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Begin part 3 of 3
THE PLAYS
Good movers: ESRX; FLO; GILD; GPN; HCC; PGR; RS; SBUX; UNH
New Post-Split Plays:
Play Date: 10/29/2005
DNA (Genentech--$87.72; +0.63; optionable): Biotechnology
http://biz.yahoo.com/p/d/dna.html
After Hours: $87.52
STATUS: Double bottom w/handle. A long term market leader DNA enjoyed a nice run earlier in the year and needed a breather. It has formed a nice 8 week base, starting higher Wednesday on strong volume but fading back to end the week on low volume. Solid 3 to 1 accumulation in the pattern shows net buying as it consolidates and sets up the next breakout move. Top rated stock. Looking for strong volume to resume as DNA makes the break higher.
Volume: 2.148M Avg Volume: 3.882M
BUY POINT: $88.88 Volume=5.8M Target=$100 Stop=$86.05
POSITION: DWN CR - Mar. $90c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/dna.html
Play Date: 10/29/2005
LUFK (Lufkin Industries--$46.51; +0.56; optionable): Oil and gas serice company
http://biz.yahoo.com/p/l/lufk.html
STATUS: Double bottom w/handle. Working on a nice low volume handle the past week to its 12 week pattern that formed to consolidate the strong February to August run. Strong money flow is leading higher even as LUFK makes this modest pullback to set up the breakout move to a new all-time high. Strong pattern to go with the strong fundamentals LUFK has been putting up. Want to see that volume jump as LUFK moves through the recent highs.
Volume: 157.155K Avg Volume: 252.867K
BUY POINT: $48.05 Volume=379K Target=$57.75 Stop=$44.69
POSITION: UFR CI - Mar. $45c (59 delta) or UFR CJ - Mar. $50c (48 delta) &/or Stock
http://www.investmenthouse.com/cs/lufk.html
Play Date: 10/29/2005
MCRS (Micros System--$45.88; +3.77; optionable): Enterprise information software for hospitality and specialty retail industries
http://biz.yahoo.com/p/m/mcrs.html
STATUS: Cup. Volume surged Friday as MCRS reported strong earnings and received some upgrades. Nice 18 week pattern that formed using the 200 day SMA (40.51) as support as it consolidated and set up the next breakout move. The earnings started the move and we are looking to start a position as it continues the move and then after the first test. Those earnings show MCRS is a top fundamental stock as well as having a great technical pattern.
Volume: 913.822K Avg Volume: 393.839K
BUY POINT: $46.21 Volume=450K Target=$54.95 Stop=$44.89
POSITION: MFK CI - Mar. $45c (57 delta) &/or Stock
http://www.investmenthouse.com/cs/mcrs.html
Continuing Leader Play:
Play Date: 10/12/2005
VTIV (Ventiv Health--$24.99; -0.01; optionable): Outsourced clinical, sales, marketing solutions for pharma, biotech and life sciences industries
http://biz.yahoo.com/p/v/vtiv.html
STATUS: Breakout test. Big breakout in late September from a 6 month cup with handle base. VTIV rallied through September and then sold in the October pullback. It has come to rest on the 50 day EMA (24.94) on low, below average volume. Strong money flow continues to run higher as VTIV pulls back to test the move. Nice doji Thursday; this is where it makes its move if it is going to do it.
Volume: 319.633K Avg Volume: 481.332K
BUY POINT: $26.48 Volume=714K Target=$32.25 Stop=$24.63
POSITION: QBP AY - Jan. $27.50c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/vtiv.html
PRE-ANNOUNCEMENT PLAYS
Current Pre-Announcement Plays: This is a list of stocks we are looking to announce splits. We are not in all of the potential splits plays but are letting them set up for the next move. In each report we look at the candidates that are in the best patterns ahead of their potential announcements. This focus on leaders in good patterns allows us to make good money even if companies do not announce the split. The key with splits is the pattern.
AGN: Forecast 11-1-05
APC: Good earnings to end the week may spark a new move, but still struggling to make a clean break above the 50 day EMA.
CLF: Forecast 11-8-05
DVN: Forecast 11-2-05 before the open
GENZ: Researching next potential date.
GG: Forecast 11-7-05. No current play. Has recovered the 10 day EMA and is easing back to test. From here it may give us a move.
IMDC: Forecast 11-7-05
MRVL: Forecast 11-17-05 after the close
PGR: Forecast 11-9-05 after the close
RL: 11-4-05 before the open
TALX: Forecast 11-15-05
WFMI: Forecast early November
New Pre-Announcement Plays:
Play Date: 10/29/2005
DIOD (Diodes--$36.39; -0.35; optionable): Semiconductor integrated circuits. Forecast to announce a split 11-2-05
BACKGROUND: Last announced a 3 for 2 split on 11-4-03 at $24.
http://biz.yahoo.com/p/d/diod.html
STATUS: Flat. DIOD announced strong earnings last week and gapped higher Thursday. It could not hold the move but tested back to the 50 day EMA (35.75). It is working in a 12 week flat base along the 50 day, sporting 3 to 2 accumulation. Strong money flow is leading this strong market leader higher, and we are looking for a rebound from here to start the play. Top rated in fundamentals to go along with the strong pattern.
Volume: 350.852K Avg Volume: 208.015K
BUY POINT: $37.15 Volume=350K Target=$44.55 Stop=$36.05
POSITION: DUH CG - Mar. $35c (62 delta) &/or Stock
http://www.investmenthouse.com/cs/diod.html
Play Date: 10/29/2005
CLF (Cleveland-Cliffs--$79.55; +1.81; optionable): Steel and iron. Forecast to announce a split 11-8-05
http://biz.yahoo.com/p/c/clf.html
BACKGROUND: Last announced a 2:1 split on 11-9-05 at $81.40.
STATUS: Cup w/handle. Sold hard to start October, but holding the 50 day EMA (77.26) as the bottom of the handle, something of a second handle to its big 8 month cup with handle base. Heck of a year and right at the split price from last year at this time. Good pattern has set up and looking for another spring to close after the announcement. Want to see the volume return to the upside so we can move in.
Volume: 455.9K Avg Volume: 538.679K
BUY POINT: $81.55 Volume=808K Target=$94.95 Stop=$77.05
POSITION: CLF AP - Jan. $80c (51 delta) &/or Stock
http://www.investmenthouse.com/cs/clf.html
Continuing Pre-Announcement Plays:
Moving TALX to pre-announcement status.
Play Date: 10/27/2005
TALX (Talx Corp.--$39.15; +1.87; optionable): Automated employment/income verification and other outsourced employee applications. Forecast 11-17-05.
BACKGROUND: Last announced a 3:2 split on 1-6-05 at $23.10. Before that it announced a 3:2 split on 11-16-00 at $31.
http://biz.yahoo.com/p/t/talx.html
After Hours: $39.09
STATUS: Double bottom w/handle. Working on a lateral move the past week, forming a handle to its 12 week base. Good volume last week. Just needs to show us another strong session as it continues higher. To recap: After a strong run starting at the beginning of 2005 TALX needed a breather to consolidate and set up the next move. It fell into the current 11 week base that formed around the 50 day EMA (34.74). Nice price/volume action with very low volume at the bottom of the pattern and then resurgent volume the past week as TALX rallied while the market sold. Some solid earnings reported last week did not lead to a sell off as with many stocks. Solid 4 to 2 accumulation in the current base is setting up the next breakout to a new all-time high. May take another couple of sessions to complete the handle and then move higher for the next breakout.
Volume: 286.287K Avg Volume: 341.176K
BUY POINT: New: $39.65 (orig. $38.65) Volume=509K Target=$46.42 Stop=$35.94
POSITION: TUB CH - Mar. $40c (51 delta) &/or Stock
http://www.investmenthouse.com/cs/talx.html
Play Date: 10/27/2005
AGN (Allergan--$88.57; +0.82; optionable): Pharmaceutical products for ophthalmic, neurological and dermatological markets. Forecast to announce a split 11-01-05.
BACKGROUND: Announced its only 2:1 split on 10-21-99 at $107.
http://biz.yahoo.com/p/a/agn.html
STATUS: Solid volume Friday as AGN rallied to tap the 50 day EMA (89.17) on the high. Good start but want to see it clear the 50 day to start the play. That only gives it Monday to make the move, but it is shaping up well. To recap: AGN has filled the late July gap higher and now is starting back up. It sold pretty hard to start October along with the rest of the market but it has checked up and moved laterally the past two weeks. Volume jumped back above average Thursday and Friday, showing renewed buying interest. This move has tested the breakout from a 14 month double bottom with handle base. Looking to start some positions as it moves back through the 50 day EMA. Money flow remains strong, leading the stock.
Volume: 1.086M Avg Volume: 804.074K
BUY POINT: $89.25 Volume=1.2M Target=$102 Stop=$86.05
POSITION: AGN AR - Jan. $90c (48 delta) &/or Stock
http://www.investmenthouse.com/cs/agn.html
Play Date: 10/25/2005
GENZ (Genzyme--$71.76; +1.52; optionable): Biotechnology. No announcement on 10-18 w/earnings but forming a solid pattern.
BACKGROUND: Last announced a 2:1 split on 4-25-01 at $101.
http://biz.yahoo.com/p/g/genz.html
After Hours: $71.68
STATUS: Double bottom. Moving laterally the past week on lower, below average volume, holding above the 50 day EMA (70.03). It is forming a nice handle to the pattern, a nice shakeout to set up the breakout move. Just being patient and letting it show us the breakout move given it did not announce with earnings in mid-October. To recap: GENZ is working on an 12 week double bottom, coming off the second low early this month. It is right below the 'hump' near 74, but showing solid 4 to 2 accumulation (4 up price weeks on rising volume to 2 down price weeks on rising volume) and strong money flow leading the way higher.
Volume: 1.803M Avg Volume: 2.292M
BUY POINT: $72.89 Volume=4M Target=$83.78 Stop=$69.69
POSITION: GZQ AN - Jan. $70c (59 delta) &/or Stock
http://www.investmenthouse.com/cs/genz.html
PRE-SPLIT PLAYS:
Play Date: 10/25/2005
FAST (Fastenal Company--$68.65; +1.03; optionable): Home improvement. Splits 2:1 on 11-11-05
http://biz.yahoo.com/p/f/fast.html
STATUS: Test breakout. FAST surged higher in early October, gapping out of a 9 week double bottom base. It rallied to 70 and then started laterally the past two weeks on lower, below average volume. Dropped harder Thursday on rising, average trade and then bounced back some Friday. May take a couple more sessions to test the move before making the next break higher to continue the run. Looking for that volume to jump back up as it does.
Volume: 536.699K Avg Volume: 621.236K
BUY POINT: $69.25 Volume=918K Target=$75 Stop=$67.89
POSITION: FQA BN - Feb. $70c (54 delta) &/or Stock
http://www.investmenthouse.com/cs/fast.html
POST SPLIT PLAYS:
Play Date: 10/27/2005
BJS (BJ Services--$34.51; +0.71; optionable): Oil and gas service company
http://biz.yahoo.com/p/b/bjs.html
After Hours: $34.51
STATUS: Test 50 day EMA. Still working on a handle to a short cup with handle base, tapping down at the 50 day EMA (32.75) on the low and rebounding to close positive. Nice recovery from the October energy correction; remember, oil service stocks are going to do well as the recovery operations on the gulf coast continue. Getting ready for the move. To recap: BJS broke out from a 10 month cup with handle base in July and has rallied well with periodic tests of the 50 day EMA. It sold off with the energy stocks in October after hitting 36 on the high. Unlike many energy stocks it did not breakdown in the selling and instead used it to form up the current short base. The tap at the 50 day EMA looks to have set the move by shaking out the last sellers.
Volume: 3.678M Avg Volume: 4.17M
BUY POINT: $35.05 Volume=6.3M Target=$40.95 Stop=$33.32
POSITION: BJS AG - Jan. $35c (48 delta) &/or Stock
http://www.investmenthouse.com/cs/bjs.html
Play Date: 10/22/2005
HIBB (Hibbett Sporting Good--$25.35; +1.05; optionable): Sporting goods stores.
http://biz.yahoo.com/p/h/hibb.html
STATUS: Cup w/handle. Working on that nice handle to its 12 week base, tapping at the 18 day EMA (24.01) on the Friday low and then rebounding. Very solid action in the handle, showing low and below average volume just like you want to see. Held the 200 day SMA (22.01) on the lows of the pattern, an important support point. Setting up nicely for the breakout to a new all-time high.
Volume: 241.125K Avg Volume: 405.015K
BUY POINT: $25.95 Volume=612K Target=$30.38 Stop=$24.48
POSITION: QQX AE - Jan. $25c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/hibb.html
Play Date: 10/27/2005
HRS (Harris Corp.--$40.17; +0.67; optionable): Telecom equipment
http://biz.yahoo.com/p/h/hrs.html
STATUS: Test 50 day EMA. Volume was solid again Friday as HRS gapped higher again, continuing the move off the 50 day EMA (38.35). Was all over the map Friday, but recovered to hold the gain, and if it continues Monday we are looking to start the play and then add to it on the test. Strong market leader with top flight fundamentals to go along with the pattern. To recap: HRS broke out in late July, moving out of an 8.5 month base and then rallying to 42. In the recent market selling it sold off as well, but volume was very low, indicating no distribution. It has held the 50 day EMA after the selling and then gapped higher Thursday and Friday on strong volume, filling the gap intraday and then recovering to hold the gains. Reported strong earnings that helped trigger the move. Strong money flow compliments solid 3 to 1 accumulation (3 up price weeks on rising volume to 1 down price weeks on rising volume). A market leader in fundamentals and pattern and ready to make the next move toward another all-time high.
Volume: 1.109M Avg Volume: 834.345K
BUY POINT: $40.35 Volume=1M Target=$46 Stop=$38.12
POSITION: HRS BH - Feb. $40c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/hrs.html
Good Investing!
Jon L. Johnson and the Stock Split Report 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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