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Begin part 3 of 3
THE PLAYS:
New Post-Split Plays:
Play Date: 08/09/2007
EBAY (Ebay--$36.59; -0.12; optionable): online auctions, etc.
http://biz.yahoo.com/p/e/ebay.html
EARNINGS: Announced 7-18-07
STATUS: Test breakout. EBAY shot higher this month, clearing a 9 month trading range on strong volume. It gapped lower on the Thursday open, but was right back up off its lows, recovering most of the loss. Very strong in a weak market as money moves to ward tech and tech related fields. Ready to buy in on some further upside.
Volume: 21.968M Avg Volume: 16.5M
BUY POINT: $36.84 Volume=25M Target=$44.95 Stop=$34.68
POSITION: XBA JG - Oct. $35c (67 delta) &/or Stock
http://www.investmenthouse.com/cs/ebay.html
Play Date: 08/09/2007
JEC (Jacobs Engineering--$68.83; +2.92; optionable): Engineering services
http://biz.yahoo.com/p/j/jec.html
EARNINGS: 11-6-07
STATUS: Test 50 day EMA. JEC is surging higher on strong volume, clearing the July high as it powers off the 50 day EMA (60.49). It needed this test of the 50 day to reset the clock after the March breakout and run higher up the short term moving averages. A strong stock will continue its run after such a test, and JEC is running higher on strong volume, showing us the move is still on. Ready to start at least part of the position on a continued run higher and then adding on the next test.
Volume: 2.093M Avg Volume: 1.087M
BUY POINT: $69.11 Volume=1.1M Target=$79.95 Stop=$65.88
POSITION: JEC JM - Oct. $65c (71 delta) &/or Stock
http://www.investmenthouse.com/cs/jec.html
Downside:
Play Date: 08/09/2007
DIA (Diamonds Trust (DJ30)--$132.79; -3.76; optionable)
http://biz.yahoo.com/p/d/dia.html
STATUS: Put. Taking another shot at DIA after its test of the June highs and then the rollover Thursday on strong volume. It fell below the 90 day SMA though it is still above the recent lows. Nonetheless this rollover has us looking for a downside push toward the 200 day MA. A long way and a lot of selling, but we still think DIA has a lot of catch-up to play on this selling. A move to the target lands a 40%ish gain.
Volume: 39.054M Avg Volume: 17.523M
BUY POINT: $132.28 Volume=26M Target=$128.50 Stop=$133.57
POSITION: DAW UC - Sept. $133p (-47 delta)
http://www.investmenthouse.com/cs/dia.html
Play Date: 08/09/2007
SIRF (Sirf Tech Holdings--$19.51; +0.80; optionable): GPS software
http://biz.yahoo.com/p/s/sirf.html
EARNINGS: Announced 7-31-07
STATUS: Put. Earnings did not help SIRF surf higher, instead gapping an already weak stock lower. Hard sell off took SIRF below its last major low back in August 2006 at 18. It rebounded this week in the market selling but on lower and lower volume. Thursday SIRF tapped at the 10 day EMA on the high (20) and then eased back. Looking for it to fall over here and do some more selling. a move to the target lands a 54%ish gain.
Volume: 3.005M Avg Volume: 2.259M
BUY POINT: $19.18 Volume=3M Target=$17.11 Stop=$19.72
POSITION: QIR UD - Sept. $20p (-49 delta)
http://www.investmenthouse.com/cs/sirf.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.
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 typically 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.
AAPL: Cracking in the hedge fund selling, closing below the 50 day EMA for the first time since February. Will see if it can hold the line at this level.
BDX: Pinpointing a date (as BDX pinpointed a dive to the 200 day SMA on Thursday.
BG: Researching a new date. Big reach down before rebounding.
BIDU: Researching the next possible date.
CELG: Back to the 50 day EMA
CLB: No split announcement but resuming a nice move up off the 18 day EMA.
DE: Forecast late August. Fading back after that strong move off the 90 day SMA.
FCN: No split with earnings but exploded higher Thursday.
HRS: Forecast late August. Well, it made the bounce higher but then reversed it right back to the 50 day EMA.
MBT: Gapped higher Wednesday but then gapped lower Thursday. Holding support but trying to find itself.
NOV: Back to he 50 day EMA in the market weakness, but that is okay given the overall market selling.
NVDA: Researching date. Announced the split with some good earnings.
PCU: Looking at late October
SHW: Researching the date. Man. Gapped higher then crapped out down to the bottom of the June and July range.
VIP: Researching date.
WOOF: Exploded higher.
NEW PRE-ANNOUNCEMENT PLAYS
Play Date: 08/09/2007
APD (Air Products & Chemicals--$88.73; -1.95; optionable): Industrial gases
http://biz.yahoo.com/p/a/apd.html
EARNINGS: Announced 7-25-07
STATUS: Test breakout. APD gapped out of a 4 month ascending base in July and is now forming a short 4 week double bottom over the 18 day EMA as a consolidation of that breakout. Nice surge this week and a very easy test Thursday, showing a doji over the 10 day EMA. Nice testing and very strong in a very weak market. Looking for a rebound from here on continued strong trade.
Volume: 2.054M Avg Volume: 1.446M
BUY POINT: $89.45 Volume=2.2M Target=$100.00 Stop=$87.65
POSITION: APD LR - Dec. $90c (49 delta) &/or Stock
http://www.investmenthouse.com/cs/apd.html
Play Date: 08/09/2007
CTSH (Cognizant Technology--$85.12; -1.91; optionable): Business software
http://biz.yahoo.com/p/c/ctsh.html
EARNINGS: Announced 8-1-07
STATUS: Reverse head and shoulders. CTSH is setting back up, working on the right shoulder to a 5 month base. Surged up to the July high near 87.50 as the week started then sold back some in the weak Thursday market, but showed some solid relative strength. Good volume as it started higher this week. Will need to see that volume continue as CTSH clears the recent highs.
Volume: 2.849M Avg Volume: 2.473M
BUY POINT: $87.32 Volume=3.2M Target=$100.00 Stop=$83.97
POSITION: UPU JQ - Oct. $85c (56 delta) &/or Stock
http://www.investmenthouse.com/cs/ctsh.html
CONTINUING PRE-ANNOUNCEMENT PLAYS
Play Date: 08/04/2007
FCX (Freeport McMoran--$85.86; -4.85; optionable): Copper
http://biz.yahoo.com/p/f/fcx.html
EARNINGS: Announced 7-25-07
STATUS: Test 50 day EMA. Back to the 50 day EMA as FCX sold off harder on Thursday after bouncing Wednesday but on low trade. That move was alluring but we held off. Now this test gives us a better entry point. To recap: Another stock that made us some excellent money on its run higher this year and over the past two weeks has used the market selling to come back to test the 50 day EMA to set up for its next move. Showed some high volume on the initial selling but that backed off and it finished the test on nice below average volume, dropping to the 50 day on Friday. The market sold on volume but FCX tested this key support on low trade. Looking for FCX to hold this level and give us a high volume bounce off of this key support to give us a buy. The big institutions use the 50 day EMA as a point to buy or sell, and with the volume it showed on the test it looks as if they are going to be buyers once again.
Volume: 14.662M Avg Volume: 10.163M
BUY POINT: $86.88 Volume=12M Target=$99.95 Stop=$85.21
POSITION: FCX KQ - Nov. $85c (60 delta) &/or Stock
http://www.investmenthouse.com/cs/fcx.html
CONTINUING POST-SPLIT PLAYS
Play Date: 08/08/2007
SLB (Schlumberger--$92.20; -1.52; optionable): Oil and gas service company
http://biz.yahoo.com/p/s/slb.html
EARNINGS: Announced 7-20-07
STATUS: Test 50 day EMA. Tried to extend the run Thursday in a weak market, but by the close it was lower, but just to the 10 day EMA on the close. Very good action in a very weak market; the pullback was on low volume to boot. Now looking for the next move higher to give us the entry point as SLB comes back. To recap: Volume jumped for the third session as SLB did the same off the 50 day EMA (87.60). This deeper test is normal in such a strong run from May to late July that made us a lot of money. After that run up the 18 day EMA it made this test that resets the run higher. Big move Wednesday, but as we have seen before, that is not the end of what SLB can do. Looking to move in as it continues this bounce off the 50 day.
Volume: 11.953M Avg Volume: 10.46M
BUY POINT: $94.12 Volume=12M Target=$109.00 Stop=$91.22
POSITION: SLB KS - Nov. $95c (52 delta) &/or Stock
http://www.investmenthouse.com/cs/slb.html
Play Date: 07/28/2007
SNDK (Sandisk--$56.46; +1.18; optionable): Memory cards, etc.
http://biz.yahoo.com/p/s/sndk.html
EARNINGS: 7-19-07
STATUS: Cup w/handle. Put some good work in on Thursday in a weak market, bouncing off the 18 day EMA on lower but continued above average volume. Nice 11 month base has set up this move and with tech, particularly chips, looking good. Looking for a continued volume as SNDK makes the breakout.
Volume: 12.727M Avg Volume: 9.687M
BUY POINT: $56.32 Volume=12M Target=$65.45 Stop=$53.96
POSITION: SWF JK - Oct. $55c (55 delta) &/or Stock
http://www.investmenthouse.com/cs/sndk.html
CONTINUING LEADER PLAY
Play Date: 08/08/2007
MTL (Mechel Steel Group--$39.99; -1.43; optionable): Steel and iron
http://biz.yahoo.com/p/m/mtl.html
EARNINGS: Announce 7-11-07
STATUS: Test 50 day EMA. Gave back some ground Thursday in the selling, but volume was lower and it showed a nice doji at the 50 day EMA. Still looking for MTL to make a nice break higher for us given the great relative strength it is showing. To recap: Nice run from the June breakout of a 10 week flat base. Surged up to 48 on the move, then in the market selling MTL came back to test support at the 50 day EMA (39.94). It has made a short, two week double bottom at that support level and started a modest bounce Wednesday on rising, average trade, rising up to the 18 day EMA (41.53) on the close. Looking for a bit more volume as it moves through that level to give us the buy as MTL rebounds and stretches for a new all-time high.
Volume: 455.8K Avg Volume: 464.602K
BUY POINT: $42.32 Volume=695K Target=$50.75 Stop=$39.77
POSITION: MTL JH - Oct. $40c (54 delta, 239 OI) &/or Stock
http://www.investmenthouse.com/cs/mtl.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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