stock ticker, stock recommendation

Begin part 3 of 3

THE PLAYS

Good movers Friday: ATI; CCK; CNX; GLBL; INFY; HOYG; KFX; LSS; PUMP; SERO; SYNM; TV; USU; VPI

Thursday night play results:
CNX: Gapped higher and ran to the close. Hard to get into.
MIK: Tried to make the move through the 10 day EMA but stalled on some lighter volume.
SERO: Continued the nice break higher on lower though still above average volume.

New Plays:

Upside:

Play Date: 02/26/2005
BEAV (BE Aerospace--$12.03; +0.53; optionable): Aerospace/defense
http://biz.yahoo.com/p/b/beav.html
After Hours: $12
STATUS: Ascending triangle. Nice volume Friday as BEAV started the breakout move from its 5.5 month base that formed around the 50 day EMA (10.83). That is an important support level where the big money steps in to support their favorite stocks. Excellent money flow is leading the stock higher, and accumulation in the base is positive at 6 to 5 (six up price weeks on rising volume to five down price weeks on rising volume), showing the net buying needed to break the stock past resistance and run higher. Moves from these bases can be explosive.
Volume: 1.514M Avg Volume: 436.272K
BUY POINT: $12.28 Volume=525K Target=$14.75 Stop=$11.45
POSITION: BQV GV - July $12.50c (52 delta) &/or Stock
http://www.investmenthouse.com/cd/beav.html

Play Date: 02/26/2005
KLAC (KLA Tencor--$50.81; +1.96; optionable): Chip equipment
http://biz.yahoo.com/p/k/klac.html
After Hours: $50.94
STATUS: Test 50 day EMA. Very similar to SOX is making a solid bounce higher as it puts together a recovery from its long decline. The past 10 months have formed something of a reverse head and shoulders pattern, an accumulation base. The right shoulder of the pattern used the 200 day SMA (43.73) as support, and it made a higher low the past week over the 50 day EMA (46.92) then bolted higher on rising volume Thursday and Friday. Very nice volume. Indeed, volume has been very good the past two months as KLAC moved higher off the 200 day SMA, something NASDAQ overall has been unable to do. Friday it moved past the recent February highs (50.73) and looks ready for a pretty substantial move.
Volume: 8.753M Avg Volume: 4.941M
BUY POINT: $51.11 Volume=6M Target=$57.48 Stop=$48.89
POSITION: KCQ FJ - June $50c (62 delta) &/or Stock
http://www.investmenthouse.com/cd/klac.html

Play Date: 02/26/2005
KND (Kindred Healthcare--$31.40; +0.90; optionable): Long term care facilities
http://biz.yahoo.com/p/k/knd.html
After Hours: $31.40
STATUS: Breakout test. KND surged two weeks back on strong volume, breaking out from an 11 month cup with handle base. After a surge close to 34, KND came back to test the move, tapping at the 18 day EMA (30.06) lat week and then rebounding Friday, continuing the breakout move. Nice 3 to 1 accumulation in the recent 6 week double bottom with handle base that acted as the handle to the larger base helped set up the move. Nice, nice pattern and breakout, moving to an all-time high with a good shot of above average volume Friday. Strong money flow is leading the way higher and relative strength is moving toward another breakout as well, a good corroboration of the stock's move. Looking to move in on a further rally here on continued improving volume.
Volume: 432.1K Avg Volume: 307.954K
BUY POINT: $31.62 Volume=462K Target=$36.55 Stop=$30.45
POSITION: KND HF - Aug. $30c (58 delta) &/or Stock
http://www.investmenthouse.com/cd/knd.html

Play Date: 02/26/2005
THQI (THQ, Inc.--$27.33; +0.54; optionable): Multimedia graphics software
http://biz.yahoo.com/p/t/thqi.html
After Hours: $27.44
STATUS: Breakout test. THQI exploded higher early this month on strong volume, gapping up over 3 points on the news as it broke out from its 8 month double bottom with handle base. Accumulation in the base was a solid 8 to 5, and that is supporting the stock as it tests the strong gap higher. It has come back on extremely low volume to test the 18 day EMA (26.45), holding the gap higher. That is a sign of strength. Friday it gapped higher, starting to follow that strong money flow once again. Volume did not jump with the stock, however, something we need to see before we move into positions on this rebound. That should come soon.
Volume: 565.333K Avg Volume: 1.096M
BUY POINT: $27.88 Volume=1M Target=$32 Stop=$26.44
POSITION: QHF FE - June $25c (74 delta) &/or Stock
http://www.investmenthouse.com/cd/thqi.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, GTRC, HDWR, MSTR, STN, TSRA, UPL

BR: Getting stronger as it continues higher up the 10 day EMA after the breakout.

GTRC: After that dip it is running higher again though showing low volume as is sometimes characteristic for this stock.

HDWR: Volume is surging as it starts up off the 50 day EMA that acted as support in the handle of its 14 week base.

MSTR: Still looks tasty as it moves laterally over the 18 day EMA on very low, below average volume. Getting ready for the move.

STN: After that big dip to the 50 day EMA Thursday STN is coming right back.

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:

PGNX: Broke out Thursday from a 14 month cup with handle base. Pretty solid drug stock.

CTSH: Continuing the breakout move on strong volume Friday after testing the move two weeks earlier.

Downside:

NVTL: Bounced up Thursday after a strong drop the prior week in its downtrend below the 10 and 18 day EMA. After a bounce up to the 10 day EMA it will be ready to continue the drop.

HELE: Gapped below the 200 day SMA a week back and made a lower volume rebound to test that move. Has not completely filled the gap but looks to have run out of gas.

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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