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Begin part 3 of 3
THE PLAYS
Good movers: ARQL; BELM; BOOM; CDIS; IDIX; INGR; JUPM; MDR; MRVL; PLLL; QSII
Best Plays:
1) ASPM: Nice doji over the 10 day EMA as it tests last week's breakout.
2) BBY: Ready to run into its split.
3) SONO: Upside volume finally shows up.
4) TLWT: Volume rising as it moves toward the next breakout.
5) EMKR: Volume is coming back as it moves off the 10 day EMA.
6) RIG: Knocking at the breakout door.
NEW PLAYS:
Upside:
Play Date: 08/01/2005
ASPM (Aspect Medical--$32.93; -0.07; optionable): Medical appliances
http://biz.yahoo.com/p/a/aspm.html
STATUS: Breakout test. Nice doji Monday as ASPM came back to test last week's breakout from a 7 week triangle that formed using the 50 day EMA (26.69) on the lows. Positive 3 to 2 accumulation in the pattern (3 up price weeks on rising volume to 2 down price weeks on rising volume) shows net buyers in the short base and strong money flow shows the buying. Great breakout on volume Wednesday and then a nice test back. Looking for it to rally off of this doji to continue the breakout.
Volume: 214.831K Avg Volume: 184.192K
BUY POINT: $33.32 Volume=276K Target=$39.45 Stop=$31.89
POSITION: UCU KF - Nov. $30c (68 delta) &/or Stock
http://www.investmenthouse.com/ct/aspm.html
Play Date: 08/01/2005
BBY (Best Buy--$77.68; +1.08; optionable): Electronics stores. Splits 3:2 on 8-4
http://biz.yahoo.com/p/b/bby.html
After Hours: $77.68
STATUS: Test breakout. BBY made us some money last week, and now that it is just before the split we are looking for another run into that event. Volume was lower Friday and Monday as BBY came back to test toward the 10 day EMA (76.15), holding above that level and moving higher Monday. Looking to move in on a further move higher and let it carry us into the split for what it will give us.
Volume: 2.503M Avg Volume: 3.37M
BUY POINT: $77.95 Volume=3.8M Target=$64 Stop=$76.11
POSITION: BBY LO - Dec. $75c (63 delta)
http://www.investmenthouse.com/ct/bby.html
Play Date: 08/01/2005
SONO (Sonosite--$34.83; +1.33; optionable): Medical instruments
http://biz.yahoo.com/p/s/sono.html
After Hours: $34.98
STATUS: Reverse head and shoulders. Soon as you look the other way SONO posted a good move, rallying Monday on even stronger volume than the Friday 18 day EMA (33.68) test. The move took it right back to knocking on the door of a breakout from its 7 month base sporting excellent 9 to 4 accumulation and strong money flow. Ready to move to a new high on a strong breakout. Want to see continued solid trade on the move, mindful there have already been two good volume sessions so we don't need to see a volume blowout.
Volume: 242.321K Avg Volume: 108.186K
BUY POINT: $35.15 Volume=175K Target=$40.45 Stop=$33.52
POSITION: UZS LG - Dec. $35c (48 delta) &/or Stock
http://www.investmenthouse.com/ct/sono.html
Play Date: 08/01/2005
TLWT (Telewest Global--$22.50; +0.16; optionable): Telecom wireless
http://biz.yahoo.com/p/t/tlwt.html
After Hours: $22.52
STATUS: Flat base. Another stock that made us some money this year after it broke out from a 13 week ascending triangle and then made a series of bounces up the 10 day EMA (22.28). That took TLWT into late June where it peaked and needed a deeper test. It came back to the 50 day EMA (21.58) in mid-June to reset its move, moving into the current 4 week flat base. Positive 2 to 1 accumulation in the base shows net buying during the lateral move. The strong money flow moving higher does not hurt at all. Volume was up Monday, moving back toward average as TLWT started higher. Looking for another nice run from TLWT as it makes the next break higher.
Volume: 1.374M Avg Volume: 1.78M
BUY POINT: $22.88 Volume=2.7M Target=$25.78 Stop=$22.04
POSITION: QTX LX - Dec. $22.50c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/tlwt.html
Downside:
Play Date: 08/01/2005
CSL (Carlisle Companies--$65.23; -0.63; optionable): Rubber and plastics
http://biz.yahoo.com/p/c/csl.html
STATUS: Put. CSL peaked in May with a quick double top that formed the apex of a 4.5 month head and shoulders top. It made the breakdown from the pattern in mid-July, slicing through the 200 day SMA (66.79) on strong trade. It fell to 64 and then rebounded last week to tap at the 200 day SMA on the Friday high before fading. It started down again Monday after that Friday 'kiss goodbye.' All of this occurred on very low trade; looking for a bit more volume as it continues the move lower. A move to the target lands us a 40%ish gain.
Volume: 135.9K Avg Volume: 170.725K
BUY POINT: $65.11 Volume=200K Target=$63.08 Stop=$68.92
POSITION: CSL UM - Sept. $65p (-44 delta)
http://www.investmenthouse.com/ct/csl.html
CONTINUING PLAYS
Upside:
New buy points:
Play Date: 07/30/2005
EMKR (Emcore--$5.22; +0.09; no options): Semiconductor integrated circuits
http://biz.yahoo.com/p/e/emkr.html
After Hours: $5.22
STATUS: Breakout test. Gapped higher on some stronger, above average volume but waffled after it made the initial move higher. Still a solid test, and if it can continue higher from here on decent trade it is a buy. To recap Nice surge in July off of the 50 day EMA (4.43) 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 (5.04) on low volume. Looking for that volume to return as EMKR continues its breakout run.
Volume: 488.748K 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: 07/08/2005
WIND (Wind River Systems--$17.28; +0.19; optionable): Business software
http://biz.yahoo.com/p/w/wind.html
After Hours: $17.28
STATUS: Test 18 day EMA. Moving higher off an intraday tap at the 18 day EMA (16.95), but volume did not move with it. Still a very nice lateral test above the 18 day, and looking for more volume as it continues the move higher. To recap: Very tight and narrow range as WIND eases back to the 18 day EMA on very low volume. This follows the breakout from a 17 week reverse head and shoulders pattern that formed using the 200 day SMA (14.25) 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: 332.47K 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: 07/30/2005
CVD (Covance--$49.86; +0.31; optionable): Drug development services for the pharma, biotech industries.
http://biz.yahoo.com/p/c/cvd.html
STATUS: Breakout test. Gapped lower Monday but then jumped right back up to post a gain. Volume remained below average, so no hard selling and no real buying as it rallied back either. IN all, still solid on the test and still looking for more strong trade as it rebounds. To recap: 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 (48.42) 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: 298K 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: 07/27/2005
PPDI (Pharmaceutical Product Dev.--$57.13; -0.1; optionable): Medical labs
http://biz.yahoo.com/p/p/ppdi.html
Earnings: Released 7-13-05
After Hours: $57.05
STATUS: Test breakout. Continuing the pullback test of the 10 day EMA (56.87), undercutting that level Monday intraday and then rebounding to hold that support on the close. Still looks ready to continue the break higher, and this lower test works to shake out more of the sellers. 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: 346.799K 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
Play Date: 07/25/2005
RIG (Transocean--$57.89; +1.46; optionable): Oil and gas drilling
http://biz.yahoo.com/p/r/rig.html
After Hours: $57.91
STATUS: Breakout test. Volume moved higher (though still just below average) Monday as RIG tapped the 18 day EMA (56.62) on the low and rallied for a nice gain. It is on the cusp of the breakout. Looks super. To recap: Volume has started a solid recovery, showing some good spikes the past two weeks. The move has narrowed the past week over the 18 day EMA and below 58, building pressure for the breakout. Looks ready to continue the breakout after a 5 week lateral trading range from 54 to 58. This followed the breakout from a 9 week double bottom with handle. Strong 5 to 2 accumulation in the pattern shows plenty of buying, setting up the breakout and the subsequent run. After this nice lateral trading range, the volume shows the buyers are back in. Looking for continued volume as RIG moves higher, following its strong money flow.
Volume: 3.947M Avg Volume: 4.294M
BUY POINT: Aggressive: 58.05; Clear resistance: $58.75 Volume=4.6M Target=$66.44 Stop=$56.35
POSITION: RIG KK - Nov. $55c (67 delta) &/or Stock
http://www.investmenthouse.com/ct/rig.html
Play Date: 07/30/2005
RTSX (Radiation Therapy--$26.5; +0.39; no options): Medical practitioners
http://biz.yahoo.com/p/r/rtsx.html
STATUS: 50 day EMA test. Moved up and off the 18 day EMA (26.22) but volume was not there, fading even lower below average. Looks ready to make the move and just see some more volume as it continues higher. To recap: 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 (25.28) 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: 89.981K Avg Volume: 208.517K
BUY POINT: New: $26.77 (orig. $26.39) Volume=250K Target=$31.85 Stop=$25.18
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/rtsx.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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