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Begin part 3 of 3

THE PLAYS

Good movers: FIZ

Wednesday night play results:
EZM: Faded back to the 10 day EMA on rising volume but still in the pattern.
FIZ: Nice strong break higher
JBHT: Nope. Diving lower on volume
UTSI: Nice doji at the 10 day EMA on continued below average volume.

New Plays:

Upside:

Play Date: 07/13/2006
FTO (Frontier Oil--$33.10; -1.25; optionable): Oil & gas refining
http://biz.yahoo.com/p/f/fto.html
After Hours: $33.77
STATUS: Breakout test. FTO tested some new frontier the past week as it broke out from an 8 week double bottom with handle base to a new all-time high. After a run higher this week it started to come back Wednesday and again Friday, moving toward the 10 day EMA (32.65). Nice lower and below average volume on these moves show the sellers are not rushing in, but instead just testing the move on some profit taking. Looking for a test of the 10 day and a bounce to give us an entry. If it fades further we will let it make the move and then be ready when it holds and rebounds, but we think the 10 day will hold.
Volume: 3.277M Avg Volume: 3.413M
BUY POINT: $33.25 Volume=3.5M Target=$39.95 Stop=$31.15
POSITION: FTO JZ - Oct. $32.50c (63 delta) &/or Stock
http://www.investmenthouse.com/cd/fto.html

Play Date: 07/13/2006
GME (Gamestop--$39.34; +2.43; optionable): Electronic games stores
http://biz.yahoo.com/p/g/gme.html
STATUS: Double bottom. Last night we noted this was the time for GME to set up a double bottom if it was going to do it, and Thursday volume shot higher as the price did the same. All of the electronic games stocks did better, but GME is the leader. It cleared the 200 day SMA (39.24) on the close, and on a continued move higher from here it is worth starting some positions. Then when it comes back to test and holds, on the bounce from there as well. Money flow is screaming higher ahead of the price. Looks nice.
Volume: 3.417M Avg Volume: 1.314M
BUY POINT: $39.75 Volume=1.5M Target=$47.75 Stop=$38.05
POSITION: GME JH - Oct. $40c (56 delta) &/or Stock
http://www.investmenthouse.com/cd/gme.html

Downside:

Play Date: 07/13/2006
CX (Cemex SA--$56.54; -1.95; optionable): Cement
http://biz.yahoo.com/p/c/cx.html
After Hours: $56.54
STATUS: Put. Gapped lower on the world events and volume was higher but it was still below average. Want to see trade continue to pick up on the selling. Gapped lower Thursday and failed a test of the 50 day EMA (58.55) intraday. A move to the target lands us a 41%ish gain, but it can fall further, and we will let it continue lower if it does.
Volume: 2.168M Avg Volume: 2.291M
BUY POINT: $56.24 Volume=2.5M Target=$53.70 Stop=$57.35
POSITION: CX TK - Aug. $55p (-38 delta)
http://www.investmenthouse.com/cd/cx.html

Continuing ready to move:

Play Date: 06/30/2006
ICUI (ICU Medical--$42.00; -0.40; optionable): Medical instruments
http://biz.yahoo.com/p/i/icui.html
STATUS: Cup w/handle. Quite an extended handle at this point, now 10 weeks long to a 26 week base. Using the 50 day EMA (40.37) as support for the handle, it is pinching off over the 10 day EMA (41.69) this month, the range narrowing. It will either break higher from here or lower. Given the pattern, the sector, and the more defensive market, we are anticipating a break higher by this market leader.
Volume: 81.544K Avg Volume: 120.7K
BUY POINT: $42.78 Volume=173K Target=$50.95 Stop=$40.88
POSITION: QPD KH - Nov. $40c (60 delta) &/or Stock
http://www.investmenthouse.com/cd/icui.html

SUBSCRIBER PORTFOLIO: These are stocks subscribers suggest by vote that we put in a portfolio to track and move into the stocks if they perform well. If you have any suggestions for additions or deletions, email us. We don't cover them all each report, just when something interesting is developing.

AAPL, AKAM, CCJ, CELG, FLR, GME, MGPI, MRVL, NVDA, SGMS, WM

AAPL: Still looking for some sign of a bottom. Doji Thursday on volume indicates it is going to jump back up to the 10 or 18 day EMA, but for now that suggests nothing more.

CELG: So much for ignoring the market. Took a dip to the 18 day EMA on slightly above average volume. Still solid, just got tired of holding out.

FLR: On the 50 day EMA on low volume. Maybe, just maybe it is ready to show us the break higher.

GME: And it is indeed setting up the double bottom here.

NVDA: Looked up 'crappy' in the dictionary today. There was a copy of this chart.

SGMS: Slaving away on its pattern, forming the second leg of a potential double bottom.

WM: This should be the bottom of the right shoulder to its 9 week reverse head and shoulders base. A break over 46.50 on strong volume is the buy point.

Good Investing!
Jon L. Johnson and The Daily 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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