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trend trading stock, stock trading information
Begin Part 3 of 4
CONTINUING CANDIDATE BEST PLAYS: Some puts in here.
1) MIKE - Pullback in the handle
2) CECO - Looking for another move
3) IGT - A small pennant
4) MMM - A put
MIKE (Michaels Stores--$39.33; -0.66; optionable):
http://biz.yahoo.com/p/m/mike.html
BACKGROUND: Based upon our research it does not appear that MIKE has ever split its stock. The annual shareholder meeting was on 9-13-00 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: MIKE pulled back Friday after a string of dojis in its handle, holding onto recent support at the 18 day MVA (39.05) to close after dipping as low as 38.60. Volume was not severe at all on the selling, coming in at 126,400 (average 222,100), and this little shakeout could be the precursor of that breakout move we have been looking for. Target on breakout: 46.
BUY POINT: Over 40.92 on volume of 330,000. Stop: 38.05.
POSITION: Stock and/or September $35 calls to buy (IKQ IF).
CECO (Career Education--$55.89; -0.85; no options):
http://biz.yahoo.com/p/c/ceco.html
BACKGROUND: Last announced a 2 for 1 split on 8-1-00 in conjunction with earnings. The stock price was $57. The annual shareholder meeting is scheduled for 5-11-01 at 1:00 pm CDT at which time additional shares will be authorized. The company has sufficient shares for a 2 for 1 split without increasing authorized shares.
STATUS: Is wavering a bit after the huge move Wednesday. After pulling back a bit the stock gapped down Friday but held support at the 10 day MVA (54.82), moving back up off of that level intraday. The stock has been making its way up steadily along its 50 day MVA (51.51) for months, and CECO blasted up from that level last week before resting and then taking off again. We were looking for the stock to hold 56 on a pullback, and it is right in there, but needs to show more strength on a move up. Target: 65.
BUY POINT: A move up from here on above average volume (259,000; Friday up to 158,200). Stop: 52.
POSITION: Stock only.
IGT (International Game Technology--$62.98; -0.47; optionable):
http://biz.yahoo.com/p/i/igt.html
BACKGROUND: Based upon our research, it does not appear that IGT has ever announced a split. The annual shareholder meeting was on 3-5-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: IGT has made two solid moves up since breaking from its cup with handle in May. After hitting a high of 66.04 the stock pulled back but is holding support in the range of an older trendline connecting September-January closing lows, at 62.25, and its 18 day MVA (62.67), showing something of a pennant pattern. It might need to consolidate a bit before making another move, but this pattern is could be the start of something sooner. Still shows good relative strength and solid buying. Target: 72, using care with stops as it has made a solid move up already.
BUY POINT: Aggressive: Over this week's high of 64.72 on above average volume (way down to 347,100; average 805,000). Stop: 60.19 (50 day MVA at 59.47). Breakout: Over 66.04 on above average volume. Stop: 61.42.
POSITION: Both buy points: Stock and/or July $60 calls to buy (IGT GL).
MMM (Minnesota Mining--$116.78; +0.44):
http://biz.yahoo.com/p/m/mmm.html
BACKGROUND: Last announced a 2:1 split on 3-15-94 in conjunction with a board meeting. The stock price was $102. The annual shareholder meeting is scheduled for 5-8-01 at 10:00 am CT at which time no additional shares will be authorized.
STATUS: Was in a promising consolidation, but dropped back this week, taking out its 50 day MVA (117.76). It could not make a strong rebound Friday, only able to tap back up at the 50 day before closing with a tight doji. Off of the doji we will see if the stock can try another move back over the 50 day that will hold, but the volume on the selling was quite heavy, so on a failure of that move and strong selling down we can look at a put. Volume eased significantly Friday, coming in at 1.46 million (average 2.18 million). The stock hit 115.50 at its low Thursday, and our initial target on a downside play would be the 200 day MVA, at 107.09.
BUY POINT: After a failed move at the 50 day, selling back below 115.50 on above average volume.
POSITION: August $130 puts to buy (MMM TF).
POST-SPLIT BEST PLAYS:
1) GENZ - Doji over support
GENZ (Genzyme--$55.25; -0.67; optionable): Split 2:1 effective 6-4-01.
http://biz.yahoo.com/p/g/genz.html
STATUS: Biotechnology. Made a solid move after the split, hitting a new high of 58.44 before pulling back to the 50 day MVA (52.40, in the lower range of its May consolidation). GENZ made a solid move back off of that level Wednesday, but has since dropped back although holding support over its short-term MVA's (10 day at 54.38). It is trying to do something here, and if it can hold the 10 day we are looking for a strong move out of this somewhat lateral consolidation. Just after the split it hit a high of 58.44. Excellent relative strength, with very strong money flow. Target on a breakout: 65.
PLAY: Aggressive: After another test of the 10 day, a move up on above average volume (3.1 million; Friday 2.98 million) in a strong Nasdaq, with stock and/or October $50 calls to buy. Breakout: Over 58.44 on above average volume, with stock and/or October $55 calls to buy).
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PRE-ANNOUNCEMENTS REMAINING PLAYS
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KRB (MBNA Corp--$34.20; -0.50; optionable): Forecast to announce a split on 7-10-01 in conjunction with earnings. At this time the company cannot confirm an earnings date.
http://biz.yahoo.com/p/k/krb.html
BACKGROUND: Last announced a 3:2 split on 7-14-98 in conjunction with earnings. The stock price was $40. KRB is a holding company and does not hold annual shareholder meetings.
STATUS: Dropped hard last week out of a cup with handle, but caught itself at the 33 level and has tried a bit of a move back up. It caught resistance at the 10 day MVA (34.63) on Thursday's move, pulling back Friday from that level. Selling back was not serious, with volume of 2.04 million (average 2.5 million). We will see if the stock holds here or the 33 range, but it has a lot of resistance to overcome before we would look at it for upside plays (50 and 200 day MVA's at 35.37 and 35.52), and has a bit of a move to go before being back in the split range.
BUY POINT: Aggressive momentum: A move over the 200 day MVA on continued strong volume.
POSITION: Stock and/or September $32.50 calls to buy (KRB IZ).
CHV (Chevron--$94.74; +1.28; optionable): Forecast to announce a split on 7-25-01 before the open in conjunction with earnings. At this time the company cannot confirm the date.
http://biz.yahoo.com/p/c/chv.html
BACKGROUND: The annual shareholder meeting was on 4-25-01 at which time authorized shares were increased.
STATUS: CHV fell out of a nice-looking ascending wedge this week. It gave up its 50 day MVA (94.44) with some heavy selling, rebounding a bit Friday to close back over that level after tapping down to 92.59 at its low. Volume was still solid, though lower at 2.76 million (average 2.38 million), and it is in a precarious position now. There is support in the 92-94 range from a former cup pattern and lows in its recent ascending wedge, so we will see if it can hold on and recover back into the upper range of the pattern (high at 98.49).
BUY POINT: Breakout: Over 98.49 on continued strong volume.
POSITION: Stock and/or September $95 calls to buy (CHV IS).
THQI (THQ Inc.--$52.31; -2.29; optionable): Forecast to announce a split on 7-20-01 in conjunction with the shareholder meeting (earnings 7-26-01).
http://biz.yahoo.com/p/t/thqi.html
BACKGROUND: Last announced a 3:2 split on 10-26-99 in conjunction with earnings. The stock price was $44. Prior to that announced a 3:2 split on 7-23-98 in conjunction with earnings. The stock price was $33. The annual shareholder meeting is on 7-20-01 at which time authorized shares will be increased. The company has sufficient shares for a 2:1 split.
STATUS: Has been a strong performer, breaking from a cup with handle in January and making several trend runs since then, going steadily upward. We have been looking for a pullback and possible test of the 50 day MVA (47.07), and after another blast upward last week the stock is peeling back now. Friday it closed just under support of its 18 day MVA (52.84), the first time it has closed below that level since April. Volume continued to be strong at 713,000 (average is 622,800), so we will see if it can hold on to this range and consolidate a bit, or drop a bit to test the 50 day. Strong stocks typically test their 50 day MVA's periodically.
BUY POINT: After a pullback and perhaps a consolidation in the 47-50 range, a strong move back up on continued strong volume.
POSITION: Stock and/or September $40 or $45 calls to buy (QHI IH or QHI II).
ATK (Alliant Techsystems--$86.40; -5.85; optionable): Forecast to announce a split on 8-7-01 in conjunction with its annual shareholder meeting.
http://biz.yahoo.com/p/a/atk.html
BACKGROUND: Last announced a 2:1 split on 11-2-00 in conjunction with earnings. The stock price was $89. The annual shareholder meeting is scheduled for 8-7-01 at 2:00 pm CT at which time additional shares will be authorized.
STATUS: Has fallen over the edge, taking out its 50 day MVA (93.88) Thursday on moderate volume, and then wholesale dumping of the stock took place on Friday. It took a hard fall, with the selling volume coming in at 429,700 (average 180,500). The stock had made a strong, steady move since its last split in November, but after trading in a solid-looking range the last six weeks the stock could not hold on. It has some support from March highs and April lows at 85, and we will see if it can catch itself there; if it makes a bounce back up but then commences to selling again, we can then look at a put play. We do not want to chase it down from here, however.
BUY POINT: After a relief bounce that takes it back up in the 90 range, strong selling back down on continued strong volume.
POSITION: August $100 puts to buy (ATK TT).
NVDA (Nvidia--$91.30; -0.41; optionable): Semiconductor. NEW INFORMATION Forecast to announce a split on 8-15-01 in conjunction with its annual shareholder meeting or on 8-13-01 during the market in conjunction with earnings.
http://biz.yahoo.com/p/n/nvda.html
BACKGROUND: The company last announced 5-16-00 after the close with earnings. Price was at $94, but the stock rose $8.74 that day in anticipation.
STATUS: NVDA has made at least four trend runs up its trendline connecting March and May closing lows, but after the last run (which hit up to 100) the stock has pulled back to visit the 50 day MVA (85.16). It was able to bounce from that level Wednesday, but the move has lost momentum for now, showing a doji just under its 10 and 18 day MVA's (10 day at 91.68) as volume fell back significantly to 3.17 million (average 5.5 million). Off of the doji we will see if it has to test the 50 day again.
BUY POINT: Aggressive: After showing that it can hold the 50 day, perhaps consolidating a bit, a strong move back over 95 on continued strong volume.
POSITION: Stock and/or September $90 calls to buy (RVU IR).
ADVP (Advancepcs--$62.82; +3.21; optionable): Health services. We are working on a date for this one.
http://biz.yahoo.com/p/a/advp.html
BACKGROUND: Last announced a 2 for 1 split on 10-12-99 at a stock price of $50. The annual shareholder meeting was on 12-7-00 at which time no additional shares were authorized. The company does not have sufficient shares for a 2 for 1 split, but does have sufficient shares for a 3 for 2 split.
STATUS: ADVP was showing signs of a good put play, but after crawling back over its 50 day MVA (59.32) this week the stock made a strong move back up Friday. There was a bit of good business news for the company, but the stock is still not in much of a pattern for upside plays, operating on momentum now after pulling itself out of what was a head and shoulders pattern. We do not like to whipsaw back and forth on plays, and will still look at the downside if the move quickly crumples. However, it is an aggressive play to the upside now (aggressive in view of the recent weakness). Still showing pretty good relative strength.
BUY POINT: Aggressive momentum: A move over 65 on continued strong volume (up to 1.05 million Friday (average 850,600).
POSITION: Stock and/or September $60 calls to buy (QVD IL).
FDC (First Data--$65.99; -0.01; optionable): Working on a forecast date. Earnings were announced on 4-12-01.
http://biz.yahoo.com/p/f/fdc.html
BACKGROUND: Last split was a 2 for 1 on 11-18-96 at a stock price of $80. The annual shareholder meeting was on 1-11-01 at which time authorized shares were increased. The company has sufficient shares for a 2:1 split.
STATUS: From its rolling range between 64 and 69 FDC is tightening a bit into a pennant pattern. It showed a bit of promise with consecutive dojis (Thursday's a 'shooting star'), but after gapping up it could only pull back intraday Friday on lower volume (908,500; average 1.58 million). It is supported to the low side by the 50 day MVA (65.17), and will see if it can hold that level for a move back up in the pattern.
BUY POINT: Breakout: 69 on above average volume.
POSITION: Stock and/or August $65 calls to buy (FDC HM).
PRE-SPLITS REMAINING PLAYS: With these stocks we keep an eye out, waiting for the start of a pre-split run.
DAKT (Daktronics--$29.44; +0.69; no options): Scientific & Technical Instruments. Splits 2:1 effective June 25.
http://biz.yahoo.com/p/d/dakt.html
STATUS: Was able to make a last bounce from its 50 day MVA (26.61) this week, but slowed a bit Friday although it closed over its short-term MVA's (10 day at 29.12). With the split Monday there is not much going on here, and there is not much of a pattern, so we are dropping.
ESRX (Express Scripts--$107.31; -1.11; optionable): Splits 2:1 effective on or about June 25.
http://biz.yahoo.com/p/e/esrx.html
STATUS: ESRX made an outstanding run into the split, running up along its 10 day MVA (106.74) from the time of its announcement. It has slowed now, moving back and hitting 103 at its low but managing to hold the 10 day to close. With the split Monday we are looking for some further weakness, with the stock perhaps testing back to the 50 day MVA (97.12). On a strong breach of support we can look at a post-split put play.
PLAY: A move back below the 18 day MVA (104.37) on increased volume (562,200 Friday; average 660,000), with August $120 puts to buy (XTQ TD).
LNCR (Lincare Holdings--$64.99; -1.46; optionable): Health Services. Splits 2:1 effective 6-25-01.
http://biz.yahoo.com/p/l/lncr.html
STATUS: Has made a strong move back up after having tested its 50 day MVA (58.83) last week. It made a second surge on the move Wednesday, hitting 67.20 but dropping back going into Monday's split. On the split we will see if the stock can hold over its 18 day MVA (62.22) post-split, but could easily get a test back to the March-April highs at 60, or 50 day MVA at 58.83.
PLAY: After holding a consolidation over the 18 day, a move back over the high of 67.20, with stock and/or November $65 calls to buy (LQN KM).
USPH (U.S. Physical Therapy--$21.40; -1.10; no options): Health Services. Splits 3:2 effective June 29.
http://biz.yahoo.com/p/u/usph.html
STATUS: The stock was trying to form something of a pennant pattern, squeezing between its 50 day MVA to the downside (23.21) and its 18 day to the upside (24.22). However, USPH fell hard through the 50 day Thursday, and after hitting 20 at its low Friday it managed to pull back up for a perfect doji. That indicates a move back up, but it has quite a bit of resistance to overcome. It has a week, but is not looking promising.
PLAY: Aggressive: Over the 18 day MVA, with stock.
MTON (Metro One--$58.20; +0.83; optionable): Telecom. Splits 3:2 effective June 29.
http://biz.yahoo.com/p/m/mton.html
STATUS: Has been trending up strong since breaking from a cup with handle in April, riding its short-term MVA's (10 and 18 day at 55.54 and 53.60). The stock tapped a new high Friday at 58.85, closing with a perfect doji. The stock has made quite a move on momentum, but it appears due to test back toward its 50 day MVA (46.92). We will see if the stock can hold the 18 day on a pullback. Relative strength has broken out, and the stock shows excellent money flow.
PLAY: On a move up from the 55 range after a pullback that holds that level, with stock and/or August $50 calls to buy (KQM HJ).
End Part 3 of 4
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trend trading stock
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