us stock market, stock recommendation

Begin part 3 of 3

THE PLAYS

Upside:

Play Date: 08/02/2007
LAVA (Magma Design Automation--$14.96; -0.04; no options): Semiconductor integrated circuits
http://biz.yahoo.com/p/l/lava.html
STATUS: Cup w/handle. A very nice 9 week base has formed atop the 50 day EMA, ready to break LAVA to a new 3 year high. This is part of a larger 3.5 year base, but this little pattern at this stage is ready to make us money as it works on that larger pattern. Strong money flow is surging higher ahead of price, and volume has swelled nicely the past week as LAVA crouches for the move higher. Looks really good for the breakout over the next several sessions.
Volume: 932.7K Avg Volume: 470K
BUY POINT: $15.55 Volume=950K Target=$18.78 Stop=$14.46
POSITION: UPB JC - Oct. $15c (55 delta) &/or Stock
http://www.investmenthouse.com/cd/lava.html

Play Date: 08/02/2007
MR (Mindray Medical Intl.--$31.11; +0.01; optionable): Chinese medical instruments
http://biz.yahoo.com/p/m/mr.html
STATUS: Double bottom w/handle. MR made us some money on its last run and it also took some back when it gapped lower in mid-July, testing down to the 50 day EMA (29.75). It bounced then faded back to the 50 day EMA to end July. It held there and formed the second leg to the short 7 week pattern. Nice surge higher then a test back to the 18 day EMA to form the handle this month. Good price/volume action (up on the up days, down on the down days) shows accumulation. Looking for the breakout over the prior highs to give us the entry point.
Volume: 471K Avg Volume: 640K
BUY POINT: $32.22 Volume=750K Target=$38.45 Stop=$29.96
POSITION: MR JF - Oct. $30c (57 delta) &/or Stock
http://www.investmenthouse.com/cd/mr.html

Play Date: 08/02/2007
PETS (PetMed Express--$15.12; +0.38; no options): Pet medication via the mail
http://biz.yahoo.com/p/p/pets.html
STATUS: Test breakout. PETS made us a lot of money in 2005 and early 2006 before it finally topped and needed a long rest period. It has based for about a year and one-half, and has set up in good position for us to make some money as it rallies higher to form the right side of its base. Broke sharply higher on strong volume in mid-July on earnings then used the market selling to test, but it was just a routine pullback to the 10 day EMA (14.55) as no one was selling. Volume jumped higher and nicely above average Thursday as PETS bounced off the 10 day EMA, ending the test. Looking to move in as PETS continues this break higher and runs toward the old highs at 20
Volume: 418.1K Avg Volume: 315K
BUY POINT: $15.48 Volume=450K Target=$18.75 Stop=$14.47
POSITION: TRQ LC - Dec. $15c (59 delta) &/or Stock
http://www.investmenthouse.com/cd/pets.html

Play Date: 08/02/2007
SRCL (Stericycle--$47.72; +0.40; optionable): Waste management
http://biz.yahoo.com/p/s/srcl.html
STATUS: Test breakout. With all of the fertilizer being shoveled in DC it is no wonder the waste management companies are doing well. SRCL exploded higher in late July on its earnings, clearing an 8 week flat base. Surged up to 51.65 on that move and then used the market selling to test, tapping the 10 day EMA the past two sessions on the lows and then rebounding to close. Good price action at that near support and looking for that to vault SRCL back up to continue the breakout run. Very strong.
Volume: 979.8K Avg Volume: 527.4K
BUY POINT: $48.75 Volume=1M Target=$55.95 Stop=$46.48
POSITION: URL KI - Nov. $45c (74 delta) &/or Stock
http://www.investmenthouse.com/cd/srcl.html

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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