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stock recommendation, stock pick
Begin part 3 of 3
THE PLAYS
Good moves Monday: CREE; INSP; MRVL; RIMM; TXN; AAP
Weekend play results:
AKAM: Still working on a handle.
HHH: Also still working on its handle.
MRVL: Volume jumped higher but it closed well off the high.
VIP: Gapped lower and rebounded.
WYNN: Working laterally in the handle.
CANI: Gapped lower but managed to struggle back. Still in trouble.
MOVI: Gapped higher but showed a doji below the 50 day EMA.
THE PLAYS
Upside:
Play Date: 09/20/2004
ADI (Analog Devices--$39.22; +1.65; optionable): Semiconductors
http://biz.yahoo.com/p/a/adi.html
After Hours: $39.23
STATUS: Double bottom w/handle. Strong breakout over the 50 day EMA (37.95), clearing the handle to a 15 week base on a strong, above average volume surge. Very similar to SOX overall, ADI has formed a double bottom, surging off the September low, resting to form a handle, and then surging higher again Monday, starting the breakout move. Unlike SOX, ADI did not make a new 2004 low, instead forming more of a 'flying W' double bottom where the right leg holds up above the left leg. Money has started to race into the stock. Looking to pick it up on a continued move with some average or better volume; as the Monday volume was strong we don't have to have huge volume on the next move to enter.
Volume: 7.068M Avg Volume: 4.721M
BUY POINT: $39.42 Volume=4.8M Target=$44 Stop=$38.88
POSITION: ADI LH - Dec. $40c (46 delta) &/or Stock
http://www.investmenthouse.com/ci/adi.html
Play Date: 09/20/2004
MSTR (Microstrategy--$42.08; +1.11; optionable): Business software
http://biz.yahoo.com/p/m/mstr.html
After Hours: $41.98
STATUS: Test BO. MSTR set up similar to the chips, hitting a low in August and then moving up to its 50 day EMA (38.01). From there it gapped over the 50 day on tremendous volume. It then faded last week to test the move, holding over the 10 day EMA (40.01) and then starting back up Monday. No real volume on the Monday move, however, something we need to see change on a further move higher. Solid money flow has jumped ahead of the stock and is leading higher. Can run like the wind when it gets going, and looking for a run near the 200 day SMA (48.26) for starters. Nice trend reversal gap and test. Now it is ready to move back up.
Volume: 348.452K Avg Volume: 392.09K
BUY POINT: $42.55 Volume=575K Target=$48 Stop=$41.98
POSITION: EOU AI - Jan. $45c (42 delta) &/or Stock
http://www.investmenthouse.com/ci/mstr.html
Play Date: 09/20/2004
SMH (Semiconductor Holders Trust--$31.68; +0.95; optionable)
http://biz.yahoo.com/p/s/smh.html
After Hours: $31.62
STATUS: Double bottom w/handle. Nice set up, tapping to a new 2004 in August, bouncing, then fading to a lower low in September. Volume then shot higher as the chips were grabbed up two weeks back. A quick test of the 18 day EMA and then SMH broke over the 50 day EMA (31.29) Monday on another impressive volume surge. May come back to test the break over the 50 day Tuesday, but we are looking to pick up some shares on the continued move higher.
Volume: 33.121M Avg Volume: 21.455M
BUY POINT: $31.92 Volume=21M Target=$36 Stop=$31.25
POSITION: SMH AF - Jan. $30c (78 delta)
http://www.investmenthouse.com/ci/smh.html
Play Date: 09/20/2004
SNDK (Sandisk--$27.22; +0.92; optionable): PC data storage
http://biz.yahoo.com/p/s/sndk.html
After Hours: $27.40
STATUS: Test 200 day SMA. Solid action. SNDK slipped into the current 5 month base after the April high, part of a larger base that started in November 2003. A nice volume surge started two weeks back when SNDK rallied up to the 200 day SMA (26.01). It looked ready to stall, but volume faded as it slid along the 200 day SMA. Monday SNDK broke over the 200 day on stronger, above average volume. Money flow is surging ahead of price. Looks ready for a good run.
Volume: 7.852M Avg Volume: 6.466M
BUY POINT: $27.55 Volume=6.5M Target=$33 Stop=$26.88
POSITION: SWQ AY - Jan. $27.50c (53 delta) &/or Stock
http://www.investmenthouse.com/ci/sndk.html
Downside:
Play Date: 09/20/2004
AW (Allied Waste--$9.31; -0.26; optionable): Waste Management
http://biz.yahoo.com/p/a/aw.html
STATUS: Put. In deep trouble. AW rallied back with the market in August, but after a three week lateral move at the 18 day EMA (9.90) AW tanked last week on a big volume surge. A modest rebound to test the 10 day EMA (9.72) and then AW was back to selling Monday on rising, above average volume. Money flow is in the tank, and we are looking for AW to continue to follow it lower. 50%ish gain to the target.
Volume: 2.483M Avg Volume: 1.503M
BUY POINT: $9.22 Volume=1.5M Target=$8.12 Stop=$9.52
POSITION: AW WB - Nov. $10p (-55 delta)
http://www.investmenthouse.com/ci/aw.html
Good Investing!
Jon L. Johnson and your IH Alerts Team
All of the foregoing is commentary for informational purposes only. All statements and expressions are the opinion of Online Investment Services, LP. or its paid consultants and are 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 our related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolio of Partners in Online Investment Services, LP. or its paid consultants may, in some instances, include securities mentioned herein and on our 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.
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stock recommendation
stock pick
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