|
|
us stock market, stock prices
Begin part 2 of 3
What to do now.
Thus we continue to look for leadership caliber stocks to buy and at the same time cull out those that are unable to withstand the basing process. If a stock is holding support and showing overall good price/volume action, we are not dumping it. We are pruning those that break down and thus will be holding only the strongest stocks when this base is over. At the same time we add those stocks that are showing themselves to be leaders as they hold their support and even break higher ahead of the pack. Those leaders that are successfully testing their breakouts and are setting up the next buy points are really interesting at this juncture as they are proven winners. It is definitely a stock by stock market at this point with month moving around fairly rapidly again. It is good policy to take some gains when they are there and then let the remaining position ride if still positive. We can let that position work for us and ride through some of the bumps as long as the price/volume action holds and it is able to hold or quickly recover breaches of support.
Support and Resistance
NASDAQ: Closed at 1995.74
Resistance: The exponential 50 day MVA (2013). The simple 50 day MVA (2015) along with the 18 day MVA (2016). Breakout from the pattern is 2080. 2089 is the February closing high. 2112 is the early January high. 2154 is the January high.
Support: 1990 to 2000, the top of the late 2003 base. Some prices from the recent March consolidation attempt (1943). The 200 day MVA (1919). Mixed tops and bottoms at 1900.
S&P 500: Closed at 1134.61
Resistance: The simple 50 day MVA (1134) and the 10 day MVA (1133) have not been totally broken. The January high (1155). Next is 1159 (February highs) and 1160 to 1175 the highs in that double top that spanned late 2001, early 2002.
Support: The exponential 50 day MVA (1127), just over 1125, holding on the close Wednesday and Thursday. 1106 is a May 2002 top and represents some early 2001 lows. 1096 to 1100. 1075 to 1070 from the December consolidation.
Dow: Closed at 10,397.46
Resistance: The simple 50 day MVA (10,448). Price consolidation at 10,600 level. September/November up trendline (10,635). 10,747 is the February high.
Support: The exponential 50 day MVA (10,390) continues to try and hold. 10,000 to 9900-9850. 9859-9855 is the next real support.
Economic Calendar
These are consensus expectations. Our expectations will vary and are discussed in the 'Economy' section.
4-19-04
Leading economic indicators, March (10:00): 0.3% expected, 0.0% February.
4-21-04
Fed Beige Book (2:00)
4-22-04
Initial jobless claims (8:30): 335K expected, 360K prior.
4-23-04
Durable goods orders, March (8:30): 0.7% expected, 2.5% February.
THE PLAYS
Good movers Friday: ABMD; MXT; R; RHI; TASR; KMRT
Best Plays:
1) ANDW: Testing a nice breakout with volume starting to surge.
2) AFFX: Biotechs have formed up well.
3) SIMG: Nice breakout test.
4) ACXM: Testing the 10 day MVA after the breakout.
5) ASKJ: 18 day MVA test on low volume.
6) RECN: And yet another nice test form a leader.
NEW PLAYS:
Upside:
Play Date: 04/17/2004
ANDW (Andrew Corp.--$20.20; +0.30; optionable): Telecom equipment
http://biz.yahoo.com/p/a/andw.html
STATUS: Breakout test. This is one of the leaders we have been talking about. It shot out of an 11 week flat base to start the month and has moved laterally during the recent selling, holding onto its gains as the market sold off. The 10 day MVA (19.67) has moved up to kiss it, and that is often the catalyst to send this type of breakout higher. Excellent 4 to 0 accumulation in the base (4 up price weeks on rising volume to 0 down price weeks on rising volume). Money flow is outstanding and turning up already ahead of the price. Excellent action and strength in the face of the market selling.
Volume: 3.812M Avg Volume: 2.966M
BUY POINT: $20.48 Volume=4M Target=$24.58 Stop=$19.05
POSITION: AQN JD - Oct. $20c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/andw.html
Play Date: 04/17/2004
AFFX (Affymetrix--$35.01; +0.45; optionable): Biotechnology
http://biz.yahoo.com/p/a/affx.html
STATUS: Cup w/handle. Biotechs have quietly re-emerged and are now set up in nice patterns to make the breakout move. A nice little 7 week base that formed over the 50 day MVA (32.91), a very good sign of institutional support. Accumulation is a solid 2 to 0 with strong money flow and relative strength ready to make the breakout as well, a sign of a breakout with legs. Volume has been lagging; we want to see it surge when the move is made to show us the big money is moving into it.
Volume: 734.564K Avg Volume: 1.3M
BUY POINT: $36.45 Volume=2M Target=$43.75 Stop=$34.32
POSITION: FIQ HG - Aug. $35c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/affx.html
Play Date: 04/17/2004
ERICY (LM Ericsson Telephone--$29.61; -0.02; optionable): Telecom equipment (phones)
http://biz.yahoo.com/p/e/ericy.html
STATUS: Reverse head and shoulders. NOK's loss appears to be ERICY's gain. The stock is moving through a solid 8 week base that formed over the 50 day MVA (27.60). Accumulation is an excellent 4 to 1. It held up very well in light of NOK's warning and selloff; that is significant, and we look for NOK to hold here at the 18 day MVA (29.34) and make the breakout on strong volume.
Volume: 2.857M Avg Volume: 4.305M
BUY POINT: $30.78 Volume=6.5M Target=$35.42 Stop=$29.22
POSITION: RQC GF - July $30c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/ericy.html
Play Date: 04/17/2004
SIMG (Silicon Image--$12.86; -0.18; optionable): Semiconductor memory chips
http://biz.yahoo.com/p/s/simg.html
STATUS: Breakout test. Another strong stock that has made the volume breakout and is now testing that move. SIMG gapped up and out of a 10 week base in early April and rallied to 14. It is making a low volume slide back to the 10 day, showing a nice hammer doji with tail at that level Friday. That often indicates a stock is finished with testing and is ready to continue the breakout.
Volume: 943.32K Avg Volume: 935.907K
BUY POINT: $13.12 Volume=1.4M Target=$15.78 Stop=$12.32
POSITION: QSI IV - Sept. $12.50c (63 delta) &/or Stock
http://www.investmenthouse.com/ct/simg.html
CONTINUING PLAYS:
Play Date: 03/17/2004
ACXM (Acxicom--$23.70; -0.02; optionable): Information technology software
http://biz.yahoo.com/p/a/acxm.html
STATUS: Breakout test. Another stock that has performed well, breaking out in late March and rallying to 24.73). It is making its first test of the move, a nice, low volume slide back to the 10 day MVA (23.40). Looking for that to hold and then for the stock to rebound on above average volume. Money flow remains strong and relative strength has held up well in the pullback. It is solid, a leader, and setting up the next buy point.
Volume: 489.143K Avg Volume: 877.257K
BUY POINT: New: $24.12 (orig. $21.29) Volume=800K Target=New positions: $28.55 (orig. positions $25.55) Stop=$23.22
POSITION: UQA HX - Aug. $22.50c (70 delta) &/or Stock
http://www.investmenthouse.com/ct/acxm.html
Play Date: 03/18/2004
ASKJ (Ask Jeeves--$36.11; -0.72; optionable): Internet information provider
http://biz.yahoo.com/p/a/askj.html
STATUS: Breakout test. And yet another leader that is testing a strong move higher. ASKJ surged in late march and rallied to 40. It spent last week easing back to the 18 day MVA (35.80), holding with a nice doji Friday at that key near term support level. Outstanding money flow. We are waiting for the stock to provide an above average volume surge through the 10 day MVA to take additional positions.
Volume: 1.942M Avg Volume: 3.03M
BUY POINT: New: $37.32 (orig. $31.44) Volume=3.7M Target=New positions: $43 (orig. positions: $37.95) Stop=$35.78
POSITION: AUK FF - June $30c (50 delta) &/or Stock
http://www.investmenthouse.com/ct/askj.html
Play Date: 04/07/2004
BBOX (Black Box--$55.66; -0.11; optionable): PC hardware
http://biz.yahoo.com/p/b/bbox.html
STATUS: Test breakout. Without the volume, the breakout from the 11 week cup base two weeks back did not get far. The pullback, however, looks good with BBOX holding the 18 day MVA (55.17) with a nice, tight hammer doji. It is set up to make the break higher. Now we need to see the volume come in as it makes the rebound.
Volume: 105.093K Avg Volume: 235.058K
BUY POINT: $56.98 Volume=354K Target=$65 Stop=$54.72
POSITION: QBX IK - Sept. $55c (61 delta) &/or Stock
http://www.investmenthouse.com/ct/bbox.html
Play Date: 04/15/2004
KMRT (Kmart Holding--$44.62; +1.62; optionable): Discount variety stores
http://biz.yahoo.com/p/k/kmrt.html
STATUS: Breakout test. KMRT surged through March, peaking in early April. It has come back on very low, below average volume to test the 18 day MVA (42.18) Thursday at the low. Friday it rebounded on rising though still below average volume. Excellent money flow is still leading higher. Good enough to start positions. On a stronger volume move this week, it is still a buy.
Volume: 894.035K Avg Volume: 853.225K
BUY POINT: New: $44.88 (orig. $44.15) Volume=1M Target=$50.75 Stop=$42.12
POSITION: KTQ II - Sept. $45c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/kmrt.html
Play Date: 02/17/2004
QLTI (QLT Inc.--$28.01; -0.02; optionable): Diagnostic substances
http://biz.yahoo.com/p/q/qlti.html
STATUS: Breakout test. After blasting out of its 2 month flat base in late March QLTI is stepping sideways over the 10 day MVA (27.79) on mostly below average volume. It is showing some small volume spikes to end the week, and that often is a signal of activity that will break the stock higher once more. Excellent money flow and relative strength. Again, another leading stock that is taking a breather and setting up for the next run. That is just what we want to see, along with a strong volume spike as it makes the next break higher.
Volume: 827.058K Avg Volume: 1.449M
BUY POINT: New: $28.75 (orig. $26.48 Volume=2M Target=$31 Stop=$27.22
POSITION: QTL FE - June $25c (48 delta) &/or Stock
http://www.investmenthouse.com/ct/qlti.html
Play Date: 03/22/2004
RECN (RSCS Connection--$42.54; -0.58; no options): International professional services (e.g., accounting, IT, human resources, finance)
http://biz.yahoo.com/p/r/recn.html
STATUS: Test 18 day MVA. And yet another stock that is a leader taking a breather in the recent market selling, falling back to the 18 day MVA (41.84) on low, below average volume. RECN exploded out of a 10 week flat base in late March on tremendous volume. It needed this breather after such a strong move, but we note it is not giving the move back and money flow remains very strong. It is tapping the 18 day on the intraday low and rebounded; that is an indication it is ready to make the break higher once more.
Volume: 95.616K Avg Volume: 173.862K
BUY POINT: New: 43.55 (orig. $36.16) Volume=225K Target=New positions: $50 (orig. $43.38) Stop=$41.78
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/recn.html
Play Date: 04/05/2004
RHAT (Red Hat--$23.19; -0.32; optionable): Internet software and services
http://biz.yahoo.com/p/r/rhat.html
STATUS: Breakout test. RHAT broke out from a 10 week cup base in late March and rallied to 25.58. In the market selling it has come back to the 18 day MVA (23.06), showing a hammer doji at that level Friday. Money flow remains excellent. We are just waiting for RHAT to make the next move higher on strong trade.
Volume: 3.201M Avg Volume: 5.145M
BUY POINT: $24.12 Volume=8.8M Target=$29 Stop=$22.88
POSITION: RCV IE - Sept. $25c (46 delta) &/or Stock
http://www.investmenthouse.com/ct/rhat.html
Play Date: 01/03/2004
SKIL (Skillsoft--$12.60; +0.04; optionable): Multimedia graphics software
http://biz.yahoo.com/p/s/skil.html
STATUS: Breakout test. Still another strong stock that broke out and surged in March and is now testing the breakout, holding the 18 day MVA (12.41) to end the week. The pullback has been on very low volume, indicating no significant selling on the pullback. The stock is still just taking a breather as money flow remain strong, moving ahead of price. Looking for volume to surge as SKIL moves through the next buy point.
Volume: 528.759K Avg Volume: 762.612K
BUY POINT: New: $12.88 (orig. $9.32) Volume=518K Target=New: $15.48 (orig. positions $11.24) Stop=$12.38
POSITION: QAG HV - Aug. $12.50c (58 delta) &/or Stock
http://www.investmenthouse.com/ct/skil.html
End part 2 of 3
|
us stock market
stock prices
|
