stock recommendation, stock pick

Begin part 3 of 3

THE PLAYS

Good movers: AMT; DBRN; DXPE; LVLT; NVDA; RVI

Weekend play results:
BLKB: Stalled out for the day on low volume.
BTUI: Tried to run higher on volume but just closed off its high. Still ready.
DJO: Didn't get the volume to make the move. Still set up
NAK: Gapped higher on solid trade
QLGC: Gapped higher but faded modestly to the close. Solid despite NASDAQ.

New Plays:

Upside:

Play Date: 05/01/2006
CELG (Celgene--$41.82; -0.34; optionable): Biotechnology
http://biz.yahoo.com/p/c/celg.html
After Hours: $41.74
STATUS: Cup w/handle. A capital run from July 2005 to the end of March 2006 put some nice money in our pocket. Then CELG needed a rest and faded back in early April. It held some support at 36 from the January and February highs in its base, moving laterally for three weeks. Last week it started higher, rallying on some strong earnings results after struggling at the 50 day EMA (38.92). Gapped higher and faded back Friday on low volume, then eased back a bit further Monday on low volume as well. May take another couple of days to complete the handle, but if it starts to run from here we are not going to back off from starting the play.
Volume: 3.008M Avg Volume: 3.477M
BUY POINT: $42.72 Volume=5.2M Target=$50.95 Stop=$40.71
POSITION: LQH JV - Oct. $42.50c (52 delta) &/or Stock
http://www.investmenthouse.com/cd/celg.html

Play Date: 05/01/2006
OIS (Oil States Int.--$41.25; +0.88; optionable): Oil & gas service company
http://biz.yahoo.com/p/o/ois.html
STATUS: Cup w/handle. OIS is looking for an all-time high with a breakout from the current 14 week base that formed using the 200 day SMA (34.45) on the lows as support. That is where the institutions either step in or step out; they were stepping in here, bouncing OIS back up. It formed the handle the past two weeks, holding the 18 day EMA on the lows. Volume has started to pick up the past week and was up Monday as OIS tested toward the breakout. Positive 4:3 accumulation in the base shows net buying, setting up the breakout. Looking for a good surge as OIS moves through the buy point.
Volume: 726K Avg Volume: 776.742K
BUY POINT: $42.05 Volume=1.2M Target=$49.95 Stop=$39.88
POSITION: OIS IH - Sept. $40c (59 delta) &/or Stock
http://www.investmenthouse.com/cd/ois.html

Play Date: 05/01/2006
WFR (Memc Electronic--$43.40; +2.80; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/w/wfr.html
After Hours: $43.32
STATUS: Test 18 day EMA. WFR made us some solid money in its early 2006 run, then got a bit volatile, coming back to test the 50 day EMA (36.96). We were looking for it to give us another entry point, but it gapped up on a contract announcement before a good set up shaped up. It spent the last two weeks testing that move, reporting earnings last week and running lower intraday to fill most of the gap, then rebounding in a furious recovery. Monday WFR surged on a nice above average volume session. Looks to have recaptured its wind and looking to move in as it continues higher through the buy point on solid trade.
Volume: 3.622M Avg Volume: 3.103M
BUY POINT: $44.12 Volume=4.7M Target=$52.95 Stop=$41.21
POSITION: WFR JI - Oct. $45c (52 delta) &/or Stock
http://www.investmenthouse.com/cd/wfr.html

Downside:

Play Date: 05/01/2006
ASH (Ashland--$65.58; -0.24; optionable): Oil & gas refining
http://biz.yahoo.com/p/a/ash.html
STATUS: Put. ASH collapsed lower the last week of April, gapping sharply lower through the 50 day EMA (68.18) and falling into the January and February consolidation. Rebounded to end last week, tried the 50 day EMA again on the Monday high and then started back down, following diving money flow. Announced disappointing results and that cratered it. After this bounce we are looking for it to roll over and resume the decline. A move to the target lands us a 40%ish gain.
Volume: 1.383M Avg Volume: 742.955K
BUY POINT: $65.31 Volume=1.1M Target=$63.05 Stop=$66.05
POSITION: ASH RM - June $65p (-42 delta)
http://www.investmenthouse.com/cd/ash.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

COH: Could not advance the ball Monday, and that left it open to the afternoon selling. COH faded off the half-hearted rebound test of the 10 day EMA. Not looking good at all.

GME: Still working laterally in that tight range over the 18 day EMA. A yawner the past three weeks as it holds near support after gapping lower.

MRVL: Still trying to hold at the March lows at 55.

NVDA: Excellent break higher on strong volume. Nicely done.

PSYS: Cannot figure out what the hell PSYS wants to do. It tanked Monday on stronger above average volume after a nice higher low and strong break higher Thursday. Now it is back below the 50 day EMA.

UNH: Lower volume rise to test the 10 day EMA before continuing lower in its downtrend.

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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