run.
2) UNTD: Nice consolidation looks to be coming to an end.
3) Continuing: BEAS, CGX stil solid. URBN looks ready to move back down. GOCN is solid as is HLTH.
New Plays:
ACTI (Activecard--$8.7; +0.1; no options): Security software
http://biz.yahoo.com/p/a/acti.html
STATUS: Pennant. One of the stronger technology sectors given the continuing growth of online activity and the specter of terrorist cyber attacks. ACTI is working through a 2-month pattern on the tail end of a longer 12-month cup base. Accumulation is solid at 2 accumulation weeks to 0 distribution weeks in the pennant and 13 to 2 since the last small cup started in June. Money flow is racing ahead of the stock as it has again successfully tested the 50 day MVA (8.36) last week, and if the stock garners some big volume on the move we will enter.
Volume: 53.7K Avg Volume: 152.318K
BUY POINT: $8.95 Volume=225K Target=$10.75 Stop=$8.28
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cd/acti.html
BRCM (Broadcom--$16.5; -0.11; optionable): Communication chips
http://biz.yahoo.com/p/b/brcm.html
STATUS: Testing the 50 day MVA. BRCM peaked in late November, then sold back to the 50 day MVA (15.40) where it traded for the past three weeks. It never collapsed, and after a shakeout early last week it jumped off the 50 day on sharply rising volume Thursday. We were waiting for it to test back to the 50 day just as many stocks did after their first moves coming off the October low. Friday BRCM did just that with a lower volume tap of the 50 day on the low and a rebound to close slightly lower. Looks ready for another move higher from here. We are ready to start some positions for this trade up to the recent high near 21.
Volume: 7.647M Avg Volume: 10.782M
BUY POINT: $16.85 Volume=12M Target=$20.45 Stop=$15.67
POSITION: RCQ EC - May $15c (69 delta) and/or Stock
http://www.investmenthouse.com/cd/brcm.html
Downside:
GTRC (Guitar Center--$16.12; -1.13; optionable): Guitars and accessories
http://biz.yahoo.com/p/g/gtrc.html
STATUS: Put. GTRC had put together a nice cup pattern from May to October, but it started to get volatile, jerking down to the 200 day MVA in a week, racing back up to the high, and then rolling over again. It plunged back through the 200 day MVA just below 18, tested it, and started to fall. Friday it rolled over on very heavy volume on rising concerns it did not have a good holiday season. The chart speaks volumes, and it looks as if GTRC is going to go test the July low near 14.
Volume: 450.799K Avg Volume: 261.09K
BUY POINT: $15.88 Volume=400K Target=$14 Stop=$16.35
POSITION: UGR NW - Feb. $15p (no delta available)
http://www.investmenthouse.com/cd/gtrc.html
Revisited:
Play Date: 11/30/2002
CRAY (Cray, Inc.--$7.52; -0.07; no options): Super computers
http://biz.yahoo.com/p/c/cray.html
STATUS: Testing the 18 day MVA (7.41). We got in on the big breakout in late October, and CRAY has made a series of steps higher and then tested the 50 day MVA in December. Since then CRAY has started back up for its next run up the short term MVA, making its first real test of the 18 day MVA. It has moved laterally over the late November highs on low volume the past week, Friday showing a doji on the 18 day. This action looks ripe for the next move higher, particulalry with the huge accumulation since July (7 accumulation weeks to 2 distribution weeks since the base started).
Volume: 618.565K Avg Volume: 757.954K
BUY POINT: New: $7.70 Volume=1M Target=$9.85 Stop=$7.15
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cd/cray.html
Play Date: 11/30/2002
UNTD (United Online--$16.54; +0.55; optionable): Internet software
http://biz.yahoo.com/p/u/untd.html
STATUS: Ascending wedge. Shaping up very well, forming a 5-week ascending triangle. Looking for a breakout to kick off the next strong move up.
Volume: 434.025K Avg Volume: 827.227K
BUY POINT: New: $17.05 (orig. $16.25) Volume=1M Target=$20.50 (new) Stop=$15.55
POSITION: QAB CC - Mar. $15c (65 delta, low OI) and/or Stock
http://www.investmenthouse.com/cd/untd.html
MEMBER PORTFOLIO: CUB, EBAY, HOTT; LOW, NOC, PG, QLGC, RCII, SRCL, WM
These are the stocks that our subscribers vote to put in a 'portfolio' to track their progress and comment upon when they reach buy points, sell points, or levels to write some covered calls on. They are not covered every report, but when something interesting is developing we take note.
We will tally the totals this weekend. Be sure and place your vote if you have not already done so.
Stock Date Play Close +/- Pivot Tgt Vol TgtV Stop
CONTINUING/WATCHLIST: These are stocks that are current plays (the buy point hit), waiting for the buy point to be hit (buy not hit), or buy not made for various reasons (buy alert not issued). The date references the date the play first appeared on the report. Pivot is the buy point.
Stock Date Play Close +/- Pivot Tgt Vol TgtV Stop
$SOX 12/07 Test 50 314.14 +5.58 335.15 385 0 0 313.94
Current. Continuing the recovery, rallying over exponential 50 day MVA and now confronting resistance at 325 next. Many key chip stocks (AMAT, KLAC), however, have made dramatic improvement and look ready for further upside.
ACTI 01/04 Pennant 8.7 +0.1 8.95 10.75 54K 225K 8.28
New.
AGU 12/30 A Wedge 11.64 +0.24 11.55 13.85 639K 357K 11.05
Current. Made the breakout move on super volume Friday. Still a buy at this point.
AIG 12/18 Put 60.12 -0.18 58.55 54 3.9M 7M 59.15
Current. Doji Friday. Need to see a drop early this week or we will close it out.
ALN 12/07 Test BO 10.15 +0.05 9.86 11.85 194K 412K 9.17
ALN 11/09 Test BO 10.15 +0.05 7.28 9.75 194K 200K 9.25
Current. Took a breather after the good recovery.
AMZN 10/21 Cup hdl 20.52 +0.95 20.32 24.38 8.8M 10M 21.75
Current. Continues to work back, now facing the 50 day MVA at 21. Solid upside volume Friday.
ANT 12/11 Put 25.4 +0.4 22.45 20 131K 200K 23.55
Current. Rallied again on low volume. Low volume kept us in a bit longer, anticipating a selling session early this week for a better exit point if it does not roll over harder.
AVID 12/07 Test 18 23.71 +0.51 21 25 277K 500K 21.75
Current. Rising still.
AVID 10/30 Cup hdl 23.71 +0.51 15.65 25 277K 177K 21.75
Current. Hit another target and a good point to cash in some more options with a big gain. Upped the target.
BBBY 01/02 Cup 35.27 -0.93 37.55 45 2.8M 5.7M 34.92
Buy Not Hit.
BEAS 12/19 Test BO 12.03 +0.08 11.77 14.74 4.9M 16M 10.94
Current. Rallied slightly, still looking ready to make a much stronger upside move.
BRCM 01/02 Test 50 16.5 -0.11 16.85 20.45 7.6M 12M 15.67
New.
BRCM 11/16 BO 16.5 -0.11 15.9 20 7.6M 15M 14.79
Current.
CGX 12/03 Cup hdl 22.65 -0.35 22 26.45 40K 65K 21.94
Current. Back to the 18 day MVA Friday after the promising Thursday move.
COGN 01/02 Cup 23.93 -0.06 25.11 30.24 489K 1.5M 23.35
Buy Not Hit. Still looks super.
CRAY 11/30 A Wedge 7.52 -0.07 7.38 8.85 619K 346K 7.15
Current.
CRAY 10/21 Cup 7.52 -0.07 4.28 8 619K 346K 7.15
Current.
CUB 07/06 Cup 19.03 +0.12 0 0 72K 0 0
DANKY 12/17 Cup hdl 4.41 -0.1 4.62 5.65 217K 560K 4.25
Buy Not Hit. Still holding above the 18 day MVA in the pattern.
DISK 12/28 Cup hdl 2.5 +0.05 2.61 3.15 19K 37K 2.38
Buy Not Hit. Ditto.
EBAY 12/12 Test 18 69.93 +0.58 69.45 77 5.1M 12M 68.05
Current. Banging around in a trading range from 66 to 70, EBAY is approaching the top of the range again, this time showing good volume. A breakout may be imminent here.
EBAY 10/15 Test 50 69.93 +0.58 62.45 71 5.1M 12M 68.05
Current.
ECL 10/30 Cup hdl 49.9 -0.15 49.11 56.55 423K 1M 48.15
Current. Still hugging the new high at 50.
ESRX 12/18 Put 51.51 +0.9 48.02 44 1.2M 1.5M 49.05
Current. Rallied up to the 50 day MVA on lower volume in a fitful session. Will see if we get a rollover here this week for a better exit point or further selling.
EUNI 12/30 Cup hdl 6.2 +0.06 6.33 7.88 157K 204K 5.68
Buy Not Hit. Fitful move higher on some average volume. Not what we were looking for, but still can make the breakout.
FLML 12/05 Test BO 4.08 +0.03 4.05 5.97 19K 100K 4.05
Current. Hugging 4. Tried the good move Tuesday, but fizzled. Will look to exit this week without a good push higher.
GRMN 11/06 Cup hdl 30.82 +0.84 22.34 34 635K 198K 28.95
Current. Another strong volume move higher that hit another target. Upping the target for the next leg.
GTRC 01/04 Put 16.12 -1.13 15.88 14 451K 400K 16.35
New.
HLTH 12/12 Cup hdl 8.91 +0.16 8.85 11.35 2.4M 3.1M 8.23
Buy Not Issued. Not bad action, showing much improved volume late in the week as HLTH tries for the breakout.
HOTT 11/23 A Wedge 23.01 -0.69 23.9 28 542K 1.5M 22.45
Current. Caught in retail problems Friday, selling back to the 50 day MVA.
JBHT 12/12 A Wedge 29.5 +0.01 30.18 35.25 287K 725K 28.07
Buy Not Hit. Still in the tight, lateral consolidation. Waiting, waiting, waiting . . .
LMLP 12/07 Cup hdl 13.27 -0.28 10.75 12.96 235K 135K 12.25
Buy Not Issued.
LMLP 11/23 Cup hdl 13.27 -0.28 9.75 14.25 235K 135K 12.97
Current. Showing some cracks, selling down on rising, above average volume Friday after the long lateral consolidation. That is never a good sign. On alert to take gains if it breaches the 18 day MVA.
LOW 07/06 Test 50 36.92 -2.43 0 0 16M 0 0
MLHR 12/28 Put 18.86 -0.14 17.94 15.85 145K 425K 19.05
Current. Tried to clear the 50 day MVA Friday but started to stall.
MRK 12/21 Test 50 58.99 +0.74 58.05 67 5.2M 9.5M 55.94
Current. Another good move higher as drug stocks continue to look solid.
MRK 12/07 Test BO 58.99 +0.74 59.15 67 5.2M 9.5M 55.94
Current.
MVL 11/04 BO 9.16 -0.07 8.74 10.75 425K 400K 8.35
Current. Still working higher on volume, but unable to put together a breakout over the high at 9.50 last week.
NOC 07/06 Test 50 99.4 -0.4 0 0 1M 1.7M 0
NTES 12/19 Test BO 13.14 +1.04 12 14.45 568K 550K 11.12
Current. Solid volume move Friday.
PENN 12/14 Put 16.44 -0.38 16.55 14 222K 300K 17.65
Current. Tried another move up but rolled over Friday. In good position to turn back down.
PFGC 12/09 Put 34.42 +0.04 33.97 31.75 204K 475K 34.75
Current. Struggled at the 200 day MVA Friday and then turned down.
PG 09/21 Test 18 86.85 -0.96 91.55 103 2.8M 5.5M 89.45
PPD 11/14 Test BO 26.18 -0.44 25.51 30.55 505K 450K 26.25
Current. On the bubble, still holding support at 26 but has lost its momentum for now. Long term holds are in decent shape as long as it holds here.
PRA 12/11 Cup hdl 20.88 -0.09 20.26 24.32 49K 145K 20.25
Current. Tested the 18 day MVA on the low and rebounded in the current consolidation.
QCOM 12/21 Test 50 35.7 -1.44 39.15 48 16M 18M 36.41
Buy Not Hit.
QCOM 12/04 Test 18 35.7 -1.44 40.85 50 16M 18M 37.99
Current. Struggling, breaking below the lows in the recent consolidation on rising, above average volume. Needs to turn back up here.
QCOM 11/07 Test BO 35.7 -1.44 34.78 42 16M 18M 38.14
Current.
QLGC 08/17 CCall 37.77 +1.37 36.48 0 11M 12M 37
Current.
RBK 01/02 DB hdl 30.5 -0.38 30.25 38.85 929K 680K 28.45
Current. Took a breather after the strong move.
RCII 08/24 Test BO 51.89 -0.21 53.05 60.94 266K 701K 49.34
RIMM 12/22 Put 13.5 -0.22 12.94 9.95 695K 1.7M 14.04
Buy Not Issued. Stalled at the 50 day MVA Friday on rising volume. Looks ready to roll back down.
ROIAK 12/28 Rv H&S 14.19 -0.04 14.55 17.49 279K 650K 13.53
Buy Not Hit. Hesitating on the move up here unlike prior attempts. Needs to make that move.
SINA 12/31 Test BO 7.41 +0.53 6.25 8.25 1.5M 950K 6.48
Current. Another strong volume move higher.
SINA 12/04 Test BO 7.41 +0.53 5.58 8.25 1.5M 950K 6.48
Current.
SRCL 10/19 Cup 33.15 -0.04 35.25 40 295K 787K 32.78
STK 12/26 Cup hdl 23.54 +1.17 23.21 27.88 1.1M 1.2M 21.59
Current. Solid breakout on volume.
TSCO 10/16 Test BO 39.85 +0.17 39.05 46.85 194K 235K 37.94
Current. Rallied to the 50 day MVA where it is stalling a bit. Needs to avoid rolling over here.
UNTD 11/30 Test BO 16.54 +0.55 16.25 19.65 434K 1M 15.55
Current.
UNTD 11/02 Cup hdl 16.54 +0.55 13.3 16 434K 1M 15.55
Current.
UPL 10/19 A Wedge 10 +0.05 9.68 11.75 240K 345K 9.35
Current. Doji at the high at 10. This is the level it needs to clear this time around.
UTHR 11/12 DB hdl 17.05 -0.05 17.65 21.45 59K 295K 16.21
Current. Still in the long lateral move. It is a decent consolidation but has run out of steam for the time being.
UTIW 12/17 Rv H&S 26.67 -0.44 24.56 29 50K 175K 25.25
Current. Took a breather after the strong Thursday move.
VRTS 08/19 CCall 17.03 +0.08 19.76 20 4.1M 8.5M 17.45
Current. Rallied up to the 50 day MVA. Needs to break over here.
WM 07/06 Cup 35.5 -0.15 0 0 2.9M 5.5M 0
YHOO 12/11 Test 50 18.1 +0.5 17.32 22.75 7.6M 20M 16.11
Current. Nice move continues, looking for a breakout here.
Good Investing!
Jon L. Johnson and The Daily 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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