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Read this report online in full color with graphs at
http://www.investmenthouse.com/weekend/091403.htm
1) MARKET SUMMARY
Stocks shrug off weaker retail sales, continue rebound.
- The rebound continues, volume does not.
- Retail sales solid but lower, sentiment still lagging.
- Government jobs reports missing the key data.
- Market still in position to defy the odds and move higher after just a short pullback, but it needs the trade.
http://www.investmenthouse.com/1weekendmarketsummary.htm?123 "> Click here or on link for our full Weekend Market Summary
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2) Stock Splits
Playing stock splits can be very profitable, but it takes know-how.
Our stock split service focuses on three main types of plays:
1) pre-announcement (where we forecast an upcoming split prior to the company making the announcement); 2) pre-split (these plays are made in the days leading up to the actual split day); and 3) post-split plays (plays made after the actual stock split where the stock is showing continued or renewed strength).
We play pre-split plays as short-term plays. We get in when the technical indicators show us things look right, grab as much as we can, and get out, always being conscious of resistance and support. These stocks are highly volatile at this time, and can turn on you quickly. Don't let good profits disappear. Watch for turns, especially when a stock trades in a wide range and finishes off its high. That is a sign these stocks often give you that they are running out of steam. We usually get out and ask questions later. We can always get back in. We like to play in the money calls, preferably two strike prices in the money as this usually gives us a greater delta (the percent an option will mover versus the stock's movement). We prefer deltas of 75 or better. This means if the stock moves 1 point, the option should move three-fourths of that point. That means up or down.
Remember, wait to see the stock start to move up. Don't just blindly make a play and don't try to guess tops and bottoms. We can look at indicators to give us a clue as to what will happen, but we need the stock to confirm it for us. Here's a pre-split play to watch and our current analysis.
PLMD (Polymedica--$52.71; -0.4; optionable): Drugs. Splits 3:2 on 9/30/03
STATUS: Testing the breakout. PLMD announced strong earnings and broke out of a 2 month cup with handle just 7 sessions back. It has been working laterally more or less, rising over the 10 day MVA (51.19), forming a flying plateau on low volume as it consolidates the breakout. Holding onto gains is a sign of excellent strength in a breakout, along with a relative strength breakout as well. We think PLMD may test the 10 day MVA (51.19) before continuing higher. We want to see a low volume test and then a strong break higher on strong volume.
Volume: 170.583K Avg Volume: 240.954K
BUY POINT: $51.45 Volume=325K Target=$60 Stop=$48.88
POSITION: PM LJ - Dec. $50c (65 delta) &/or Stock.
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Learn more about our Stock Split Report - Forbes.com Best of the Web Online Edition says: ". . . seek out the Stock Split Report . . ."
http://www.investmenthouse.com/1stocksplits1.htm
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3) Technical Play
ARTC (Arthrocare--$19.09; +0.19; optionable): Medical appliances
STATUS: Testing the breakout. After the break from a 3 month flat base sporting solid 4 to 2 accumulation (4 up weeks on rising volume to 2 down weeks on rising volume), ARTC is coming back on very low, below average volume to test the breakout. You want to see low volume on the test of the break higher as that tells you not many are selling the positions that were just purchased during the base and on the breakout. ARTC has eased back to the 10 day MVA (18.68), tapping that level on the Friday low. Very strong money flow and a relative strength breakout on the move higher. After this nice test we are looking for a rebound on stronger volume. That was starting Friday as volume edged higher as ARTC moved up off the 10 day.
Volume: 71.372K Avg Volume: 158.636K
BUY POINT: $19.88 Volume=210K Target=$23.88 Stop=$18.49
POSITION: ARU LD - Dec. $20c (45 delta) &/or Stock.
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Learn more about our Technical Trader Report!
http://www.investmenthouse.com/1tech1.htm
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4) Covered Call Play
HPQ - Hewlett Packard is currently trading at $20.08. The October $20 Calls (HHYJD) are trading at $0.95. That provides a return of about 4% if HPQ is above $20 on expiration Friday in October.
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Learn more about our Covered Calls Service!
http://www.investmenthouse.com/1coveredcalls1.htm
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BOOK STORE SPECIAL OFFERS!
We are now offering "Special Offers" each week in our Book Store! You will not find these specials on our web site. They are only available by clicking the link below in this Weekend Newsletter!
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The foregoing is commentary for informational purposes only. All statements and expressions are the opinions of Online Investment Services, LP., or Split Ventures, Ltd. This information is 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 the related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolios of writers for this issue may, in some instances, include securities mentioned herein and on the related 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. No one associated herewith receives compensation in any manner from any of the companies that are discussed in this newsletter or on the related websites.
Copyright 1997 - 2003 by Online Investment Services, LP. - All Rights Reserved.
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