|
|
trading system, trade stock
Begin Part 3 of 3
THE PLAYS: Removed several stocks again, making room for better-looking plays, as always. We are keeping the former on a watchlist: ERTS, LFIN, ARE, ASBC, COTT, ETN, CPC (looks good still), SCUR, NTIQ, POWI, CCBL, APC, APA, CWN, NMTC, EBAY (could still move down on the put), PMI, ZION, BSC (hit target), BBBY, EEFT, GP, SOTR, JCP, SLVN, MTG and CERN. Several of those still look good and we will keep a watch and update you. They are still on the alert system when and if the buy points are reached.
Note for reading plays: A "prior high" refers to the high at the start of a base.
All prices are current as of the close of trading Friday.
IMPORTANT NOTE: We regret that deltas were not available for inclusion in the plays this weekend. We apologize for the inconvenience and look for the situation to be back on track Monday.
Best Plays:
1) AOC: Testing the breakout and back at support on low volume.
2) KNDL: A tight lateral on low volume.
3) PHTN: Moving up in its handle.
4) AAS: Momentum play.
5) THOR: Ditto.
6) FFIV: Broke strong resistance on strong volume.
7) PTMK: A possible short sell.
8) Puts: RYAAY, MSCC, MMC, CERS
9) CHRW: Looks good in its pattern.
10) GOTO: Low-volume doji.
NEW PLAYS:
TRMK (Trustmark--$24.12; -0.38; no options): Regional banks
http://biz.yahoo.com/p/t/trmk.html
STATUS: In an ascending wedge pattern that formed since mid-July and has shown decreasing volume throughout (down to 43,800; avg. 135,409). The pattern is a test of the breakout from a strong July run off support at the 200 day MVA. Look for the breakout over the pattern high of 24.75. Good money flow and buying. Target: initial 29
BUY POINT: 24.88, on minimum breakout volume of 183,000. Stop: 23.90 (below the 18 day MVA, at 23.99). A buy on the breakout up to 26.
POSITION: Stock.
AOC (Aon--$38.17; -0.33; optionable): Insurance
http://biz.yahoo.com/p/a/aoc.html
STATUS: A test of the breakout from a saucer base. AOC has pulled back to the 10 day MVA (tested on the low of 38.01), bouncing up slightly as volume dropped very low to 308,300 (avg. 966,045). Looking for a stronger bounce and move over the breakout high at 39.30. Good money flow and buying, with relative strength ahead of price. Target:
BUY POINT: 39.43, on volume in the range of 416,000. Stop: 38.
POSITION: Stock and/or October $35 calls to buy (AOC JG).
KNDL (Kendle Intl--$20.33; -0.02; optionable): Drug
http://biz.yahoo.com/p/k/kndl.html
STATUS: Testing the recent breakout by pulling back and consolidating above its 10 day MVA (20.04) on low volume, which was at 36,100 by Friday (up slightly toward the average of 77,363). We are looking for a breakout over the August high of 21.35 on strong volume. The stock formed a similar but longer pattern the first two-thirds of July, so there is the chance this pattern will take a bit longer to get ready for the strong move. Strong money flow and high relative strength. Initial target: 25
BUY POINT: Over 21.35 on volume of 78,000 or higher. Stop: 20.
POSITION: Stock and/or November $17.50 calls to buy (KQR KW; low open interest).
Deltas unavailable at the time of this writing. Please check with your broker.
SKYF (Sky Fincl--$20.26; -0.28; no options): Regional banks
http://biz.yahoo.com/p/s/skyf.html
STATUS: Recently broke from a flat base and is testing, having fallen back to the 10 day MVA (20.28) Friday on lower volume (64,700; avg. 143,000). The buy point was 20.12, so we don't mind a pullback to that. The 18 day MVA is below that level at 20.04, and in this market there's the chance that SKYF will test that, which is still okay since it is above the level of the base. Good buying and high relative strength. Initial target: 23
BUY POINT: Aggressive: 20.60, on volume of 87,000 or better. Stop: 20
POSITION: Stock.
PHTN (Photon Dynamics--$38.34; +1.34; optionable): Chip Equipment
http://biz.yahoo.com/p/p/phtn.html
STATUS: Moving up in the handle to a 9.5-month saucer/cup base formed at the bottom of a much larger base of 17 months. Volume was nice and strong Friday at 557,400 (avg. 263,000), taking the stock to a high of 39.24 before pulling back off. PHTN has been on a three-day climb, but Friday's volume was its first strong shot, so look for the move up. Our initial target are the highs at the start of the current base, at 43-44. Super money flow and positive buying.
BUY POINT: Aggressive: 39.30 (over Friday's high) on continued strong volume. Stop: 35.85, the 18 day MVA. Breakout: 40.79, on minimum breakout volume of 395,000, but on higher volume from Friday's numbers. Stop: 38.50
POSITION: Stock and/or October $35 calls to buy (PDU JG; low open interests).
New Trading Plays: Take the move and move on. Will watch APA for a bounce back from the 50 day MVA. APC pulled back on lower volume as well; both stocks are above support for now.
SOX (Phili Semi--$555.54; -27.49; optionable): Either way
STATUS: Playing the trading range. Sold back and tapped 552.41 on the low Friday; the index may continue to sell down toward 535 this week, and if so we are looking for support in the 537 range (March and July prices) for a bounce back up. We don't mind playing the 20-point move down to 535 or the bounce back up after that toward the 583 range (10 day MVA is at 587.10 Friday). If it breaks below 541 on rising volume, look for a drop to 500.
BUY POINT: Downside Aggressive: Below 552. Upside Aggressive: On a bounce back up from the 537-541 range, on rising volume. Put: Below 541 on strong volume. Stop: 563.
POSITION: Aggressive Put: September 560 puts to buy (SJX UL). Upside Aggressive: September $540 calls to buy (SJX IH; no open interests, and delta unavailable). Put: September $540 puts to buy (SJX UH). Deltas unavailable at the time of this writing. Please check with your broker.
AAS (Amerisource--$59.00; +1.85; optionable): Drugs wholesale
http://biz.yahoo.com/p/a/aas.html
STATUS: Making a move off the 18 day MVA (57.19) on strong volume Friday (at 1.9 million; avg. 749,136). The stock is in an 8-week base with a prior high of 62.50, and we are looking for a trade up to that level, initially. The strong volume suggests a good start on that move from here. High relative strength, and money flow is surging.
BUY POINT: Aggressive: 59.50, on continued strong volume. Stop: 56.61 (50 day MVA).
POSITION: Stock and/or November $55 calls to buy (AAS KK). Delta unavailable; please check with your broker.
THOR (Thorate--$17.64; +1.79; optionable): Medical Instruments
http://biz.yahoo.com/p/t/thor.html
STATUS: Making a strong move up in the handle to an 10.5-month base. Volume was heavy on the move up from support at 16 (the 50 day MVA is just below at 15.51), stacking in at 1.7 million (avg. 438,000). Looking for a breakout over the handle high at 19.59. The stock is showing great money flow and buying. Initial target: 22
BUY POINT: Aggressive: Over 18 on continued strong volume. Breakout: 19.72, on continued strong volume (minimum breakout volume is 657,000). Stop: 18.
POSITION: Stock and/or October $12.50 calls to buy (TQU JV). Deltas unavailable at the time of this writing. Please check with your broker.
FFIV (F5 Networks--$14.59; +1.45; optionable): Software
http://biz.yahoo.com/p/f/ffiv.html
STATUS: In a huge base (prior highs from fall 1999) but just off the lows around 4. FFIV reached a June high at 19.20 on a breakout over the 200 day MVA, but crossed back below that major support until Friday, when strong volume took it back over all its moving averages (818,900; avg. 619,090). After such a lengthy pullback, we are looking for this strong move to head things back up to that June high for an initial target (19). FFIV is showing strong money flow and positive buying.
BUY POINT: Aggressive: 15.50, on continued rising volume. Stop: 13.85 (50 day MVA).
POSITION: Stock and/or October $12.50 or $15 calls to buy (FLK JV or JC). Deltas unavailable at the time of this writing. Please check with your broker.
A Short Sale:
PTMK (Pathmark Stores--$23.10; -0.65; no options): Grocery
http://biz.yahoo.com/p/p/ptmk.html
STATUS: The stock broke support of its 50 day MVA (23.52) on strong volume Friday (273,800; avg. 234,000) and on a move below Friday's intraday low of 22.95 we are looking at selling the stock short on a move down to 19-20 (the 200 day MVA is at 19), since there are no options available. Once at the support, we can buy the stock back, return it to the broker and pocket the difference.
BUY POINT: Aggressive: Below 22.95 on continued strong volume. Stop: 23.86 (18 day MVA 23.86)
POSITION: Stock.
New Puts:
BBY (Best Buy--$59.28; -1.30; optionable (BBY): Retail
http://biz.yahoo.com/p/b/bby.html
STATUS: 60 is giving the stock some resistance, and it turned away from that level Friday to hit a low of 58.75 (near Thursday's low). We will need to see stronger volume in market selling, and a move below 57.42 (August low) for looking at the put down to $50 or the 200 day MVA (48). Volume was 1.6 million (avg. 2.4 million). Some discouraging analyst comments out Friday may help this one fall. These calls have been killing stocks.
BUY POINT: Aggressive: Below 58.50 on rising volume. Stop: 61.55 (10 day MVA). On a move below the August low: 57, on strong and rising volume. Stop: 61.55
POSITION: September $60 puts to buy (BBY UL). Deltas unavailable at the time of this writing. Please check with your broker.
RYAAY (Ryanair--$50.79; +0.02; optionable): Regional airlines
http://biz.yahoo.com/p/r/ryaay.html
STATUS: A classic put scenario: Broke through strong support (the 200 day MVA at 51.24, in this case), tried to break back over it, but is being held in check. The stock got such low volume Friday (27,700; avg. 112,227) that it's no wonder it went nowhere, but we are looking for it to fail on another test of the resistance. Target: March lows near 42.
BUY POINT: Aggressive: A fall from here. Breakdown: Below 49.50 on strong selling volume. Stop: 52
POSITION: December $55 puts to buy (ZQ XK). Deltas unavailable at the time of this writing. Please check with your broker.
CERS (Cerus--$57.55; -0.90; optionable): Biotech
http://biz.yahoo.com/p/c/cers.html
STATUS: Sold below the 200 day MVA Wednesday, tried to recover Thursday, but after opening closer to the broken support Friday, sold back on heavy volume (542,800; avg. 94,000). The stock is still above Thursday's low of 55.60, so we will look for a move below that for taking positions. Target: initial, 50; below that, 45.
BUY POINT: 57, on continued strong volume. Stop: 60.70 (200 day MVA).
POSITION: October $60 puts to buy (CEQ VL). Deltas unavailable at the time of this writing. Please check with your broker.
DIGE (Digene--$29.29; -2.79; optionable): Drugs
http://biz.yahoo.com/p/d/dige.html
STATUS: Recovered from a Wednesday break below its 200 day MVA (30.59), but headed back down Friday as volume broke above average levels to 137,800. It's the 50 day MVA that the stock can't take out, but this time, DIGE may not be able to make it back over the 200 day MVA. We will expect it to try if it does not first drop below Thursday's low of 28.11 and keep going. Target: initial, 25.
BUY POINT: Aggressive: On a move down from a retest of 30 (200 day). Stop: 31.
Below Thursday's low: 28, on continued rising volume. May try to test the low as well, before heading back down.
POSITION: Aggressive: September $30 puts to buy (QDG UF). Below 28: December $30 puts to buy (QDG XF). Deltas unavailable at the time of this writing. Please check with your broker.
MSCC (Microsemi--$59.75; -5.52; optionable): Chip
http://biz.yahoo.com/p/m/mscc.html
STATUS: Broke below the 50 day MVA (61.64) Friday on strong volume (1.13 million; avg. 798,000). We are looking for a continued move down to a target of 55 initially, then 50. The stock was trying to wedge above the support when it got hit with selling, unable Thursday to break back over the short term MVAs on strong volume.
BUY POINT: 59, on continued selling. Stop: 62
POSITION: December $60 puts to buy (QMS XL).
MMC (Marsh & Mclennon--$95.21; -3.24; optionable): Insurance
http://biz.yahoo.com/p/m/mmc.html
STATUS: Opened just under the 10 day MVA (99.06) and sold on strong volume from there (1.3 million; avg. 799,000), closing just under the July low of 95.25. Looking for the put play down to 90 for an initial target, then 85 (April low is at 80).
BUY POINT: A strong move below 95 on heavy volume. Stop: 99
POSITION: October $95 or $100 puts to buy (MMC VS or VT).
Continued Puts: BSC hit our target for the put. We will see what it does from here.
DJX (1/100 Dj Ind--$103.46; -0.66; optionable):
STATUS: Hit a lower low Friday (101.81) with volume fading back (though not much) to 980,400 (avg. 1.1 million). On a move below that level on market selling we will be looking at taking the position on the downside play. Target is 100 for now; setting our sights on 97-98 if the sell-off gains strength. The index may try to test 102 before making a clean break down.
BUY POINT: Breakdown: 101.70, on average or better volume.
POSITION: September $104 or $102 puts to buy (DJV UZ or UX). Please check with your broker for deltas, which were unavailable at the time of this writing.
OEX (Standard & Poors--$593.87; -11.16; optionable):
STATUS: Broke below our support level at 600 despite lower volume (980,400; avg. 1.1 million). We have been playing this one down, and now it may try to test the breach of support and move back down. It already bounced back from a low of 590.18 on Friday. If that continues, we will look for the test. Target: 568
BUY POINT: Below 600: the index may move back up to test the 600 level; on "the kiss good-bye" (move back down from the resistance), we can look at getting in.
POSITION: September $600 puts to buy (OEY UT). Please check with your broker for
deltas.
AMGN (Amgen--$59.95; -1.05; optionable): Biotech
http://biz.yahoo.com/p/a/amgn.html
STATUS: Made the buy point of 59.75 Tuesday, but bounced back from the low on the strong volume (which fell back below average Friday to 5.9 million). Friday AMGN tested the 50 day MVA on the high of 61.65, then closed back lower, showing a doji, on below average volume. If it heads below 58.30 (Tuesday's low) on selling, we can still look at playing it down to our target at 53-54.
BUY POINT: 58.25, on higher volume. Stop: 62 (just above the 50 day MVA, at 61.32).
POSITION: September $70 puts to buy (YAA UN). Deltas unavailable at the time of this writing. Please check with your broker.
CONTINUED PLAYS:
Trading Plays: These stocks are not necessarily long-term plays for now. The plan is to look at a shorter-term target, taking profits when we get there, then leaving. If the play falters or gets hit with some selling, we won't wait around too long for it to recover.
SAGI (Sage--$17.75; -0.10; optionable): Integrated circuits
http://biz.yahoo.com/p/s/sagi.html
STATUS: After Wednesday's nice breakout move, the stock pulled back on lower volume the last 2 days of the week, off the high of 18.50. Volume was still just above average at 229,000 as the stock first tested near the 10 day MVA on the low of 17.20, then closed higher with a doji. We are looking for a move up to the prior basing highs (9-month cup base) for an initial target: 21. Great money flow and buying.
BUY POINT: Aggressive: Over 18.10 (intraday high) on above average volume. Stop: 17
POSITION: Stock and/or October $15 calls to buy (UEJ JC).
BREAKOUTS:
Removed ARE, which had a fine breakout; volume, however, keeps pulling back. Also, ASBC, which may be topping out here. Good performers!
WEDGES, PENNANTS, and FLYING PLATEAUS (AND FLAGS): These are some of our favorite patterns as the moves can be explosive. In this market, however, we need to see the move on the breakout on strong volume.
Ascending wedges:
Continued:
CHRW (C.H.Robinson Worldwide--$30.74; -0.11; optionable): Transportation
http://biz.yahoo.com/p/c/chrw.html
STATUS: Still a good-looking ascending wedge. The stock pulled back slightly Friday on lower volume (170,600; avg. 212,000), showing a tight doji. The pattern is tightening, too. Looking for a move over the May high of 31.28 for the breakout. Continued strong money flow and high relative strength. Target: 36
BUY POINT: Breakout: 31.41, on volume of 290,000 or better. Stop: 30.18 (18 day MVA).
POSITION: Stock and/or November $30 calls to buy (CJQ KF).
SON (Sonoco Products--$25.61; -0.29; no options): Paper
http://biz.yahoo.com/p/s/son.html
STATUS: On higher volume SON dropped to a test of the 18 day MVA (25.47) then bounced back (volume was up and strong and 173,300; avg. 143,000). Despite the strong volume, the stock did well to hold here, so we will continue to look for the breakout. The ascending wedge-type pattern formed as a handle to a large cup at the bottom of the stock's much larger base. Target: 30
BUY POINT: 26.13, on volume of 193,000 or better. Stop: 24.85 (just below the 50 day MVA at 25). A buy on a breakout up to 27.44
POSITION: Stock.
Pennant: MTG is showing higher volume as it holds at the 50 day MVA, not able to break over resistance. It is showing distribution. We will keep it on a watchlist for the breakout (buy point 77.13).
BASING/TRADING RANGES:
Continued:
TMCS (Ticketmaster Online--$15.95; -0.64; optionable): Software
http://biz.yahoo.com/p/t/tmcs.html
STATUS: Off the lows (around 7) in a base that is almost at three years in length. The stock has formed a cup base (with a "u" dip down to the 200 day MVA in July; almost a reverse head and shoulders), moved laterally the first week in August on low volume then on stronger volume broke higher up the right side in the base. Friday it pulled back from the high (16.77) on super low volume of 91,800 (avg. 495,000), so we are looking for a handle formation. Shows great money flow and buying, so if the "u" bottom does not give the stock some trouble, we look for a breakout after this pullback. 10 day MVA is at 15.54. Target: 19-20
BUY POINT: 16.90, on volume of 743,000 or better. Stop: 16
POSITION: Stock and/or October $15 calls to buy (QMF JC).
Basing: Keeping SOTR on a watchlist, which is having trouble breaking resistance at 26.64.
GOTO (Goto.Com--$23.90; -0.84; optionable): Internet
http://biz.yahoo.com/p/g/goto.html
STATUS: Another stock in a really long base (2 years) and off the lows around 6. GOTO has been back over its 200 day MVA for nearly 4 months, and has formed an 11-week cup base. It made a decent move up Thursday as volume rose, but since volume remained below average, no wonder the stock pulled back Friday on even lower numbers (518,700; avg. 964,000). It is showing a tight doji here, up from a test of the 10 day MVA on the low (23.49). Looking for a move up and breakout over July's high (25.15).
Initial target: 30.
BUY POINT: Breakout: 25.28, on volume of 1.4 million or better. Stop: 23.51
POSITION: Stock and/or November $20 calls to buy (GUO KD).
CWN (Crown American--$8.46; -0.03; no options): REIT
http://biz.yahoo.com/p/c/cwn.html
STATUS: In a pennant/flat base of nearly 3 months' length. The stock headed up Thursday on a spike in volume, but as that dropped back below average Friday, CWN lost a few pennies off the high of 8.55. Can retest the 10/18 day MVAs (8.37, 8.33 respectively), and from there we continue to look for the breakout. Volume: 51,500; avg. 87,090. Initial target: 10
BUY POINT: 8.62, on volume of 131,000. Watch the May high of 8.72 for resistance. Stop: 8.06 A buy on the breakout up to 9.05
POSITION: Stock.
Good Investing!
Jon L. Johnson and your Technical Traders Report 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.
|
trading system
trade stock
|
