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stock recommendation, stock market report
Begin Part 2 of 2
We apologize for the late report. Jon Johnson is to undergo a medical procedure tomorrow morning unexpectedly and has had some difficulties preparing for it. Again we apologize for the delay.
SUBSCRIBER QUESTIONS
This question deals with a specific stock but it is appicable to any.
Q: One of your picks, JBHT, was within cents of your buy point...good volume...pushed over 30 at the close. They then received a downgrade buy a brokerage company last night to neutral from outperform...so the stock is down this morning on HUGE volume. What is your experience in such cases...is it better to just join the crowd & bail out of the stock....or, are these downgrades sometimes temporary phenomena to scare out the "weak hands" and, in turn, a buying opportunity in which case the primary trend will re-assert itself? I know you've been following JBHT for a while, it was on your list last night, so your analysis would be appreciated!
A: Downgrades have different impacts in different markets. Most all stocks take a hit on the initial news. After that much depends on the market and the strength of the stock. As we saw during the downtrend, a downgrade could take a tentative move higher and thrash it. As the market improved we saw valuation downgrades. With the market still in a tentative recovery, some survived the downgrades, some did not. Stronger stocks will take a hit for a few sessions and then recover. How do you know it is strong? Does it hold near support on the news? Does it gap below and then recover right away? One of the keys we typically look at is whether the stock did in fact hold support or hold the current pattern. If it does, the knee-jerk reaction to the analysts has a good chance of blowing over. In JBHT's case the stock managed to hold the pattern and may recover. As it had not hit the buy point we can wait and see if it regroups. If it does not hold the pattern or breaks support on such volume on the close the chances of recovery diminish. We can go ahead and exit or give it a session to recover the pattern.
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THE PLAYS:
Good moves: UNTD; TECH; PFGC; MERQ; NBIX; BRCM; ASKJ
New Plays:
Upside:
Play Date: 01/07/2003
DBD (Diebold--$41.43; -0.14; optionable): Business Equipment
http://biz.yahoo.com/p/d/dbd.html
STATUS: Double bottom. DBD is moving laterally this week, repeatedly tapping resistance at 42 as it works laterally above the 10 day MVA at 41. It showed an impressive volume spike Monday, and it looks as if DBD is ready to make a new breakout. Accumulation in the big base is excellent at 12 accumulation weeks (up on rising volume) to just 3 distribution weeks (down weeks on rising volume). Very strong and looks ready for the breakout.
Volume: 399.9K Avg Volume: 316.136K
BUY POINT: $42.12 Volume=474K Target=$50.55 Stop=$40.25
POSITION: DBD EH - May $40c (65 delta) and/or Stock
http://www.investmenthouse.com/ct/dbd.html
Play Date: 01/07/2003
LF (Leapfrog Enterprises--$28.14; +1.88; optionable): Educational games
http://biz.yahoo.com/p/l/lf.html
STATUS: Testing the 50 day MVA. A new issue in July, LF rallied to 34 and then spend December testing the move. It broke below the 50 day MVA and then broke back over that level Tuesday on strong, above average volume as it reported earnings would be much better than expected. The move back over the 50 day MVA is an important one and we are looking for it to clear the simple 50 day MVA for positions.
Volume: 771.8K Avg Volume: 347.227K
BUY POINT: $28.95 Volume=521K Target=$34.88 Stop=$26.92
POSITION: LF FE - June $25c (70 delta, low OI) and/or Stock
http://www.investmenthouse.com/ct/lf.html
CONTINUING PLAYS: These look good for Wednesday
Play Date: 12/07/2002
AFCO (Applied Films--$20.89; +0.45; optionable): Semiconductor
http://biz.yahoo.com/p/a/afco.html
STATUS: Ascending wedge. AFCO is working through a 5-week pattern after a 9-month cup base showing solid accumulation. The pattern is tightening up toward a breakout. Tuesday it hit the buy point but there was no volume. We are upping the buy point a hair and looking for strong volume as it moves through that level.
Volume: 54.4K Avg Volume: 186.09K
BUY POINT: $21.17 (orig. $20.85). Volume=225K Target=$25 Stop=$18.79
POSITION: UOF DW - April $17.50c (55 delta, low OI) and/or Stock
http://www.investmenthouse.com/ct/afco.html
Play Date: 12/30/2002
ANSI (Advanced Neuromo--$34.88; -0.11; optionable): Medical instruments
http://biz.yahoo.com/p/a/ansi.html
STATUS: Cup w/handle. A very nice looking handle forming with ANSI testing the 10 day MVA (34.65) the past two sessions, showing a very tight doji Tuesday that tested that level on the low. Looks ready for the next move.
Volume: 96K Avg Volume: 201K
BUY POINT: $35.43 Volume=309K Target=$40.74 Stop=$32.95
POSITION: UAI EG - May $35c (45 delta, low OI) and/or Stock
http://www.investmenthouse.com/ct/ansi.html
WATCHLIST/ CONTINUING:
Stock Date Play Close +/- Pivot Tgt Vol TgtV Stop
$SOX 12/07 Test 50 333.42 +1.73 335.15 385 0 0 313.94
Current. Doji that tapped 343 on the high. If it cannot rally early Wednesday we will look at exiting.
ADTN 12/10 Test 18 35.95 -0.31 32.05 38.45 1.1M 800K 33.25
Current.
AFCO 12/07 Test BO 20.89 +0.45 20.85 25 54K 225K 18.79
Buy Not Hit.
AIG 12/18 Put 60.93 -1.21 58.55 54 5.4M 7M 59.15
Current.
AMTD 12/19 A Wedge 5.98 -0.1 5.54 6.85 3.1M 165K 5.35
Current.
ANSI 12/30 Cup hdl 34.88 -0.11 35.43 40.74 96K 309K 32.95
Buy Not Hit.
ANT 12/11 Put 25.1 -0.1 22.45 20 232K 200K 23.55
Current.
APSG 12/28 Cup hdl 11 +0.03 12.04 14.55 41K 85K 11.45
Buy Not Hit.
ASKJ 12/26 Cup hdl 3.25 +0.21 2.89 3.88 858K 305K 2.44
Current.
AVCT 12/28 Test 50 25.04 +0.26 23.08 27 958K 750K 22.05
Current.
AVID 12/07 Test 18 23.65 -0.15 21 25 429K 500K 21.75
Current.
AVID 10/30 Cup hdl 23.65 -0.15 15.65 25 429K 177K 21.75
Current.
AVO 12/16 A Wedge 11.81 -0.12 12.06 14.45 50K 210K 11.22
Buy Not Issued.
AVP 11/25 Cup hdl 53.81 -0.71 52.94 61 772K 1.8M 52.75
Current.
BBBY 01/02 Cup 36.2 +0.12 37.55 45 3.1M 5.7M 34.92
Buy Not Hit.
BRCM 01/02 Test 50 18.55 +0.89 16.85 20.45 15M 12M 15.67
Current.
BRCM 08/17 CCall 18.55 +0.89 19.2 19.8 15M 9M 17.25
Current.
BSTE 12/11 A Wedge 38 +0.57 34 41.25 452K 900K 33.94
Current.
CCCG 01/06 Cup 19.49 -0.11 20.05 25.12 50K 173K 18.65
Buy Not Hit.
COLM 11/13 DB hdl 44.77 -1.22 41.96 48.45 893K 389K 44.25
Current.
CVD 12/21 Cup hdl 23.64 -1.21 24.75 29.74 1M 581K 23.65
Current.
CVD 11/05 Test BO 23.64 -1.21 23.65 28 1M 581K 23.35
Current.
CVH 12/09 Put 29.82 -0.14 29.04 26 312K 820K 30.24
Current.
DBD 01/07 Cup hdl 41.43 -0.14 42.12 50.55 400K 474K 40.25
New.
ETM 12/28 Put 50.1 -0.5 45.75 42 277K 325K 46.78
Exited.
GPN 12/19 BO 31.67 -0.1 31.55 38 120K 225K 30.12
Current.
GRMN 11/06 Cup hdl 31.32 -0.41 22.34 34 669K 198K 28.95
Current.
HAR 11/21 Test 18 59.25 -1.37 61.6 70 266K 488K 59.45
Current.
HD 09/16 Test 50 21.46 -0.36 34.55 38 20M 10M 32.13
Current.
HSIC 12/09 Put 43.12 -1.78 44.15 40 895K 667K 46.05
Tanking finally.
IDBE 12/16 DB hdl 6.42 -0.11 6.65 8.55 52K 165K 6.15
Current.
IDBE 01/04 DB hdl 6.42 -0.11 6.85 8.55 52K 165K 6.37
New.
JAKK 12/22 Put 13.86 -0.02 13.55 11 202K 325K 14.65
Current.
KLAC 01/03 Test 50 40.46 -0.38 39.25 45.25 13M 12M 36.55
Current.
LF 01/07 BO 28.14 +1.88 28.95 34.88 772K 521K 26.92
New.
LXK 01/02 Test 50 64.55 -0.25 63.78 69 1.6M 1.8M 60.25
Current.
MBT 12/22 Cup hdl 39.6 +0.09 40.06 47.96 68K 255K 37.26
Buy Not Hit.
MEDI 01/03 A Wedge 28.09 -0.02 28.55 33.88 3.3M 5M 26.98
Buy Not Hit.
MERQ 12/11 Test BO 37 +3.92 31.55 38 10M 5M 29.94
Current.
MLHR 12/28 Put 18.65 -0.38 17.94 15.85 384K 425K 19.05
Current.
MRCY 12/14 A Wedge 31.14 -0.1 32.55 37.85 120K 350K 29.43
Buy Not Issued.
MSN 12/21 Test BO 5.45 -0.24 5.92 7.45 92K 150K 4.94
Buy Not Hit.
MSN 12/04 Cup hdl 5.45 -0.24 4.85 6.35 92K 150K 4.75
Current.
MSN 11/23 Cup hdl 5.45 -0.24 4.15 5.68 92K 150K 4.75
Current.
NBIX 10/08 Rv H&S 45.75 +0.58 44.85 55 355K 1.1M 45.45
Current.
NSCN 12/22 Pennant 17.76 +1.08 17.24 21.24 1.1M 1.8M 16.03
Current.
NTII 12/22 Test BO 6.1 +0.2 6.74 8.25 67K 90K 6.18
Buy Not Hit.
PFGC 12/09 Put 31.95 -2.32 33.97 31.75 2M 475K 34.75
Current.
POSS 01/06 Test BO 17.83 +0.05 18.35 22.12 372K 167K 16.75
Buy Not Hit.
PVSW 11/23 Cup 4.18 +0.13 4.27 5.35 141K 125K 3.97
Current.
QCOM 12/21 Test 50 37.26 -0.11 39.15 48 14M 18M 36.41
Buy Not Hit.
QCOM 12/04 Test 18 37.26 -0.11 40.85 50 14M 18M 37.99
Current.
QCOM 11/07 Test BO 37.26 -0.11 34.78 42 14M 18M 38.14
Current.
QLGC 11/07 Test BO 41.18 +1.06 41.4 50 12M 25M 39.88
RBK 01/02 DB hdl 31.05 -0.14 30.25 38.85 348K 680K 28.45
Current.
RDEN 12/17 Cup hdl 15 +0.14 15.39 18.45 62K 185K 14.31
Buy Not Hit.
RINO 10/24 Test BO 18.13 -0.46 17.35 20.75 131K 225K 16.95
Current.
RINO 08/28 Cup hdl 18.13 -0.46 13.8 20 131K 300K 16.95
Current.
SAFC 12/07 A Wedge 36.62 -0.22 36.69 41 930K 1.5M 34.12
Current.
SINA 12/31 Test BO 8.42 +0.09 6.25 8.25 2.3M 950K 6.48
Current.
SINA 12/04 Test BO 8.42 +0.09 5.58 8.25 2.3M 950K 6.48
Current.
SJM 12/02 Test BO 41.36 +0.51 40.15 48 384K 476K 37.65
Buy Not Issued.
SOHU 01/03 BO 7.72 +0.04 7.75 9.45 1.1M 800K 6.65
Current.
TARO 12/18 Cup hdl 34.76 -2.14 39.05 46.85 3.4M 575K 36.32
Buy Not Hit.
TECH 01/03 Put 25.95 -1.24 27.88 24 836K 400K 29.21
Plunging lower.
TK 12/07 Cup hdl 42.2 +0.34 39.25 46.65 356K 235K 36.15
Buy Not Issued.
TSCO 10/16 Test BO 41.7 +0.89 39.05 46.85 496K 235K 37.94
Current.
UNTD 11/30 Test BO 17.9 +1 16.25 19.65 1.4M 1M 15.55
Current.
URBN 12/22 Put 22.75 -0.19 23.36 20.22 339K 500K 24.65
Current.
UTHR 11/12 DB hdl 17 -0.02 17.65 21.45 159K 295K 16.21
Current.
VRTY 11/30 Cup hdl 15 +0.84 14.56 17.65 640K 450K 13.54
Current.
VZ 12/04 Cup hdl 43.62 -0.45 41 47.5 13M 11M 38.13
Buy Not Hit.
VZ 11/23 Cup hdl 43.62 -0.45 41 45 13M 11M 38.25
Current.
VZ 10/10 Test 50 43.62 -0.45 34.75 42 13M 10M 38.25
Current.
WCN 12/31 BO 37.22 -0.78 39.1 46.45 386K 425K 36.94
Current.
WGO 12/28 Put 40.5 -0.6 39.49 36 207K 270K 41
Current.
YHOO 12/11 Test 50 19.15 +0.21 17.32 22.75 14M 20M 16.11
Current.
Good Investing!
Jon L. Johnson and your Technical Traders Report 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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stock recommendation
stock market report
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