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trade stock, stock recommendation
Begin part 3 of 3
THE PLAYS
Good movers: HITT; KNOT; NVDA; NVLS; SEIC; SIMO; UTSI; VTAL
Strong plays:
1) AGE: Stronger volume as it makes a higher low in its base
2) DNA: Surging higher on strong volume as it breaks from an interim pattern.
3) ADS: Nice test looks to be over.
4) BLKB: Made the test of the 18 day EMA and now looks ready to move
5) PKE: Volume is edging higher as it moves off the 10 day EMA.
NEW PLAYS:
Upside plays:
Play Date: 10/09/2006
AGE (A.G. Edwards--$54.79; -0.09; optionable): Investment brokerage
http://biz.yahoo.com/p/a/age.html
STATUS: Ascending triangle. AGE threw us a curve in mid-September as it looked strong but then gapped lower on its earnings. Earnings were good, but the buyers were not ready for it. It held the 50 day EMA (53.50) as support once more in its 18 week base, then jumped higher on strong volume last Wednesday. Lower volume move followed, right below the breakout point. Looking for a high volume breakout to enter positions.
Volume: 398.3K Avg Volume: 410.918K
BUY POINT: $55.82 Volume=616K Target=$64.00 Stop=$53.95
POSITION: AGE AK - Jan. $55c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/age.html
Play Date: 10/09/2006
CHRS (Charming Shoppes--$14.67; +0.06; optionable): Apparel stores
http://biz.yahoo.com/p/c/chrs.html
STATUS: Cup w/handle. Working on a three week handle to its 7 month base, setting up for a breakout to a new 12 year high. Excellent 6 to 2 accumulation (6 up price weeks on rising volume to 2 down price weeks on rising volume) shows the kind of buying that propels strong breakouts and subsequent runs. Nice run to this point but it has taken a rest and is now ready for more. Just waiting for this low volume test to complete the shakeout and deliver the next upside break.
Volume: 659.3K Avg Volume: 1.885M
BUY POINT: $15.21 Volume=2.8M Target=$18.25 Stop=$14.22
POSITION: QSR AC - Jan. $15c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/chrs.html
Play Date: 10/09/2006
DNA (Genentech--$86.28; +3.08; optionable): Biotechnology
http://biz.yahoo.com/p/d/dna.html
STATUS: Double bottom w/handle. DNA is breaking higher on solid volume once more as news again turns very positive for it. This little 15 week base is part of a 11 month cup base and DNA is starting to race up to form the right side of the pattern. Monday DNA broke out from the shorter base within the base and we are looking to move in as it continues this break and then again on the next test. A strong leader that is getting its legs back under it for another run.
Volume: 6.43M Avg Volume: 3.094M
BUY POINT: $86.88 Volume=3.1M Target=$97.95 Stop=$84.94
POSITION: DWN AQ - Jan. $85c (60 delta) &/or Stock
http://www.investmenthouse.com/ct/dna.html
Play Date: 10/09/2006
SIGM (Sigma Designs--$14.77; -0.11; optionable): Chip equipment
http://biz.yahoo.com/p/s/sigm.html
STATUS: Cup w/handle. SIGM is working on a 5 week handle to a 9 month base setting SIGM up for a breakout to a 10 year high. Strong 8 to 4 accumulation in the pattern (8 up price weeks on rising volume to 4 down price weeks on rising volume) shows solid buying setting up the foundation for the breakout. Nice quiet volume during the handle as it eases back to near support at the 18 day EMA (14.69), and that is what you want as the last holders get frustrated and sell out. I know; been there before. Just being patient and letting it show us the breakout move.
Volume: 370.788K Avg Volume: 618.435K
BUY POINT: $16.06 Volume=928K Target=$19.32 Stop=$14.94
POSITION: MQN AC - Jan. $15c (56 delta) &/or Stock
http://www.investmenthouse.com/ct/sigm.html
CONTINUING PLAYS:
Upside:
Play Date: 10/07/2006
ADS (Alliance Data--$57.85; +0.52; optionable): Credit services
http://biz.yahoo.com/p/a/ads.html
STATUS: Test breakout. Still coming back to test the strong move from last week, holding on low volume and ready for the next move. To recap: ADS surged last Tuesday and Wednesday, breaking out from a 12 week cup with handle base on some solid trade. It faded to end the week, coming back to test the move on very low, below average volume. That shows us very little selling, just settling back on some short term profit taking. May come back to test the 10 day EMA (56.57) before rebounding. Whether it moves higher from the Friday close or tests further we want to pick it up as it rebounds on rising trade. Strong 4 to 2 accumulation (4 up price weeks on rising volume to 2 down price weeks on rising volume) shows plenty of buying in the base. Ready to move in on the rebound that starts ADS back toward a new all-time high.
Volume: 578K Avg Volume: 877.017K
BUY POINT: $58.11 Volume=950K Target=$66.85 Stop=$56.11
POSITION: ADS CL - Mar. $60c (52 delta) or ADS CK - Mar $55c (65 delta) &/or Stock
http://www.investmenthouse.com/ct/ads.html
Play Date: 10/03/2006
BLKB (Blackbaud--$23.62; +0.08; optionable): Software for nonprofit organizations
http://biz.yahoo.com/p/b/blkb.html
STATUS: Ascending base. Excellent test of the 18 day EMA (23.17) intraday and then rebounding to close flat. Looks super to break higher from here after this test of that prior high volume move. To recap: Strong volume the past week, jumping well above average this week as BLKB rebounds off a late week test of the 50 day EMA (22.40) in its 3 month base. Higher lows up the 50 day EMA set up the breakout, and a lateral move in September looks to be the quiet before the storm. Strong money flow is leading the way higher, complementing the outstanding 6 to 1 accumulation (6 up price weeks on rising volume to 1 down price week on rising volume). Strong on both fundamentals and technical pattern. Ready to move in as it makes the breakout to a new all-time high.
Volume: 218.411K Avg Volume: 284.48K
BUY POINT: New: $24.22 (orig. $23.89) Volume=433K Target=$28.45 Stop=$22.78
POSITION: QDO CX - Mar. $22.50c (60 delta, no OI) &/or Stock
http://www.investmenthouse.com/ct/blkb.html
Play Date: 10/04/2006
CVD (Covance--$66.24; -0.13; optionable): Drug development services
http://biz.yahoo.com/p/c/cvd.html
STATUS: Test 50 day EMA. Showing a doji with tail that held the 18 day EMA on the close (66.16). Now it looks ready to continue the move after this quick shakeout. To recap: CVD made us money on its last move after it broke out from an 18 week ascending base formed over the 50 day EMA (64.60). Came back to test that level this past week then after gapping lower Wednesday it rebounded on strong, above average volume, the first such trade in two weeks.
Volume: 246.8K Avg Volume: 421.465K
BUY POINT: Has tested 66. Buy is now $66.75 on the rebound. Volume=450K Target=$74.95 Stop=$64.62
POSITION: CVD AM - Jan. $65c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/cvd.html
Play Date: 10/04/2006
GENZ (Genzyme--$69.50; -0.11; optionable): Biotechnology
http://biz.yahoo.com/p/g/genz.html
STATUS: Trendline break. Continued the lateral move started Friday, showing another tight doji just below 70, tapping that level on the high. Volume remained low after that solid surge last week; just needs some more trade again to make the next move. Looks solid. To recap: Wednesday GENZ broke through its down trendline extending back to the November 2005 peak. It had spent the past 8 weeks bumping up against that trendline (now at 68), measuring it for the breakout. Wednesday that move came on rising, above average volume. Money flow is racing higher ahead of the price and we are ready to move in on a further move as it follows the cash.
Volume: 1.005M Avg Volume: 2.125M
BUY POINT: New: $69.96 (orig. $69.35) Volume=3M Target=$77.95 Stop=$66.98
POSITION: GZQ AU - Jan. $67.50c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/genz.html
Play Date: 09/30/2006
OPLK (Oplink Communications--$20.29; +0.01; no options): Semiconductor integrated circuits
http://biz.yahoo.com/p/o/oplk.html
STATUS: Breakout test. Low volume continues as we still wait for OPLK to continue its break higher. It is set to move after showing that strong volume break, just hasn't done it. To recap: OPLK jumped higher last Tuesday on very strong, above average volume, clearing a 4 month cup with handle. Strong break, nice test to end the week, showing a doji at the 10 day EMA. Excellent 5 to 2 accumulation shows plenty of buying to set up the breakout. After this test it is ready to resume the breakout run and link up with a three year high.
Volume: 152.721K Avg Volume: 243.921K
BUY POINT: New: $20.45 (orig. $20.22) Volume=368K Target=$24.45 Stop=$19.55
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/oplk.html
Play Date: 10/07/2006
PKE (Park Electrochemical--$32.20; +0.40; optionable): Printed circuit boards
http://biz.yahoo.com/p/p/pke.html
STATUS: Cup w/handle. Volume ticked up to average Monday as PKE perked up but still holding close to the 10 day EMA (31.59). Still looks solid, just needing the trigger to break it higher. To recap: Big surge from PKE in late September as it reported excellent earnings. That big move formed the right side of its 17 week base in one move, and it needed to consolidate some afterwards. It spent the next two weeks doing that, easing back while the 10 day EMA rose to meet it. Now the 10 day is there and PKE has had its rest. Looking for strong volume to return as PKE continues the move higher. Strong money flow is leading higher. A top stock in terms of sales and earnings growth rates. Looking for a six year high as it makes the breakout.
Volume: 165.3K Avg Volume: 187.235K
BUY POINT: $33.11 Volume=281K Target=$39.75 Stop=$31.35
POSITION: PKE CF - Mar. $30c (63 delta, low OI) &/or Stock
http://www.investmenthouse.com/ct/pke.html
Play Date: 09/19/2006
RTEC (Rudolph Technologies--$18.56; +0.36; optionable): Chip equipment
http://biz.yahoo.com/p/r/rtec.html
Earnings: 11-2-06
STATUS: Cup w/handle. Still working on the handle, showing some signs of life but still not able to show us the breakout. Monday it was up but volume was almost not there. Money flow continues to lead higher. Now we want RTEC to follow. To recap: RTEC is working on the handle to a 5 month base, the last 7 weeks forming a short double bottom with handle. It is a leader in its sub-sector and it has taken its time setting up this base. We have been patiently watching it and letting it set up its base. Again, it needs to show the breakout move.
Volume: 81.701K Avg Volume: 291.752K
BUY POINT: New: $19.06 (orig. $18.88) Volume=450K Target=$22.75 Stop=$17.65
POSITION: UXH BW - Feb. $17.50c (63 delta) &/or Stock
http://www.investmenthouse.com/ct/rtec.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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