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Begin part 3 of 3
THE PLAYS
Good movers: PPDI; PRFT; ALTR; X; XTO
Strong plays:
1) ANEN: Strong volume as it continues higher
2) KNOL: Ready to bust higher.
3) OXY: Diving lower and more room to fall.
4) LMIA: Nice doji on stronger volume at the 50 day EMA
5) MXWL: Nice hammer doji at the 10 day EMA.
6) VVUS: Doji at the 10 day EMA.
NEW PLAYS:
Upside plays:
Play Date: 06/07/2006
ANEN (Anaren--$22.32; +0.80; optionable): Microwave and radio frequency components for wireless communications, GPS, satellites
http://biz.yahoo.com/p/a/anen.html
After Hours: $22.32
STATUS: Cup w/handle. A very short but sweet 5 week base has formed over the 50 day EMA (19.97), a quick consolidation of the early May breakout from a 28 month cup with handle base. Positive accumulation is complemented by strong money flow. Strong surge Wednesday as both price and volume jumped. ANEN closed off of its intraday high (23.56), but still looks solid to continue the breakout move from that big pattern. Solid earnings and sales growth.
Volume: 420.989K Avg Volume: 155.954K
BUY POINT: $22.57 Volume=234K Target=$27.00 Stop=$20.99
POSITION: EVB JX - Oct. $22.50c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/anen.html
Play Date: 06/07/2006
KNOL (Knology, Inc.--$9.92; +0.29; no options): Wireless telecom
http://biz.yahoo.com/p/k/knol.html
STATUS: Cup w/handle. After a strong run from March through mid-May KNOL needed a rest as it approached its all-time high hit back in early 2004 when KNOL was a new issue. Short but nice 5 week base over the 50 day EMA (8.04) sporting 3 to 1 accumulation (3 up price weeks on rising volume to 1 down price weeks on rising volume) shows buying even as KNOL took a breather. Good shakeouts the past two sessions as KNOL tested down to the 18 day EMA (9.09) intraday and rebounded. This action is setting up its next breakout.
Volume: 334.225K Avg Volume: 215.617K
BUY POINT: $10.41 Volume=323K Target=$12.50 Stop=$9.68
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/knol.html
Play Date: 06/07/2006
IWM (Ishares Russell 2000--$70.10; -0.69; optionable)
http://biz.yahoo.com/p/i/iwm.html
After Hours: $70.09
STATUS: Double bottom. This is the small cap Russell ETF and more or less mirrors the action of that index. It has set up a double bottom right on top of the 200 day SMA (69.83), a key institutional support level where the big money steps in or steps out. Wednesday IWM came back to close right above the 200 day. This is where it shows us a breakout or a breakdown. Looking for a strong volume move higher to show us the money is back in and to give us the buy point.
Volume: 81.944M Avg Volume: 45.295M
BUY POINT: $70.88 Volume=68M Target=$75.00 Stop=$69.72
POSITION: DIW KR - Nov. $70c (59 delta)
http://www.investmenthouse.com/ct/iwm.html
Downside Plays:
Play Date: 06/07/2006
OXY (Occidental Petroleum--$94.72; -3.07; optionable): Oil and gas integrated
http://biz.yahoo.com/p/o/oxy.html
After Hours: $94.64
STATUS: Put. Energy was down sharply Wednesday and OXY fell as well on strong, above average volume. It does not look to have played out this move, however, as it tried to rally Tuesday at the 50 day EMA (97.82) and the recent lows, but then folded Wednesday. That opens the door for a test down to the May low (89.56) as OXY follows its tanking money flow. A move to the target lands us a 40%ish gain.
Volume: 6.583M Avg Volume: 3.736M
BUY POINT: $94.44 Volume=3.8M Target=$90.00 Stop=$95.65
POSITION: OXY SS - July $95p (-46 delta)
http://www.investmenthouse.com/ct/oxy.html
CONTINUING PLAYS
Play Date: 06/05/2006
CIEN (Ciena--$4.42; -0.21; optionable): Telecom processing systems
http://biz.yahoo.com/p/c/cien.html
After Hours: $4.38
STATUS: Cup w/handle. Tested a bit lower Wednesday and on strong though still below average volume. Holding easily above the 10 day EMA (4.34), a good shakeout as it forms the handle that sets up the next move higher. To recap: 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: 19.905M Avg Volume: 24.962M
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: 05/27/2006
LMIA (LMI Aerospace--$19.35; +0.10; no options): Aerospace/defense
http://biz.yahoo.com/p/l/lmia.html
STATUS: Breakout test. Rallied up to 20.50 intraday but gave it back by the close; volume was up but still below average. Excellent pattern ready to yield a break higher. To recap: LMIA has tried the resume the breakout move the past four sessions, 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: 169.545K Avg Volume: 210.974K
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: 06/06/2006
MXWL (Maxwell Technologies--$20.21; -0.03; optionable): Energy storage and power delivery components
http://biz.yahoo.com/p/m/mxwl.html
STATUS: Breakout test. Excellent hammer doji at the 10 day EMA (20.21) Wednesday as MXWL stemmed the pullback on lower, average volume. The doji indicates it is ready to resume the breakout move. To recap: Huge surge Friday on strong volume as MXWL broke out from a 16 week range between 17 and 20, mostly using the 50 day EMA (19.12) as support. Outstanding 7 to 2 accumulation in the base shows lots of buying setting up the breakout and run higher. Strong move then a test this week. Volume was lower Monday but jumped Tuesday as it tapped the 50 day EMA on the low and rebounded to hold the breakout. Strong money flow is a good complement to the buying.
Volume: 171.354K Avg Volume: 148.834K
BUY POINT: $20.78 Volume=223K Target=$24.95 Stop=$19.65
POSITION: QMW LD - Dec. $20c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/mxwl.html
Play Date: 06/05/2006
SABA (Saba Software--$6.80; -0.04; no options): Human capital management solutions
http://biz.yahoo.com/p/s/saba.html
STATUS: Ascending triangle. Could not continue the move Wednesday as volume dropped well below average after two big volume sessions Monday and Tuesday. May come back to test the 10 day EMA (6.44) before it is ready to continue; we would not complain about that at all as we could pick it off that level as it rebounded. To recap: The current 16 week base formed using the 50 day EMA (6.44) 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: 72.688K Avg Volume: 100K
BUY POINT: Test 6.44, then 6.55 on the rebound; From the Wednesday close: $6.87 Volume=175K Target=$8.32 Stop=$6.39
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/saba.html
Play Date: 06/01/2006
VVUS (Vivus--$4.53; +0.03; no options): Medical instruments
http://biz.yahoo.com/p/v/vvus.html
STATUS: Test breakout. Nice doji right at the 10 day EMA on the close, testing the 18 day EMA (4.39) on the low and rebounding. Nice action; just waiting for it to show us the break higher. To recap: VVUS blasted higher in mid-May, surging out of a 9.5 month base that formed after the May 2005 low. Used the 18 day as near support and now ready to move higher and continues its recovery.
Volume: 316.882K Avg Volume: 458.115K
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--$29.72; -0.05; optionable): Industrial electrical equipment
http://biz.yahoo.com/p/z/zolt.html
STATUS: Test 50 day EMA. Nice doji at the 18 day EMA (29.79) Wednesday as ZOLT has come back to test near support after a nice surge off the 50 day EMA last week (27.17). Looks ready. 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: 543.433K Avg Volume: 710.849K
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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