stock recommendation, stock option

Begin part 3 of 3

We apologize for the tardy delivery of part 3. A water pipe from the office above ours broke and we had to find higher ground. Time to find a new office lease.

THE PLAYS

Good movers: ECOL; PSSI; FRED; KMP

Monday night play results:
ALKS: Sold below the 18 day EMA and holding some support at 24
GME: Sold back, but holding support.
MDCC: Low volume as it slipped through the 18 day EMA.

New Plays:

Upside:

Play Date: 03/07/2006
SILC (Silicom Ltd.--$10.95; -0.64; no options): PC networking and communication
http://biz.yahoo.com/p/s/silc.html
STATUS: Breakout test. SILC broke higher in early February from a 10 week ascending base, rising on sharp trade. It is making the second test of that breakout, coming back to the 10 day EMA (10.98) on lower volume the past two sessions. Solid 3 to 1 accumulation in the base (3 up price weeks on rising volume to 1 down price weeks on rising volume), showing nice buying as the stock consolidated. That set up the breakout. SILC should make 4 bounces up off the 10 or 18 day EMA on this run. Looking for a solid volume shot as it bounces higher from this test. Strong money flow to go with the accumulation, and relative strength broke out as well, a good corroboration of the price move.
Volume: 78.658K Avg Volume: 100K
BUY POINT: $11.39 Volume=155K Target=$13.75 Stop=$10.59
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cd/silc.html

Play Date: 03/07/2006
PLCE (Childrens Place--$51.16; +0.6; optionable): Apparel stores
http://biz.yahoo.com/p/p/plce.html
STATUS: Cup w/handle. PLCE gapped higher last week on strong volume, completing the right side of its 11 week base. It has moved laterally the past three sessions on lower trade, forming the handle. This follows a 6 month cup base; nice base on base pattern setting PLCE for the breakout to a new all-time high. Excellent 5 to 2 accumulation in the base shows solid buying. Good complement to the strong money flow racing higher.
Volume: 730.065K Avg Volume: 669.687K
BUY POINT: $51.88 Volume=1M Target=$59.95 Stop=$48.39
POSITION: TUY FJ - June $50c (55 delta) &/or Stock
http://www.investmenthouse.com/cd/plce.html

Play Date: 03/07/2006
KOMG (Komag--$49.84; -2.99; optionable): PC data storage
http://biz.yahoo.com/p/k/komg.html
After Hours: $49.85
STATUS: Breakout test. KOMG is a leading stock in technical strength and fundamentals. It broke sharply higher Friday from a 5 week flat base over the 18 day EMA (48.82) on very strong volume. That move brought out a downgrade and KOMG gapped lower Tuesday on strong volume. It tapped the 18 day EMA on the low and recovered some; there is some support there. Strong stocks should survive a downgrade. Strong money flow. It held the breakout on the gap lower. Looking for it to hold this support and show a solid rebound after the downgrade. That shows real strength.
Volume: 2.876M Avg Volume: 1.291M
BUY POINT: $51.28 Volume=1.9M Target=$60.95 Stop=$48.62
POSITION: QKX FJ - June $50c (56 delta) &/or Stock
http://www.investmenthouse.com/cd/komg.html

New buy point on current position:

Play Date: 03/07/2006
NVDA (Nvidia--$48.22; -0.84; optionable): Semiconductors. Splits 3:2 on 3-28-06
http://biz.yahoo.com/p/n/nvda.html
After Hours: $48.4
STATUS: Test 18 day EMA. Nice reach down to the 18 day EMA (46.98) on the low and a recovery to close at the 10 day EMA (47.86). It is in a continuing uptrend, breaking out from a short 6 week base in late February. Nice test of that move is setting up the further run higher.
Volume: 5.052M Avg Volume: 4.15M
BUY POINT: $49.25 Volume=6.2M Target=$56.95 Stop=$46.78
POSITION: UVA FZ - June $47.50c (59 delta) &/or Stock
http://www.investmenthouse.com/cd/nvda.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, BRCM, CELG, COH, FFIV, GME, MRVL, NVDA, PSYS, UNH

AAPL: Holding support at 65 (February low) for now. Might wan tot buy back the calls just for safety.

BRCM: Under pressure, sliding through the 18 day EMA. Needs to recover quickly.

FFIV: Holding the 18 day EMA and tapped at support at 65 on the low.

MRVL: Nasty sell off below the 50 day EMA.

PSYS: Getting ugly but did close well off session lows.

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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