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Begin part 3 of 3
THE PLAYS
Good movers Monday: ARBA; AVO; BWLD; MNDO; NGEN; TKR; AVID; INOD; NCR; SGMS
Best Plays:
1) CERN: Ready to continue the breakout move.
2) VISG: Surging on strong volume.
3) EFJI: Volume is up as EFJI heads toward the breakout.
4) EYET: Volume is up as EYET has gapped higher.
5) WITS: Looks as if the handle has completed.
6) DRIV: Still the nice test.
7) STK: Volume is coming back as the stock starts the rebound.
NEW PLAYS:
Upside:
Play Date: 12/13/2004
CERN (Cerner--$51.95; +0.78; optionable): Healthcare information software
http://biz.yahoo.com/p/c/cern.html
After Hours: $51.98
STATUS: Breakout test. Nice low volume pullback to the 18 day EMA (51.38) to test the mid-November breakout from the 8.5 month trading range. Excellent 11 to 4 accumulation (11 up price weeks on rising volume to 4 down price weeks on rising volume) set up the breakout move. Making the first serious test, and the low volume shows few sellers as it eases back. Strong money flow has held its ground on the pullback. Volume needs to rally along with the stock.
Volume: 291.088K Avg Volume: 478.363K
BUY POINT: $53.48 Volume=565K Target=$60.55 Stop=$51.24
POSITION: CQN CJ - Mar. $50c (68 delta)
http://www.investmenthouse.com/ct/cern.html
Play Date: 12/13/2004
EFJI (EFJ, Inc.--$8.31; +0.21; no options): Telecom equipment
http://biz.yahoo.com/p/e/efji.html
After Hours: $8.34
STATUS: Double bottom w/handle. Excellent volume Monday as EFJI started the breakout from the 22 week base sporting excellent 9 to 3 accumulation. The stock is ready to breakout to a new multiyear high, a level with no overhead supply (buyers at higher prices) ready to push it lower when disgruntled shareholders who bought higher unload their shares. Looking very good and ready to move in on a further break higher on solid trade.
Volume: 464.114K Avg Volume: 119K
BUY POINT: $8.55 Volume=178K Target=$10.35 Stop=$7.95
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/efji.html
Play Date: 12/13/2004
MNST (Monster Worldwide--$29.50; +1.25; optionable): Internet jobs advertising
http://biz.yahoo.com/p/m/mnst.html
After Hours: $29.53
STATUS: Reverse head and shoulders. Excellent volume Monday as Monster made a frightening breakout from its 8.5 month base sporting very strong 10 to 5 accumulation. Good 7 week right shoulder to the base formed on mostly below average volume, tapped the 50 day EMA (27.03) on the low, and then blasted higher. This current base formed right after a 7 month double bottom tried to breakout but failed. These base-on-base patterns act to really weed out the sellers. Strong first move as MNST clears resistance that has held it back for over a year. Looking to start positions on a continued breakout move and then again on the test.
Volume: 3.042M Avg Volume: 1.425M
BUY POINT: $30.11 Volume=2.1M Target=$36.89 Stop=$28.88
POSITION: BSQ CF - Mar. $30c (50 delta) &/or Stock
http://www.investmenthouse.com/ct/mnst.html
Play Date: 12/13/2004
VISG (Visage Technology--$8.99; +1.27; optionable): Identity solutions software for government, law enforcement agencies, and businesses
http://biz.yahoo.com/p/v/visg.html
After Hours: $8.43
STATUS: Cup. Volume has surged the past two weeks as VISG has started the move off the bottom of its 8 month cup base. Excellent 11 to 3 accumulation in the pattern shows a lot of buying in the base even before it starts building the right side of the base where a lot of buying takes place. Strong money flow is way out ahead of the stock. Volume shot higher Monday as VISG blasted off the 200 day SMA (7.69) after a two week lateral move over that level following a late November break through that resistance level. Ready to move in as it continues its break higher.
Volume: 3.583M Avg Volume: 834.136K
BUY POINT: $9.12 Volume=1.3M Target=$10.98 Stop=$8.65
POSITION: TUM DU - Apr. $7.50c (77 delta) &/or Stock
http://www.investmenthouse.com/ct/visg.html
CONTINUING PLAYS:
Not yet entered:
Play Date: 12/06/2004
ECL (Ecolab--$34.96; +0.07; optionable): Cleaning, sanitizing, pest removal products and services (and more) for just about every industry there is.
http://biz.yahoo.com/p/e/ecl.html
STATUS: Flying plateau. Still working laterally at the 18 day EMA (34.82), continuing the 5 week lateral move consolidating the October breakout from a nice 16 week cup with handle base. That dip to the 50 day EMA (33.93) Thursday may have finally shaken out the last sellers. Nice 2 to 0 accumulation in the plateau is setting up the next move along with the money flow rising ahead of the stock.
Volume: 405.6K Avg Volume: 727.863K
BUY POINT: $35.55 Volume=1.2M Target=$40.38 Stop=$34.65
POSITION: ECL DG - Apr. $35c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/ecl.html
Play Date: 12/11/2004
EYET (Eyetech Pharmaceuticals--$44.50; +1.63; optionable): Biotechnology
http://biz.yahoo.com/p/e/eyet.html
After Hours: $44.49
STATUS: Cup w/handle. Gapped higher and rallied up and down before closing in the top half of its range. Volume was up and just above average. A good move but not the breakaway one we wanted. Still very solid in its 6 month base sporting excellent 8 to 2 accumulation (8 up price weeks on rising volume to 2 down price weeks on rising volume). Plenty of buying and money flow rallying well, moving higher even as the stock moves laterally.
Volume: 1.057M Avg Volume: 821.681K
BUY POINT: New: $44.68 (orig. $44.38) Volume=1.5M Target=$52 Stop=$42.58
POSITION: QUJ CI - Mar. $45c (42 delta) &/or Stock
http://www.investmenthouse.com/ct/eyet.html
Play Date: 12/04/2004
WITS (Witness Systems--$16.60; +0.20; optionable): Application software for capturing customer intelligence (no kidding; we took this right off the profile) and optimizing workforce performance.
http://biz.yahoo.com/p/w/wits.html
STATUS: Cup w/handle. Showing signs it is done forming the handle, volume jumped up to average Monday as WITS rallied to 16.94 on the high though falling back on the close. Nice 10 week base sporting strong 4 to 1 accumulation and solid money flow. Still looks ready.
Volume: 282.889K Avg Volume: 365.454K
BUY POINT: $17.05 Volume=553K Target=$20.75 Stop=$16.15
POSITION: UPJ CW - Mar. $17.50c (50 delta) &/or Stock
http://www.investmenthouse.com/ct/wits.html
Play Date: 12/02/2004
WMS (Williams Industries--$30.79; +0.28; optionable): Diversified electronics
http://biz.yahoo.com/p/w/wms.html
STATUS: Reverse head and shoulders. Volume started to edge higher Monday posting the best trade in three weeks. It has been holding over the 18 day EMA (29.98), moving laterally as it forms the last part of the right shoulder to the 8.5 month base. Excellent money flow and accumulation has set up the move. On the brink, and we are watching for volume to jump as it makes the move.
Volume: 388.5K Avg Volume: 588.136K
BUY POINT: $31.28 Volume=945K Target=$37 Stop=$29.68
POSITION: WMS DF - Apr. $30c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/wms.html
New Buy Points on Current Plays:
Play Date: 11/15/2004
DRIV (Digital River--$41.60; -0.20; optionable): Electronic commerce outsourcing solutions
http://biz.yahoo.com/p/d/driv.html
After Hours: $41.60
STATUS: Breakout test. Another low volume session as DRIV tapped 42.50 on the high once more, unable to hold the move. Another nice test of the breakout and run, easing back to the 18 day EMA (40.65) on low, below average volume. Nice run, nice test, and now we are looking for volume to rebound sharply as the stock moves through the buy point to add to positions or start a new one. Again, strong stocks make 4 to 5 such bounces off the short term MA before needing to test lower. This is the second test since the breakout, leaving DRIV plenty of upside on this run.
Volume: 490.48K Avg Volume: 962.09K
BUY POINT: New: $42.72 (orig. $38.65) Volume=1.3M Target=$50 Stop=$41.22
POSITION: DQI CH - Mar. $40c (53 delta) or DQI CG - Mar. $35c (68 delta) &/or Stock
http://www.investmenthouse.com/ct/driv.html
Play Date: 11/11/2004
MIPS (Mips Technologies--$9.00; +0.20; no options): Semiconductor memory chips
http://biz.yahoo.com/p/m/mips.html
STATUS: Test 18 day EMA. Solid price move off the 18 day EMA (8.71) test, the second such test following its late October breakout from a 10 month double bottom with handle base. Want to see volume get better as it continues the move. Strong stock that took a breather during its run. A bit more volume and it is a buy on this rebound.
Volume: 171.706K Avg Volume: 305.59K
BUY POINT: New: $9.11 (orig. $8.67) Volume=347K Target=$10.94 Stop=$8.68
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/mips.html
Play Date: 11/30/2004
STK (Storage Technology--$30.90; +0.65; optionable): PC data storage devices
http://biz.yahoo.com/p/s/stk.html
STATUS: Breakout test. Starting the rebound from the nice, low volume test of the explosive breakout to start the month. Volume was higher Monday, but still well below average, not the strong surge we were looking for. STK blasted out of an 11 month base on tremendous trade, rallying over 32 on the first run. Jumping off of the 18 day EMA (29.86), its first test of this level following the breakout. Strong money flow is leading higher. A buy on a continued move that shows above average volume.
Volume: 756.9K Avg Volume: 958.272K
BUY POINT: New: $31.02 (orig. $29.92) Volume=1.4M Target=$36.00 Stop=$29.98
POSITION: STK CF - Mar. $30c (43 delta) &/or Stock
http://www.investmenthouse.com/ct/stk.html
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.
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