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us stock market, stock watch
Begin Part 2 of 3
THE PLAYS:
Some very solid moves, including FISV, THQI, ASFC, CAKE, DGX and FIC, with CHV making the drop back that we were looking for.
BONUS PLAYS:
CERS (Cerus--$71.50; +3.29; optionable (CEQ): Biotech
http://biz.yahoo.com/p/c/cers.html
STATUS: The stock is in a handle to its 5-month cup. The handle tested 65 on the low and moved up today after a small Wednesday pullback, with volume increasing to 49,700 (avg. 79,454). Looks ready to continue the move up toward breakout. Shows strong money flow and buying, with relative strength ahead of price. Target: 84-87.
BUY POINT: 76.13, on volume of 119,000 or more. Stop: 70.
POSITION: Stock and/or October $70 calls to buy (CEQ JN).
ADRX (Andrx--$74.09; +3.50; optionable (QAX): Drugs
http://biz.yahoo.com/p/a/adrx.html
STATUS: Making a good move up in the double handle to a 7-month cup base (previous highs in the base around 95). Volume was sharply stronger at 1.55 million (avg. 867,000), so we are looking for a breakout. Good money flow and relative strength is breaking out. Target: $82-85.
BUY POINT: 74.32, on continued strong volume (minimum breakout volume is 1.3 million). Stop: 68.37. A buy on the breakout up to 78.04.
POSITION: Stock and/or September $65 calls to buy (QAX IM).
ANSS (Ansys--$16.15; +0.36; no options): Technical Software
http://biz.yahoo.com/p/a/anss.html
STATUS: The stock is in a tightening pennant that formed above its 50 day MVA (14.82), most recently as it squeezed down finding support at the 18 day MVA (15.55). Today the stock got a sharply higher shot of volume (255,800; avg. 129,000) and the stock made a move up. Looking for a breakout over the pattern high (16.95). Huge money flow and great buying, and relative strength is ahead of price. Target: $20.
BUY POINT: 17.08, on volume in the range of 174,000. Stop: 15.71 (18 day MVA, 15.55).
POSITION: Stock.
PRE-ANNOUNCEMENT PLAYS FOR THIS WEEK: Looking at BMET for this Friday.
BEST PLAYS: Besides the plays set forth below best plays, there are some other stocks that also look good. These include Pre-Announcements FISV, THQI, NVDA and FDC; Pre-Split KG; Continuing Candidates CECO and CHBS; and Post-Split EMLX, JNJ and SEBL.
PRE-ANNOUNCEMENT BEST PLAYS:
1) BMET - Forecast for tomorrow
2) FITB - Still solid in its pullback
3) ATK - Put play
BMET (Biomet--$48.45; +0.81; optionable): Medical equipment. Forecast to announce a split with a board meeting 6-29-01, or on 7-9-01 before the open with earnings.
http://biz.yahoo.com/p/b/bmet.html
BACKGROUND: Last announced a 3:2 split on 7-6-00 at a stock price of $29. The annual shareholder meeting was on 9-16-00 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: Continued its pattern of bouncing up along the 10 day MVA (47.38), today reaching up to a new high at 49.18 before backing off of that level to close. Volume was not very strong on the bounce, however, coming in at 1.09 million (average 1.7 million), so off of this pattern we could get a pullback in the morning. For new positions we will watch for the stock to hold the 10 day, looking at taking new positions on a move back up, looking for an announcement to propel the stock to a new high. Remember that options prices are often inflated just after an announcement, and it is often good practice to hold off on positions until the stock makes its first pullback after the announcement. The stock has been very strong, breaking from solid ascending wedge patterns and climbing steadily up its short-term MVA's the last five weeks. Excellent relative strength and money flow. Target: 54.
BUY POINT: On a move up after a pullback on lower volume that holds over the 10 day MVA. Stop: 44.06 (50 day MVA at 44.33).
POSITION: Stock and/or October $45 calls to buy (BIQ JI).
FITB (Fifth Third Bancorp--$61.61; +0.11; optionable): Looking for an announcement with earnings on 7-16-01 before the market open.
http://biz.yahoo.com/p/f/fitb.html
BACKGROUND: Last announced a 3:1 split on 6-20-00 at a stock price of $61. The annual shareholder meeting was on 3-20-01 at which time authorized shares were increased.
STATUS: Has gradually pulled back from the big breakout move made last Thursday, holding over the support of its 10 day MVA (61.13; breakout point was 61.11). Today it showed another loose doji over that support, with volume remaining just below the average (1.52 million; average 1.74 million). We look for strong stocks to use their breakout levels as support, but also look to the 10 day MVA if in that range. FITB is looking strong, and we are looking for the stock to make another strong move up and over the breakout high of 63. Target: 68-70.
BUY POINT: Breakout: A move over 63 on above average volume. Stop: 58.59.
POSITION: Breakout: Stock and/or August $60 calls to buy (FTQ HL).
ATK (Alliant Techsystems--$87.50; +2.03; 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: After a big drop (recent high at 101.24, 50 day MVA at 92.68), the stock found support in the 85 range, and bounced back up off of a couple of dojis today. The bounce was rather weak, however, moving up on volume that continued to decrease at 121,800 (average 188,500). We were looking for a bounce up to the 87-88 range (10 day MVA at 89.62), and with this weak move we have to see it start up on higher volume. If not, we are ready for a put on strong selling back down. Initial target: 78-80.
BUY POINT: Strong selling back down below 85 on above average volume.
POSITION: August $95 puts to buy (ATK TS).
PRE-SPLIT BEST PLAYS: Remember, we try to grab these as they break out of good patterns or as they start a run right before the split. Not looking for home runs, but looking for those $3 to $4 moves running into the split, watching for topping signs and potential resistance. Not huge money, but it can be very steady. We set our initial stops at the 7-8% range below the purchase price (or just below obvious support), and move them up on a move to preserve our profits.
1) LOW - Holding on support.
LOW (Lowe's--$75.40; +1.84): Splits 2:1 on July 2.
http://biz.yahoo.com/p/l/low.html
STATUS: Made solid move up last week out of its small ascending wedge (formed as it makes its strong move up along its short-term MVA's after breaking from a cup with handle in May), and has pulled back this week. It is holding over its 18 day MVA (74.11) and the former highs in the ascending wedge (74), and with the slight move up today we will see if it can get some momentum for another run. The high is 79.72, and it has already been a great pre-split play.
PLAY: A move over 76, with stock and/or August $70 calls to buy (LOW HN).
CONTINUING CANDIDATE BEST PLAYS: Some puts in here.
1) ASFC - A powerful rebound
2) FDC - Cup with handle with a pennant base afterwards.
3) MMM - Still looking like a put
ASFC (Astoria Financial--$58.30; +1.45; optionable): Savings and Loan.
http://biz.yahoo.com/p/a/asfc.html
BACKGROUND: Last split its stock in 1996 with the split at a price of $56. The annual shareholder meeting was on 5-16-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: ASFC has been quite volatile, today blasting up with continued big volume (675,500; average 361,500). The stock was in a saucer with handle, but after pulling back to the 50 day MVA (56.43) in the handle, it has bounced along that level. A promising move up fell back with strong volume, only to bounce back up with a vengeance the last two sessions. Today marks a 52-week closing high, with the pattern high of 58.55 just ahead. We could finally get a breakout, but we will carefully protect positions, as it has had trouble sustaining moves. Target: 68.
BUY POINT: 58.68, with continued strong volume. Stop: Just below the recent low at 55.75.
POSITION: Stock and/or October $55 calls to buy (AQR JK).
FDC (First Data--$66.50; +0.06; 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 has tightened a bit into a pennant pattern. It is now holding firm on its short-term MVA's (10 day MVA at 66.50), today gapping up but pulling back down to close. Volume has been rather strong in recent days as the stock showed some signs of making a move but could not keep it up. Looking for it to hold here, and then move up toward the high at 68.85. Target on breakout: 79.
BUY POINT: Breakout: 69 on increased volume (1.57 million; average 1.52 million). Stop: 64.17 (or just under the 50 day MVA, currently at 65.40).
POSITION: Stock and/or August $65 calls to buy (FDC HM).
MMM (Minnesota Mining--$115.86; +1.56):
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: Dropped back recently from a lateral consolidation it had formed early this month, and hit as low as 114 Wednesday after dipping under its 50 day MVA (117.50). The stock gapped up and tested that level today, hitting 117.95 at its high but fell back to close with a tight doji. Volume was weak on the move (1.47 million; average 2 million), and the stock looks like it could take another fall. On a drop back down on increased volume we are looking at an initial target on a downside play would be the 200 day MVA, at 107.50.
BUY POINT: A move below 114 on increased volume near the average.
POSITION: August $125 puts to buy (MMM TE).
POST-SPLIT BEST PLAYS:
1) BAX - Bouncing up from support
2) DGX - Breakout to a new high
3) CAKE - A wild ride
4) GENZ - Looking to break out
BAX (Baxter International--$53.03; +0.57; optionable): Health Services. Split 2:1 effective 5-30-01.
http://biz.yahoo.com/p/b/bax.html
STATUS: BAX made a great run post-split, and after pulling back it started up again today. The stock found support at the 10 day MVA (52.16), which is right at the up trendline (connecting April-May lows). Off of the dojis we saw the last few days over that support, the stock move up today with a strong move, with volume moving up to 4.04 million (average 1.65 million). It reached up to 53.55 on the move (high of 54.50), pulling back. We will use care with stops on a move up, but on this move the stock could hit up to 58.
PLAY: Aggressive: A move over 53.55 on continued strong volume, with stock and/or August $50 calls to buy (BAX HJ). Stop: 49.80 (or just under the 18 day MVA, at 51.40).
DGX (Quest Diagnostics--$74.15; +3.23; optionable): Health services. Split 2:1 June 1.
http://biz.yahoo.com/p/d/dgx.html
STATUS: Formed a nice wedging consolidation the past week after a strong gapping breakout last Thursday, and today made another strong gapping breakout move. The stock made a new high with the move, taking out the high from a cup dating back to early January. The move came on increased, strong volume of 751,800 (average 442,700). It has been very strong, making its fourth move now along its up trendline established from the March low near 40, breaking out in stair-step fashion from consecutive handles to a cup. We will see how much more it has in it, but will carefully protect positions with stops. Target: 80.
PLAY: From here: A move up on continued strong volume, with stock and/or August $70 calls to buy (DGX HN). Stop: 68.96 (10 day MVA at 69.17). Test: On a test of the breakout at 73, a strong move back up, with stock and/or August $70 calls to buy (DGX HN). Stop: 67.89.
CAKE (Cheesecake Factory--$26.95; +1.49; optionable): Restaurant. Splits 3:2 effective 6-19-01.
http://biz.yahoo.com/p/c/cake.html
STATUS: Quite a ride as CAKE blasted up last Thursday to hit its early high of 26.80, but just as rapidly pulled back. However, after finding support at the 18 day MVA (24.89; 50 day MVA at 24.48), the stock made a move back up on massive volume today (1.18 million; average 407,100). So much for the possible put. Anyway, a lot of power on the move and it just broke over the recent resistance, so it is a solid momentum play, but it still has substantial overhead supply up to its high of 32. On a continued move, we will look for a move up to the next major resistance at the January-February highs near 30. Protecting positions carefully with stops, given the recent volatility.
PLAY: Momentum: A move up from here on continued strong volume, with October $25 calls to buy (CFQ JE). Stop: 25.04 (or just under the 18 day MVA).
GENZ (Genzyme--$57.57; +1.51; optionable): Split 2:1 effective 6-4-01.
http://biz.yahoo.com/p/g/genz.html
STATUS: Biotechnology. Had been moving somewhat laterally in an expanding consolidation, recently making a small double bottom. This week GENZ moved back up off of the 50 day MVA (52.82) with strong momentum, taking out the center of the pattern today and tapping a new high at 58.46. Volume continued to be strong at 4.25 million (average 3.1 million), so we will look for a continued move. Relative strength has broken out. Target on a breakout: 65.
PLAY: Over 58.50 on continued strong volume, with stock and/or October $55 calls to buy). Stop: 54.40.
* * *
PRE-ANNOUNCEMENTS REMAINING PLAYS
* * *
KRB (MBNA Corp--$33.75; +1.20; 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: Trying to hang in their, making the anticipated bounce but showing some strength, hitting up to 34.30 on good volume, although still lower than what we saw on the recent selling. The stock settled back to close just under its 10 day MVA (33.82). Still looking for the move to fail and turn into some solid selling. The recent low was 32.45. Target: 29-30.
BUY POINT: A move back below 32.45 on continued strong selling volume (3 million today; average 2.4 million).
POSITION: August $37.50 puts to buy (KRB TU).
THQI (THQ Inc.--$59.46; +1.96; 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 (48.37) until Tuesday, when the stock again started to show that it had momentum. A solid move ensued, including a run up today on strong volume that took it to a new closing high. Just a solid uptrend pattern, but an aggressive play with new positions here, as were targeting the 60 level for this move. Still strong, but we are protecting positions carefully from here.
BUY POINT: Aggressive: A move up on continued strong volume (up to 709,000; average 2.43 million) in a strong market. Stop: Just under the 10 day MVA, at 55.55.
POSITION: Aggressive: Stock and/or September $55 calls to buy (QHI IK).
CHV (Chevron--$88.74; -2.66; optionable): Forecast to announce a split on 7-24-01 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 has taken a hard fall with its sector, and gave us a solid put play with a continued drop today. It moved down on big volume of 4.23 million (average 2.33 million), and now faces the target of the 200 day MVA (87.38). We will see if it can hold onto that level, holding off on any positions until we see what it will do. We are expecting something of a relief bounce, although it could be very weak after such solid selling. Nothing new for Friday.
CEFT (Concord EFS--$56.08; +2.04; optionable): Forecast to announce a split on 7-25-01 in conjunction with earnings. At this time the company cannot confirm this date, but based upon our research this is the date for the release.
http://biz.yahoo.com/p/c/ceft.html
BACKGROUND: Last announced a 3:2 split on 8-26-99 at a stock price of $37. Prior to that announced a 3:2 split on 5-14-98 in conjunction with its annual shareholder meeting. The annual shareholder meeting is scheduled for 5-24-01 at 9:30 am CST at which time additional shares will be authorized.
STATUS: Has stalled a bit since its big breakout move last week (after testing a breakout from a cup with handle). The stock tested back to its 10 day MVA (53.85) Wednesday, but gapped up today and reached to a new high at 56.93. However, it again closed well off of its high, as it did earlier in the week on a move that preceded the pullback to the 10 day. We will see again if the stock will test support before making a solid move up that it can hold. Target: 62. It has been a steady performer.
BUY POINT: From here: A move over 57 on increased volume (up to 4.95 million today; average 4.4 million). Stop: 53. Pullback: A strong move up after holding the 10 day MVA on another low-volume pullback. Stop: 50.
POSITION: From here: Stock and/or September $55 calls to buy (EQF IK). Pullback: Stock and/or September $50 calls to buy (EQF IJ).
NVDA (Nvidia--$91.92; +1.07; optionable): Semiconductor. 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 (86.16), and is now battling with its short-term MVA's (10 day at 91.80). It showed a doji Thursday on that level, still moving on below average volume (3.79 million; average 5.3 million), and if it holds this one could spring in a decent market.
BUY POINT: Aggressive: After holding the 10 day, a strong move up with a good market, looking for volume near the average.
POSITION: Stock and/or September $85 calls to buy (RVU IQ).
FISV (Fiserv--$63.11; +1.07; optionable): We are working on a date.
http://biz.yahoo.com/p/f/fisv.html
BACKGROUND: Last announced a 3:2 split on 3-25-99 in conjunction with its annual shareholder meeting. The stock price was $52. FISV's last two splits were announced in conjunction with its annual shareholder meeting. The company currently has sufficient shares for a 2:1 split.
STATUS: FISV has been on a tear, breaking from a cup with handle and then an ascending wedge over that pattern (a double base we love), and the stock has steadily climbed up along its 10 day MVA (60.90). Today it made a move up with strong volume (1.82 million; average 1.54 million), tapping up near its all-time high of 64.13 at its intraday high of 63.84. Generally a bit extended for us, but if it can break to the new high we could look at a play, carefully protecting our positions. We could get a pullback to the 10 day, where it could regroup a bit for a strong move at a new high. On a move up, the target: 68.
BUY POINT: From here: A move over 64.13 on continued strong volume. Stop: 59.64. Pullback: After holding a lower-volume pullback at the 10 day, a strong move back up. Stop: 56.63 (50 day MVA at 56.09).
POSITION: From here: Stock and/or September $60 calls to buy (FTQ IL). Pullback: Stock and/or September $55 calls to buy (FTQ IK).
End Part 2 of 3
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us stock market
stock watch
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