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us stock market, stock recommendation
Begin part 3 of 3
THE PLAYS
Good movers: PSSI; RACK; RNVS; FRED
Thursday night play results:
LPSN: Tried to extend off the 50 day EMA but volume caved.
ORB: No volume either as ORB gapped higher but could not make the move.
SHW: Moved up to the 10 day EMA on low volume. Getting ready to fall.
New Plays:
Upside:
Play Date: 03/11/2006
EFD (Efunds--$26.08; +0.27; optionable): Transaction processing, etc. for financial institutions, retailers, telecom companies, EFT networks and government agencies
http://biz.yahoo.com/p/e/efd.html
STATUS: Breakout test. A solid market leader that shot higher the third week of February on strong earnings, blasting out of a 14 month cup with handle base. Strong move on strong volume, and now EFD is testing that breakout, coming back to the 18 day EMA (25.67) the past two weeks on lower and lower below average volume. Excellent fundamentals to match the technical pattern. Indeed, EFD broke to a new all-time high on this move. After this pullback it is ready for more. Strong money flow is leading the way higher. Looks to be ready to continue higher this week.
Volume: 161.2K Avg Volume: 231.597K
BUY POINT: $26.72 Volume=325K Target=$31.95 Stop=$25.52
POSITION: EFD IE - Sept. $25c (68 delta) &/or Stock
http://www.investmenthouse.com/cd/efd.html
Play Date: 03/11/2006
IDEV (Interneuron Pharma--$6.58; +0.1; optionable): Biotechnology
http://biz.yahoo.com/p/i/idev.html
STATUS: Ascending base. IDEV spent most of 2005 basing, starting to rally in Q4 to form the right side of its long pattern. A solid break higher in December was followed by a 50 day EMA (5.67) test in early February. It surged off that level and is now working laterally the past three weeks, forming another consolidation before continuing its move. This time it is not giving back any ground, a sign that the new owners don't want to give up their shares and any sold are quickly purchased by the longer term holders. Volume jumped Friday as IDEV started toward the breakout. Strong fundamentals are helping drive this recovery. Strong money flow is leading.
Volume: 642.935K Avg Volume: 529.261K
BUY POINT: $6.78 Volume=625K Target=$8.38 Stop=$6.31
POSITION: QUF IU - Sept. $5c (76 delta) &/or Stock
http://www.investmenthouse.com/cd/idev.html
Play Date: 03/11/2006
STLD (Steel Dynamics--$48.69; +2.46; optionable): Steel and iron
http://biz.yahoo.com/p/s/stld.html
After Hours: $48.71
STATUS: Ascending base. Steel is again hot, and STLD makes hot rolled steel products, so it is even hotter. Weak attempt at humor. This is a nice base on base pattern setting up a strong run. It formed a 11 month base that broke out in late January and then ran up to February when it started this base; not much of a run, but this subsequent 7 week pattern is setting up the next move. You often see this pattern just before a bigger run. Nice 3:0 accumulation in the current base (3 up price weeks on rising volume to 0 down price weeks on rising volume) shows all buying as it takes this final breather and shakes out the last sellers. Strong money flow is zooming higher and relative strength is breaking out in front of the stock, a bullish indication. Excellent fundamentals to go with its strong technical pattern. A giant in its own sector.
Volume: 1.089M Avg Volume: 946.036K
BUY POINT: $48.96 Volume=1.4M Target=$58.75 Stop=$46.22
POSITION: RQL HJ - Aug. $50c (52 delta) &/or Stock
http://www.investmenthouse.com/cd/stld.html
Downside:
Play Date: 03/11/2006
OXPS (OptionsXpress Holdings--$28.27; +1.51; optionable): Investment brokerage
http://biz.yahoo.com/p/o/oxps.html
After Hours: $28.37
STATUS: Put. OXPS was in a steady uptrend from November, using the 18 day EMA (29.77) as support (with an occasional quick dip to test the 50 day EMA) as it rallied. It reported earnings last week, however, and it was whacked. Volume shot higher as OXPS made a quick 3-day drop that pushed it through the 50 day EMA (28.61) and down to some support at 26. It rebounded on lower trade, Friday tapping at the 50 day on the high and backing off. We are looking for OXPS to stall out at the 50 day; it may take a few days to do it, and when it turns down we want to see some volume. It surprised everyone that it missed and thus there is likely more downside baked into the cake. A move to the target lands us a 53%ish gain.
Volume: 2.571M Avg Volume: 1.146M
BUY POINT: $28.05 Volume=1.2M Target=$24 Stop=$28.72
POSITION: QYB PY - Apr. $27.50p (-40 delta)
http://www.investmenthouse.com/cd/oxps.html
Play Date: 03/11/2006
PSTI (Per-Se Technologies--$24.31; +0.22; optionable): Healthcare solutions to physicians and hospitals
http://biz.yahoo.com/p/p/psti.html
After Hours: $24.26
STATUS: Put. PSTI made a lower high in late February, but was not looking too bad until it reported earnings and declining net income. That sent the stock gapping lower to the 200 day SMA (22.24). That plunge occurred Tuesday, and it spent the rest of the week rebounding, filling most of the gap by Friday when it reached up and touched the 10 day EMA (24.60) on the intraday high. Volume has steadily declined on the move, falling below average late in the week. This is a classic gap fill and test of the breakdown, the old 'kiss goodbye' before the return to selling. We are going to move in when it shows a return to the downside and ride it to the target for a 40%ish gain. That keeps us above the 200 day SMA, and if it is heading lower through the target we will let it run to the 200 day SMA.
Volume: 260.165K Avg Volume: 559.782K
BUY POINT: $24.05 Volume=560K Target=$22.65 Stop=$24.65
POSITION: MQA PE - Apr. $25p (-48 delta)
http://www.investmenthouse.com/cd/psti.html
Continuing play ready to move:
Play Date: 02/11/2006
COH (Coach--$36.50; +1.17; optionable): Handbags, etc.
http://biz.yahoo.com/p/c/coh.html
After Hours: $36.75
STATUS: Test 50 day EMA. It took awhile, but Friday COH finally showed us the type of move we are looking for. Volume jumped above average for the first time in a month as COH gapped higher and headed toward the breakout from its 18 week cup with handle (a very elongated handle) base. Money flow is leading sharply higher once more. It is ready for us to move into this week it looks like, just a month after we started looking at it.
Volume: 2.71M Avg Volume: 2.536M
BUY POINT: $36.88 Volume=4.1M Target=$42.95 Stop=$35.15
POSITION: COH HG - Aug. $35c (68 delta) &/or Stock
http://www.investmenthouse.com/cd/coh.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
BRCM: Not rebounding at all and indeed, selling on rising volume as the market bounced. It is looking to fill some of that gap and the 50 day EMA (41.51) is only half the way there. Can sell some calls if have not already done so, looking for the 50 day EMA to hold and the point to buy them back.
COH: It is ready to make the move, rebounding off the 50 day EMA Friday on strong, above average volume.
FFIV: Doji at the 18 day EMA. May tyr to show us something this week but we need to see how it develops.
MRVL: As with BRCM, MRVL was unable to rebound Friday with the market in general. Heading for some support at 55.
NVDA: Continues to show sold strength, holding near term support at the 18 day EMA.
UNH: Still glued to the 200 day SMA.
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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us stock market
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