stock split, stock recommendation

Begin Part 2 of 2

PLAYS: These look good for tomorrow and this week.

BONUS PLAYS: Solid move by OMG and still a good buy.

ALLY (Alliance Gaming--$28.46; +1.57; optionable): Gaming activities.
http://biz.yahoo.com/p/a/ally.html
STATUS: Has been on a nice run up its short-term MVA's since breaking from a double bottom in early November. It has made three bounces up from those levels, most recently hitting a new high of 29.40 before coming back to test the 18 day (26.75). Today it surged back up from that level, moving on very heavy volume (741,400; average 390,000). Like the strength on this move, and we will look for positions as this fourth bounce takes out the high, targeting 32. We will use care on topping signs, as this is the fourth bounce up and one often does not get a fifth before a test of lower support.
BUY POINT: 29.52 on continued strong volume. Stop: 27.45.
POSITION: Stock and/or April $25 calls to buy (AQL DE).

AH (Armor Holdings--$26.26; +0.11; optionable): Security services.
http://biz.yahoo.com/p/a/ah.html
STATUS: Broke over its October high earlier this month (which are the left side highs in a skewed cup pattern), and after hitting up to 27.60 pulled gradually back to tighten up with support at its 10 day MVA (which it hit at its low of 26.15 today). Today it showed another loose doji on light, post-holiday volume of 107,500 (average 340,000), and it looks poised to spring. Targeting 32.
BUY POINT: Breakout: 27.72 on volume of 520,000. Stop: 25.78. Aggressive: Over 27 on above average volume.
POSITION: Stock and/or February $20 calls to buy (AH BD).

MARKET FAVORITES:

NTAP (Network Appliance--$22.15; -0.21; optionable): Computer hardware.
http://biz.yahoo.com/p/n/ntap.html
STATUS: Made a great move in early December, and made another strong move on the test of the breakout. Last week it dipped back again from the latter move, but caught the 10 day MVA (which it tapped at its low of 21.78 today) as support. It has settled down over that support the last few sessions, and after the 'shooting star' today (high of 23.22), we are looking for a bounce and strong move over the recent high of 24.53. Target: 30.
BUY POINT: 23.34 on above average volume (12.1 million; today still light at 4.23 million). Stop: 21.71 (7%).
POSITION: Stock and/or March $17.50calls to buy (NUL CW).

EMLX (Emulex--$40.50; +1.38; optionable): Computer hardware.
http://biz.yahoo.com/p/e/emlx.html
STATUS: Still looking good, making a break over its recent pattern high of 40.81 intraday, but pulling back with the market off of 41.20 to close. EMLX made a great run in late-November and early this month, and the pullback has held the 18 day MVA (currently 37). This is a nice cup with handle, and we are looking for a move to 41.32 in market strength and good volume. Targeting 50.
BUY POINT: 41.32 on volume of 14 million. Stop: 38.43 (7%).
POSITION: Stock and/or February or April $35 calls to buy (UMQ BG and UMQ DG, respectively).

PRE-ANNOUNCEMENTS: SONC has made quite a move, but it is precarious.

DRI ($35.97; +0.24): We are working on a date. DRI has made two big moves this month, and it has made a nice pullback to support (the 10 day MVA at 35.31) since the last move. Today it made a slight push from the 10 day, moving on very low volume (245,600; average 773,000). Looking for DRI to build strength as it moves up toward the high and beyond. The buy point on a move over the high is 37.59 on above average volume, with stock and/or April $35 calls to buy (DRI DG).

GNSS ($66.45; +2.41): Working on a date. Never gave up support for a put play, but instead caught the 18 day MVA (63) and is looking good for a possible bounce. Today it pushed back up from that support with volume remaining light but much better than most stocks on the session (1.86 million; average 2.3 million), and we will look for GNSS to make another of the solid moves we have seen in recent weeks, challenging its high at 70.91. On a move over 67 on increased volume near the average, stock and/or March $65 calls to buy (QFE CM).

TRDO ($26.60; -0.32): Working on a date. Rolling up and down after catching support at the 26 level. It has been working in a range from 26-31, and we will look for another move up in that range. A buy point of 38 on above average volume, with stock and/or February $25 calls to buy (UNC BE).

DIAN ($61.51; +1.46): Forecast to announce a split in 1-17-02 with earnings. At this time the company cannot confirm this date. After making the solid bounce we were looking for on the breakout test, DIAN rested Monday and then took off again today, jumping on solid volume of 317,000 (average 197,500). It pulled off its high of 62.18 a bit with the market, but on a move up DIAN is still a buy up to 63. If we get a bit of a continued pullback, we will look for the stock to hold 60 and make another solid push. Stock and/or February $55 calls to buy (UID BK - no open interest at this time for this or the nest month out, May, although there is substantial open interest for the $60 calls, but the delta is of course low).

FDC ($78.64; +1.36): Working on a forecast date. FDC was looking solid as it was setting up to break from its small ascending wedge, but on its move out of that pattern today it was on volume that was much weaker than we would like. It could test back a bit, but upon holding the 78 level we will look for more volume to push a run back up. On a move from here or back up from 78, we need to see volume of 2.5 million, with stock and/or February $75 calls to buy (FDC BO).

NDN ($39.80; +0.63): Researching a date. Tried to break from its handle, but volume was not there today and it pulled back from its high of 40.10. That hit the breakout buy point, but volume was 214,200 and we were looking for 600,000. We could get another test back, but that is fine if it holds support at its 10 day MVA (38.35), and look for the right volume on a move to 40.22. Stock and/or March $35 calls to buy (NDN CG).

PRE-SPLITS:

CPRT ($38.50; +0.60): Splits 3:2 effective 1-22-02. Made the bounce we were looking for, a nice pre-split move that has taken it up to its upper channel trendline drawn from its December tops. It cleared that line, currently at 38.35, and for current positions we will be wary of a drop back down, protecting the profit we have on this move. On a drop we can again look for a bounce and another nice pre-split play. It can still be a play from here after breaking the trendline, but it is aggressive, looking for a move to 38.86 with continued strong volume, and stock and/or January $32.50 calls to buy (KQJ BZ - under 100 open interest, February low open interest).

PAST SPLITS:

FIC ($62.70; -0.43): FIC has tightened in its handle, showing several loose dojis in a row. Volume continued low today just after the holiday at 91,000 (average 195,000). Looking for a breakout over the recent high at 65, with the buy point 65.12 on volume of 300,000, with stock and/or April $60 calls to buy (FIC DL).

CONTINUING CANDIDATES:

IGT ($69.26; +1.97): Good move as IGT made a move over its recent consolidation high, running on volume of 1.2 million (average 1.26 million), not bad for today. Still a buy up to 71.40 on increased volume, riding toward the target of 75. Stock and/or January $60 calls to buy (IGT BL).

APPB ($35.25; +0.25): Has pulled back and caught support again at its 18 day MVA (34.98), dipping below that point today but recovering to close. Looking for an 18 day MVA, challenging the recent high of 36.89. On a move to 35.62 on increased volume over the average of 435,000 (344,100 today), stock and/or February $30 calls to buy (AQB BF).

POST-SPLITS:

CBH ($38.84; +0.64): Split 2:1 effective 12-19-01. Holding up nicely post split, finding support at 38 (November highs) as it forms a pennant pattern. Today we saw a lot of volume (341,500; average 155,000) as the stock move back up, and we are looking for it to take out the recent high of 39.49 with continued strong volume, with stock and/or March $35 calls to buy (CBH CG - low open interest).

Good Investing!
Jon L. Johnson and the Stock Split Report 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.

stock split
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