trade stock, stock recommendation

Begin part 3 of 3

NOTE: Part 2 will follow part 3 this evening.

THE PLAYS

New Plays:

Play Date: 05/15/2007
SKS (Saks Holdings--$22.31; +0.05; optionable): High end (some say luxury) department stores
http://biz.yahoo.com/p/s/sks.html
EARNINGS: 5-21-07
STATUS: Test breakout. SKS broke higher from a 6 month ascending triangle in early May, running to 23 on the breakout move. It has come back to test the 10 day EMA (21.98) this week, not willing to give up much of its move and holding well above the breakout point at 21. This was one we saw the pattern set up and then watched it breakout. Cannot make a lot of money doing that, but the beauty of a strong stock is that it comes back to test, and that initial test is a great place to move in and pick up the positions. Looking for SKS to hold in this range and then break higher on good volume to give us the buy. The earnings are next Monday, but we still like what we see in this pattern.
Volume: 2.588M Avg Volume: 2.366M
BUY POINT: $22.72 Volume=3.5M Target=$27.32 Stop=$21.72
POSITION: SKS HX - Aug. $22.50c (54 delta) &/or Stock
http://www.investmenthouse.com/cd/sks.html

Play Date: 05/15/2007
TIE (Titanium Metals--$38.11; -0.57; optionable): Industrial metals
http://biz.yahoo.com/p/t/tie.html
EARNINGS: 5-7-07
STATUS: Double bottom. TIE is showing some good upside volume the past week as it broke higher from a 12 week double bottom that looks to be the tail end of a larger 13 month cup base. Some explosive moves as it cleared the 'hump' at 37.65; nice price and nice volume moves. It spent Monday and Tuesday testing back and on lower volume. May have some more to come back (a hump test?) before it is ready to continue, forming something of a handle to the double bottom, but the moves upside were explosive so we want to be ready to get into some titanium.
Volume: 2.537M Avg Volume: 2.453M
BUY POINT: $38.55 Volume=3.2M Target=$46.38 Stop=$36.11
POSITION: TIE IG - Sept. $35c (68 delta) &/or Stock
http://www.investmenthouse.com/cd/tie.html

Play Date: 05/15/2007
UTX (United Technologies--$68.50; +0.25; optionable): Elevators, engines, everything
http://biz.yahoo.com/p/u/utx.html
EARNINGS: Announced 4-18-07
STATUS: Double bottom w/handle. UTX has quietly formed a very nice, well-defined double bottom the past 12 weeks. It broke higher to start May, but volume was a bit squeamish. It slid laterally a bit more, using the 10 day EMA (68.23) as it set up again on some low volume. That low volume shows no one was selling, just picking up some shares on the down low. Tuesday the volume came back with the first above average session in four weeks. UTX made the break over the handle high (69.08), but as with most stocks the strong upside was vaporous and most of it was gone by the close. Nonetheless UTX is set up very nicely to give us the breakout, and that quiet accumulation is trying to turn a bit more raucous. That is what we like to see on a breakout: raucousness.
Volume: 5.642M Avg Volume: 4.477M
BUY POINT: $69.21 Volume=6.5M Target=$77.95 Stop=$67.86
POSITION: TUX HM - Aug. $65c (71 delta) &/or Stock
http://www.investmenthouse.com/cd/utx.html

Downside:

Play Date: 05/15/2007
TLB (Talbots--$19.58; -0.25; optionable): Apparel stores
http://biz.yahoo.com/p/t/tlb.html
EARNINGS: 5-23-07
STATUS: Put. Earnings are out next week, but TLB does not look to be in the mood to move higher into them. It collapsed from a 2 month lateral move to start the month, then tried to consolidate the past week, but simply had no strength following the same store sales numbers. Monday TLB made a weak attempt at the 10 day EMA (20.73) but was quickly undermined. Tuesday it was heading back down on rising, above average volume. Looking to move in as it continues its massive weakness. A move to the target lands a 50%ish gain.
Volume: 1.008M Avg Volume: 756.136K
BUY POINT: $19.47 Volume=950K Target=$18.00 Stop=$20.04
POSITION: TLB RD - June $20p (-50 delta)
http://www.investmenthouse.com/cd/tlb.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, PCLN, NVDA, NYX

AAPL: Gee, a downside session. First one in 8. Volume was above average, rising as the selling started. APPL is due a pullback after that move. The 10 day EMA is just over 105 and that is the first test point.

AKAM: As expected, AKAM did not hold the rebound and was slaughtered on Tuesday with rising trade and a new low on the move.

GME: Strong volume as GME never made it even to the 50 day EMA just below 32 before bouncing. This stock has game.

GOOG: Gurgling lower, falling through some potential support at 460 on rising though below average volume. The shareholders were upset at the meeting and the stock is not reacting well to the answers they received from management.

PCLN: Just has not recovered from those earnings, slipping through the 50 day EMA on the close as volume rose. Might be awhile before we contemplate moving back into this one.

NVDA: Still testing after the nice earnings report and gap higher. One of the few that looks good and the only one really in a position to buy once it turns up from this test.

NYX: Like something too old to identify in the back of the refrigerator, NYX stinks. Higher, above average volume as it breaks through the March low. We will say so long to it for now.

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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