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us stock market, stock recommendation
Begin part 3 of 3
THE PLAYS
Good Movers: ATHR; BIDU; BMRN; CEPH; CRM; DRIV; HOC; MA
Strong plays:
1) SAY: Starting the breakout on strong volume.
2) WBSN: Nicely set up
3) HMSY: Volume surging as it tested and rebounded
4) LAZ: Tapped the 18 day EMA on the low and started to rebound on volume
5) UCTT: Volume coming back up as it tests and rebounds to close positive.
NEW PLAYS:
Upside plays:
Play Date: 11/13/2006
NVLS (Novellus Systems--$30.52; +1.24; optionable): Chip equipment
http://biz.yahoo.com/p/n/nvls.html
STATUS: Cup w/handle. Strong shot of above average volume Monday as NVLS started the breakout from its 10 month base. This move not only takes it out of its pattern, but also clears significant resistance from Q4 2004, Q1 2005, Q3 2005, and Q1 2006. That is an important move. Ready to move in as it continues higher and then will look to add positions after a successful test of this breakout move.
Volume: 6.243M Avg Volume: 3.751M
BUY POINT: $30.88 Volume=3.9M Target=$36.95 Stop=$29.28
POSITION: NLQ CF - Mar. $30c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/nvls.html
Play Date: 11/13/2006
SAY (Satyam Computer Services--$22.61; +0.72; optionable): IT services
http://biz.yahoo.com/p/s/say.html
STATUS: Cup w/handle breakout. Volume jumped back above average Monday as SAY started the breakout from a 7.5 month base. Moving to a new all-time high on that strong trade. SAY has moved into market leadership with some strong fundamentals growth rates on top of an excellent technical pattern. Ready to move in as SAY continues higher on more solid trade.
Volume: 1.578M Avg Volume: 1.008M
BUY POINT: $22.84 Volume=1.1M Target=$27.45 Stop=$21.54
POSITION: SAY DX - Apr. $22.50c (58 delta) &/or Stock
http://www.investmenthouse.com/ct/say.html
Play Date: 11/13/2006
TNB (Thomas & Betts Corp--$52.20; +0.84; optionable): Electrical connectors, components for communications, etc.
http://biz.yahoo.com/p/t/tnb.html
STATUS: Reverse head and shoulders. Strong volume Friday and Monday as TNB got serious about its bounce off the 50 day EMA (49.60) that acted as support for the right 'shoulder' to its 6 month base. Positive accumulation to complement some solid fundamentals growth rates. Strong run in 2005 and it needed this base to rest and set up to rally again. Looks ready with this strong volume.
Volume: 507.3K Avg Volume: 478.695K
BUY POINT: $52.55 Volume=700K Target=$60.45 Stop=$50.65
POSITION: TNB CJ - Mar. $50c (68 delta, low OI) &/or Stock
http://www.investmenthouse.com/ct/tnb.html
Play Date: 11/13/2006
WBSN (Websense--$27.52; +0.33; optionable): Employees internet management and web security software
http://biz.yahoo.com/p/w/wbsn.html
STATUS: Cup w/handle. Like seeing this 2004 and 2005 leader forming back up in an excellent pattern for a breakout move. Nice, very quiet three week lateral move has allowed the 10 day EMA (26.89) to catch up with it after a strong gap higher in late October helped form the right side of its 10 month base. Excellent volume on the surge, and now a very quiet low volume handle has formed as money flow moves higher ahead of price. Excellent set up for this former leader that is setting up to lead once more.
Volume: 381.92K Avg Volume: 687.509K
BUY POINT: $28.22 Volume=1M Target=$33.95 Stop=$26.78
POSITION: DQH DE - Apr. $25c (65 delta) &/or Stock
http://www.investmenthouse.com/ct/wbsn.html
New buy point on current play:
Play Date: 11/11/2006
AKAM (Akami Technologies--$49.55; -0.52; optionable): Internet content delivery and business processes
http://biz.yahoo.com/p/a/akam.html
STATUS: Double bottom w/handle. Tried to move higher Friday but could not hold the modest gain; low volume was not enough to push it. Not a bad session; more of a breather. Still ready to move in as it makes its breakout from this short base. To recap: AKAM is setting up well for yet another run, forming a short but sweet 6 week base using the key support at the 50 day EMA (46.61) for the lows. Love to see a strong stock use the 50 day as support after a good run. Solid 3 to 1 accumulation in the pattern (3 up price weeks on rising volume to 1 down price weeks on rising volume) shows plenty of buying during the consolidation to once more break AKAM higher to a six year high. Suffered a distribution session Thursday after gapping higher and reversing. Nice recovery session Friday on above average volume complementing a strong Tuesday upside session.
Volume: 3.949M Avg Volume: 5.137M
BUY POINT: $50.75 Volume=7.5M Target=$60.95 Stop=$48.21
POSITION: UMU BJ - Feb. $50c (55 delta) &/or Stock
http://www.investmenthouse.com/ct/akam.html
CONTINUING PLAYS:
Upside:
Play Date: 10/23/2006
BAMM (Books-A-Million, Inc.--$19.63; -0.43; no options): Book retailer
http://biz.yahoo.com/p/b/bamm.html
EARNINGS: 11-16-06?
STATUS: Flying plateau. Volume moved up almost to average Monday as BAMM got some cold feet and sold off a bit. Still easily holding its range; with earnings and retail sales coming out this week we can see it break either way. We will be patient and let it show us the breakout move and if so, we move in. To recap: Working laterally the past 5 weeks as BAMM consolidates the early October breakout from a 13 week cup with handle base. Low, low volume the past week as it worked along the 18 day EMA (19.67). Really nice set up to the breakout that will take BAMM to a new all-time closing high. Just want to see the volume go bam as it makes the breakout.
Volume: 103.889K Avg Volume: 102.889K
BUY POINT: $20.24 Volume=150K Target=$24.45 Stop=$18.94
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/bamm.html
Play Date: 11/09/2006
HMSY (HMS Holdings--$14.00; +0.25; no options): Cost containment and payment accuracy services
http://biz.yahoo.com/p/h/hmsy.html
STATUS: Test breakout. Looks as if the test has run its course as it reached down toward the 50 day EMA (13.39) on the low and rebounded on strong volume to post a gain. Looks ready to continue the breakout move from its 8 week base. Want to see that volume continue as HMSY resumes the breakout run.
Volume: 417.354K Avg Volume: 244.718K
BUY POINT: $14.55 Volume=331K Target=$17.65 Stop=$13.53
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/hmsy.html
Play Date: 11/09/2006
LAZ (Lazard Ltd.--$42.35; -0.32; optionable): Asset management
http://biz.yahoo.com/p/l/laz.html
STATUS: Cup w/handle. Still in the test, tapping and holding the 18 day EMA (42.02 on the low and rebounding modestly. Volume jumped higher again, holding well above average. Looking for that to spark up the next move higher and show us the breakout. To recap: Strong volume to start the month as LAZ rallied on earnings and a nice dividend. It has come back the past three sessions on very low volume, forming the handle to this nice 7 month base. Excellent 'first' base (a new issue in May 2005) is setting up a strong breakout. Nice action.
Volume: 554.8K Avg Volume: 365.817K
BUY POINT: $44.12 Volume=555K Target=$51.95 Stop=$42.22
POSITION: LAZ CH - Mar. $40c (64 delta) or LAZ CI - Mar. $45c (51 delta) &/or Stock
http://www.investmenthouse.com/ct/laz.html
Play Date: 11/11/2006
OPLK (Oplink Communications--$20.20; -0.01; no options): Semiconductor integrated circuits for optical networking components
http://biz.yahoo.com/p/o/oplk.html
STATUS: Test 50 day EMA. Volume remained low as OPLK continued its move along the 50 day EMA (19.86), setting up the break higher to follow that money flow. To recap: OPLK broke out from a 4.5 month cup with handle base in mid-October and rallied over 22 on the move. It stumbled and has come back, giving up its breakout to start the month, but immediately rebounding to hold that level and the 50 day EMA that is right there as well. Money flow continues to run higher ahead of OPLK as it moves laterally on low volume, setting up the next move. Want to see volume jack back up as OPLK rebounds and links up with a good run for us.
Volume: 96.36K Avg Volume: 268.591K
BUY POINT: $20.38 Volume=368K Target=$24.65 Stop=$18.72
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/oplk.html
Play Date: 11/08/2006
UCTT (Ultra Clean Holdings--$13.18; +0.38; no options): Semiconductors
http://biz.yahoo.com/p/u/uctt.html
STATUS: Test 18 day EMA. Still working laterally in the tightening range as volume started to move higher Monday, closing in on average as UCTT posted a gain after testing the 18 day EMA (12.71) intraday. Looking very promising here. To recap: UCTT broke out in mid-September from a 7.5 month base. It came back to test, holding the 50 day EMA (11.36) and then starting its breakout run up the 18 day EMA. This is its second test of this near support, and a strong breakout typically yields 4 to 5 such bounces and tests. That leaves plenty of upside for UCTT on this move once it finishes this two week lateral consolidation. A new issue in Q1 of 2004, this breakout and run is its best thus far. Strong money flow and ready to make the next break higher on this breakout run.Volume: 460.675K Avg Volume: 419.12K
BUY POINT: $13.42 Volume=600K Target=$16.21 Stop=$12.48
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/ct/uctt.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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