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Begin part 3 of 3
THE PLAYS
Good movers: DXPE; ESV; IOC; NVEC; OMCL; RIG; AEO; AKAM; CTSH
New Plays:
Upside:
Play Date: 05/23/2007
FCX (Freeport McMoran--$73.75; +2.40; optionable): Copper
http://biz.yahoo.com/p/f/fcx.html
EARNINGS: Announced 4-25-07
STATUS: Ascending base. FCX broke out from an 11 month base in late March and rallied on up to 72. Nice 12 stick run. It made it to the April and May 2006 highs and stalled. That slipped it into the current 6 week base as FCX makes some higher lows along the 18 day EMA (71.25). Looks as if it made its last one last Thursday, reversing off some selling on rising volume. Wednesday it was bouncing to a new closing high on this move on even better, much better, trade. Money flow is running higher ahead of price. Looking quite good here.
Volume: 17.435M Avg Volume: 11.763M
BUY POINT: $74.05 Volume=12M Target=$85.00 Stop=$71.11
POSITION: FCX HN - Aug. $70c (67 delta) or FCX KO - Nov. $75c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/fcx.html
Play Date: 05/23/2007
OMNI (Omni Energy Svc.--$11.48; +0.52; optionable): Oil and gas services in Gulf of Mexico (seismic, environmental services, etc.)
http://biz.yahoo.com/p/o/omni.html
STATUS: Ascending triangle. OMNI is in a big 11 month triangle. It shot higher on 5-17 when it raised its guidance. That took it to the December high at 11.75ish, roughly the top of the pattern. Strong volume on that move and then a low volume side-step Monday and Tuesday. Wednesday OMNI was moving back up with a sharp gain on a jump in volume back above average. Money flow is surging higher ahead of price, and OMNI is ready to make the break from this nice accumulation pattern.
Volume: 694.616K Avg Volume: 498.29K
BUY POINT: $11.69 Volume=750K Target=$14.00 Stop=$10.98
POSITION: QOC HB - Aug. $10c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/omni.html
Play Date: 05/23/2007
PEP (Pepsico--$68.69; +0.02; optionable): Snack and beverages (sugar water)
http://biz.yahoo.com/p/p/pep.html
EARNINGS: 7-24-06
STATUS: Breakout test. PEP broke higher from a 7.5 month base in mid-April and is making its second test of that breakout, coming back to the 10 day EMA (68.26) this week after a strong rally to a new high. Nice lower volume test, showing a couple of dojis above that level the past two sessions. Looking for PEP to rebound from here and make the next run in the breakout move. Looking to play that run with some options. A move to the target lands a 52%ish gain.
Volume: 4.412M Avg Volume: 5.746M
BUY POINT: $69.05 Volume=6.2M Target=$72.25 Stop=$68.08
POSITION: PEP JU - Oct. $67.50c (65 delta)
http://www.investmenthouse.com/ct/pep.html
Play Date: 05/23/2007
TIE (Titanium Metals--$36.21; -0.17; optionable): Industrial metals
http://biz.yahoo.com/p/t/tie.html
EARNINGS: Announced 5-7-07
STATUS: Double bottom w/handle. Back on the report already after testing and holding the 50 day EMA (35.79) the past two sessions. Volume jumped Wednesday as TIE tried to make the break higher but fell back in the afternoon market selling. Despite that fade we still really like the pattern, a nice 14 week base that used the 90 day MA on the lows of the two legs as support; that shows the big money stepping in. Now that it has made the test we are looking for it to make the break higher and finally show us the breakout move.
Volume: 3.62M Avg Volume: 2.366M
BUY POINT: $38.11 Volume=3.2M Target=$46.00 Stop=$35.68
POSITION: TIE IG - Sept. $35c (68 delta) &/or Stock
http://www.investmenthouse.com/ct/tie.html
Downside:
Play Date: 05/23/2007
SBUX (Starbucks--$28.89; -0.12; optionable): Coffee, pastries, music, coffee makers. Next week maybe it will offer counseling (addiction counseling)
http://biz.yahoo.com/p/s/sbux.html
EARNINGS: 8-1-07
STATUS: Put. Going to the well again with Starbucks. It has made us a lot of money on the downtrend since its sales started to decline. Good things were expected of it last earnings in early May, and it was up shortly after the announcement and then rolled over for another run downside. It bottomed on that move last week and rebounded. It tapped at the 18 day EMA (29.57) on the Monday and Tuesday highs but then faded back down. Key because it was unable to break back above lows from August 2006 and March 2007 that marked significant bounces. That means it is likely heading lower from here. Looking for a continued move lower from this last test to give us the buy point. A move to the initial target lands a 50%ish gain.
Volume: 9.544M Avg Volume: 12.807M
BUY POINT: $28.75 Volume=13M Target=$27.25 Stop=$29.32
POSITION: SQX SF - July $30p (-59 delta)
http://www.investmenthouse.com/ct/sbux.html
Play Date: 05/23/2007
TTEC (Teletech Holdings--$33.90; -0.50; optionable): Front to back office outsourced solutions
http://biz.yahoo.com/p/t/ttec.html
EARNINGS: Announced 5-9-07
STATUS: Put. Big rounded top the past 12 weeks looks to be the top of this strong run from July 2006. This last part of the move gapped higher in early February (earnings) but could not get a lot of volume as it continued higher. Peaked in early April, and then this month the earnings could not deliver any upside. The stock plunked down to the 90 day MA (34.28) on that news. It has tried to skate laterally the past week and hold this support, the last line of defense from filling that February gap, but it is slipping. Wednesday it fell back below the 90 day on rising though still below average volume. Looks as if TTEC is going to fill the gap from 27.50. Our initial target is not that ambitious. A move to that level lands a 50%ish gain.
Volume: 750.857K Avg Volume: 1.005M
BUY POINT: $33.75 Volume=1M Target=$31.25 Stop=$34.35
POSITION: QTC SG - July $35p (-54 delta)
http://www.investmenthouse.com/ct/ttec.html
CURRENT PLAYS:
Upside:
Play Date: 05/21/2007
ALJ (Alon USA Energy--$38.88; -0.30; optionable): Oil and gas refining
http://biz.yahoo.com/p/a/alj.html
EARNINGS: 5-10-07
STATUS: Double bottom w/handle. Testing back the past two sessions after that strong Monday break higher on very strong trade. It is holding over the 10 day EMA (38.43) on this test, and we are looking for it to continue holding this near support and then deliver the break higher. To recap: Nice rangy 10 month base, the largest of its relatively short life (went public in summer 2005. A nice handle formed the past 7 weeks where it tested down to the 50 day EMA (36.03) and then recovered. Earnings took it lower but it held key support. Heck of a shakeout. It bounced off that level on strong volume, showing there were buyers. It then surged Monday on very strong trade, the best in two months. It cleared the prior highs in the handle and we are looking to move in as it continues this breakout move.
Volume: 657.5K Avg Volume: 477.311K
BUY POINT: $40.15 Volume=500K Target=$48.31 Stop=$37.66
POSITION: ALJ IH - Sept. $40c (53 delta) &/or Stock
http://www.investmenthouse.com/ct/alj.html
Play Date: 05/22/2007
ATHR (Atheros Communications--$29.15; -0.19; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/a/athr.html
EARNINGS: Announced 4-30-07
STATUS: Test breakout. Faded slightly Wednesday and on lower, below average volume as ATHR pulled back from the brink of its very solid Tuesday test of the breakout point. Still in position, just waiting for it to show us the move. To recap: ATHR broke out from a short 5 week double bottom base in April, a base that was part of a larger 13 month cup with handle. It rallied to 30 and tested back last week to the 50 day EMA (27.04), finding support at that key level. Volume jumped back above average the past three sessions as it found support and started higher. It cleared the prior rally closing high Monday, and we are looking to move in as it continues the run.
Volume: 1.109M Avg Volume: 1.561M
BUY POINT: $29.58 Volume=2.2M Target=$35.50 Stop=$28.05
POSITION: QRA IE - Sept. $25c (81 delta) &/or Stock
http://www.investmenthouse.com/ct/athr.html
Play Date: 05/22/2007
CMI (Cummins--$87.49; -0.07; optionable): Diesel engines, etc.
http://biz.yahoo.com/p/c/cmi.html
EARNINGS: Announced late April
STATUS: Test 18 day EMA. Another tight doji on the 18 day EMA (87.60) Wednesday on very low trade as CMI continues its test of the late April break higher. Still looks ready, but again, it has to show us the move on some volume before we commit. To recap: Big run for CMI to end April that ended with a gap higher and run higher before an intraday reversal. After that session and run it needed to test, and the current 4 week pullback to the 18 day EMA is giving it that rest. Low volume shows no dumping, just a quiet, behind the scenes pullback. After that big surge higher on big volume to end the last run we need to see strong volume on the break higher to show the buyers are back in and it was not a blow off top that is leading to a collapse. It is not showing those indications as the pullback is orderly and on light volume, but strong upside trade is the best indication the buyers are ready to move back in and take CMI on a run to 100.
Volume: 1.125M Avg Volume: 2.287M
BUY POINT: $89.15 Volume=2.5M Target=$99.85 Stop=$86.95
POSITION: CDM IY - Sept. $87.50c (57 delta)
http://www.investmenthouse.com/ct/cmi.html
Good Investing!
Jon L. Johnson and your Technical Traders Report Team
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 in 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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