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Begin part 3 of 3
THE PLAYS
Good movers: AMX; ATVI; IDBE; MFE; PLLL; SKS; SOSA; SPN
Best Plays:
1) ARQL: Excellent breakout test at the 10 day EMA.
2) COSI: Nice breakout test.
3) CVD: Held the 18 day EMA after the strong upside move.
4) EMKR: Ready to resume its breakout move.
5) IDIX: Ditto.
6) PPDI: And yet another ready to move up after its breakout test.
NEW PLAYS:
Upside:
Play Date: 07/30/2005
ARQL (Arqule--$7.59; +0.14; no options): Drugs
http://biz.yahoo.com/p/a/arql.html
STATUS: Breakout test. Nice low volume test of the 10 day EMA (7.34) is underway and looks to be over already. It broke out two weeks back with a big volume surge off the 50 day EMA (6.68), moving out of a 26 week cup with handle base. Very tight flat handle and then a high volume breakout. Held the 18 day on the test and looks ready to resume the move. Excellent 7 to 2 accumulation (7 up price weeks on rising volume to 2 down price weeks on rising volume) shows plenty of buying. Money flow is rallying ahead of the stock as well. Looks super.
Volume: 241.481K Avg Volume: 236.709K
BUY POINT: $7.73 Volume=310K Target=$9.25 Stop=$7.24
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/arql.html
Play Date: 07/30/2005
COSI (Cosi--$8.47; -0.10; optionable): Eating establishments
http://biz.yahoo.com/p/c/cosi.html
STATUS: Breakout test. Surged out of an 18 week cup with handle base three weeks back, rallying to 9.53 on the high. Volume backed off the past week as it slowed down and came back to test that move, holding at the 10 day EMA (8.34) on the lows. Excellent 5 to 1 accumulation in the base shows plenty of buying and great money flow is leading the move higher. Expecting COSI to follow it higher and continuing the breakout move to a new all-time high.
Volume: 109.896K Avg Volume: 323.655K
BUY POINT: $8.68 Volume=485K Target=$10.55 Stop=$8.22
POSITION: CQA AU - Jan. $7.50c (69 delta) &/or Stock
http://www.investmenthouse.com/ct/cosi.html
Play Date: 07/30/2005
CVD (Covance--$49.55; +0.21; optionable): Drug development services for the pharma, biotech industries.
http://biz.yahoo.com/p/c/cvd.html
STATUS: Breakout test. Strong volume breakout two weeks back as CVD moved out of its 14 week trading range between 43 and 48. Rallied to 51 and has come back to test and hold the 18 day EMA (48.25) a good near support level for a strong breakout. Started back up off of that level to end the week with volume rising. Strong 5 to 3 accumulation in the pattern shows net buying. Looking for another new all-time high as CVD resumes the breakout. The first test of a strong breakout is one of our favorite entry points as it shows buyers are ready to buy even at the higher price; that is a sign of strength.
Volume: 308K Avg Volume: 386.428K
BUY POINT: $50.05 Volume=400K Target=$56.35 Stop=$48.65
POSITION: CVD KJ - Nov. $50c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/cvd.html
Play Date: 07/30/2005
RTSX (Radiation Therapy--$26.11; -0.09; no options): Medical practitioners
http://biz.yahoo.com/p/r/rtsx.html
After Hours: $25.93
STATUS: 50 day EMA test. RTSX broke in mid-June from a 9 week ascending triangle, moving to 28 on the move. It has spent the past three weeks testing that move on lower volume, holding the 50 day EMA (25.23) the past week. Strong 4 to 1 accumulation in the base set the move. Strong money flow to go along with the great accumulation. Looking for strong volume on a continued rebound off the 50 day as RTSX starts toward another all-time high.
Volume: 115.534K Avg Volume: 208.517K
BUY POINT: $26.39 Volume=250K Target=$31.85 Stop=$25.18
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/rtsx.html
Downside:
Play Date: 07/30/2005
LNCR (Lincare Holdings--$40.34; +0.01; optionable): Specialized health services
http://biz.yahoo.com/p/l/lncr.html
After Hours: $40.37
STATUS: Put. After a strong run from September 2004 to May, LNCR peaked and started to struggle. Broke below the 50 day EMA in late June on rising volume, fell to the 200 day SMA (40.99), and then tried to hold, working laterally along that level for a couple of weeks. That couldn't hold either and LNCR fell through the 200 day on volume. A weak, very low volume recovery last week culminated with a tombstone doji below the 18 day EMA (40.62). Looks ready to roll over once more. Looking for some more volume as it heads back down. A move to the target lands us a 44%ish gain.
Volume: 534.591K Avg Volume: 816.347K
BUY POINT: $40.08 Volume=820K Target=$38.05 Stop=$40.75
POSITION: LQN UH - Sept. $40p (-44 delta)
http://www.investmenthouse.com/ct/lncr.html
CONTINUING PLAYS
Upside:
New buy points: Love to enter proven winners when they make pullbacks to test strong moves.
Play Date: 07/30/2005
EMKR (Emcore--$5.13; +0.08; no options): Semiconductor integrated circuits
http://biz.yahoo.com/p/e/emkr.html
After Hours: $5.13
STATUS: Breakout test. Nice surge in July off of the 50 day EMA (4.39) in a test after the late May breakout from its 22 week base. Strong breakout, good run, test of the 50 day EMA, and then a rebound. This is a good test of that move off the 50 day, holding the 10 day EMA (5.00) on low volume. Looking for that volume to return as EMKR continues its breakout run.
Volume: 312.346K Avg Volume: 348.691K
BUY POINT: $5.24 Volume=485K Target=$6.31 Stop=$5.96
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/emkr.html
Play Date: 07/30/2005
MRVL (Marvell Technology--$43.69; -0.44; optionable): Semiconductor integrated circuits. Forecast to announce a split 8-18-05 after the close.
BACKGROUND: Last announced a 2:1 split 2-26-04 at $42.90.
http://biz.yahoo.com/p/m/mrvl.html
After Hours: $43.66
STATUS: Breakout test. Good move on average volume Wednesday and then a very low volume test Thursday and Friday with MRVL holding well above the 10 day EMA (43.02) as it pulls back. It may come all the way back to the 10 day before this move is over, but we are going to be ready to move in on a volume move higher as it has held up better than most stocks. Strong leader that will be looking for another 5 year high after this test.
Volume: 1.372M Avg Volume: 3.29M
BUY POINT: $44.05 Volume=3.3M Target=$49.55 Stop=$42.94
POSITION: UVM KV - Nov. $42.50c (60 delta) &/or Stock
http://www.investmenthouse.com/ctmrvl.html
Play Date: 07/08/2005
WIND (Wind River Systems--$17.09; -0.08; optionable): Business software
http://biz.yahoo.com/p/w/wind.html
After Hours: $17.09
STATUS: Test 18 day EMA. Very tight and narrow range as WIND eases back to the 18 day EMA (16.91) on very low volume. This follows the breakout from a 17 week reverse head and shoulders pattern that formed using the 200 day SMA (14.23) on the lows as support. Strong 7 to 3 accumulation in the base has set the foundation and money flow is leading higher. Looking for the stock to follow the money and deliver a strong break higher to continue the run.
Volume: 325.746K Avg Volume: 770.048K
BUY POINT: New: $17.65 Volume=1.3M Target=$20.95 Stop=$16.78
POSITION: QWV KW - Nov. $17.50c (53 delta) &/or Stock
http://www.investmenthouse.com/ct/wind.html
Not yet entered:
Play Date: 07/28/2005
IDIX (Idenix Pharmaceuticals--$25.46; -0.54; no options): Biotechnology
http://biz.yahoo.com/p/i/idix.html
STATUS: Breakout test. Another nice test of the 18 day EMA (20.92) on the Friday low and a rebound to recoup some of the losses. Volume backed off to below average on the pullback, a good sign there is no dumping. Money flow is still strong and IDIX is setting up to continue the breakout run. To recap: IDIX has already made us some money, and it is setting up to do that again. A new issue in July 2004, it formed a 5 month cup with handle base February to mid-July and broke out then. Excellent breakout that ran above 28 on the run. It sold back and has tested the 18 day EMA, holding the breakout move. Outstanding 8 to 2 accumulation in the base (7 up price weeks on rising volume to 2 down price weeks on rising volume) shows plenty of buying; lots of support for the stock. Strong money flow is leading higher as well. Looks ready to rumble again as volume jumped back above average last Thursday as IDIX moved off of the 18 day EMA. Looks ready.
Volume: 167.499K Avg Volume: 148.778K
BUY POINT: $26.17 Volume=221K Target=$30.45 Stop=$24.67
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/idix.html
Play Date: 07/27/2005
PPDI (Pharmaceutical Product Dev.--$57.23; +0.18; optionable): Medical labs
http://biz.yahoo.com/p/p/ppdi.html
Earnings: Released 7-13-05
STATUS: Test breakout. A low volume session Friday as PPDI held the 10 day EMA (56.82), showing a nice doji at that level. After a pullback a doji at support can indicate a rebound is coming. With the strong breakout and equally strong money flow we are looking for PPDI to rebound this week. To recap: PPDI exploded higher 7-13 on news it beat earnings estimates and upped Q3 and Q4. The move broke it out of a 13 week base on some very strong volume. After rallying to 60 it has pulled back the past week to test the 10 day EMA, moving lower on declining volume. Strong money flow has surged ahead of the price and is holding well on the test. Looking for PPDI to turn back up from here and continue the breakout move.
Volume: 334.605K Avg Volume: 366.009K
BUY POINT: $57.31 Volume=547K Target=$64.48 Stop=$56.35
POSITION: PJQ AK - Jan. $55c (62 delta) &/or Stock
http://www.investmenthouse.com/ct/ppdi.html
Downside:
Play Date: 07/25/2005
FDX (Federal Express--$84.09; -1.43; optionable): Air delivery and freight
http://biz.yahoo.com/p/f/fdx.html
After Hours: $84.16
STATUS: Put. Have not given up on FDX making the drop because it has done little to indicate it is going to reverse the downtrend below the 50 day EMA (85.27). Indeed, FDX rallied back to the 50 day the past week, initially moving up to that level on stronger volume but then seeing volume fade as it was unable to make the break. Friday it sold to the 18 day EMA (84.11). Looking for a break below that level on a jump in volume to enter the downside play.
Volume: 1.233M Avg Volume: 2.051M
BUY POINT: $83.97 Volume=2.2M Target=$81 Stop=$82.48
POSITION: FDX UQ - Sept. $85p (-54 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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