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Begin part 3 of 3

THE PLAYS

Good movers Tuesday: ANSR; ASPT; BEAS; BEV; GEMS; MERX; TGT; UNTD

Weekend play results:
KYPH: Nice break higher on strong volume.
LNUX: Edged higher on stronger volume, but fell well off the early high so we left it to see how it would work the next session.
NSM: Gappd higher but gave back much of the move. Higher volume. Would like to see one more test toward 28ish for a very good entry point.
PLL: Volume was up but it could not make any more traction.

New Plays for Wednesday:

Upside:

Play Date: 09/02/2003
CMVT (Comverse Technology--$17.19; +0.79; optionable): Telecom processing systems
http://biz.yahoo.com/p/c/cmvt.html
STATUS: Reverse head and shoulders. CMVT is starting the breakout from a 2.5 month base. This is the second base following the October low. Strong money flow is leading higher and relative strength is breaking out as well, a signal of the breakout strength. Want to see more volume on the breakout, but looks good here.
Volume: 3.161M Avg Volume: 2.979M
BUY POINT: $17.32 Volume=4M Target=$20.85 Stop=$16.11
POSITION: CQV AW - Jan. $17.50c (52 delta) &/or Stock
http://www.investmenthouse.com/cd/cmvt.html

Play Date: 09/02/2003
ONT (On2.com--$2.77; +0.52; no options): Internet services
http://biz.yahoo.com/p/o/ont.html
STATUS: Test 50 day MVA. This is the test of the breakout and explosion higher in July, that move following a 2.5 month flat base. It rallied to 4.50 intraday on its high and then fell back to the 50 day MVA (2.09) over the past 7 weeks on lower, below average volume. This is basically the formation of a new base. ONT started up sharply on a big volume increase Tuesday. It is not a breakout play, but with solid 3 to 0 accumulation and money flow starting to surge back up, we are looking for an entry piont here and then later after it forms a handle and makes the next breakout.
Volume: 2.478M Avg Volume: 1.039M
BUY POINT: $2.92 Volume=1.6M Target=$4 Stop=$2.72
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cd/ont.html

Play Date: 09/02/2003
SSYS (Stratasys--$45; +4.31; no options): Prototyping & 3-D printing devices
http://biz.yahoo.com/p/s/ssys.html
STATUS: Cup w/handle. SSYS was a big winner for us earlier in the year surging from 10 to 40 after the breakout from a long flat base in 2002 and a cup with handle in early 2003. It raced up the short term MVA into July, and has since come back for a deeper test to form a much needed 7 week base. It found support at 30, just below the 50 day MVA (now at 35.77), and started back up on strong trade to form the right side of the base. After breakouts from bases stocks will typically run up the short term MVA 4 to 5 times before a deeper test. That is what this action is. Last week it made a more or less lateral move on below average volume, and then shot higher Tuesday on another huge volume surge. Money flow is screaming back up and relative strength made the breakout. Looks ready to continue on and start the next run.
Volume: 1.158M Avg Volume: 419.227K
BUY POINT: $45.33 Volume=629K Target=$54.25 Stop=$42.16
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cd/ssys.html

Continuing plays that look ready:

Play Date: 08/27/2003
MROI (MRO Software--$13.06; +0.1; optionable): Application software
http://biz.yahoo.com/p/m/mroi.html
STATUS: Cup w/handle. MROI is putting on the finishing touches to its 8 month cup with handle, tapping the 18 day MVA on the Tuesday low (12.66) and rebounding on rising though still below average volume. Excellent money flow to match the outstanding 8 to 1 accumulation. Looks ready for the breakout.
Volume: 102.581K Avg Volume: 110.318K
BUY POINT: $14.03 Volume=163K Target=$16.85 Stop=$12.94
POSITION: UPJ LV - Dec. $12.50c (55 delta) &/or Stock
http://www.investmenthouse.com/cd/mroi.html

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SUBSCRIBER PORTFOLIO: Here is the revamped portfolio. A very good mix of stocks that will provide some very interesting plays in the weeks and months ahead. Right now we are just putting them in, and when they provide a buy point that is when we will start to move into positions. That is the key to any purchases, i.e., wiaitng for them to provide the entry points and not just a shotgun buy.

AVID, DIS, GTRC, KKD, LPNT, OCR, TGT, UTSI

AVID 08/09 Test 18 51.5 +1.8 50.45 60 821K 1M 47.35
Blew through 50 on another strong volume session!

TGT 08/09 Flat 41.51 +0.91 41.45 50 5.2M 5.7M 39.28
Current. Entered the play as the stock ran up on strong volume.

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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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