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us stock market, trade stock
Begin part 3 of 3
THE PLAYS:
Good movers: COH; CTRP; HCP; HRS
New Plays:
New Post-Split Plays:
Play Date: 01/04/2007
BAX (Baxter Intl.--$46.98; +0.48; optionable): Medical instruments
http://biz.yahoo.com/p/b/bax.html
STATUS: Reverse head and shoulders. Solid volume push back above average Thursday as BAX heads for the breakout from its 11 week base, looking for a 4.5 year high. Sweet little pattern sporting 3 to 1 accumulation (3 up price weeks on rising volume to 1 down price weeks on rising volume) that is consolidating a nice July breakout and run higher into October. Strong money flow is moving higher ahead of the stock price. Tech and healthcare enjoyed a strong session as money moved in. BAX looks to benefit from that redirecting of money.
Volume: 3.053M Avg Volume: 2.253M
BUY POINT: $47.22 Volume=2.4M Target=$54.45 Stop=$46.04
POSITION: BAX EW - May $47.50c (54 delta) &/or Stock
http://www.investmenthouse.com/cs/bax.html
Play Date: 01/04/2007
BRCM (Broadcom--$32.31; -0.06; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/b/brcm.html
STATUS: Test 200 day SMA. Getting right back after BRCM as it held onto near support and on Thursday jumped off the 200 day SMA (32.59) that it has tangoed with for the past month. Not huge volume but solid trade as it made the move; a good upswing in trade is underway. Plenty of room to bounce and run higher if there is really money moving into the big techs.
Volume: 5.097M Avg Volume: 15.127M
BUY POINT: $33.78 Volume=17M Target=$42.45 Stop=$32.36
POSITION: RCQ EZ - May $32.50c (63 delta) &/or Stock
http://www.investmenthouse.com/cs/brcm.html
Play Date: 01/04/2007
GPN (Global Payments--$49.05; +1.28; optionable): Global payment services
http://biz.yahoo.com/p/g/gpn.html
STATUS: Cup w/handle. Nice winner for us in the second half of 2005 when it announced its split and ran higher right on through the actual split up to March when it peaked out near 55. Big run requires a nice siesta; it slipped into the current 9 month base. Formed a nice quiet handle the past three weeks, holding the 18 day EMA. Volume started popping Wednesday and it started higher. Gapped lower Thursday but zoomed back up on even more volume. Ready to move in as it continues the breakout move.
Volume: 1.284M Avg Volume: 809.083K
BUY POINT: $49.31 Volume=850K Target=$58.95 Stop=$46.74
POSITION: GPN EJ - May $50c (56 delta) &/or Stock
http://www.investmenthouse.com/cs/gpn.html
Leader Play:
Play Date: 01/04/2007
MA (MasterCard--$101.14; +4.73; optionable): Payment services (credit cards, etc.)
http://biz.yahoo.com/p/m/ma.html
STATUS: Cup. MA is another stock that enjoyed a strong late 2005 as it surged over 30 points in November. Again, a move like that requires a rest period (there is no Viagra for stocks). It slipped into the current 6 week shallow cup, holding above the 50 day EMA in mid-December when it tapped down intraday and recovered. Has made a higher low and broke across the 100 level that acted as some resistance in early December. Improving volume on the move. Looking to step in as it continues higher on some decent trade.
Volume: 2.635M Avg Volume: 3.345M
BUY POINT: $101.65 Volume=3.5M Target=$119.75 Stop=$97.35
POSITION: MA DT - Apr. $100c (57 delta)
http://www.investmenthouse.com/cs/ma.html
PRE-ANNOUNCEMENT PLAYS
We consider many stocks for pre-announcement plays every week. We get information regarding upcoming announcements and other data that leads us to conclude a split announcement is coming. Even then, however, we have to be discriminating. We have to see a strong technical pattern as well, and thus we reject many potential candidates based on a weak technical position. Some we consider have announced, but have not fared well given their technical patterns were weak to begin with.
The key today is to find stocks in strong patterns or that are ready to rebound off support. A split announcement will amplify the move higher in these cases as we enjoy moves from strong leaders in position to run higher. We won't chase a stock in a poor technical position even if we know it is going to split; it simply won't do us any good, i.e. it won't make us any money to the upside. We could list all stocks we think are going to split, but again, that won't make us any money unless we are in an office pool as to what stocks will or won't announce a stock split.
Current Pre-Announcement Plays:
This is a list of stocks we are looking to announce splits. We are not in all of the potential splits plays but are letting them set up for the next move. In each report we look at the candidates that are in the best patterns ahead of their potential announcements. This focus on leaders in good patterns allows us to make good money even if companies do not announce the split. The key with splits is the pattern and of course the strong earnings growth that put it in the pattern in the first place.
ATVI: Tentatively set 2-5-07.
BCR: Forecast mid-January
BDX: Forecast 1-25-07
BEC: Tentatively forecast first week of January. Big gap higher Wednesday but could not hold the move. No announcement yet, but a solid pattern ready to make the break.
BPO: Forecast early February
CLE: Looking in early January but pinpointing a date. Flat same store sales but recovered from Wednesday selling to retake the 18 day EMA.
CRDN: Tentatively forecast early February
CTSH: 2-9-07. Trying hard to take back the 50 day EMA, but it sure is a struggle.
DRI: Researching the date
GILD: Tentatively forecast 1-31-07. Slumped down to the 200 day SMA where it has held for now.
GPRO: Researching the date.
JCI: Forecast 1-25-07
JCP: Forecast 1-25-07
RNT: Tentatively forecast third week of January
TRMB: Forecast 1-25-07
UNP: Tentatively set for 1-25-07
WCN: Forecast third week of January
WWW: Forecast 1-3-07. Nothing thus far.
XTO: Forecast with board meeting on 1-26-07. Will have to do better than this.
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 01/04/2007
FFIV (F5 Networks--$76.36; +2.64; optionable): Networking solutions to manage application traffic on networks
BACKGROUND: No splits in FFIV's history.
http://biz.yahoo.com/p/f/ffiv.html
STATUS: Flying plateau. FFIV is back in NASDAQ compliance with NASDAQ listing requirements, and that likely removes the last barrier before the next breakout. It made us some strong coin in the run from the August low, making a strong breakout from a 7 month cup with handle base in October and rallying on up to December. It then took a breather as the market turned choppy, working laterally along the 18 day EMA (74.42). Shakeout on Thursday and an intraday recovery. Then a good bounce higher Thursday on rising, average trade. Nice action showing renewed buying. Looking to move in on some more solid upside with good trade as FFIV heads for a new all-time high.
Volume: 1.003M Avg Volume: 947.098K
BUY POINT: $76.87 Volume=1.1M Target=$91.95 Stop=$73.35
POSITION: FLK DO - Apr. $75c (60 delta) or FLK DP - Apr. $80c (51 delta) &/or Stock
http://www.investmenthouse.com/cs/ffiv.html
Play Date: 01/04/2007
TRMB (Trimble Navigation--$51.62; +1.46; optionable): Advanced positioning products for commercial and government users
BACKGROUND: TRMB announced its only split, 3:2, on 2-3-04 at $38.20.
http://biz.yahoo.com/p/t/trmb.html
STATUS: Test breakout. TRMB broke higher in mid-December from a 16 week reverse head and shoulders pattern, heading for a new all-time high. It faltered and came back last week, and was heading even lower Wednesday. It held at support at 50 and rebounded that session on rising, above average volume. Thursday it was up again on even stronger trade, moving to a new all-time high. Strong 6 to 3 accumulation in the pattern (6 up price weeks on rising volume to 3 down price weeks on rising volume) shows plenty of buying, setting up the breakout and run to that new high. Strong money flow is a good complement, leading higher. Ready to move in as it continues higher.
Volume: 733.4K Avg Volume: 445K
BUY POINT: $53.24 Volume=455K Target=$60.95 Stop=$50.95
POSITION: TUH EJ - May $50c (70 delta) or TUH EK - May $55c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/trmb.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 12/21/2006
WCN (Waste Connections--$41.91; +0.01; optionable): Waste management
BACKGROUND: Last announced a 3:2 split on 5-26-04 at $41.80
http://biz.yahoo.com/p/w/wcn.html
STATUS: Double bottom w/handle. Trying to break higher on rising volume, but not quite making the move, bumping at the breakout and showing a big doji. Nice little 10 week pattern over the 50 day EMA that is consolidating the October breakout from a larger 6 month double bottom. Just waiting for the break higher.
Volume: 304.3K Avg Volume: 222.644K
BUY POINT: $41.75 Volume=344K Target=$48.00 Stop=$40.57
POSITION: WCN DH - Apr. $40c (67 delta) &/or Stock
http://www.investmenthouse.com/cs/wcn.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 01/03/2007
ACH (Aluminum Corp of China--$24.61; -0.42; no options): Chinese aluminum
http://biz.yahoo.com/p/a/ach.html
STATUS: Cup w/handle. A bit of a give back Thursday after that strong volume gap higher to start the year. Came back well off the intraday lows, recouping half its losses. May come back to tap 24 before it rebounds, but a sweet pattern and good break higher. To recap: Strong volume Wednesday as ACH broke out from an 8 month base that has set up ACH for a run at a new all-time high. Nicely formed pattern with strong volume in December as it rallied to finish the cup, and then a fade in trade last week as it eased back to the 10 day EMA (23.35) last week to form the handle, the point where the last sellers are shaken out. Nice gap higher Wednesday on strong trade, and looking to pick up some positions as it continues higher and again on the first test of this breakout move.
Volume: 893.9K Avg Volume: 519.179K
BUY POINT: $25.22 Volume=525K Target=$29.95 Stop=$23.92
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/ach.html
Play Date: 12/28/2006
CBG (CB Richard Ellis--$33.34; -0.31; optionable): Property management
http://biz.yahoo.com/p/c/cbg.html
STATUS: Flying plateau. Stronger volume Wednesday as CBG crouched for the breakout, but Thursday it could not make the move with the market as volume faded back and it did to, down to the 10 day EMA. Still in excellent shape to make a higher low and the breakout. Just have to see it. Very solid.
Volume: 1.32M Avg Volume: 2.635M
BUY POINT: $34.11 Volume=3.9M Target=$40.95 Stop=$32.72
POSITION: CBG FF - June $30c (75 delta) &/or Stock
http://www.investmenthouse.com/cs/cbg.html
Play Date: 01/03/2007
DBRN (Dress Barn--$23.99; +0.12; optionable): Apparel stores
http://biz.yahoo.com/p/d/dbrn.html
STATUS: Reverse head and shoulders. Sales were up and DBRN tried to rally, making it to 24.65 on the high before fading back for a modest gain. Stronger above average volume, but not enough to make the move stick. Still well positioned to make the break higher, but has yet to close the deal. To recap: Wednesday DBRN rallied to 24.61 on the high, and though it gave much of the move back it held a gain on strong, above average volume. We still want to see a strong move from it, but a good start for the year as it looks to make the break from its 8 month base.
Volume: 1.743M Avg Volume: 890.489K
BUY POINT: $24.32 Volume=925K Target=$28.95 Stop=$22.88
POSITION: DTQ FE - June $25c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/dbrn.html
CONTINUING LEADER PLAYS:
Play Date: 01/03/2007
AKAM (Akami Technologies--$53.12; -0.47; optionable): Internet services for delivery of content and business processes.
http://biz.yahoo.com/p/a/akam.html
STATUS: 50 day EMA test. Bounced higher after the Wednesday intraday test of the 50 day MA, but it stalled out the move just below the 10 day EMA (53.48). As volume was lower we decided to wait and see if it can clear the 10 day on some strong trade. If it can we are all over it. To recap: We exited AKAM last week as it weakened at the end of the year after leading tech stocks in 2006. We expected it to come back and test the 50 day EMA (51.07) and it did that Wednesday, tapping at the 50 day on the low and rebounding. It may still come back to snug up to the 50 day EMA before advancing, but if it rebounds sharply here over the 10 day EMA we will look at new positions as this leader reloads after a test of a key support level.
Volume: 2.288M Avg Volume: 5.088M
BUY POINT: Over 10 day EMA: 53.65. Volume=7.6M Target=$60.75 Stop=$50.42
POSITION: UMU EJ - May $50c (64 delta) &/or Stock
http://www.investmenthouse.com/cs/akam.html
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.
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