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Begin part 3 of 3

THE PLAYS

Good movers: DJO; GRMN; HWAY; LUK; MGI; OII; PMTI; SMSI

Wednesday night play results:
RNT: Another test of the 10 day EMA as it continues the lateral test.
SMDI: Still looks good in its test with volume jumping up Thursday.
SMSI: Nice run higher.
CTXS: Still testing the 50 day EMA
FSL: Moved up to test the 18 day EMA on the high, but no volume to push it further.

New Plays:

Upside:

Play Date: 05/25/2006
DRIV (Digital River--$46.77; +0.67; optionable): e-commerce outsourcing solutions (design, hosting, optimization, etc.)
http://biz.yahoo.com/p/d/driv.html
STATUS: Ascending base. DRIV broke to a 6.5 year high in mid-March as part of a 3.5 month run off of the lows hit in November 2005. After that move it formed the current 10 week base that has moved roughly laterally in a range from 42.50 to 47.50, making higher lows as the 50 day EMA (44.13) rose to meet it. Excellent 4 to 0 accumulation in the lateral base (4 up price weeks on rising volume to 0 down price weeks on rising volume) shows buyers still want the stock. Moved up toward the top of the range this week but volume has remained below average. Nice pattern but we are not going to rush it. Just going to let it show us the break higher with some strong volume to show us the buyers are piling in again.
Volume: 615.688K Avg Volume: 971.533K
BUY POINT: $47.55 Volume=1.5M Target=$57.00 Stop=$45.57
POSITION: DQI II - Sept. $45c (63 delta) &/or Stock
http://www.investmenthouse.com/ci/driv.html

Play Date: 05/25/2006
EXPD (Expeditors Intl.--$97.49; +0.23; optionable): Air delivery. Splits 2:1 on 6-26-06
http://biz.yahoo.com/p/e/expd.html
After Hours: $97.50
STATUS: Test breakout. Big gap higher in early May on the announcement and a three week pullback since, filling part of the gap and finding support at 95 the past week. Mostly lower volume on the pullback and then traded kicked up this week in the market volatility as EXPD showed some intraday volatility but held its range. Looking for a break higher on some better volume to enter this play.
Volume: 804.513K Avg Volume: 1.08M
BUY POINT: $98.95 Volume=1.5M Target=$110.00 Stop=$95.05
POSITION: URP HS - Aug. $95c (66 delta)
http://www.investmenthouse.com/ci/expd.html

Play Date: 05/25/2006
MANT (Mantech Intl.--$34.97; +0.28; optionable): Software and services for national security programs
http://biz.yahoo.com/p/m/mant.html
After Hours: $34.91
STATUS: Breakout test. MANT gapped sharply higher out of a 9 month cup with handle base in early May. That was about the extent of the breakout move however, having burned all its gas on the first 6 point move. It has come back the past two weeks to test, fading to just above the 50 day EMA (33.34) on mostly lower, below average volume. Moved laterally the past week at that level and showing some better volume Wednesday and Thursday as it tightens up its range. Money flow remains strong, moving higher ahead of price. Relative strength broke out and held up even on the test as MANT used the market selling to test and set up the next run higher. Going to pick it up as it starts the run anew after this first test of the massive breakout. Solid leader with great fundamentals to go with the great technical shape.
Volume: 186.533K Avg Volume: 176.714K
BUY POINT: $35.88 Volume=265K Target=$43.00 Stop=$33.57
POSITION: UUN KG - Nov. $35c (54 delta) &/or Stock
http://www.investmenthouse.com/ci/mant.html

Play Date: 05/25/2006
RMD (Resmed--$45.18; +0.52; optionable): Medical appliances
http://biz.yahoo.com/p/r/rmd.html
STATUS: Test breakout. We let RMD make its test and now it looks ready to move higher again. It broke out from a 5 month ascending triangle in early May with a big gap higher. It has come back in a rather volatile fashion the past three weeks, but managed to hold the 50 day EMA (44.14) Wednesday after undercutting that support intraday. Nice volume on the test lower and reversal that day, holding the breakout move. Looking for volume to jump up again as RMD moves through the 10 day EMA (45.58) on strong volume.
Volume: 318.4K Avg Volume: 443.667K
BUY POINT: $45.75 Volume=500K Target=$52.95 Stop=$43.94
POSITION: RMD JI - Oct. $45c (59 delta) &/or Stock
http://www.investmenthouse.com/ci/rmd.html

Good Investing!
Jon L. Johnson and your IH Alerts Team

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 in 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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