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us stock market, trade stock
Begin part 3 of 3
THE PLAYS
Good movers: NGPS; PETD; TYL; EXPD; JEF; XPRSA
Strong plays:
1) HLEX: Strong volume break thru resistance Friday in a low volume market.
2) RTEC: In position for a strong, quick move higher.
3) BRCM: Locked and loaded.
4) DRIV: Ready to move and can do it fast.
5) PRXL: Outstanding test of an outstanding breakout.
NEW PLAYS:
Upside plays:
New buy points on current positions:
Play Date: 08/26/2006
HLEX (Healthextras--$29.64; +1.11; optionable): Pharmacy benefit management
http://biz.yahoo.com/p/h/hlex.html
STATUS: Cup. A perennial leader, HLEX enjoyed a strong 2005 through Q1 2006 and then finally had to base out. It has spent almost 6 months doing just that, coming off the bottom of its base, the final tap lower, in late July and early August. It rallied, then bunched up below the 200 day SMA (28.79) the past week, and then exploded through the 200 day Friday on strong, above average volume. Excellent action and we are ready to move into positions as HLEX continues its move higher. Plenty of upside room to run in the base and make us a nice gain without ever having to get past the March high in the pattern. Positive accumulation already in the base, a good sign that it is only going to get better as it rallies to form the right side of its base.
Volume: 365.545K Avg Volume: 235.349K
BUY POINT: $30.31 Volume=300K Target=$36.00 Stop=$28.54
POSITION: HUE LF - Dec. $30c (51 delta) &/or Stock
http://www.investmenthouse.com/ct/hlex.html
Play Date: 08/26/2006
INFA (Informatica--$14.30; +0.24; optionable): Enterprise data integration software
http://biz.yahoo.com/p/i/infa.html
STATUS: Reverse head and shoulders. Nice price move Friday as INFA moves toward the breakout from its 13 week reverse head and shoulders that formed at the bottom of its 20 week cup base. Nicely formed pattern with plenty of upside without a breakout and the ability to move quickly when it breaks out, just what we want for this week.
Volume: 617.407K Avg Volume: 1.344M
BUY POINT: $14.71 Volume=2M Target=$16.95 Stop=$13.68
POSITION: UYF AC - Jan. $15c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/infa.html
Play Date: 08/26/2006
RTEC (Rudolph Technologies--$16.97; -0.09; optionable): Defect inspection systems for semiconductor manufacturing
http://biz.yahoo.com/p/r/rtec.html
STATUS: Breakout test. RTEC shot higher two weeks back in the overall rally in chips when they broke their downtrend. The move took it out of a 13 week cup with handle base, but the selling last week brought it all the way back to test the move. Low volume taps at the 18 day EMA (16.59) Thursday and Friday and then a recovery to hold the breakout worked as the last shakeout. Strong money flow is leading higher, a good complement to the positive accumulation. Set up to make a nice, fast move higher for us.
Volume: 161.138K Avg Volume: 345.258K
BUY POINT: $17.31 Volume=500K Target=$20.75 Stop=$16.44
POSITION: UXH KW - Nov. $17.50c (52 delta) &/or Stock
http://www.investmenthouse.com/ct/rtec.html
Play Date: 08/26/2006
SPY (S&P Depository Receipts--$129.81; +0.16; optionable)
http://biz.yahoo.com/p/s/spy.html
After Hours: $129.85
STATUS: Double bottom w/handle. Matching the large cap index, SPY made a nice low volume pullback tot eh 10 day EMA (129.45) last week, testing the strong move higher and setting up the next leg up this week. We are looking for a run up to the prior high before any trouble sets in. A move to the target lands a 43%ish gain.
Volume: 41.758M Avg Volume: 80.535M
BUY POINT: $130.04 Volume=80M Target=$132.60 Stop=$129.39
POSITION: SFB JZ - Oct. 130c (56 delta)
http://www.investmenthouse.com/ct/spy.html
Downside:
Play Date: 08/26/2006
BRLI (Bio-Reference Labs--$21.09; +0.05; optionable): Medical labs
http://biz.yahoo.com/p/b/brli.html
After Hours: $21.09
STATUS: Head and shoulders. BRLI is showing a doji below the 50 day EMA (21.15), trying to hang on after a hard drop Wednesday that put it below that level and completed the right shoulder to the 10 week pattern. Money flow is in the tank and still diving lower. Looking to move in as BRLI continues the drop from here. A move to the target lands us a 43%ish gain.
Volume: 111.454K Avg Volume: 196.857K
BUY POINT: $20.94 Volume=200K Target=$19.15 Stop=$21.35
POSITION: BJQ VX - Oct. $22.50p (-57 delta)
http://www.investmenthouse.com/ct/brli.html
CONTINUING PLAYS:
Upside:
Play Date: 08/21/2006
BRCM (Broadcom--$28.54; -0.40; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/b/brcm.html
After Hours: $28.58
STATUS: Test 50 day EMA. Locked and loaded, holding above the 50 day EMA (28.36) last week in a nice low volume test after blasting through that level two weeks back on strong volume. Broke its downtrend, broke the 50 day EMA, and now rested. Ready to move in as it rebounds. If the market moves well, we can even get aggressive and get in a bit lower in price than the original buy point. This may be a very good long term entry point for BRCM as well. We will just have to see how it plays out after the market makes this next run. To recap: It has been a long time since January when we bought a bunch of BRCM and it bolted higher on strong volume. That was just about the apex of its run and shortly after it topped and rolled over. BRCM broke through its 4 month downtrend this month, moving laterally with SOX and then breaking sharply higher last Tuesday and Wednesday. Strong volume on the upside move shows the buyers (short coverers and long buyers) were moving in force. It then eased back to end the week and did more of the same Monday, fading toward the 50 day EMA on lower volume, below average. Has made the test of the 50 day EMA, and now looking for the bounce higher. This was a trend reversal move, and this is the first test of the stronger break higher. If it continues up from here on volume we know the buyers are back in.
Volume: 9.157M Avg Volume: 17.123M
BUY POINT: Aggressive: $29.15 (orig. $29.75) Volume=20M Target=$36.00 Stop=$28.08
POSITION: RCQ AF - Jan. $30c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/brcm.html
Play Date: 08/21/2006
BRKS (Brooks Automation--$13.80; +0.14; optionable): Chip equipment
http://biz.yahoo.com/p/b/brks.html
STATUS: Test 200 day SMA. Still working laterally over the 200 day SMA (13.46), showing a bit better volume Friday as it bounced modestly. Nicely set up to continue the strong break higher. To recap: After languishing in a downtrend since February, BRKS jumped higher to start the month, rising to the 200 day SMA. It stalled, then broke through early last week. It is now testing, and we are looking for this tap back at the 200 day to hold and for BRKS to rebound on rising trade from here. That is our entry point to trade this one back up to the February high.
Volume: 384.87K Avg Volume: 669.328K
BUY POINT: $14.12 Volume=900K Target=$17.50 Stop=$13.33
POSITION: BQE AV - Jan. $12.50c (69 delta) &/or Stock
http://www.investmenthouse.com/ct/brks.html
Play Date: 08/22/2006
COHR (Coherent--$35.42; +0.17; optionable): Lasers, precision optics
http://biz.yahoo.com/p/c/cohr.html
STATUS: Double bottom w/handle. Still working on the handle, gapping modestly lower Friday but rebounding to close just over the 10 day EMA. Nice work, set to move if the techs can stage that third leg. Can move quickly as well, just what we want. To recap: Nice lateral move as COHR consolidates the August run that formed the right leg of its 16 week base. Volume jumped sharply higher Tuesday as COHR showed a tight doji, holding the gains and well above the 10 day EMA. Positive accumulation and money flow going hand in hand as COHR sets up the next break higher. The leader in its sector.
Volume: 165.416K Avg Volume: 249.898K
BUY POINT: $36.74 Volume=350K Target=$43.00 Stop=$35.15
POSITION: HRQ AG - Jan. $35c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/cohr.html
Play Date: 08/24/2006
DRIV (Digital River--$46.43; -0.57; optionable): e-commerce outsourcing solutions
http://biz.yahoo.com/p/d/driv.html
STATUS: Breakout test. Tried the move Friday, but no volume and it faded back, but still holding easily above the 18 day EMA (45.92). Nice breakout, nice test, just needs the market to come with it. To recap: DRIV made us some nice money on the last breakout 2 weeks back from its 14 week double bottom with handle base. Strong volume on that move and a low volume test this week, back to the 18 day EMA Thursday, rebounding back up from that test lower on rising, average volume. Strong money flow remains. Like the strong rebound back up to the 10 day EMA after the test. The higher volume shows buyers coming back in. Looks ready to continue the breakout move.
Volume: 619.043K Avg Volume: 985.783K
BUY POINT: $47.55 Volume=1.2M Target=$54.75 Stop=$45.85
POSITION: DQI LI - Dec. $45c (63 delta) &/or Stock
http://www.investmenthouse.com/ct/driv.html
Play Date: 08/19/2006
PRXL (Parexel Intl.--$31.31; -0.40; optionable): Biopharma services company
http://biz.yahoo.com/p/p/prxl.html
STATUS: Breakout test. Just an excellent pullback from the strong break higher two weeks back, holding at the 18 day EMA (31.09) near support Thursday and Friday to end last week. It is ready to go, just needs the trigger. To recap: Strong break higher on strong volume on 8-14-06 as PRXL moved out of a 14 week cup base. Strong surge, nice test and ready for more upside from this market leader.
Volume: 127.464K Avg Volume: 247.298K
BUY POINT: $32.05 Volume=285K Target=$36.95 Stop=$31.31
POSITION: VBQ LF - Dec. $30c (67 delta, low OI) &/or Stock
http://www.investmenthouse.com/ct/prxl.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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