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trade stock, stock option
Begin part 2 of 3
THE PLAYS
Plays from the Wednesday report:
AFCO: Dove lower but then recovered to the 50 day MVA but on low volume.
CELG: Continued lower on strong trade though it did cut its losses. Still in the selling mode.
ENTU: Gapped higher but backed off with the selling.
SMTS: Ran in place Thursday on lower volume. Still a very nice pattern.
New Plays:
Play Date: 01/29/2004
BKHM (Bookham Technology--$3.04; 0; no options): Semiconductors
http://biz.yahoo.com/p/b/bkhm.html
STATUS: Test breakout. Certain niche players continue to perform well, and BKHM is using the pullback to test its strong volume breakout from its 12 week double bottom with handle base. It rallied to 3.55 and then started this low volume pullback. Even when the market was selling on volume, trade remained low on BKHM as it faded to test the 18 day MVA (2.97). It tested well below the 18 day Thursday and then rebounded for a slight gain on a big volume spike. Accumulation is strong at 3 to 1 (3 up price weeks on rising volume to 1 down price week on rising volume) and money flow is remaining very strong even as BKHM makes this test. Very nice, and the volume spike makes it look ready.
Volume: 5.859M Avg Volume: 1.825M
BUY POINT: $3.28 Volume=2.7M Target=$4.12 Stop=$3.05
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ci/bkhm.html
Play Date: 01/29/2004
CALM (Cal-Maine Foods--$34.16; -0.84; no options): Atkins diet foods. Splits 2:1 on a date to be determined.
http://biz.yahoo.com/p/c/calm.html
STATUS: Cup w/handle. This is a short 5 week base that is consolidating a super breakout and run in November and December as the low carb craze took off. It is a bit short for a base, but the accumulation is solid (2 to 0) and CALM was in need of a consolidation. If you are going to consolidate, this is a good pattern. It surged higher and then faded the past two days on very low volume, ignoring the overall market. Very nice test and we anticipate a big volume break higher soon.
Volume: 451.122K Avg Volume: 528.5K
BUY POINT: $35.65 Volume=650K Target=$42.75 Stop=$33.15
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ci/calm.html
Play Date: 01/29/2004
NEWP (Newport--$19.72; -0.24; optionable): Scientific & technical instruments
http://biz.yahoo.com/p/n/newp.html
STATUS: Breakout test. NEWP exploded out of a 5 month cup base (more or less) that formed over the 200 day MVA (16.25), a sign of institutional support, and it is now coming back to test that breakout. The test was on lower volume until the past two sessions. Thursday, however, the stock reached way below the 18 day MVA (19.62) and then rallied furiously back up to close over that near support level, showing some strong trade as it did. Accumulation in the base is a solid 7 to 3, and money flow is still very strong. This big doji with tail over the 18 day MVA indicates that NEWP is just about ready to make the rebound to continue the breakout. Looking for it to use this rebound to shoot it forward on continuing strong trade.
Volume: 691.589K Avg Volume: 373.954K
BUY POINT: $21.55 Volume=561K Target=$25.88 Stop=$20.04
POSITION: NZZ ED - May $20c (58 delta) &/or Stock
http://www.investmenthouse.com/ci/newp.html
Play Date: 01/29/2004
WWCA (Western Wireless--$22.18; +0.10; optionable): Wireless telecom
http://biz.yahoo.com/p/w/wwca.html
STATUS: Breakout test. A very nice test of the early January breakout from a 16 week more or less flat base showing excellent 5 to 1 accumulation. Volume surged as WWCA broke from the pattern and it slid back as the stock did the same. Thursday WWCA showed a very strong volume surge as it reached below the near support at the 18 day MVA (21.71) and roared back up to hold over that level and post a slight gain. Money flow remained solid on the pullback, and we are looking for WWCA to rebound from this first test of the breakout, and provide plenty more upside.
Volume: 2.887M Avg Volume: 1.318M
BUY POINT: $22.62 Volume=2M Target=$27.15 Stop=$21.42
POSITION: WRQ EX - May $22.50c (56 delta) &/or Stock
http://www.investmenthouse.com/ci/wwca.html
End part 2 of 3
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