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us stock market, stock watch
Begin Part 3 of 3
XL ($92.50; -0.40): Researching a date. Has pulled back after its weak move back up, holding the 18 day MVA (92.36) as volume remains very low (841,000; average 2 million). The break to a new high is a move over 96.50 on above average volume, and the aggressive play is on a move over 95 on above average volume, both with stock and/or January $90 calls to buy (XL AR).
THQI ($52.05; +1.40): We are working on a date. Holding over the 50 day MVA (51.78), today testing that level again as it moved back over the short-term MVA's (53.50) on continued low volume. Not the strong move we were looking for, but we will see if it can build strength.
Plays:
DHR (Danaher--$60.55; -0.07; optionable): Forecast to announce a split in late January in conjunction with earnings. At this time, the company cannot confirm a date for earnings release.
http://biz.yahoo.com/p/d/dhr.html
BACKGROUND: Last announced a 2:1 split on 3-6-98 with a board meeting. The stock price was $70. The annual shareholder meeting was on 5-1-01 at which time authorized shares were increased. The company has enough shares for a 2:1 split.
STATUS: DHR formed a cup in the shape of a reverse head and shoulders pattern, and it is now trying to hold a move back over its neckline. It has encountered resistance from a down trendline (connecting December and May highs, at 60), and has pulled into a handle consolidation over that level and its 10 day MVA (59.56). Today DHR hit the buy point but was nowhere near the required volume for a breakout (today 391,800; average 1.27 million), and the stock pulled back to close from the intraday high of 61.13. Still a decent consolidation that could give us a strong breakout, but it is wedging higher a bit, not the best handle action (prefer it to decline slightly as measured by the intraday lows). The first resistance is the February, May and June highs at 65, and the target is 70.
BUY POINT: 61.25 on volume of 1.9 million. Stop: 57.50.
POSITION: Stock and/or March $55 calls to buy (DHR CK - low open interest).
TJX (TJX Companies--$37.85; +0.52; optionable): Retail. Forecast to announce a split on 12-5-01 in conjunction with a board meeting. The company will not confirm this date, but based upon our research this is the date for the board meeting.
http://biz.yahoo.com/p/t/tjx.html
BACKGROUND: Last announced a 2:1 split on 4-8-98 with a board meeting. The stock price was $43. The annual shareholder meeting was on 6-5-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: TJX has been on a steady uptrend the last 15 months, recovering quickly back to the trendline (connecting December, April and July lows) after September 11. It bounced from the 50 day MVA (then 34.50, just above the trendline) earlier this month and broke to a new high. It was volatile on the move, but after testing the break it is attempting a move back up. The last two sessions it has made a solid move up on decent volume (up to 1.41 million today; average 1.3 million), pulling back from 38.22 today (high on the breakout 38.51) to close. We will see if the momentum can continue, and from here we will look for a move over the breakout high for positions, as a failure can lead to a severe drop. Target: 45.
BUY POINT: A move over 38.51 on increased volume. Stop: 36.
POSITION: Stock and/or January $35 calls to buy (TJX AG).
EDS (Electronic Data System--$71.88; +1.83; optionable): We are researching a date.
http://biz.yahoo.com/p/e/eds.html
BACKGROUND: Last announced a 2:1 split on 3-9-92 at a stock price of $60. The annual shareholder meeting was on 5-22-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: EDS has been creeping up the 10 day MVA (69.32), and made a solid move up from that support today on increased volume (3.48 million; average 3.2 million). A good move, but this is the fourth run up the 10 day for EDS; stocks tend to make 4 to 5 such runs, and while we will ride this move for all it is worth, watching 2000 highs at 75 for resistance, we are not looking at new positions from here. We will wait for the pullback to a deeper level of support and then run it again.
NDN ($35.75; +0.01): Retail. Researching a date.
http://biz.yahoo.com/p/n/ndn.html
STATUS: Made a very strong bounce up from the 50 day MVA (33.58) Monday, moving on solid volume. Not too bad after holding the 50 day for the second time after hitting resistance at 37 in July, October and November. It tested back to the short-term MVA's (10 day at 34.52) today but bounced back up again to close. Volume dipped back to 286,200 (average 359,000), so we will see after this rest if NDN can continue the move, taking out resistance at 37. Target: 45.
BUY POINT: 37.12 on above average volume. Stop: 34.50.
POSITION: Stock and/or March $35 calls to buy (NDN CG).
FDC (First Data--$72.24; -0.69; optionable): Working on a forecast date.
http://biz.yahoo.com/p/f/fdc.html
BACKGROUND: Last split was a 2:1 on 11-18-96 at a stock price of $80. The annual shareholder meeting was on 1-11-01 at which time authorized shares were increased. The company has sufficient shares for a 2:1 split.
STATUS: Pulled back from its recent breakout (from a cup pattern), but caught the 18 day MVA (71.37). It bounced back up Friday with very low holiday volume, and has not been able to continue, pulling back slightly today to the 10 day MVA (72.11) as volume was up but still rather low (1.29 million; average 2.04 million). This weak move is the fourth bounce up from the 18 day, and we are careful with the fourth move as typically a stock will need to dip back and visit lower support (the 50 day is at 68.43). Moreover, FDC has made its recent move up in the right side of the cup on low volume, and we like to see accumulation in the right side of the pattern. We will see if it makes a strong move, which the aggressive can play, but with existing positions will carefully watch for a drop to test the 50 day, and use it as a chance to sell calls. We were targeting 82 on a strong breakout.
BUY POINT: Breakout is 74.23 on volume of 3 million. Stop: 70. On current positions we will look at selling some December $70 calls if it falls below the 18 day MVA, buying them back at support at 68 (the 50 day MVA).
POSITION: Stock and/or February $70 calls to buy (FDC BN).
MI (Marshall & Ilsley--$62.26; +0.05; optionable): Banking: Regional. We are researching a forecast date.
http://biz.yahoo.com/p/m/mi.html
BACKGROUND: Based upon our research it does not appear that MI has ever split its stock. The annual shareholder meeting was on 4-24-01 at which time no additional shares were authorized. The company has sufficient shares for a 2:1 split.
STATUS: Managed to make the breakout Monday, but it might not have legs. In early November MI broke from a "flying W" with handle, but was looking perilous after making double tops on that move. It appeared to be weakening at those tops again (61.50), but made the nice move yesterday. However, we got a classic "tombstone" doji today, on lower but still strong volume (282,600; average 231,000). The doji typically signals a drop, so we will be ready for that move, carefully watching the 18 day MVA (60.54), which has been recent support. A failure there, however, could result in a sharp move down. Don't anticipate that now; the stock has been performing very well. On renewed strength we are still targeting 70.
BUY POINT: Aggressive: 63.02 on volume of 300,000. Stop: 60.
POSITION: Stock and/or January $60 calls to buy (MI AL).
FORMER SPLITS REMAINING PLAYS: As the market finds itself, we are focusing on some of the stocks that have shown a propensity to split and which are looking solid.
Watchlist:
LUV (18.76; +0.09): LUV has pulled laterally over the 200 day and 10 day MVA's (17.84 and 18.31), testing the 10 day at its lows as volume remains below the average (4.13 million; today 3.16 million). Still looking pretty solid in something of a cup with handle, although dipping back a bit toward 18 would not hurt to set up a better base. On a move over 19, stock.
PRE-SPLITS REMAINING PLAYS:
Watchlist:
PBG ($44.64; -0.21): Splits 2:1 effective 12-5-01. Still drifting down on falling volume. PBG has now fallen out of a pennant/descending wedge and through its long-term trendline (from September 2000). Nothing going on at the moment.
ITG ($60.03; -1.42): Splits 3:2 effective 12-10-01. Dropped back through the 50 day (60.66) after a strong back from 66. Looked like it could hold, and we will see if it can make a recovery and set up something going toward the split.
CBH ($75.51; +0.51): Splits 2:1 effective 12-19-01. Still in a precarious handle, and we could get a drop back toward the 50 day (72.64). However, today looked better with the recovery, and we are still watching for a possible breakout out of the handle, which is a move to 75.86 on volume of 230,000, with stock and/or January (very low open interest currently) or March $70 calls to buy (CBH AN or CBH CN).
FLO ($40.33; -1.66): Splits 3:2 1-3-01. Never made the move, and took a nasty fall Tuesday out of its lateral consolidation over the 10 day (41.61), although volume was not catastrophic (down to 60,300; average 65,000). The 50 day is just below at 39.52, so we will see if it can hold that level. Plenty of time to go before the split.
VAR ($71.90; -2.81): Splits 2:1 on or about January 16. Not good. Tried the breakout from the cup with handle Monday and today, but there was just no volume (looking for 345,000; up to 197,100 today). It reached up to 76.50 today but crashed back hard close at the 10 day MVA. We will see if it can hold and recover (the 18 day is just below at 71.09).
Continuing Plays:
EPIQ (Epiq Systems--$30.32; -3.68): Splits 3:2 effective December 3.
http://biz.yahoo.com/p/e/epiq.html
STATUS: My what a turn. Made another big drop to the 50 day MVA (30.45) after a bounce from that level. The stock broke out recently from a cup with handle, but it abruptly failed at 39, and the drop has been severe. We could still get a put on a move through the 50 day on continued strong volume. Target: 200 day MVA (24.26).
PLAY: On a move below 29 on continued strong volume (up to 574,000 today; average 156,300), January $35 puts to buy (FQU MG).
CHBS (Christopher & Banks--$38.10; -0.70; optionable): Retail apparel. Splits 3:2 effective 12-13-01.
http://biz.yahoo.com/p/c/chbs.html
STATUS: CHBS recently broke from its ranging handle to a cup (dating back to May, high of 47.50), and after testing the break pushed up toward the recent high. Monday it hit just over that level (to 39.40) but showed a topping sign ('tombstone' doji), and today it dipped back. Double tops are not what we like to see on breakouts, but the drop back today was on low volume (103,200; average 412,000), so we will see it can hold support (10 day & 18 day at 37.35 and 36.46) and try again to make the strong move. With existing positions we will use care as the double top can lead to some serious drops. The target on a move over the high is 48.
PLAY: From here or after a test of the 37 range, a move to 39.47 on above average volume. Stop: 37. Stock and/or January $35 calls to buy (URH AG). Stop: 35.
KIM (Kimco Realty--$49.52; -0.11; no options): REIT. Splits 3:2 effective 12-24-01.
http://biz.yahoo.com/p/k/kim.html
STATUS: KIM is in a large ascending wedge, and the last two sessions has again pulled back off of the highs. After Friday's loose doji under the high we were expecting a drop, and although volume has been increasing, it was only up to 151,800 today (average 169,500). It is also holding the 18 day MVA (49.42), which was support for recent intraday lows. We will see if it can hold and continue the series of higher lows, watching for a breakout. Target: 60.
PLAY: 50.32 on volume of 230,000. Stop: 48.
CONTINUING CANDIDATES REMAINING PLAYS: When splits are not announced, we will keep the best split prospects on the report rather than continue to carry all of them in case there is a an unexpected announcement. We will continue to monitor the stocks that are trimmed and add them again when we ascertain a revised split announcement date.
Watchlist:
ACS ($95.99; -0.21): Still consolidating over 95, although it gapped up to 97.45 Monday before reversing. We are still riding current positions, and will see if it continues laterally or slightly down, with the 10 and 18 day MVA's at 94.85 and 93.65 (upper channel trendline also with the 10 day). For new positions we will wait for it to come back to its up trendline.
BJ ($45.92; -0.28): Struggling after its big drop, hitting the 10 day MVA (46.79) Monday before dropping again. Still could make a stronger move down, and for put positions we are still targeting 42. The aggressive can look at January $55 (BJ MK) puts on a drop through 45 on above average volume. Recent low is 43.
FLIR ($42.51; +1.06): Has recovered from the recent low of 33.75 and is now holding over the 50 day (40.50). It managed a bounce today, hitting 43.60 before pulling back intraday and holding the short-term MVA's (18 day at 42.21). We will see if it can hold and form something playable.
JEC ($69.30; 0.00): Received an upgrade, but it did not upgrade the price. Still consolidating over the 50 day (67.58) and under the short-term MVA's (10 day at 69.84). We were looking for a bounce, but JEC is holding now, so we will see if it can manage to do something after this rest. The play is on a move over 70 on above average volume, with stock or January $65 calls to buy (JEC AM). Stop: 67.
PEP ($48.44; -0.55): Fell back through the 50 day MVA (48.54) today. The recent drop was preceded by a weak volume move up to 50.46, so the drop is not surprising. We will see if it can recover and set something up.
RMD ($58.25; -0.04): Pulled up over the short-term MVA's (18 day 57.02) with a decent move Monday, but on the whole it is not showing much strength. It can still make a move here after resting today on lower volume. For new or additional positions we will see if it can hold the 18 day and make a strong move over 59 on above average volume of 300,000, with stock and/or January $55 calls to buy (RMD AK).
SLM ($87.35; -0.05): Still holding over the 10 day (57.37) after the weak move up. Still watching to see if we get a test of the 18 day or 50 day (86 and 84) to set up better for a strong move.
THC ($58.88; -1.05): Made a very solid move up last week, but is pulling back toward the 50 day MVA (58). Volume has not been wild on the drop the last two sessions, so if it can hold the 50 day we will be interested in a possible bounce.
SUI ($36.48; -0.57): Could not recover after the big drop last week, today falling back hard from the 50 day (58). Dropping.
Plays:
APPB (Applebee's--$32.62; -0.54; optionable): Leisure: Restaurants
http://biz.yahoo.com/p/a/appb.html
STATUS: Cannot quite make it. APPB has been trying to breakout from a ragged double bottom with handle, but after a rather weak move up from the 18 day MVA (32.18) Monday, APPB pulled back again today on sharply higher volume of 694,000 (average 409,800). The 18 day has been recent support, and we will see if it can continue to hold (50 day down at 31.02), but for positions we will need to see a breakout. Target on a breakout: 40
BUY POINT: After holding support at the 18 day, we are looking for a move over the high of 34.91 with continued strong volume (minimum 620,000). Stop: 32.50.
POSITION: Stock and/or February $30 calls to buy (AQB BF; under 100 open interests thus far).
POST SPLITS REMAINING PLAYS:
Watchlist:
ATK ($81.00; -0.53): Split 3:2 on 9-10-01. Dipped back through the 50 day (81.76), hitting the put buy point but recovering to close with a doji. Still under the 50 day, so the drop could resume, but with existing positions we will be wary of a strong move (volume today up to 398,800; average 352,500) back over the 18 day MVA (82.53). Still targeting 75.
BRO ($30.81; +0.01): Split 2:1 on 11-23-01. Post split BRO has advanced out of its ascending wedge pattern, but the moves have been of the gap up and reverse variety, which do not build confidence of continued moves up. Today the stock showed a doji on low volume (92,600; average 155,000). We will see if it test the recent highs at 30 (with the 10 day MVA), and can hold through some potential post-split weakness and try again.
MIKE ($28.99; -0.75): Split 2:1 effective November 27. Pulled back on the split to its 10 day MVA, moving on strong volume of 1.25 million (average 540,000). We will see if it holds, but MIKE has climbed far (from 17) in less then 2 months, so could need to test back a bit (18 day and 50 day MVA's at 28.13 and 25.25). It is scheduled for earnings Wednesday, and is to go on the NYSE December 12. We will keep an eye on it.
WFMI ($42.55; -0.49): Split 2:1 on June 5. After giving us a strong and sustained breakout, WFMI is taking a breather and showing a consolidation over 42. Volume shot up today (1.46 million; average 703,000) as it pulled back slightly. We will see if it can hold up or gently test the 10 day MVA (41.17). Still riding current positions to the target of 45, carefully protecting profits.
Plays:
PDLI (Protein Design Labs--$38.05; -0.73; optionable): Biotechnology. Splits 2:1 effective October 12.
http://biz.yahoo.com/p/p/pdli.html
STATUS: PDLI made a solid move Monday, just taking out the prior week's high at 38.64, but it might be ready to pull back already. Tuesday showed us a 'tombstone' doji on increased, strong volume (3.45 million; average 2.23 million), which usually indicates a pullback. The 18 day MVA has been recent support at 35.70, although we will need to watch carefully as the stock has made three bounces up along that level since its breakout in October. The 50 day MVA is back at 32.50, and it could pay it a visit; however, if it can hold the 18 day, we will certainly look again at playing a move by PDLI in a market rally, as it can move and give us another play on a fourth bounce. Target: 42.
PLAY: Aggressive bounce: After holding the 36 level on a lower volume pullback, a move over 37 on above average volume in a rally, with stock and/or February $32.50 calls to buy (PQI BZ). Stop: 35.
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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