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Begin part 3 of 3
THE PLAYS
Good movers: CUTR; FORD; FTO; GNSS; MSTR; NVDA; QSII
Best Plays:
1) FLSH: Breaking out to make us some more money.
2) BRCM: Ready to continue the July break higher.
3) GME: Struggling and ready to head lower.
4) ASPM: Volume is up as it starts to rebound.
5) CVD: Another light volume doji.
6) MINI: Very nice 18 day EMA test.
7) MMSI: Starting higher, just needs some volume.
NEW PLAYS:
Upside:
Play Date: 08/15/2005
FLSH (M-Systems Flash Disk--$26.40; +1.15; optionable): Semiconductors
http://biz.yahoo.com/p/f/flsh.html
STATUS: Double bottom w/handle. FLSH has already made us some nice money, and now it is ready to do it again. Strong volume Monday as FLSH rallied off the 18 day EMA (24.94) and broke out from the handle of its 23 week base. Solid pattern that used the 200 day SMA (20.98) as support for the two legs. Strong money flow is leading higher and relative strength broke out as well. Making a 5 year new high and ready to move in as it continues the breakout.
Volume: 1.404M Avg Volume: 634.462K
BUY POINT: $26.68 Volume=850K Target=$30.69 Stop=$25.41
POSITION: VUM AE - Jan. $25c (68 delta) &/or Stock
http://www.investmenthouse.com/ct/flsh.html
Play Date: 08/15/2005
BRCM (Broadcom--$42.85; +1.05; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/b/brcm.html
After Hours: $42.95
STATUS: Flying plateau. BRCM made us some good money in July, and it is setting up to do so once more. A big gap higher in July on earnings and since then a 3 week lateral move on mostly low, below average volume. A pullback to the 18 day EMA (41.82) last week looks to have been the final shakeout as BRCM came to life Monday, moving off the 18 day on a solid rise in volume. Excellent money flow is leading higher. Ready to move in as BRCM continues its move and clears the recent highs on above average volume. That is our buy point.
Volume: 6.345M Avg Volume: 7.662M
BUY POINT: $43.54 Volume=11M Target=$49.95 Stop=$42.25
POSITION: RCQ KS - Nov. $42.50c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/brcm.html
Play Date: 08/15/2005
HAWK (Petrohawk Energy--$11.4; +0.19; optionable): Independent oil and gas
http://biz.yahoo.com/p/h/hawk.html
STATUS: Flying plateau. HAWK broke out from a 12 week reverse head and shoulders base in late June and then fell into the current lateral move over the 18 day EMA (11.02). Volume has surged the past three weeks, indicating a lot of buying. Outstanding 5 to 0 accumulation in the base (5 up price weeks on rising volume to 0 down price weeks on rising volume) shows all buyers. Solid volume as it cleared the recent highs in the handle. Looking ot move in on a continued volume move.
Volume: 735.377K Avg Volume: 427.788K
BUY POINT: $11.57 Volume=642K Target=$13.31 Stop=$10.98
POSITION: PQM LB - Dec. $10c (65 delta) &/or Stock
http://www.investmenthouse.com/ct/hawk.html
Downside:
Play Date: 08/15/2005
GME (Gamestop--$31.55; +0.15; optionable): Electronics stores
http://biz.yahoo.com/p/g/gme.html
After Hours: $31.75
STATUS: Put. A solid run in April to July peaked in July on low volume; always hate to see a new high on rising volume as that shows a lack of buyers. It broke below the 50 day EMA (32.47) two weeks back, rebounded, but then broke back through Friday on some much stronger, above average volume. Modest rebound Monday on lower volume and may come back to test the 50 day before it is ready to continue back down. It could not hold the gap higher Monday and gave back most of the gain; thus it may turn back down right from here. Want to see that volume continue as it continues to ride down. A move to the target gains us a nice 42%ish.
Volume: 845.6K Avg Volume: 704.137K
BUY POINT: $31.35 Volume=750K Target=$29.59 Stop=$31.82
POSITION: GME UF - Sept. $30c (-35 delta)
http://www.investmenthouse.com/ct/gme.html
CONTINUING PLAYS
Upside:
Not yet entered:
Play Date: 08/11/2005
AMGN (Amgen--$80.59; +0.17; optionable): Biotechnology
http://biz.yahoo.com/p/a/amgn.html
After Hours: $80.63
STATUS: Test 18 day EMA. Another doji over the 18 day EMA (79.31) on very low volume. Just being patient and letting AMGN show us the upside move. To recap: AMGN exploded higher in mid-July with a superb earnings report, gapping higher after already clearing a 7 month flat base. It has moved laterally the past 4 weeks and then received some downgrades last week and earlier this week. That sent AMGN back to the 18 day EMA where it has held its ground and is starting to rebound, giving us an opportunity. A strong stock will get these valuation downgrades, test near support, then rebound. Looking for more volume as it continues higher.
Volume: 4.819M Avg Volume: 9.675M
BUY POINT: $81.65 Volume=11M Target=$92.88 Stop=$78.78
POSITION: VAM AQ - Jan. $85c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/amgn.html
Play Date: 08/01/2005
ASPM (Aspect Medical--$32.82; +0.4; optionable): Medical appliances
http://biz.yahoo.com/p/a/aspm.html
After Hours: $32.77
STATUS: Breakout test. Moved up off the 18 day EMA (32.06) and volume was higher but still a bit low. Looks ready and on a bit more volume it is a buy. To recap: A very nice, low volume test of the late July breakout, holding over the 18 day EMA (31.97) last week as the market sold. That is a sign of strength we love to see. This move follow the breakout from a 7 week base formed just over the 50 day EMA (30.58). Just a solid base, nice breakout, and a super test. Looking for a strong volume move higher this week.
Volume: 127.91K Avg Volume: 176.054K
BUY POINT: New: $32.89 (orig. $32.78) Volume=276K Target=$38.65 Stop=$31.48
POSITION: UCU KF - Nov. $30c (68 delta) &/or Stock
http://www.investmenthouse.com/ct/aspm.html
Play Date: 08/13/2005
CMX (Caremark RX--$46.12; -0.31; optionable): Specialized health services
http://biz.yahoo.com/p/c/cmx.html
STATUS: Breakout test. Still making the test, holding the 10 day EMA (46.06) on the Monday low as volume jumped to near average. That tells us to get ready for the continued breakout move. To recap: CMX blasted out of a nice little 8 week double bottom with handle base to start August. This base followed directly on the heels of a 15 week trading range in May; a good base on base pattern that really works to weed out the sellers. Strong volume breakout and then a lateral move the past week to tap and test the 10 day EMA on the Friday low as volume turned low and below average Thursday and Friday. Nice test and looking for a strong break higher once more as CMX moves to another new all-time high.
Volume: 2.072M Avg Volume: 2.351M
BUY POINT: $47.25 Volume=2.6M Target=$53.15 Stop=$45.97
POSITION: CMX LI - Dec. $45c (62 delta) &/or Stock
http://www.investmenthouse.com/ct/cmx.html
Play Date: 07/30/2005
CVD (Covance--$49.23; -0.31; optionable): Research services
http://biz.yahoo.com/p/c/cvd.html
STATUS: Breakout test. Lower volume as CVD tapped the 18 day EMA (48.91) on the low and rebounded for a modest loss. Looks as if the final shakeout has taken place and CVD is ready to make the break higher. To recap: CVD continues to move laterally the past two weeks following the breakout from a 14 week double bottom with handle base that formed along the 50 day EMA (47.70). Holding up very well in the weaker market. Want to see a big volume surge as it makes the move through the buy point.
Volume: 177.9K Avg Volume: 373.155K
BUY POINT: $50.25 Volume=400K Target=$56.95 Stop=$48.68
POSITION: CVD KJ - Nov. $50c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/cvd.html
Play Date: 08/13/2005
EEFT (Euronet Worldwide--$30.08; +0.08; optionable): Secure electronic financial transactions
http://biz.yahoo.com/p/e/eeft.html
STATUS: Double bottom w/handle. Modest move higher on lower volume as EEFT continues to form the handle to set up its next breakout. Nice pattern, just letting it finish its base. To recap: A very nice 12 week base has formed using the 200 day SMA (26.54) as support for both legs of the double bottom base. EEFT is a leader in this market, setting up for a new all-time high on a breakout from the pattern. Excellent 4 to 1 accumulation in the base (4 up price weeks on rising volume to 1 down price week on rising volume) shows plenty of buying and has set up the foundation for the breakout and breakout run. Money flow is strong as well, leading higher ahead of price. Volume has kicked up the past week, positing a higher close Friday as EEFT edged toward the breakout in a down market. All we need to see it the breakout move on even better volume.
Volume: 303.905K Avg Volume: 343.586K
BUY POINT: $30.41 Volume=515K Target=$34.95 Stop=$28.97
POSITION: HSQ AF - Jan. $30c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/eeft.html
Play Date: 08/10/2005
GPRO (Gen Probe--$46.59; -0.22; optionable): Medical equipment (probe-based products for diagnosis of diseases.
http://biz.yahoo.com/p/g/gpro.html
STATUS: Cup w/handle. And yet another nice doji Monday as GPRO continues to hold the 10 day EMA (46.39) on the close. Still looks good; just waiting it out to let it show us the breakout. To recap: After disappointing earnings in early May gapped GPRO lower and started the current 14 week base. It gapped higher to start the month as it reported better than expected earnings; ah the earnings game. Positive 3 to 2 accumulation (3 up price weeks on rising volume to 2 down price weeks on rising volume) shows net buyers and that is all it takes to support a breakout move. It has come back to fill most of that early August gap higher, showing a doji on the 10 day EMA the past three sessions. Going to let it show us the move on strong volume to enter. With the market a bit equivocal, the healthcare sector is more defensive and a good place to look.
Volume: 293.883K Avg Volume: 699.205K
BUY POINT: $47.12 Volume=1.1M Target=$54 Stop=$45.95
POSITION: PSU KI - Nov. $45c (60 delta) &/or Stock
http://www.investmenthouse.com/ct/gpro.html
Play Date: 08/10/2005
MINI (Mobile Mini--$40.91; -0.07; optionable): Portable storage containers, mobile offices
http://biz.yahoo.com/p/m/mini.html
After Hours: $40.91
STATUS: Breakout test. Nice test of the move off the 18 day EMA (40.20) last week, tapping at the 18 day on the Monday low and rebounding for a modest loss on low volume. Nice shakeout and still looks ready to continue the move higher, following the strong money flow higher. To recap: MINI makes small metal buildings. With the construction boom its business has been sweet. It broke out from a 16 week cup with handle base to end July, surging to 44. It has come back to test the move, holding the 18 day EMA and bouncing last Wednesday on another surge in very strong trade. Nice base that used the 50 day EMA (38.74) as support. Strong 6 to 3 accumulation in the pattern (6 up price weeks on rising volume to 3 down price weeks on rising volume) shows plenty of buying remains. Strong money flow is leading higher as well, another good indication of solid buying. Looking to move in as MINI continues the run after this test.
Volume: 54.914K Avg Volume: 100K
BUY POINT: New: $41.15 (orig. $40.95) Volume=200K Target=$46.95 Stop=$39.69
POSITION: UAC KH - Nov. $40c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/mini.html
Play Date: 08/03/2005
MMSI (Merit Medical Systems--$18; +0.46; optionable): Medical instruments
http://biz.yahoo.com/p/m/mmsi.html
STATUS: Flying plateau. Started higher Monday on rising though still below average volume. Needs some more trade as it continues the move. Solid money flow is leading higher and relative strength is ready to make the breakout as well.
Volume: 131.006K Avg Volume: 162.209K
BUY POINT: New: 18.12 (orig. $17.74) Volume=235K Target=$20.44 Stop=$16.79
POSITION: RMQ AQ - Jan. $17.50c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/mmsi.html
Play Date: 08/08/2005
NXTP (Nextel Partners--$25.93; -0.09; optionable): Wireless telecom
http://biz.yahoo.com/p/n/nxtp.html
After Hours: $25.89
STATUS: Double bottom w/handle. Another test back, tapping the 18 day EMA (25.73) on the low and rebounding on some higher though still below average volume. Nice shakeout in the handle, very, very good action. Ready to make the breakout move now. To recap: NXTP continues to form the handle to its sweet little base, shaking out the last sellers; once they are going we should see a strong upside breakout. To recap: A nice 7 week pattern has formed over the 50 day EMA (25.10) after a nice breakout and run from March to late June. Solid 3 to 1 accumulation in the base (3 up price weeks on rising volume to 1 down price weeks on rising volume) shows solid buying as NXTP took a breather. Looks ready to make the move.
Volume: 1.516M Avg Volume: 2.273M
BUY POINT: $26.69 Volume=3.4M Target=$30.25 Stop=$25.98
POSITION: KTU AE - Jan. $25c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/nxtp.html
Downside:
Play Date: 08/13/2005
IYR (Dow Jones Real Estate Index--$64.7; +0.66; optionable): Closed end real estate ETF
http://biz.yahoo.com/p/i/iyr.html
STATUS: Put. Rallied up to the 50 day SMA (64.92) on very low, below average volume. That low volume indicates the move lacked any real buying and was still a part of the relief move after the crash lower last week. Looking for IYR to fail here. To recap: Real estate is starting to show signs of wear and tear, breaking down in the past week after strong runs. The IYR ETF broke out from a 20 week base in June and rallied to 69 to start the month. It then collapsed, plunging through the 50 day EMA. After a further plunge Monday on massive volume, IYR managed a very low volume rebound the rest of the week, tapping at the 50 day EMA on the Friday intraday high. Still looking for that kiss goodbye and a rollover once more and give us the second downside run in this sell off. Money flow has flushed down the toilet and we are looking for IYR to follow it further. A move to the target lands us a 42%ish gain.
Volume: 1.088M Avg Volume: 1.952M
BUY POINT: New: $64.25 (orig. $63.91) Volume=2.5M Target=$62 Stop=$64.55
POSITION: IYD UL - Sept. $65p (-47 delta)
http://www.investmenthouse.com/ct/iyr.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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