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us stock market, trade stock
Begin part 3 of 3
THE PLAYS
Good movers: SMSI; ALTR; CELL
Strong plays:
1) ANN: Impressive relative strength.
2) SABA: Outstanding accumulation and strong volume to boot.
3) X: Volume surging as X rolls over
4) XTO: Failing at the 200 day SMA.
5) PPDI: Set up after this low volume test.
6) VVUS: Ready to make the break higher.
NEW PLAYS:
Upside plays:
Play Date: 06/05/2006
ANN (Ann Taylor--$39.38; +0.13; optionable): Apparel stores
http://biz.yahoo.com/p/a/ann.html
STATUS: Ascending base. ANN jumped higher last Thursday on good same store sales results, starting to move out from a 12 week base formed using the 50 day EMA (37.07) as support. Solid 3 to 1 accumulation (3 up price weeks on rising volume to 1 down price weeks on rising volume) shows nice buying during the pattern. Strong volume again Monday in a weak volume market. Holding up well, a solid market leader.
Volume: 1.798M Avg Volume: 1.162M
BUY POINT: $39.87 Volume=1.3M Target=$46.55 Stop=$38.05
POSITION: ANN LH - Dec. $40c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/ann.html
Play Date: 06/05/2006
CIEN (Ciena--$4.54; -0.11; optionable): Telecom processing systems
http://biz.yahoo.com/p/c/cien.html
After Hours: $4.55
STATUS: Cup w/handle. Strong volume to end last week as CIEN moved up off the lows in its 11 week base. It started to come back Friday after hitting an early high and fading, continuing that pullback on much lower, below average volume. It is working on its handle, the low volume pullback that shakes out sellers. One of the group of telecom leaders that enjoyed a strong November through March run, CIEN has set up a nice base and is trying to start to lead again. We will let it continue to work on the handle as the market makes this test; how it holds up will show us a lot about the buyers in the stock.
Volume: 16.107M Avg Volume: 25.081M
BUY POINT: $4.85 Volume=38M Target=$5.88 Stop=$4.51
POSITION: EUQ JA - Oct. $5c (48 delta) &/or Stock
http://www.investmenthouse.com/ct/cien.html
Play Date: 06/05/2006
SABA (Saba Software--$6.61; +0.04; no options): Human capital management solutions
http://biz.yahoo.com/p/s/saba.html
STATUS: Ascending triangle. The current 16 week base formed using the 50 day EMA (6.00) as support. It is a base formed following the January breakout from a much larger 12 month double bottom with handle base. It is showing excellent action in the base, with surging volume the past two sessions. Before that it has compiled an excellent 6 to 1 accumulation reading (6 up price weeks on rising volume to 1 down price weeks on rising volume) with money flow surging higher ahead of price. Relative strength broke out ahead of price, a very bullish indication that price is about to make the move.
Volume: 239.103K Avg Volume: 100K
BUY POINT: $6.87 Volume=175K Target=$8.32 Stop=$6.39
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/saba.html
Downside Plays:
Play Date: 06/05/2006
X (US Steel--$65.02; -4.49; optionable): Metal fabrication, etc.
http://biz.yahoo.com/p/x/x.html
After Hours: $64.90
STATUS: Put. After a strong run through mid-May, X looks to have run out of steam. Note how volume ran out on the last burst higher in early May, hitting a new high on lower and lower trade. Then trade surged as X started to sell off. It fell through the 50 day EMA (65.44) down to 60 where it rebounded in a recovery attempt. Volume ran lower as it made the rebound. It managed to clear the 50 day but then rolled over and fell through the 50 day Monday on a spike in volume. Money flow is again diving ahead of price, and we expect X will continue to fall and give us a nice downside gain. A move to the target lands us a 44%ish gain.
Volume: 6.258M Avg Volume: 4.382M
BUY POINT: $64.78 Volume=4.5M Target=$60.25 Stop=$65.55
POSITION: X SM - July $65p (-44 delta)
http://www.investmenthouse.com/ct/x.html
Play Date: 06/05/2006
XTO (XTO Energy--$40.69; -1.41; optionable): Independent oil and gas
http://biz.yahoo.com/p/x/xto.html
STATUS: Put. XTO set up two consecutive head and shoulders bases, the first bouncing off the 200 day SMA (42.83), the second crashing through that level in May. It fell on strong volume to 37 on the low and then rebounding to test the 200 day. It gapped higher Monday, not quite making it to that level before rolling back over on rising volume. Money flow is heading lower ahead of price. Looking to move in on further downside and pick up some gain on the downside move. A move to the target lands us a 46%ish gain.
Volume: 3.186M Avg Volume: 3.509M
BUY POINT: $40.48 Volume=3.2M Target=$38.35 Stop=$41.25
POSITION: XTO SH - July $40p (-41 delta)
http://www.investmenthouse.com/ct/xto.html
CONTINUING PLAYS
Play Date: 05/27/2006
LMIA (LMI Aerospace--$19.05; -0.85; no options): Aerospace/defense
http://biz.yahoo.com/p/l/lmia.html
STATUS: Breakout test. LMIA fell Monday on rising but still below average volume. Not bad given the market as LMIA still holds above the 50 day EMA (18.60) as it has all during this test. Setting up to make the next break higher despite the market. To recap: LMIA tried the resume the breakout move Friday, but volume remained below average and it faded to close flat. This continues the low volume test of the early May breakout from a 16 week ascending base. Strong money flow is leading higher as LMIA tests the 50 day EMA, setting up to resume the run higher to a new all-time high.
Volume: 181.033K Avg Volume: 206.531K
BUY POINT: $20.75 Volume=265K Target=$24.95 Stop=$19.65
POSITION: - Stock (No option chain)
http://www.investmenthouse.com/ct/lmia.html
Play Date: 05/31/2006
PPDI (Pharmaceutical Product Dev.--$36.20; -1.11; optionable): Medical labs
http://biz.yahoo.com/p/p/ppdi.html
After Hours: $36.12
STATUS: Test 50 day EMA (35.41). Fell back with the market Monday, dropping to the 18 day EMA (36.05) but on continued very low, below average volume. Thus no real selling, just a sympathy drop. Want to see it hold here and rebound this week on some strong trade to give us the entry. Remains very strong and has set up a new small double bottom with handle here. To recap: Volume surged Wednesday as PPDI started back up off the 50 day EMA after the 6 week pullback to test the mid-April gap higher. Strong leader ready for a new high, and the money flow is surging higher ahead of price, leading PPDI to a new all-time high. Want to see it clear the recent closing highs on continued solid trade.
Volume: 403.447K Avg Volume: 638.348K
BUY POINT: New: $37.88 (orig. $37.12) Volume=950K Target=$44.50 Stop=$35.15
POSITION: PJQ JJ - Oct. $37.50c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/ppdi.html
Play Date: 06/01/2006
VVUS (Vivus--$4.71; +0.11; no options): Medical instruments
http://biz.yahoo.com/p/v/vvus.html
STATUS: Test breakout. Showing excellent relative strength Monday, racing higher to 4.99 but unable to hold most of the move by the close. Volume was up but below average. Still looks super. To recap: VVUS blasted higher in mid-May, surging out of a 9.5 month base that formed after the May 2005 low. Strong jump off the 18 day EMA (4.36) Thursday after the three week test of the strong break higher. Used the 18 day as near support and now ready to move higher and continues its recovery.
Volume: 382.583K Avg Volume: 451.488K
BUY POINT: $4.85 Volume=677K Target=$5.97 Stop=$4.51
POSITION: - Stock
http://www.investmenthouse.com/ct/vvus.html
Play Date: 06/02/2006
ZOLT (Zoltek Companies--$30.74; -1.22; optionable): Industrial electrical equipment
http://biz.yahoo.com/p/z/zolt.html
STATUS: Test 50 day EMA. Rallied to 33.83 on the Monday high but could not hold the move, fading back to the 10 day EMA (29.95) on the close. Volume remained strong as ZOLT tried the move but faded. Still in very nice shape with this quick little double bottom over the 50 day EMA (26.96). To recap: ZOLT started up sharply off of the 50 day EMA Friday, rallying on strong above average volume, the best trade in over a week. This stock can peel off big jumps in real estate in a hurry, and we are looking to capture this next move. It filled the gap higher from mid-May, tested key support, and is now moving higher.
Volume: 943.305K Avg Volume: 697.834K
BUY POINT: $31.22 Volume=850K Target=$39.00 Stop=$29.57
POSITION: LVQ IF - Sept. $30c (66 delta) &/or Stock
http://www.investmenthouse.com/ct/zolt.html
Good Investing!
Jon L. Johnson and your Technical Traders Report 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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