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us stock market, trade stock
Begin part 3 of 3
THE PLAYS:
New Plays:
Upside:
New Post-Split Play:
Play Date: 03/06/2007
RIO (Companhia Vale Do Rio Doce--$34.13; +2.28; optionable): Steel & iron
http://biz.yahoo.com/p/r/rio.html
STATUS: Test 50 day EMA. Great breakout in December, then after a quick test of the 50 day EMA (32.51) RIO rallied up the 18 day EMA from January to February. It is making another test of the 50 day EMA. Monday it gapped below that level, but Tuesday it was right back up, gapping higher on even stronger trade as buyers swooped in and scooped it up. Want to pick it up and ride the move back up to the prior highs at 38, but it can really move so our initial target is just beyond that level.
Volume: 13.671M Avg Volume: 8.509M
BUY POINT: $34.75 Volume=10M Target=$39.95 Stop=$32.55
POSITION: RIO FZ - June $32.50c (64 delta) &/or Stock
http://www.investmenthouse.com/cs/rio.html
Play Date: 03/06/2007
RS (Reliance Steel--$43.60; +1.31; optionable): Metal fabrication
http://biz.yahoo.com/p/r/rs.html
STATUS: Test 50 day EMA. Nice breakout in mid-February from a 9.5 month cup with handle base. Big volume on that break higher, and it was on a good run when last week's selling hit. It gapped lower Tuesday and then slipped back to the 50 day EMA (42), but volume never got out of hand. Bounced Tuesday off the 50 day but volume did not follow on the session. Looking for RS to clear near resistance and do so on some better trade to move into a position. Lots of of big money backing for this stock.
Volume: 799.4K Avg Volume: 1.003M
BUY POINT: $44.32 Volume=1M Target=$50.95 Stop=$41.97
POSITION: RS FI - June $45c (56 delta) &/or Stock
http://www.investmenthouse.com/cs/rs.html
Leader:
Play Date: 03/06/2007
HMSY (HMS Holdings--$19.21; -0.06; no options): Cost containment and payment accuracy for government healthcare programs
http://biz.yahoo.com/p/h/hmsy.html
EARNINGS: Reported 2-28-07
STATUS: Test 50 day EMA. Made us some nice money on its last run and set up well to do it again. HMSY broke out in early January and posted an excellent run up the 10 day EMA (now at 20). It needed a test to set up the next run, and the market selling has provided that. It was selling a bit ahead of that as earnings were already built into the run prior to the release. Nice fade to this support where it is showing a doji, the past two sessions on rising volume. Strong stocks run up the short term moving averages after a breakout, test the 50 day EMA, and then resume the move. Looking for continued strong volume as it makes the next break higher.
Volume: 441.898K Avg Volume: 269.14K
BUY POINT: $19.68 Volume=450K Target=$22.95 Stop=$18.75
POSITION: - Stock (no option chain)
http://www.investmenthouse.com/cs/hmsy.html
Play Date: 03/06/2007
WFR (Memc Electronic--$53.49; +3.72; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/w/wfr.html
STATUS: Test 50 day EMA. WFR is coming off the 50 day EMA (49.17) on some solid trade after showing a doji at that level Monday. It broke higher from a 9 month cup with handle base in late February and was moving nicely up the 10 day EMA before gapping lower on Tuesday. It held this key support, however, and is rebounding. Ready to take some positions as it continues higher.
Volume: 4.979M Avg Volume: 4.67M
BUY POINT: $54.12 Volume=5.4M Target=$61.95 Stop=$50.65
POSITION: WFR GK - July $55c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/wfr.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.
BA: Researching the date
BNI: Has to set back up
CAH: Tentatively forecast for 4-26-07. Held the 50 day EMA and bouncing back up on stronger, above average volume.
CEC: Forecast 3-6-07. Higher earnings after hours. Still no word on a split yet.
CLE: Tentatively forecast 3-15-07. Struggling to hang on below the 90 day MA.
DLTR: Announced earnings 2-28-07. Researching the date.
EXC: Researching date. Has made the test and trying to hold over the February peaks
FDX: Forecast 3-21-07
JCI: Researching the date
POT: Tentatively set for third week in April. Trying to hold the 50 day MA.
RL: Researching date. Good action at the 50 day EMA
RIMM: Tentatively set first week of April
YUM: Forecast 5-1-07. Needs a lot of work to set back up, but did bounce up off the 200 day SMA on rising, above average volume.
NEW PRE-ANNOUNCEMENT PLAYS:
Play Date: 03/06/2007
NOV (National Oilwell--$70.50; +2.78; optionable): Oil and gas service company
http://biz.yahoo.com/p/n/nov.html
STATUS: NOV is massing at 70 as it prepares for the breakout from its 13 month base. Strong rally off the lows in January and February and then a lateral move the past three weeks as it holds the 10 day EMA (68.89). No damage done during the recent market selling and actually showing some strong accumulation after the Tuesday selling, rebounding on strong volume. Stronger, above average volume Tuesday as NOV bumps against the breakout point. Looks ready to make the break regardless of what the market does.
Volume: 3.379M Avg Volume: 2.875M
BUY POINT: $71.48 Volume=4.3M Target=$79.95 Stop=$67.57
POSITION: NOV EN - May $70c (50 delta) &/or stock
http://www.investmenthouse.com/cs/nov.html
CONTINUING PRE-ANNOUNCEMENT PLAYS:
Play Date: 03/03/2007
VSEA (Varian Semiconductor--$47.70; +1.50; optionable): Chip equipment
http://biz.yahoo.com/p/v/vsea.html
STATUS: Breakout test. Nice move off the 50 day EMA (44.66) is pushing VSEA toward the breakout. It needs to jump through 48 on some strong trade, something it didn't have Tuesday. Looks good; needs to show the strength. To recap: VSEA has established itself as the leader in its sector. Strong move higher in mid-February on some solid earnings news broke VSEA out from a short 7 week base. Nice rally to 50, and you would expect it to get roughed up in the selling. It was lower but showed excellent relative strength, closing near the 18 day EMA on Friday and just above some support at 46. Looking for this to hold and for VSEA to bounce from here as the overall market posts a relief rally.
Volume: 1.417M Avg Volume: 1.484M
BUY POINT: $48.05 Volume=2M Target=$54.95 Stop=$45.31
POSITION: UES EI - May $45c (61 delta, low OI) or UES HJ - Aug. $50c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/vsea.html
CONTINUING PRE-SPLIT PLAYS:
Play Date: 03/03/2007
GES (Guess? Inc.--$80.71; +2.99; optionable): Apparel stores. Splits 2:1 on 3-13-07
http://biz.yahoo.com/p/g/ges.html
EARNINGS: Announced 2-14-07
STATUS: Test 18 day EMA. Turned right back from the Monday selling and recovered the 18 day EMA. Nice higher low and set to move on into the split. Retail sales out Thursday but GES has filled the gap and is the strongest in the sector. To recap: Gapped higher on the earnings and the split in mid-February. It was testing back to start last week and then gapped sharply lower Tuesday as the retailers were thrown out en masse on fears the consumer would fold. It is not going to because jobs are solid and thus confidence is high. In any event, GES filled the gap on Tuesday and then rebounded the same session. It worked laterally to end the week, pretty much immune to the other issues. Looking for a hold here and then a bounce as the market starts its relief rally. GES is well-positioned to give us plenty of upside in that market move.
Volume: 576K Avg Volume: 783.983K
BUY POINT: $81.88 Volume=845K Target=$91.45 Stop=$79.45
POSITION: GES FP - June $80c (59 delta) &/or Stock
http://www.investmenthouse.com/cs/ges.html
Play Date: 03/01/2007
NKE (Nike--$105.10; +2.64; optionable): Sportswear, sporting goods. Splits 2:1 on 4-3-07
http://biz.yahoo.com/p/n/nke.html
STATUS: Test 50 day EMA. After weakening Monday, NKE turned around and rallied on stronger though still below average volume. Trying a higher low above the 50 day EMA (101.58) and showing great action. To recap: NKE blasted higher to start February with a solid run off 100. It has come back to test, dumping hard last Tuesday but holding near the 18 day EMA with a couple of dips that waved at the 50 day EMA. Money flow has already jumped back up ahead of price. Looking to pick it up as it continues the rebound off the 50 day EMA test.
Volume: 1.608M Avg Volume: 1.729M
BUY POINT: $105.67 Volume=2M Target=$115.00 Stop=$102.95
POSITION: NKE GA - July $105c (52 delta)
http://www.investmenthouse.com/cs/nke.html
CONTINUING POST-SPLIT PLAYS:
Play Date: 03/05/2007
FLIR (Flir Systems--$33.95; +0.79; optionable): Thermal imaging systems and infrared camera systems
http://biz.yahoo.com/p/f/flir.html
STATUS: Test 50 day EMA. Volume jumped above average Tuesday as FLIR jumped off the 50 day EMA test (33.14). Like the stronger volume but want to see it move through the 10 day EMA (34.35) that stopped it Tuesday. Solid position to rally. To recap: FLIR weathered the news it would restate results following an option review. It is testing the early February breakout from a 12 week base, making a higher low at the 50 day EMA, showing a doji at that level Monday. It was holding up the breakout well until last week's selling. Volume was overall low on the selling. That shows not a lot of sellers, and that leaves FLIR in good position to rebound from this pullback to test its breakout. Just needs the market selling pressure to let up a bit.
Volume: 717.34K Avg Volume: 533.532K
BUY POINT: $34.55 Volume=750K Target=$39.35 Stop=$32.65
POSITION: FFQ GG - July $35c (50 delta) &/or Stock
http://www.investmenthouse.com/cs/flir.html
CONTINUING LEADER PLAYS:
Play Date: 03/03/2007
BWLD (Buffalo Wild Wings--$55.12; +1.58; optionable): Restaurants selling very domestic food, beer
http://biz.yahoo.com/p/b/bwld.html
EARNINGS: Announced 2-15-07
STATUS: Double bottom w/handle. Volume was up to average Tuesday as BWLD held the confluence of the 18, 50 and 90 day MA as it tests back in the handle and starts higher. Looking very good for the breakout. Very good. To recap: BWLD gapped out from a 6 month base in late October 2006 and surged higher. It needed to rest, and it has put in a volatile 14 week lateral move, the last 6 weeks a double bottom with handle, coming back last week to test and hold the convergence of the 18, 50, and 90 day MA from 53 to 54. Solid volume Thursday as BWLD attempted a move off this level. It could not hold the move Friday, but volume was much lower as it tested. Set up well to hold and lead in a market relief rally that is setting up.
Volume: 343.479K Avg Volume: 320.673K
BUY POINT: $56.25 Volume=450K Target=$63.85 Stop=$54.78
POSITION: BQU FK - June $55c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/bwld.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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