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us stock market, trade stock
Begin part 3 of 3
THE PLAYS
Good movers: GSIC; ILMN; ITG; KERX; KOMG; KOSP
Best Plays:
1) IDBE: Strong leader making a good test of its breakout.
2) WITS: Excellent pattern setting up a multi-year high.
3) VIVO: Very nice test of the breakout to a new all-time high.
4) MLHR: Volume is edging higher as it approaches the breakout.
5) SONO: Just needs some volume.
NEW PLAYS:
Upside:
Play Date: 07/16/2005
CTRX (Cotherix--$12.20; +0.78; no options): Biotechnology
http://biz.yahoo.com/p/c/ctrx.html
STATUS: Cup w/handle breakout. A new issue in October 2004, CTRX is making the breakout move from its first base, a 6.5 month cup with handle. Excellent 8 to 3 accumulation in the base (8 up price weeks on rising volume to 3 down price weeks on rising volume) shows plenty of strong buying during the consolidation along with money flow racing higher ahead of price. Very strong and a relative strength breakout as well as the stock made its move; good corroboration of the breakout strength. Looking to start positions on a continued solid volume move and then complete the buy on a successful test of the breakout.
Volume: 125.928K Avg Volume: 118.262K
BUY POINT: $12.32 Volume=125K Target=$14.69 Stop=$11.46
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/ctrx.html
Play Date: 07/16/2005
IDBE (ID Biomedical--$18.9; +0.49; optionable): Biotechnology
Earnings: Mid-August.
http://biz.yahoo.com/p/i/idbe.html
STATUS: Breakout test. Tuesday saw IDBE blast out from a 30 week flat base that formed along the 50 day EMA (16.90), a key support level where institutions step in to accumulate shares in their favorite stocks. Accumulation has been a solid 10 to 7, showing there is in fact ongoing buying. This is a base on base pattern, having formed right on the heels of a 15 month cup base. That looks to have weeded out the sellers as IDBE took off last week on the heels of strong money flow. A quick lower volume test back on Thursday and Friday (though Friday posted a gain) is setting up the next move higher. Looking for volume to come back in as IDBE continues its breakout run. A market leader heading to a new all-time high where it will have room to stretch its legs.
Volume: 256.335K Avg Volume: 254.002K
BUY POINT: $19.28 Volume=350K Target=$22.45 Stop=$17.93
POSITION: QQ LW - Dec. $17.50c (68 delta) &/or Stock
http://www.investmenthouse.com/ct/idbe.html
Play Date: 07/16/2005
VIVO (Meridian Biosciences--$20.57; -0.03; optionable): Diagnostic substances
http://biz.yahoo.com/p/v/vivo.html
STATUS: Breakout test. VIVO has eased back to the 10 day EMA (20.31) on very low volume this past week after a strong bounce off the 50 day EMA (19.07) that started three weeks back. It broke out of a 20 week cup with handle base in early June and then fell back to test the move, holding at the 50 day EMA. After the last bounce it looks to be forming a higher low over the 10 day EMA. Looking for a strong volume move off of this level to start the position.
Volume: 24.773K Avg Volume: 112.5K
BUY POINT: $21.05 Volume=170K Target=$24.88 Stop=$20.22
POSITION: ZUG JD - Oct. $20c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/vivo.html
Play Date: 07/16/2005
WITS (Witness Systems--$18.48; -0.14; optionable): VOIP telephony solutions for improving customer interactions, etc.
Earnings: July 27
http://biz.yahoo.com/p/w/wits.html
STATUS: Double bottom w/handle. Working laterally the past three weeks on mostly lower volume, forming the handle to its 22 week pattern as WITS sets up for a 5 year high. Excellent 7 to 3 accumulation shows plenty of buyers moving in during the pattern. Money flow is also surging higher as price moves laterally in the handle, another good indication of ongoing buying. With money flow leading well ahead of price, that is a strong positive for a breakout move to come. Solid base that is setting up under the radar of many analysts.
Volume: 253.939K Avg Volume: 333.741K
BUY POINT: $18.84 Volume=501K Target=$21.95 Stop=$18.08
POSITION: UPJ LW - Dec. $17.50c (62 delta) &/or Stock
http://www.investmenthouse.com/ct/wits.html
Play Date: 07/16/2005
XXIA (Ixia--$19.71; +0.20; optionable): Chip equipment
http://biz.yahoo.com/p/x/xxia.html
After Hours: $19.77
STATUS: Test 50 day EMA. XXIA broke out from a 13 week cup with handle base in early June, rallied to 22, and has since made a full test of the breakout, coming back to the 50 day EMA (18.86) to start July. It has bounced modestly off that level, making a higher low the past week. That higher low often sets up the breakout move or the continuation of the breakout run. Solid 3 to 1 accumulation in the prior base and 2 to 0 accumulation in the current pullback to test the move. Looking for the volume to jump back above average as it moves through the buy point and continues the breakout move.
Volume: 433.391K Avg Volume: 750.491K
BUY POINT: $20.28 Volume=995K Target=$24.35 Stop=$19.25
POSITION: UJC KD - Nov. $20c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/xxia.html
CONTINUING PLAYS
Upside:
Current plays ready for a new buy:
Play Date: 06/27/2005
CDIS (Cal Dive--$54.39; -0.27; optionable): Oil and gas equipment/services.
http://biz.yahoo.com/p/c/cdis.html
STATUS: Breakout test. Nice doji Friday just above the 18 day EMA (53.64) as CDIS tests the breakout from a nicely formed 15 week double bottom with handle base. A breakout on volume on the move and now it is running higher, using the short term MA (10 and 18 day EMA) as support. Looking for volume to return (low volume Friday on the test) as it starts back up and moves through the 10 day EMA (54.70).
Volume: 382.812K Avg Volume: 550.308K
BUY POINT: New: $55.05 Volume=800K Target=$60 Stop=$54.05
POSITION: KPQ LK - Dec. $55c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/cdis.html
Not yet entered:
Play Date: 07/09/2005
MLHR (Herman Miller--$31.78; +0.28; optionable): Business equipment
http://biz.yahoo.com/p/m/mlhr.html
After Hours: $31.81
STATUS: Cup w/handle. All MLHR needs is some volume. It is moving up off of the 10 day EMA (31.23) but volume has remained below average. Still a nice pattern but needs that better trade as it makes the breakaway move. To recap: A nice easy pullback the past two weeks as the market struggled, forming the handle to its 13 week base. The pattern formed using the 50 day EMA more or less as support (30.18), a good indication the big money was hanging onto positions and accumulating more stock. Indeed, the solid 4to 2 accumulation shows the buying. Strong money flow is leading higher, and we are looking for MLHR to follow it. A solid, perennial leader, and a breakout takes it toward a new all-time high.
Volume: 291.194K Avg Volume: 344.223K
BUY POINT: $31.92 Volume=523K Target=$36.25 Stop=$30.95
POSITION: MHQ KF - Nov. $30c (58 delta) &/or Stock
http://www.investmenthouse.com/ct/mlhr.html
Play Date: 07/13/2005
PRFT (Perficient--$7.73; -0.06; no options): Business software
http://biz.yahoo.com/p/p/prft.html
STATUS: Double bottom w/handle. Volume surged the last two sessions of the weeks as PFRT tried to make the breakout Thursday but faded back as did much of the market. It has held steady in any case, holding the handle to the pattern. Still looks ready to move higher from here for a new 4.5 year high. To recap: PRFT is setting up for the breakout to a 4.5 year high as it works on the handle to its 4.5 month base. It used the 200 day SMA (6.48) on the lows of the two legs as support, a key institutional support level. Solid 5 to 2 accumulation shows net buyers, and with the strong money flow PRFT looks solid in making the breakout. Volume has backed off the past couple of sessions after a strong volume jump higher Monday. Looks solid and looking for another break higher on volume.
Volume: 378.429K Avg Volume: 159.634K
BUY POINT: $8.12 Volume=230K Target=$9.75 Stop=$7.55
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/prft.html
Play Date: 07/14/2005
SONO (Sonosite--$33.89; +0.5; optionable): Medical instruments
http://biz.yahoo.com/p/s/sono.html
STATUS: Breakout test. SONO bounced up off of the 18 day EMA (32.95) Friday after gapping lower, positing a gain on the session. Volume was up but still well below average as it recovered. Still looks very good and ready for the continued breakout move. To recap: SONO broke out in early July, moving out of its 7 month reverse head and shoulders base. It rallied to 35 on the move and has faded back the past three sessions on lower and lower below average volume, holding the 10 day EMA (33.39) on the close. Great position to continue the move higher. Strong 7 to 4 accumulation in the base set up the breakout, and this test gives us a good entry point when the stock starts back up on rising volume.
Volume: 73.376K Avg Volume: 122.605K
BUY POINT: New: $34.02 (orig. $33.72) Volume=175K Target=$38.25 Stop=$33.05
POSITION: UZS LG - Dec. $35c (48 delta) &/or Stock
http://www.investmenthouse.com/ct/sono.html
Play Date: 07/13/2005
VASC (Vascular Solutions--$12.16; -0.62; optionable): Medical instruments
http://biz.yahoo.com/p/v/vasc.html
After Hours: $12.19
Earnings: 7-21-05 after the close.
STATUS: Cup w/handle. After the huge move higher Wednesday, VASC has faded back to the 10 day EMA (12.07), fully testing the breakout. Volume was much lower as it made the test back, and that keeps the positive side of the breakout in tact. Looking for VASC to hold here and resume the break higher this week. To recap: Volume shot higher Wednesday as VASC started the breakout move from its 14.5 month base, a nicely formed pattern sporting solid 13 to 10 accumulation. It has formed the handle the past 9 weeks, and that lateral move shows excellent 4 to 0 accumulation. Looking to step into positions on a continued strong move and then again on a successful test of the breakout move, i.e. when it comes back on lower volume and then starts higher on stronger trade. Nice pattern and the start of a nice breakout move.
Volume: 91.83K Avg Volume: 725K
BUY POINT: New: $12.55 (orig. $13.05) Volume=200K Target=$15.72 Stop=$12.32
POSITION: BOQ LV - Dec. $12.50c (62 delta) &/or Stock
http://www.investmenthouse.com/ct/vasc.html
Downside:
Play Date: 06/30/2005
FDX (Federal Express--$83.04; -0.36; optionable): Air delivery & freight
http://biz.yahoo.com/p/f/fdx.html
STATUS: Put. FDX continues to struggle just below the 18 day EMA (83.63) on very low, below average volume. After a major plunge lower from the 50 day EMA (85.78) in late June it has rebounded on low trade to the 18 day EMA where it has hit a wall. Money flow remains weak and we anticipate FDX is going to roll back down from here and continue its 4.5 month downtrend.
Volume: 1.458M Avg Volume: 2.115M
BUY POINT: $82.97 Volume=2.7M Target=$79.57 Stop=$83.75
POSITION: FDX UQ - Sept. $85p (-59 delta)
http://www.investmenthouse.com/ct/fdx.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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