us stock market, stock recommendation

Begin part 3 of 3

THE PLAYS

Good movers: CRXL; ESRX; PCP; WIRE

Weekend play results:
AQNT: Nice price move but no volume.
AVL: Solid break higher.
CRDN: Drifted higher but very low volume.
SYKE: Held steady.
AXL: Gapped higher but gave back much of the gain.
CX: Rallied up to the 10 day EMA. Looking for it to roll back down.

Upside:

Play Date: 10/17/2005
AAPL (Apple Computer--$53.44; -0.56; optionable): iPods, Macs, etc.
http://biz.yahoo.com/p/a/aapl.html
After Hours: $53.42
STATUS: Test 50 day EMA. Broke out in mid-August, rallied up the 18 day EMA (52.10) and then dumped to the 50 day EMA (49.47) on earnings. Then it ricocheted off the 50 day Thursday on the introduction of the new iVideo gadget introduction. The past two sessions AAPL ahs moved laterally over the short term MA on low volume, setting up for the continued run. When you look at this you see typical action: breakout from a nice 6 month cup with handle base, run up the 18 day EMA, then a test of the 50 day EMA and a sharp bounce off that level. When volume jumps back up and AAPL starts higher that is our entry point as it continues its run up the 18 day.
Volume: 22.036M Avg Volume: 20.257M
BUY POINT: $54.48 Volume=30M Target=$62.95 Stop=$51.97
POSITION: QAA AX - Jan. $52.50c (57 delta) &/or Stock
http://www.investmenthouse.com/ci/aapl.html

Play Date: 10/17/2005
CNQR (Concur Technologies--$13.15; +0.19; optionable): Technical & system software
http://biz.yahoo.com/p/c/cnqr.html
After Hours: $13.15
STATUS: Test breakout. CNQR is moving laterally over the 50 day EMA (12.14) the past month, working in a range between 12 and 13 after breaking out in early September from a 11 month cup with handle base. Strong money flow is leading higher. Accumulation in the recent lateral range is a solid 3 to 1 (3 up price weeks on rising volume to 1 down price weeks on rising volume). Relative strength broke out Monday as CNQR cleared the recent highs on strong volume. Looking to move in as CNQR continues higher. Earnings in late October.
Volume: 340.974K Avg Volume: 196.646K
BUY POINT: $13.32 Volume=250K Target=$15.98 Stop=$12.52
POSITION: JCQ BV - Feb. $12.50c (59 delta) &/or Stock
http://www.investmenthouse.com/ci/cnqr.html

Play Date: 10/17/2005
NTES (Netease.com--$80.17; +0.75; optionable): Chinese internet
http://biz.yahoo.com/p/n/ntes.html
After Hours: $80.16
STATUS: Test 50 day EMA. Blasted out of a 22 month base in August with a big gap higher. NTES then rallied up the 18 day EMA (82.95) with a strong run. In the recent selling NTES came back to test the 50 day EMA (78.51) on mostly below average volume. Not bad action and rather typical: breakout, run up the 18 day EMA, then test the 50 day EMA before starting higher once more. Looking for strong volume as it starts back up.
Volume: 895.205K Avg Volume: 1.219M
BUY POINT: $81.25 Volume=1.6M Target=$94.95 Stop=$78.39
POSITION: NGQ AP - Jan. $80c (51 delta) &/or Stock
http://www.investmenthouse.com/ci/ntes.html

Downside:

Play Date: 10/17/2005
IWM (Ishares Russell 2000--$63.02; +0.11; optionable)
http://biz.yahoo.com/p/i/iwm.html
After Hours: $63.03
STATUS: Put. Crashed lower as the small caps led the selling lower in October. IWM blew through the 200 day SMA (63.08) last Tuesday and sold to 61.05. It rebounded with the market and showed a doji at the 200 day Monday, tapping the 10 day EMA (63.31) on the intraday high before sliding back. Lower volume Monday after a pretty strong volume session Friday. This is one of the plays that we catch for the next test that probes the recent October low. If it keeps falling we will let it run. A move to the target, however, lands us a nice 50%ish gain.
Volume: 32.204M Avg Volume: 25.562M
BUY POINT: $62.91 Volume=30M Target=$61.05 Stop=$63.34
POSITION: DIW WS - Nov. $63.50p (-51 delta)
http://www.investmenthouse.com/ci/iwm.html

Play Date: 10/17/2005
SPY (S&P Depository Receipts--$119.11; +0.44; optionable)
http://biz.yahoo.com/p/s/spy.html
After Hours: $119.10
STATUS: Put. Tumbled lower in the October selling from a lower high. It has rebounded the past three sessions to test the 10 day EMA (119.14) on declining volume. May find the strength to rally up to the 200 day SMA (120.03), but the entire market is looking pretty wobbly after this low volume rebound and we want to be ready to move in if it turns back down. A move to the target lands us a 44%ish gain.
Volume: 68.973M Avg Volume: 63.487M
BUY POINT: $118.97 Volume=70M Target=$117.15 Stop=$119.26
POSITION: SPY WO - Nov. $119p (-46 delta)
http://www.investmenthouse.com/ci/spy.html

Good Investing!
Jon L. Johnson and your IH Alerts 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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