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Begin part 3 of 3
THE PLAYS
Tuesday night play results
CDN: Volume backed off and CDN held steady on a down market session.
MOT: Rallied sharply on some stronger trade, but could not hold the move, ending at the 18 day EMA.
RTSX: Turned right back down and sold to the 50 day EMA
AAPL: Big hammer doji on higher volume at the 10 day EMA.
New Plays:
Upside:
Play Date: 08/24/2005
MDRX (Allscripts Healthcare Sol.--$17.94; +0.16; optionable): Clinical software and information solutions for physicians
http://biz.yahoo.com/p/m/mdrx.html
STATUS: Flat base. Volume has surged well above average Tuesday and Wednesday as MDRX rallied to the top of its 6 week trading range that has formed using the 50 day EMA (16.70) on the low as support and 18 as the lid. Money flow is rallying higher as the stock works through the range. Relative strength is ready to make the breakout, an indication it is ready to make the break from this range. A solid leader since the October 2002 bottom, and it looks ready to continue the move break higher.
Volume: 1.762M Avg Volume: 861.023K
BUY POINT: $18.21 Volume=1M Target=$20.95 Stop=$17.12
POSITION: MXQ AW - Jan. $17.50c (59 delta) &/or Stock
http://www.investmenthouse.com/cd/mdrx.html
Play Date: 08/24/2005
PTEN (Patterson-Uti Energy--$32.36; +0.80; optionable): Oil and gas exploration
http://biz.yahoo.com/p/p/pten.html
STATUS: Test 50 day EMA (30.59). PTEN sold back with the rest of the energy stocks tow weeks back, coming back to test the 50 day EMA after the June breakout from a 12 week trading range. This is a periodic 50 day EMA test that a stock makes after a breakout and rally up the 18 day EMA. PTEN tested the 50 day last week and bounced; after a brief stall it was up Wednesday, breaking through the 18 day EMA (31.84) on stronger, above average volume. Money flow remains strong and it looks ready to continue the breakout run.
Volume: 2.501M Avg Volume: 2.527M
BUY POINT: $32.57 Volume=2.7M Target=$37.45 Stop=$31.62
POSITION: NZQ AZ - Jan. $32.50c (54 delta) &/or Stock
http://www.investmenthouse.com/cd/pten.html
Downside:
Play Date: 08/24/2005
ADCT (ADC Telecom--$22.02; -0.62; optionable): Telecom equipment
http://biz.yahoo.com/p/a/adct.html
After Hours: $22
STATUS: Put. ADCT peaked at 26.39 to start the month, matching its January 2004 high. It faded at that point to test the move, but then collapsed through the 50 day EMA (22.87) on a huge volume spike. It moved laterally this week on lower trade, and rallied up to the 50 day EMA on the Wednesday high. It could not hold that move and rolled back over to close negative. Money flow is still dropping ahead of the stock, and we are looking for ADTC to continue the move lower after this test of the 50 day EMA breakdown. A move to the target lands us a 43%ish gain.
Volume: 1.263M Avg Volume: 1.846M
BUY POINT: $21.91 Volume=2M Target=$19.89 Stop=$22.65
POSITION: TLQ VX - Oct. $22.50p (-48 delta)
http://www.investmenthouse.com/cd/adct.html
SUBSCRIBER PORTFOLIO: These are stocks subscribers suggest by vote that we put in a portfolio to track and move into the stocks if they perform well. If you have any suggestions for additions or deletions, email us. We don't cover them all each report, just when something interesting is developing.
AAPL, CELG, BLUD, BR, COH, HW, PSYS, RTSX, STN
CELG: Looks just about ready to make its big move over 48.
BR: Nice recovery and moving higher on stronger, above average volume.
COH: Reported some strong earnings results and gapped higher. Managed to close above the 50 day EMA.
PSYS: Doji over the 50 day SMA looks to have completed the handle to the 6 week double bottom with handle base.
SUBSCRIBER WATCHLIST
We continually receive ideas for potential plays from subscribers. Many times they are already on our watchlists, other times not. We always take a look and sometimes find a gem or two, or more. We don't necessarily endorse these, but want to provide a forum for subscribers with ideas that may appeal to other subscribers. We may just put on the ticker or we might describe our thoughts as to why or why not we think it is a buy or sell. This is a way we can all learn a bit more and maybe find a few more candidates to make us some good money.
Upside:
ET: Broke out form a big 19 month double bottom with handle in July and has rallied up the 10 day EMA since. Good move but needs a nice pullback at least toward the 18 day EMA to provide an entry point.
PALM: Still working on its 8 month cup base, breaking higher two weeks back on strong volume and now waiting for the 10 day EMA to catch up with it. Would like to see a pullback to the 10 day (33.23) as a better entry point.
WEBM: Strong volume break higher Monday and Tuesday followed by a low volume doji Wednesday. Decent 8 month base forming near the stock's lows. A good test of this move will provide a decent entry point.
Good Investing!
Jon L. Johnson and The Daily Staff
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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