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us stock market, stock recommendation
Begin part 3 of 3
THE PLAYS
Good movers: BRLI; LIFC; SMSI; UARM; NVTL; PGNX
Thursday night play results:
ARRO: Tried the break higher and on some solid trade, but could not hold the move.
GPN: Nice day off to test the Thursday surge. A better set up for the continued move higher.
SBUX: Same action, testing the Thursday move & holding support. Ready to move this week.
RTI: Turning back down at the 10 day EMA.
SCHN: Falling from the 200 day SMA on volume.
New Plays:
Upside:
Play Date: 06/17/2006
IDEV (Indevus Pharmaceuticals--$5.27; +0.26; optionable): Biotechnology
http://biz.yahoo.com/p/i/idev.html
After Hours: $5.27
STATUS: Double bottom. IDEV rebounded to end the week, putting in a strong showing Friday while most of the market sold. This is not your classic double bottom but more of a 'flying W' where the right leg holds above the left leg. It also formed something of a reverse head and shoulders at the bottom of the 16 week pattern. Used the 200 day SMA (4.75) as support on the two legs; good to see as the institutions either step in to support stocks at this level or the sell out. They were buying IDEV as the rebound suggests. Strong money flow is leading higher and IDEV is following it. This is one of the sectors showing strength in the market and not just rebounding but having put in some work on a base already.
Volume: 1.391M Avg Volume: 418.209K
BUY POINT: $5.41 Volume=450K Target=$6.55 Stop=$5.06
POSITION: QUF LA - Dec. $5c (65 delta) &/or Stock
http://www.investmenthouse.com/ci/idev.html
Play Date: 06/17/2006
KNOT (The Knot--$18.30; +0.12; no options): Wedding services via the internet
http://biz.yahoo.com/p/k/knot.html
STATUS: Cup w/handle. You never know what is going to work in the marketplace and the market, but KNOT is one of those unlikely winners. It has formed an 11 week base with a rather jagged cup, but after surging up the right side of the pattern in June is has come back to form a nice handle at the 50 day EMA (17.44) the past two weeks. Solid action as the market sold, using the weakness to shake out the sellers and put the finishing touches on its new base, the third in this run. That means it is not overextended on this move. Positive accumulation and surging money flow; leading the way for KNOT's next breakout.
Volume: 124.91K Avg Volume: 139.74K
BUY POINT: $18.67 Volume=210K Target=$22.50 Stop=$17.36
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ci/knot.html
Play Date: 06/17/2006
RMD (Resmed--$44.47; -0.05; optionable): Medical appliances
http://biz.yahoo.com/p/r/rmd.html
STATUS: Test 50 day EMA. Taking another run at RMD as it tests the strong early May breakout from its 5.5 month ascending triangle. Strong 7 to 3 accumulation in that base (7 up price weeks on rising volume to 3 down price weeks on rising volume) shows plenty of buying that set up the breakout move. Has used the market selling to test that move, fading back to the 50 day EMA (44.29) on lower volume. That shows there are not many sellers in RMD, just the buyers taking time off. Good volume jump Thursday as RMD moved up off its recent lows. Looking for that volume to continue building as RMD makes the move off of this test. A market leader that has sold back in an orderly test as the rest of the market dove lower. Looks to have made the shakeout to set up the next move.
Volume: 262.5K Avg Volume: 449.922K
BUY POINT: $44.78 Volume=650K Target=$52.75 Stop=$44.05
POSITION: RMD JI - Oct. $45c (55 delta) &/or Stock
http://www.investmenthouse.com/ci/rmd.html
Downside:
Play Date: 06/17/2006
CSX (CSX Corp.--$64.35; -0.44; optionable): Railroads
http://biz.yahoo.com/p/c/csx.html
STATUS: Head and shoulders. CXS broke down from a seven week topping pattern after a strong run from November 2005 to early May. It was one of the stocks that exploded higher in May after an already strong run; blow off top. It tumbled to the 50 day EMA (65.13), tried to hold, then broke below that level to start June. It bottomed at 60 and bounced last week, tapping the 50 day on the Friday high and backing off some. This takes it back up just below the right shoulder lows, a natural resistance point on top of the 50 day EMA. Looking for it to roll over here and follow the money stream lower. A move down to the target lands us a 50%ish gain. If it falls on through the target with authorit, we will let it continue down.
Volume: 2.003M Avg Volume: 2.268M
BUY POINT: $63.69 Volume=2.3M Target=$59.65 Stop=$65.31
POSITION: CSX TM - Aug. $65p (-51 delta)
http://www.investmenthouse.com/ci/csx.html
Play Date: 06/17/2006
SMH (Semiconductor Holders Trust--$33.03; -0.27; optionable): Semiconductor ETF
http://biz.yahoo.com/p/s/smh.html
After Hours: $33.00
STATUS: Put. The chips have led each move lower in this sell off, starting the second leg in early June with a failed test of the 18 day EMA (33.45). SMH ended the week with a Thursday and Friday test of the 18 day on lower, below average volume, showing a tombstone doji Friday. As the name suggests, that is not a real bullish indication after a bounce higher. As it occurred just below the 18 day EMA, the resistance in this downtrend, it looks ripe to turn lower and continue the decline. A move to our initial target lands us a 48%ish gain. If it keeps falling from there, we will let it.
Volume: 10.605M Avg Volume: 18.289M
BUY POINT: $32.88 Volume=20M Target=$31.35 Stop=$33.48
POSITION: SMH TZ - Aug. $32.50p (-39 delta)
http://www.investmenthouse.com/ci/smh.html
Play Date: 06/17/2006
TEX (Terex--$83.48; -2.29; optionable): Big, big construction and earth moving trucks and equipment
http://biz.yahoo.com/p/t/tex.html
STATUS: Head and shoulders. Similar to other stocks in the industrial sector, TEX formed one of those head and shoulders patterns spanning late April to early May, the head created by that last run, that blow off move, after a very strong August 2005 to April 2006 move. It finished the right shoulder in early May and then broke sharply lower last Monday. It rebounded with the market to the 50 day EMA (86.02) on Thursday, but could not break through. It turned back down Friday on rising but still below average volume. Money flow is still heading lower, and we are looking for TEX to follow it. The target we have set is an initial one. A move to that level lands us a 42%ish gain. If it is selling hard at that point we will take some gain but let some run.
Volume: 784.4K Avg Volume: 828.851K
BUY POINT: $83.22 Volume=850K Target=$79.05 Stop=$84.38
POSITION: TEX TQ - Aug. $85p -49 delta)
http://www.investmenthouse.com/ci/tex.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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us stock market
stock recommendation
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