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Support and Resistance

Nasdaq: Closed at 1887.97.
Resistance: 1930 to 1940. The 200 day MVA is at 1960.54. The March 2000 down trendline is at 2115.
Support: 1875 is the bottom of the recent trading range. We will see how it fares tomorrow. The up trendline is at 1885. The 18 day MVA is at 1863.62. Below that is 1800 and the 50 day MVA at 1800.20.

S&P 500: Closed at 1128.52.
Resistance: 1150. The March 2000 down trendline is at 1162. The upper channel is right at the 200 day MVA at 1180.80 (the 'hump' in the March and April double bottom as well).
Support: The up trendline is at 1125 (also a point of prior price consolidations). Below that is the 50 day MVA at 1115.13. Then 1103, the old closing low in the double bottom from March and April.

Dow: Closed at 9711.86.
Resistance: 9992 (former top and bottom). The upper channel is now coincident with the 200 day MVA at 10,167.32. Other resistance at 10,200.
Support: 9790 did not hold at the bottom of the former trading range. It fell below the 18 day MVA (9732.94). Up trendline at 9670. 50 day MVA below that at 9605.37. 9500 also acts as support independently.

Weekly Economic Calendar (All times Eastern). The figures are the consensus expectations, not ours.

11-27-01
Consumer Confidence, November (10:00): 82.2 acutal versus 86.5 expected and 85.3 prior (revised from 85.5).
Existing Home Sales, October (10:00): +5.5% or 5.17M annual units versus 5.00M expected and 4.90 prior (revised from 4.89M).

11-28-01
Fed's Beige Book (14:00)

11-29-01
Durable Orders, October (8:30): 1.8% versus -8.5% prior.
Initial Claims, 11/24 (8:30): 430K versus 427K prior.
Help-Wanted Index, October (10:00): 52 versus 52 prior.
New Home Sales, October (10:00): 850K versus 864K prior.

11-30-01
Chain Deflator-Prel., Q3 (8:30): 2.1% versus 2.1% prior.
GDP-Prel., Q3 (8:30): -0.8% versus -0.4% prior.
Chicago PMI, November (10:00): 45.5 versus 46.2 prior.

TEAM TRADES

Today stocks were selling for the most part and as we discussed last night we were going to have to look at whether we wanted to keep some positions if they sold down as well as look at some covered call positions. BRCM and other leaders were primed for some selling, and we did sell some December 50 calls on some of our shares early on. We are trying to catch a move down to 45, buy them back and be done. That is money in the bank as BRCM pulls back after its good moves.

AMCC was a harder nut. It was downgraded and was selling early but made a rally attempt with the market before it rolled down. When it hit 7% below our buy point with about 45 minutes to go, volume was high. We sent out an alert notice that it had hit that level to let everyone know. It was still above the 50 day MVA, but it had fallen below that 14 level that looked solid. We missed on selling covereds on it earlier in the session. We may have made a mistake, but we decided to sell out with a loss on the most recent positions; we made some gain on the positions taken earlier, so it was not that bitter of a pill. The selling was just too intense for us to hang on.

MNC was in a tight, tight pattern, and we were ready to jump on it when it made its move. Well, today it did that about 2.5 hours into the session. Volume was good for the time and the move was impressive. We moved in with a stock position at the ask, and the stock then ran up to 20, about 20 cents above our buy point. Then it pulled back as they often do after an impressive run, but just to the buy point (just what we want), and then it ran back up to 20. It could not, however, break beyond that point. It formed a quick double top and sold all the way back down to close with a slight gain, but well below our buy point. Good volume on the session, but it could not hold it. Still like the pattern.

PLAYS TO LOOK AT:

BONUS PLAYS:

IDXX (Idexx Laboratories--$27.95; +0.25; optionable): Drugs.
http://biz.yahoo.com/p/i/idxx.html
STATUS: IDXX is in a cup with handle going back to late June (left side high 31.25), and recently pulled into a handle over its short-term MVA's (10 & 18 day at 27.42 and 26.98). Today it tried to make a breakout move, hitting up to 28.50 (former handle high 28.29), but volume was not very strong (252,800; average 273,600) and the stock pulled back to close near the former handle closing highs. Still looking good, and we will look for it to hold the 10 day MVA and make another try at a breakout. Target: 33.
BUY POINT: 28.62 on volume of 410,000. Stop: 26.75.
POSITION: Stock and/or March $25 calls to buy (IQX CE - low open interest).

HDI (Harley-Davidson--$51.16; -0.24; optionable): Motorcycles.
http://biz.yahoo.com/p/h/hdi.html
STATUS: HDI double-topped (at 54.35) in July-August and tumbled hard with the market, but recovered back over its 200 day MVA (46) and over the last 5-6 weeks formed a small saucer with handle. HDI broke out Monday, and while it was not the strongest move, it is holding on well, dipping back only slightly the last two sessions, and on much lower volume today (1.32 million; average 1.89 million). Looking for the stock to hold over 50 (breakout point; 10 day MVA at 49.90), and make a stronger move up from here. There is some resistance at the double tops, but we are targeting 60.
BUY POINT: 52.37 on volume of 2 million or better. Stop: 48.70 (7%; 18 day MVA at 49). Aggressive: After holding the 10 day MVA on a low volume pullback, a move back over 51 on above average volume. Stop: 48.70.
POSITION: Stock and/or February $50 calls to buy (HDI BJ). Aggressive: Stock and/or February $45 calls to buy (HDI BI).

PRE-ANNOUNCEMENTS: Still looking at DHR, NDN and SRCL.

TJX ($38.25; +0.40): 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. TJX continues up from its test of the breakout, and today reached closer to the breakout high (38.51) as volume increased (1.43 million; average 1.3 million). A solid move up, but we need to see the high taken out for positions. On a move over 38.51 on increased volume, stock and/or January $35 calls to buy (TJX AG).

BBY ($69.90; -1.18): Forecast to announce a split on 12-18-01 in conjunction with earnings. The company has not confirmed a time for the release at this time. BBY made a solid move that took out the left-side high of its cup, but has pulled back gently the last two sessions, today closing at the left side high (volume down to 2.77 million; average 3.6 million). If it can hold its ground we will look for more strength on a move. From here or after a low-volume pullback that holds 69-70, a buy point of 71.72 on volume of 4 million or better, with stock and/or January $65 calls to buy (BBY AM).

PAST SPLITS:

FIC ($56.70; -1.10): Continues to hold in its handle consolidation, pulling back again to its 10 day MVA today on volume that continued to be below average at 153,000 (average 177,500). Looking for the pattern to hold (18 day at 55.57) and then get a breakout. On a move to 58.88 on volume of 270,000, stock and/or January $55 calls to buy (FIC AK - low open interest). The stock tried a breakout Monday and hit 59.98, so we will watch that level on a breakout.

LUV (18.49; -0.27): LUV is in a tightening consolidation over the 200 day and 10 day MVA's (18.34 and 17.83), testing the 10 day at its lows as volume remains below the average (down to 1.79 million today; average 4.16 million). On a move over 19, stock.

PRE-SPLITS:

CHBS ($37.84; -0.26): Splits 3:2 effective 12-13-01. Continued pulling back on low volume (165,000; average 8.5 million), holding its 10 day MVA (37.44) to close. We are watching carefully here as CHBS made double tops at 39.40, which is not the best action after a breakout, but if it can hold this higher support (used 18 day last time, currently at 36.60), we will see if it can try again and blast over resistance. From here or after a test of the 37 range, a move to 39.52 on above average volume, with stock and/or January $35 calls to buy (URH AG).

KIM ($49.86; +0.34): Splits 3:2 effective 12-24-01. KIM is holding support after pulling back off of the highs in its large ascending wedge. Holding the short-term MVA's (10 & 18 day at 49.66 and 49.46) with a low-volume pullback, today moving back off the 18 day as volume dipped to 83,300 (average 170,300). Still looking for a breakout, with a buy point of 50.32 on volume of 230,000, with stock.

HRH ($60.75; -0.63): Splits 2:1 eff. 1-2-01. HRH made a couple of solid moves Friday and Monday, breaking out of its pennant. The last two days it has pulled back to test the breakout, moving on decreasing volume (45,900 today; average 114,000), testing the 10 day MVA at is low of 60 and pulling up to close. Not bad action, and we will see if it can hold here and give us another strong move up. On a move over 62 on above average volume, stock.

PSC ($30.00; -0.05): Splits 5:4 effective 12-3-01. Has pulled back a bit to test the breakout, today dropping slightly to show a 'shooting star' doji on much lower volume (41,400; average 82,200). Holding the breakout point (29.64) and the 10 day MVA (29.58) is key, and going into Monday's split we will look for the stock to hold support and make a solid move back up. A buy point of 30.50, with stock.

CONTINUING CANDIDATES:

STJ ($74.13; +0.63): Tried to move up in its double bottom with handle, hitting the buy point but lacking the volume (657,500; average 709,500). Still holding up well after its huge move last week. The new buy point is 75.04 on volume of 1.05 million, with January $70 calls to buy (STJ AN).

AZO ($65.76; -0.49): Tightened up with the 10 day MVA (65.88), still moving in the small ascending wedge. It is in a position where it could end up either breaking out or dropping out, but we are looking for a move to 68.12 on volume of 1.84 million, with stock and/or March $65 calls to buy (AZO CM).

POST-SPLITS: BRO and PDLI are still on the radar screen.

AMHC ($29.25; +0.89): Nice move! A good post-split move today by AMHC, bouncing up from its 10 day MVA (28.28) on sharply higher volume (217,700; average 124,000). It hit our buy point on the way to an intraday high of 29.72, pulling back to close. Still looking strong, though, and from here we can still get into positions on a move over the intraday high of 30.01 in the pennant, with continued strong volume. On the move, stock. Stop: 28.

MARKET FAVORITES: QLGC pulled back on lighter volume but EMLX dropped a bit harder.

NVDA ($51.36; -2.73): This semiconductor is being added to the S&P 500, and after hours was racing over 55. The stock pulled back on low volume today before the close, holding recent support at the 18 day MVA (50.43). With the news the stock could make a solid move over the high, at 55.99. On a move to a new high, stock and/or January $52.50 calls to buy (RVU AT). Targeting 65.

KLAC ($49.82; -2.35): After the solid breakout move Tuesday, KLAC could not overcome the market weakness, gapping down and then falling some more. Not too bad, considering, as the drop came on much lower volume (9.6 million; average 9.1 million), and the stock held the 10 day MVA (49.05). We will see if it is just a quick test back, and if it can hold on in some more market weakness, we can look at new or additional positions on a run back over 51 on increased volume and a rally. Stock and/or January $45 calls to buy (KLA AI).

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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