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Begin part 3 of 3

THE PLAYS

Good movers Wednesday: EBAY; QCOM; SBAC; TV

Tuesday night play results:
BYD: Took the day off after the strong Tuesday surge.
ESMC: Slipped below the 200 day SMA on rising volume. No good.
CCRN: Wrong way but no volume.
EBAY: Starting the next breakout move.

New plays for Thursday:

Upside:

Play Date: 09/29/2004
CTV (Commscope--$21.33; +0.01; optionable): Telecom equipment
http://biz.yahoo.com/p/c/ctv.html
STATUS: Breakout test. CTV has come back to test the 18 day EMA (21.25) the past week after a nice volume breakout from a 9 week double bottom with handle base. A nice base on base with the double bottom following a prior 5 month base and breakout. Excellent money flow is leading higher as the stock makes the pullback to test the breakout move. Volume jumped Tuesday as the stock held tight to the 18 day, kind of crouching before jumping higher. Just looking for some more volume as it rallies and holds the move.
Volume: 589.2K Avg Volume: 652.013K
BUY POINT: $21.75 Volume=750K Target=$26 Stop=$21.12
POSITION: CTV BD - Feb. $20c (72 delta) &/or Stock
http://www.investmenthouse.com/cd/ctv.html

Play Date: 09/29/2004
LTD (The Limited--$22.31; +0.43; optionable): Apparel stores
http://biz.yahoo.com/p/l/ltd.html
After Hours: $22.19
STATUS: Breakout. Volume has jumped well above average the past two sessions as LTD resumed the breakout move from a 17 week cup with handle base. It broke out, ran to 22, then moved laterally the past two weeks just below 22 as the 10 day EMA (21.81) moved up from below. Excellent 7 to 2 accumulation shows buyers moving in during the base, holding over the 200 day SMA (19.54) on the pattern lows, showing institutions stepping in. Strong money flow and relative strength is breaking out on the move, showing the stock is outperforming the market. Ready to move in on a further run higher on decent trade (it has already had two solid volume sessions).
Volume: 3.146M Avg Volume: 2.077M
BUY POINT: $22.48 Volume=2.2M Target=$25.88 Stop=$21.45
POSITION: LTD BX - Feb. $22.50c (51 delta) or LTD AD - Jan. $20c (96 delta) &/or Stock
http://www.investmenthouse.com/cd/ltd.html

Play Date: 09/29/2004
SNDK (Sandisk--$28.98; +0.99; optionable): PC data storage devices
http://biz.yahoo.com/p/s/sndk.html
After Hours: $29.05
STATUS: Cup. SNDK is showing one of those 'building patterns' we discussed in the summary. It is in an 11 week base, starting up the right side of the pattern the past 4 weeks. It rallied through the 200 day SMA (25.85), came back to test, and is now moving higher again on rising volume. May not want to marry it long term, but it is in a good risk/reward position and the Wednesday gap higher and gain was on rising, above average volume.
Volume: 7.541M Avg Volume: 6.628M
BUY POINT: $29.15 Volume=7M Target=$34 Stop=$28.12
POSITION: SWQ AY - Jan. $27.50c (65 delta) or SWQ AF - Jan. $30c (49 delta) &/or Stock
http://www.investmenthouse.com/cd/sndk.html

Play Date: 09/29/2004
VRSN (Verisign--$19.82; +1.11; optionable): Internet certificates and verifications
http://biz.yahoo.com/p/v/vrsn.html
After Hours: $19.84
STATUS: Double bottom w/handle. Strong volume surge as VRSN started the breakout move from the handle to its 8.5 month base. Another solid pattern that used the 200 day SMA (17.53) on the lows as support, showing the big money stepping in to buy into the stock at that key level. Accumulation is a strong 7 to 2, showing buyers moving into the stock during the pattern. Money flow is surging higher and relative strength is ready for the breakout, a good corroboration of the breakout move.
Volume: 5.108M Avg Volume: 2.527M
BUY POINT: $20.06 Volume=2.6M Target=$24 Stop=$19.38
POSITION: QVR CD - Mar. $20c (53 delta) &/or Stock
http://www.investmenthouse.com/cd/vrsn.html

SUBSCRIBER PORTFOLIO: These are stocks subscribers suggest by vote that we put in a portfolio to track and move into the stocks if they perform well. If you have any suggestions for additions or deletions, email us. We don't cover them all each report, just when something interesting is developing.

BR, COH, EASI, EBAY, GMAI, GTRC, HDWR, JNPR, MSFT, QCOM

COH: Hanging in there and forming what looks to be the right shoulder to a 15 week reverse head and shoulders base. Moved up off the 50 day EMA Wednesday, the bottom of the right shoulder. Volume is not running yet, but the stock is getting ready for a break higher over 45

GTRC: Setting back up with a nice hold at the 50 day EMA as it forms a new handle.

QCOM: Volume started higher as QCOM moved off of the 50 day EMA. May be ready for a more dramatic move.

SUBSCRIBER WATCHLIST

We continually receive ideas for potential plays from subscribers. Many times they are already on our watchlists, other times not. We always take a look and sometimes find a gem or two, or more. We don't necessarily endorse these, but want to provide a forum for subscribers with ideas that may appeal to other subscribers. We may just put on the ticker or we might describe our thoughts as to why or why not we think it is a buy or sell. This is a way we can all learn a bit more and maybe find a few more candidates to make us some good money.

Upside:

INCY: Nice test of a strong August to September surge. Now it needs to show volume as it makes the break past the recent high.

JUPM: Volume is blasting off as JUPM did the same Wednesday.

Good Investing!
Jon L. Johnson and The Daily Staff

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 of 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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