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Begin part 3 of 3

THE PLAYS

Good movers: EFX; GME; HANS; HLEX; TZIX; UBET; UTHR

Weekend play results:
BOOM: Holding over the 50 day EMA as it continues the test.
GME: Nice break higher after the test.
BLL: Moved up to the 200 day SMA but on lower volume.
ETN: Still weak below the 10 day EMA on low volume.

New Plays:

Upside:

Play Date: 04/25/2005
EW (Edwards Life Sciences--$43.78; +1.16; optionable): Medical appliances
http://biz.yahoo.com/p/e/ew.html
STATUS: 50 day EMA test. Volume has surged the past three sessions as EW crouched at the 50 day EMA (42.42). Monday it was done crouching and blasted higher on continued strong volume. This test follows the attempted breakout from an 11 week base in late February. No volume and that move failed, setting up the current 7 week test. Money flow is leading higher and relative strength broke out on the Monday move, moving to a new high ahead of the price. That is a bullish indication. Looking to move in on a further volume move higher and then take more positions on the test. Moving to a new high where there are no disgruntled shareholders.
Volume: 920.5K Avg Volume: 422.09K
BUY POINT: $44.05 Volume=600K Target=$50 Stop=$42.55
POSITION: EW HI - Aug. $45c (45 delta) &/or Stock
http://www.investmenthouse.com/cd/ew.html

Play Date: 04/25/2005
PEP (Pepsico--$55.14; +0.67; optionable): Pepsi, Pepsi, Pepsi
http://biz.yahoo.com/p/p/pep.html
After Hours: $55
STATUS: Cup w/handle. We still remember the famous words Steve Jobs spoke to John Scully: do you want to sell sugar water or do you want to change the world? While Apple is not doing bad at all, it is strong not because it is changing the world as Jobs envisioned, but is selling a new music box. A different form of sugar water? In any event, PEP is not bad either, having formed the current 10 week base using the 200 day SMA (51.67) as support on the lows. This part of a larger 13 month reverse head and shoulders base, another accumulation pattern. A breakout from the current base sends it to an all-time high; there's money in that there sugar water. Accumulation in the base is strong at 3 to 0 (3 up price weeks on rising volume to 0 down price weeks on rising volume); nothing but buyers in the short base. Money flow is moving higher ahead of the price, and we expect PEP to follow the money.
Volume: 4.834M Avg Volume: 3.528M
BUY POINT: $55.38 Volume=5.3M Target=$60 Stop=$54.12
POSITION: PEP JK - Oct. $55c (64 delta) &/or Stock
http://www.investmenthouse.com/cd/pep.html

Play Date: 04/25/2005
SIVB (Silicon Valley Bancshares--$46.50; -0.09; optionable): Regional pacific bank
http://biz.yahoo.com/p/s/sivb.html
After Hours: $46.50
STATUS: Breakout test. SIVB shot out of a 13 week ascending triangle two weeks back, surging on volume as it upped its earnings outlook. Nice breakout with strong money flow leading the way. Relative strength broke out as well; SIVB is a leader moving toward an all-time high. Accumulation is a strong 5 to 2 in the base. Nice breakout, good test, holding the 10 day EMA (46.37) as it pulls back. Waiting for the move back up on rising trade to enter.
Volume: 420.949K Avg Volume: 343.045K
BUY POINT: $47.11 Volume=515K Target=$53 Stop=$45.55
POSITION: SQU HI - Aug. $45c (73 delta) &/or Stock
http://www.investmenthouse.com/cd/sivb.html

Downside:

Play Date: 04/25/2005
QLGC (Qlogic--$36.51; +0.38; optionable): PC storage networking infrastructure
http://biz.yahoo.com/p/q/qlgc.html
After Hours: $36.50
STATUS: Put. QLGC was trying to build a move off the 50 day EMA (38.81) in late March and early April, but in the market selling two weeks back it cascaded lower on strong volume, reaching down and almost tapping the 200 day SMA (33.48) on the low. It has since rebounded but on very low, below average volume, moving back up to tap the 10 day EMA (37.03) the past three sessions, Monday showing a doji at that level. Looking for QLGC to fade at this point and move back toward the 200 day SMA. A move to the target lands us a 38%ish gain.
Volume: 1.72M Avg Volume: 2.982M
BUY POINT: $36.27 Volume=3M Target=$34.25 Stop=$37.08
POSITION: QLC RU - June $37.50p (-55 delta)
http://www.investmenthouse.com/cd/qlgc.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.

AAPL, BLUD, BR, COH, HW, STN, TSRA

Roughed up to say the least. Need some new suggestions to rebuild the group.

BLUD: Excellent 5 to 1 accumulation in this lateral move. Just needs a big volume break higher.

STN: Could reverse its fortunes Tuesday as BYD reported strong results after hours.

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:

NTES: A steady move up the 10 day EMA has put NTES at the highs hit in December. If it forms a handle for a week or so from here it could be well situated to break higher.

Downside:

TOPT: A new issued in July 2004, TOPT formed something of a head and shoulders pattern February to early April, and then broke lower two weeks back. It has rebounded to the 18 day EMA, but money flow remains very weak.

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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