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us stock market, trade stock
Begin part 3 of 3
THE PLAYS
New Plays:
Upside: Looking at some more solid upside plays that held up nicely during the selling and are ready to move higher in an overall market relief rally.
Play Date: 03/03/2007
CVNS (Covansys--$24.08; -0.59; optionable): IT services
http://biz.yahoo.com/p/c/cvns.html
EARNINGS: Announced 1-17-07
STATUS: Breakout test. CVNS broke to a new 6 year high in mid-February on the breakout run from its 14 week trading range. Strong volume and price surge on that move. It spent the past two weeks testing the move, holding the 50 day EMA (23.93) during last week's pullback. Strong volume Thursday as CVNS tested the 50 day and posted a gain. That shows buyers are still there, buying positions on the pullback. Looking for more of that strong volume as it bounces up off this support in an overall market relief rally.
Volume: 258.233K Avg Volume: 173.098K
BUY POINT: $25.41 Volume=300K Target=$30.45 Stop=$23.89
POSITION: CUC GE - July $25c (57 delta, low OI) &/or Stock
http://www.investmenthouse.com/cd/cvns.html
Play Date: 03/03/2007
UCTT (Ultra Clean Holdings--$15.58; -0.63; no options): Gas & liquid delivery systems for semiconductor chip makers
http://biz.yahoo.com/p/u/uctt.html
EARNINGS: Announced 2-12-07
STATUS: Double bottom w/handle. Earnings did not help UCTT out a lot, but the key was it kept working on its base, forming the second leg of a short but sweet 8 week base. Used the 50 day EMA (14.30) as support, a very good indication the buyers have stayed with it. Strong money flow to match a strong technical pattern that is ready to send UCTT off on another all-time high. Excellent action in a tough week for the market, and the test sets up the next run.
Volume: 515.477K Avg Volume: 517.64K
BUY POINT: $16.41 Volume=725K Target=$19.45 Stop=$15.26
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cd/uctt.html
Play Date: 03/03/2007
VCLK (Valueclick--$25.48; -0.87; optionable): Internet advertising services
http://biz.yahoo.com/p/v/vclk.html
EARNINGS: Announced 2-21-07
STATUS: Test 50 day EMA. VCLK made us some great money on its last run. After gapping higher on earnings it faded the past week in the market selling, but it held support at the 50 day EMA (25.43), a key support level where the big money buys more or decides to pass. VCLK has some top fundamental growth rates, and looking for the big money to move in as the market starts a relief rally. Excellent money flow is surging higher ahead of price even with this price pullback.
Volume: 1.887M Avg Volume: 1.928M
BUY POINT: $26.87 Volume=2.9M Target=$31.95 Stop=$25.32
POSITION: QCS FE - June $25c (60 delta) &/or Stock
http://www.investmenthouse.com/cd/vclk.html
Downside:
Play Date: 03/03/2007
AEOS (American Eagle Outfitters--$29.80; -1.02; optionable): Teen apparel stores
http://biz.yahoo.com/p/a/aeos.html
EARNINGS: 3-7-07
STATUS: Head and shoulders. AEOS has formed a big 5 month rounded top, the last part a head and shoulders peak. It broke lower Tuesday in the general market selling, tried to hold the line, but then cracked Friday below some support at 30. It looks ready to fall into earnings, and earnings may give it even more downside impetus. Looking to move in as it continues lower. A move to the target lands a 44% gain. If it breaks the 200 day SMA (27.76) we will let it roll on down.
Volume: 4.691M Avg Volume: 4.06M
BUY POINT: $29.68 Volume=4M Target=$28.05 Stop=$30.48
POSITION: AQU PF - Apr. $30p (-44 delta)
http://www.investmenthouse.com/cd/aeos.html
Play Date: 03/03/2007
PHRM (Pharmion--$25.31; -0.69; optionable): Drug manufacturers
http://biz.yahoo.com/p/p/phrm.html
EARNINGS: 2-21-07
STATUS: Head and shoulders. Ugly break lower Tuesday as PHRM fell below the 90 day MA (26.87) after its 7 week topping pattern. It tried to hold the line at 26ish Wednesday and Thursday but was heading lower Friday. Looking for a test down toward the 200 day SMA (22.27). Our initial target is higher; don't want to try and stretch it too far. If it is selling hard, however, we will let it run toward the 200 day. A move to the initial target lands a 42%ish gain.
Volume: 731.058K Avg Volume: 409.463K
BUY POINT: $25.18 Volume=600K Target=$23.65 Stop=$26.32
POSITION: JUF PE - Apr. $25p (-42 delta)
http://www.investmenthouse.com/cd/phrm.html
Continuing plays that look solid to move:
Play Date: 03/01/2007
BRCD (Brocade Communications--$9.08; +0.07; optionable): Data storage networking and solutions
http://biz.yahoo.com/p/b/brcd.html
STATUS: Cup w/handle. Nice hold Friday, rising modestly on some strong volume. Held up exceedingly well last week and set to lead in a market relief rally. To recap: With the late 2006 run BRCD cleared a series of peaks that held it in check since 2003. After that run it needed a rest and it formed the current 13 week base over the prior peaks, using the 50 day EMA as support. It broke higher Tuesday on very strong earnings, testing back the past two sessions, holding the 10 day EMA on the Thursday low. It rebounded from that test, doing so on lower volume. Looks ready to continue the move but want to see strong volume as it jumps back up.
Volume: 19.348M Avg Volume: 10.196M
BUY POINT: $9.45 Volume=15M Target=$11.68 Stop=$8.79
POSITION: BQB GL - July $9c (63 delta) &/or Stock
http://www.investmenthouse.com/cd/brcd.html
Play Date: 03/01/2007
TRW (TRW, Inc.--$30.02; 0.00; optionable): Automotive systems, modules, etc. for OEM and after-market uses
http://biz.yahoo.com/p/t/trw.html
STATUS: Breakout test. Nice hold at the 18 day EMA (29.51) Friday as TRW continues its test and set up for the next break higher. Just add volume. To recap: TRW surged out of a 9 month cup with handle base in early February, running near 30 on the high in that breakout run. It has come back this week to test that move, holding the 18 day EMA on the low and rebounding intraday on very strong volume Thursday. Very strong breakout move and a nice, easy test during all of the market selling. Looking for a rebound on continued solid trade to start taking some positions.
Volume: 344.8K Avg Volume: 365.467K
BUY POINT: $30.55 Volume=530K Target=$35.95 Stop=$29.28
POSITION: TRW GF - July $30c (62 delta, low OI) &/or Stock
http://www.investmenthouse.com/cd/trw.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
AKAM: Diving lower. The leader of 2006 has finally broken and needs a base.
CELG: Continuing the breakdown as it was unable to hold the attempted double bottom.
DRIV: Ready to head lower to test that early February low and attempt a double bottom.
GOOG: Heading to the 200 day SMA (432).
ISE: Trying to make a higher low at the 200 day SMA. If it does that will be worth looking into as it continues to recover.
WEBX: Giving the full monty down to the 50 day EMA.
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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