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Begin Part 2 of 2

THE PLAYS:

Continuing Plays: SBC gapped higher and closed near its high, but volume was even lower below average. We will see if that turns around and the stock makes a breakout from the cup with handle (see last night's report for details). PLCM moved higher on surging volume; it will be of interest as well in tomorrow's action. Other continued plays that looked very good today:
DORL: Approaching our buy point of 39.75 on a strong volume surge. Watch for the breakout (see Monday night's report for other details).
PER: Took out the buy point of 16.28 on strong, above average volume - a breakout from the double bottom with handle! Remains a buy on the move up to 17.09 (closed at 16.44).
IMNX: Made our aggressive buy point on a move up from the 20 range; volume was higher but still well below average. Looking for the breakout over the 200 day MVA (21.37). Please see Monday night's report for details.

New or Revisited Plays:

Revisited:

SZA (Suiza Foods--$61.76; +1.32; optionable):
http://biz.yahoo.com/p/s/sza.html
STATUS: Moved up from support on stronger volume (380,500; just under average levels). The stock looks ready to continue a move up after testing the recent breakout run; high on that run is at 64.73, but resistance may pop up at 63.85. Looks great! Target: 74
BUY POINT: Aggressive: Over 62.20 on 500,000 or better. Stop: 59
POSITION: Stock and/or December $55 calls to buy (SZA LK).

ISIP (Isis Pharmaceuticals--$17.98; -0.32; optionable): Manufacturers
http://biz.yahoo.com/p/i/isip.html
STATUS: Hit support at the 10 day MVA range (17.49 range) then bounced back up in its test of the breakout (the stock bounded off the 50 day MVA in late September and moved more or less laterally after peaking). Volume was sharply up to 1.1 million (avg. 582,000), so we are looking for a breakout over the accumulation of highs just under 19. Target: 25
BUY POINT: Aggressive: 18.50 on continued rising volume. Stop: 16.62 (just below the 18 day MVA at 16.87).
POSITION: Stock and/or January $15 calls to buy (QIS AC).

New:

CPRT (Copart--$31.75; +0.73; optionable): Auto Parts
http://biz.yahoo.com/p/c/cprt.html
STATUS: Testing the recent breakout from its cup base (did not form much of a handle, but cups don't have to do that to break out). After reaching the high at 33.06, CPRT pulled back for three days on decreasing volume, and looks ready to hold support at the July top (31; the intraday low tested 30.92 then the stock moved up from there). Volume fell further below average to 490,000 (avg. 526,000), appropriate for the pullback. Showing great money flow and good buying. Initial target: 38
BUY POINT: Over 33.24 (Monday high) on above average and rising volume. Stop: 29.64 (just under the 10 day MVA).
POSITION: Stock and/or November $30 calls to buy (KQJ KF)

GNTA (Genta--$11.51; +0.32; optionable): Biotechnology
http://biz.yahoo.com/p/g/gnta.html
STATUS: Pulling back in the handle to a double bottom pattern. The stock hit a high last week (the handle high) at 12.08 then pulled back on below average volume, which was down again today to 391,500 (avg. 515,000). Tuesday GNTA showed a tight doji after testing some support on the low of 11.20, and we like that the closing price held above the middle peak high in the pattern (11.42). Looking for a hold there or at the 11 range for a strong move back up to breakout. The double bottom is part of a base that started mid-June. Great money flow and high relative strength, pretty good buying. Target: 15
BUY POINT: Breakout: 12.21 on minimum breakout volume of 773,000. Stop: 10.75
POSITION: Stock and/or November $10 calls to buy (GJU KB).

RA (Reckson Assoc--$23.74; +0.40; optionable): REIT
http://biz.yahoo.com/p/r/ra.html
STATUS: In an ascending wedge that has seen some wild action in the "middle" of the pattern (the stock in mid-September raced up and down but held above the current support in the pattern, the 50 day MVA). It saw decreasing volume (and well below average) the previous 2 days, but Tuesday took off from the 50 day (and the 200 day on the low), breaking upper resistance of its short term MVAs on huge volume (no news today). Looking for a breakout over upper resistance in the pattern; RA shows great money flow and buying. Target: 29
BUY POINT: 24.48 on continued strong volume (surpassed minimum breakout volume of 501,000 (soared Tuesday to 2.25 million; avg. 370,000). Stop: 22.77, below the 200 day MVA at 23.13.
POSITION: Stock and/or December $22.50 calls to buy (RA LX; low open interests).

Indexes: The following are poised for a move up.

OEX (Standard & Poors 100--$541.84; -3.04; optionable):
STATUS: Has pulled back nicely the last few sessions, on steadily decreasing volume which bumped higher Tuesday (to 1.1 million; avg. 1.26 million). The index is resting right at support at the 18 day MVA on the closing price, and we are looking for a move back up. Additional support is at the 10 day MVA (540.15). The aggressive can take positions on a move up from here; resistance, however, is likely at 549.38, a price hit 3 times recently. The 50 day MVA is at 567.49, our target. Potential resistance at 558.58 (hit twice).
BUY POINT: Aggressive: 545 on 1.3 million or higher. Over resistance: 550 on above average volume.
POSITION: October $540 calls to buy (OEB JH). Deltas unavailable.

DJX (1/100 Dj Indu--$90.52; -0.16; optionable):
STATUS: Moving laterally for 4 days in a gradual descending pullback; volume decreased the previous three sessions but was up Tuesday (still below the average of 1.17 million). The 18 day MVA is at 90.74, so the index has to take out that resistance and the recent high at 91.87. Target: 95
BUY POINT: Aggressive: Over 90.74 on rising volume. Break of resistance: Over 91.87 on 1.2 million or higher volume. Stop: 86
POSITION: November $90 (DJV KL) or January $90 calls to buy (DJV LL). Low open interests for both; deltas unavailable.

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Jon L. Johnson and the Technical Traders 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 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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