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Begin part 3 of 3

THE PLAYS

Good movers: ANST; ATHR; BEAV; COH; HMSY; INFY; LEH; LVLT; MNST; NITE; SMOD; TWLL; WFR

Wednesday night play results
BEAV: Nice break higher on strong volume.
LTBG: Big run on solid trade but backed off by the close.
MFE: Half-hearted effort at breaking out
BMC: Still working laterally in the test.

New Plays:

Play Date: 01/11/2007
INTC (Intel--$21.92; +0.40; optionable): Semiconductors
http://biz.yahoo.com/p/i/intc.html
STATUS: Cup. A bit of a different technical play here. INTC gapped lower in January 2006 as part of its general malaise that has dogged it for years. That gap led to more selling through the year until INTC reached bottom in June and July and formed a short double bottom. That helped it rally with the rest of the market to the year end. Peaked in November, sold, and then rebounded the past three weeks to form the right side of a short 8 week base. Volume has jumped back into INTC to start the year, with two really good showings Wednesday and Thursday. We think this move is going to send it up to fill the gap and that is what we are looking to capture with this move.
Volume: 99.293M Avg Volume: 59.297M
BUY POINT: $22.15 Volume=60M Target=$25.55 Stop=$20.98
POSITION: NQ DD - Apr. $20c (63 delta) or NQ GX - July $22.50c (50 delta) &/or Stock
http://www.investmenthouse.com/cd/intc.html

Play Date: 01/11/2007
LXK (Lexmark Intl.--$71.06; +0.06; optionable): PC hardware (printers, etc.)
http://biz.yahoo.com/p/l/lxk.html
STATUS: Test 50 day EMA. LXK broke out from a 13 week reverse head and shoulders in September and then ran steadily up the 10 and 18 day EMA (71.83) through December. After that long run it needed a breather to rest and set up the next run. It fell to the 50 day EMA (69.24) this week, tapping at that level on the intraday lows the past three sessions. It doesn't look like it wants to stay here long. A strong stocks will breakout, rally up the short term moving averages, then come back to the 50 day EMA for a deeper test to reset the move. Looking for LXK to rebound on the solid volume we saw Thursday, moving through the 18 day EMA. That is our entry point for the new run.
Volume: 2.716M Avg Volume: 1.866M
BUY POINT: $71.95 Volume=2.8M Target=$82.95 Stop=$69.65
POSITION: LXK GN - July $70c (52 delta) &/or Stock
http://www.investmenthouse.com/cd/lxk.html

Play Date: 01/11/2007
STX (Seagate Tech Holdings--$26.81; 0.00; optionable): PC data storage devices
http://biz.yahoo.com/p/s/stx.html
STATUS: Cup w/handle. Trying to make the break from the handle to its 10 month base, showing some solid above average volume this week as it taps at that level. It formed a reverse head and shoulders at the bottom of the base and that sent it higher up the right side. This handle is setting it up to take on the all-time high near 32. near 32.
Volume: 6.22M Avg Volume: 6.417M
BUY POINT: $27.44 Volume=8M Target=$32.95 Stop=$26.18
POSITION: STX FY - June $27.50c (50 delta) &/or Stock
http://www.investmenthouse.com/cd/stx.html

Continuing play ready to move

Play Date: 01/03/2007
VCLK (Valueclick--$23.18; +0.02; optionable): online advertising services
http://biz.yahoo.com/p/v/vclk.html
STATUS: Test 50 day EMA. Tight doji at the 50 day EMA (22.79) indicates that this pullback may be over. Looking for some strong volume to come in as it makes the break back up through the 18 day EMA (23.66).
Volume: 1.241M Avg Volume: 2.304M
BUY POINT: $24.31 Volume=3.5M Target=$29.32 Stop=$23.15
POSITION: QCS FX - June $22.50c (67 delta) &/or Stock
http://www.investmenthouse.com/cd/vclk.html

SUBSCRIBER PORTFOLIO: These are stocks subscribers suggest by vote that we put in a portfolio to track and move into the stocks if they perform well. If you have any suggestions for additions or deletions, email us. We don't cover them all each report, just when something interesting is developing.

AAPL, AKAM, CELG, DRIV, GME, GOOG, ISE, MA, MRVL, NVDA, WEBX

AAPL: Spat between AAPL and CSCO. Not sure how AAPL will win this one based on the 'facts' out thus far. Apple has a lot of hubris to think it can just take a trademark because it believes most people identify it with anything 'i'. I am thinking of putting out an iToilet (remember those calls on the porcelain phone in college?); wonder if Apple would give me any gas over that?

MA: Doji at the November high. Having a bit of a struggle here but a solid move to this point.

MRVL: Tanking a pause below the 200 day SMA. What we look for here is a strong break on strong volume through that level (21.43).

NVDA: Rebounded to the 50 day EMA but Thursday it stalled, showing a doji. Not dead yet but not in a position of strength.

Good Investing!
Jon L. Johnson and The Daily 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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