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us stock market, trade stock
Begin part 3 of 3
THE PLAYS
New Plays:
Upside: No downside this weekend. The fall as hard and we will let it rebound to test and then we can look to the downside if the rebound is weak.
Play Date: 10/20/2007
EJ (E-House China Holdings--$27.31; +1.53; optionable): Real estate agency services in China
http://biz.yahoo.com/p/e/ej.html
EARNINGS: Third week November
STATUS: Test 18 day EMA. A new issue in August, EJ rallied nicely, gapping higher to start October as new money was put to work in the market and the stock. It rallied to 30 and then came back to test last week in the market chop. Friday it tested lower and below the 18 day EMA, filling the gap from early October and then bouncing higher for a gain on the session on some strong volume. Like that gap fill and the strength in the otherwise weak market. Looks ready to move and we are ready to move in as EJ continues higher.
Volume: 1.799M Avg Volume: 910.7K
BUY POINT: $27.92 Volume=1.4M Target=$33.85 Stop=$26.24
POSITION: EJ BE - Feb. $25c (69 delta) &/or Stock
http://www.investmenthouse.com/ct/ej.html
Play Date: 10/20/2007
ELN (Elan--$23.02; -0.51; optionable): Drug delivery systems
http://biz.yahoo.com/p/e/eln.html
EARNINGS: 10-25-07
STATUS: Test breakout. A bit on the defensive side, but you have to love the pattern. ELN broke out Monday with a big gap higher, clearing a 14 week cup with handle base (that formed one of those reverse head and shoulder patterns we so often see at the bottom of a cup). Nicely formed base that took it to a three year high. In the market chop the rest of the week ELN tested the move, coming back to the 10 day EMA (22.83) on the lows and on much lower volume. That shows few sellers, just easing back and setting to move higher again. Our favorite upside entry point is the first breakout test and ELN is set up beautifully.
Volume: 3.434M Avg Volume: 4.137M
BUY POINT: $23.65 Volume=4.2M Target=$28.45 Stop=$22.55
POSITION: ELN AX - Jan. $22.50c (59 delta) &/or Stock
http://www.investmenthouse.com/ct/eln.html
Play Date: 10/20/2007
MA (MasterCard--$151.60; -2.12; optionable): Credit services
http://biz.yahoo.com/p/m/ma.html
EARNINGS: 10-31-07
STATUS: Cup w/handle. Yes MasterCard is in the credit business and no one thinks the consumer is worth a darn right now, yet MA's pattern is very nice. It spent the past two weeks forming the handle to its 15 week base, fading back to the 90 and 50 day EMA to end last week as volume remained well below volume. That low trade shows us there was no heavy selling, just an easy pullback. We are looking for volume to jump back up as MA rebounds off of this near support and moves through the 10 day EMA (156.08). That is our buy point.
Volume: 1.725M Avg Volume: 3.469M
BUY POINT: $156.22 Volume=5.2M Target=$179.95 Stop=$150.89
POSITION: MAL AK - Jan. $155c (54 delta) &/or Stock
http://www.investmenthouse.com/ct/ma.html
Play Date: 10/20/2007
NDAQ (Nasdaq Stock Market--$40.00; -0.11; optionable): This is the actual company that owns the index
http://biz.yahoo.com/p/n/ndaq.html
EARNINGS: 10-24-07 (time not supplied)
STATUS: Cup w/handle. A beautiful set up heading into its earnings on Wednesday. It has come back on low volume the past week to the 18 day EMA (39.54), forming a handle to its 11 month base. The indices have gone through a long basing process and that has put them in position for their next runs higher, and if NASDAQ shows us the break higher heading into the results we will take some positions. Excellent set up anticipating strong results.
Volume: 2.068M Avg Volume: 2.668M
BUY POINT: $40.65 Volume=3M Target=$48.88 Stop=$39.42
POSITION: NQD AH - Jan. $40c (56 delta) &/or Stock
http://www.investmenthouse.com/ct/ndaq.html
Play Date: 10/20/2007
SGMS (Scientific Games--$38.30; 0.00; optionable): Gaming industry products
http://biz.yahoo.com/p/s/sgms.html
EARNINGS: 11-1-07
STATUS: Test breakout. One of the vice stocks, i.e. gambling related, and they typically perform when the economy falls off as people turn to boozing, smoking, gambling. Today however, that happens at anytime, and thus SGMS is enjoying good success. It broke out from a 20 week base in early October and rallied over 50 into the start of last week. It then pulled back on low, below average volume to test, holding at the 18 day EMA (38.10) on the lows. Nice easy action that has it set up to break higher this week.
Volume: 590.411K Avg Volume: 1.22M
BUY POINT: $39.18 Volume=1.3M Target=$44.95 Stop=$37.74
POSITION: TUJ AH - Jan. $40c (49 delta) &/or Stock
http://www.investmenthouse.com/ct/sgms.html
Play Date: 10/20/2007
STLD (Steel Dynamics--$48.74; -1.80; optionable): Steel mining
http://biz.yahoo.com/p/s/stld.html
EARNINGS: 10-16-07
STATUS: Test breakout. Announced earnings last week and they were made of steel. That broke STLD higher out of a choppy 22 week base that you could call a double bottom with handle if you stretch a bit. Call it a train wreck if you want; it held at the 50 day EMA on the low and then blasted higher on strong volume. After two strong price and volume sessions Wednesday and Thursday it made the obligatory pullback Friday in deference to the market selling, but volume was much, much lower and it held above the prior highs as it did. May do some more testing early this week, but metals held up well despite the Friday gutting of many parts of the market. Looking for STLD to finish the pullback early this week and then start back up. When it does we will move in.
Volume: 2.882M Avg Volume: 2M
BUY POINT: $49.31 Volume=3M Target=$58.95 Stop=$47.28
POSITION: RQL AJ - Jan. $50c (52 delta) or RQL AI - Jan. $45c (69 delta) &/or Stock
http://www.investmenthouse.com/ct/stld.html
Play Date: 10/20/2007
TLM (Talisman Energy--$20.38; -0.36; optionable): Independent oil and gas
http://biz.yahoo.com/p/t/tlm.html
EARNINGS: 11-2-07
STATUS: Reverse head and shoulders. TLM broke higher on strong trade just over a week back, clearing a 2 week lateral consolidation that more or less formed the right shoulder to its 20 week base. Friday it tested back as the energy sector sold off, tapping at the 10 day EMA on the low and bouncing modestly. Very solid action in a solid pattern. After this pullback to test we are looking for TLM to continue its move. Oil at $80/bbl, despite its economic implications, brought the independents out of their slumber, and TLM is in excellent position to continue a run higher after this test.
Volume: 3.331M Avg Volume: 3.1M
BUY POINT: $20.95 Volume=4.5M Target=$25.11 Stop=$20.08
POSITION: TLM AD - Jan. $20c (55 delta) &/or Stock
http://www.investmenthouse.com/ct/tlm.html
CONTINUING PLAYS:
Play Date: 10/17/2007
ALGN (Align Tech--$27.05; -1.04; optionable): Medical appliances (transparent braces)
http://biz.yahoo.com/p/a/algn.html
EARNINGS: 10-24-07
STATUS: Reverse head and shoulders. Fell to the 18 day EMA on the Friday close. Volume bounced but was still below average. Looking for ALGN to hold at this near support and then rebound and give us the breakout move. To recap: ALGN gapped higher last Wednesday on strong volume as it tried the breakout from its 12 week base that formed just below a new all-time high. We were watching the pattern develop, and that strong volume caught our attention. It could not hold the move on Wednesday what with the market up and down and back up, but we like the pattern and the action, looking for the continued break to the upside to give us the buy point.
Volume: 993.076K Avg Volume: 1.191M
BUY POINT: $28.11 Volume=1.3M Target=$34.38 Stop=$26.14
POSITION: CUA AE - Jan. $25c (71 delta) &/or Stock
http://www.investmenthouse.com/cd/algn.html
Play Date: 10/17/2007
AMSC (American Superconductor--$25.81; -0.04; optionable): Power electronic converters, high temperature superconductor wires
http://biz.yahoo.com/p/a/amsc.html
EARNINGS: 11-8-07
STATUS: Cup with handle. Nice surge to start the month took AMSC off of its low and formed the right side of its 10 week base. It peaked just over a week ago and has come back on low volume to test the move, holding at near support at the 10 day EMA (24.21), showing a nice tight doji at that level Wednesday. Excellent action on this test is setting up for a breakout to a new 7 year high.
Volume: 656.391K Avg Volume: 751.992K
BUY POINT: $26.05 Volume=1.1M Target=$31.32 Stop=$24.23
POSITION: QAY AE - Jan. $25c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/amsc.html
Play Date: 10/18/2007
BEAV (BE Aerospace--$44.25; -0.50; optionable): Aerospace/defense
http://biz.yahoo.com/p/b/beav.html
EARNINGS: 10-30-07
STATUS: Breakout test. Nice test Friday as the market sold, holding above the 10 day EMA (43.92) on the low and rebounding modestly. Still an excellent set up for the next run higher in the breakout. To recap: Volume jumped back above average Thursday as BEAV made the bounce off the 18 day EMA after testing that level the prior three sessions as it came back to near support to test the early October breakout from its 10 week cup with handle base. This base formed below the all-time high hit back in 1997, and after this consolidation it looks ready to move to a new high. Excellent action from an excellent stock that is ready to continue to that new high.
Volume: 970.695K Avg Volume: 1.134M
BUY POINT: $45.25 Volume=1.7M Target=$53.00 Stop=$43.11
POSITION: BQV AI - Jan. $45c (56 delta) &/or Stock
http://www.investmenthouse.com/ct/beav.html
Play Date: 10/18/2007
CMC (Commercial Metals--$34.09; -1.72; optionable): Steel and iron
http://biz.yahoo.com/p/c/cmc.html
EARNINGS: 10-30-07
STATUS: Cup w/handle. Fell back on Friday after the strong Thursday breakout move. Using this test to give us a bit better entry point. To recap: Volume surged Thursday as CMC started the breakout from its 13 week base. Nicely formed pattern that is a beautiful foundation for the break and run higher. Metals led higher, needed to base, did so, and are now making the break higher. Ready to move in as CMC continues higher on this great breakout.
Volume: 1.655M Avg Volume: 1.439M
BUY POINT: $34.88 Volume=1.5M Target=$42.95 Stop=$33.22
POSITION: CMC CG - Mar. $35c (57 delta) &/or Stock
http://www.investmenthouse.com/ct/cmc.html
Play Date: 10/13/2007
GIVN (Given Imaging--$30.03; -0.05; optionable): Medical equipment for diagnosing ailments of the gastrointestinal tract
http://biz.yahoo.com/p/g/givn.html
EARNINGS: 10-31-07
STATUS: Double bottom w/handle. Ignored the selling on Friday, showing a nice, tight doji at the 10 day EMA on a big volume surge, even stronger than Wednesday. Looks ripe to make the move higher. A nice handle is forming to the 14 week base, working laterally in a tight range as the 10 day EMA (29.38) rises to catch up with it after that strong late September to early October run that set the right leg of the base. This base formed after the June breakout from a long 1.5 year reverse head and shoulders base; all of that basing gives it plenty of shaking out to make the run higher. Money flow is strong, surging higher ahead of price. Looking for price to follow the money higher this week.
Volume: 363.204K Avg Volume: 147.423K
BUY POINT: $30.35 Volume=217K Target=$34.95 Stop=$28.89
POSITION: GPQ BF - Feb. $30c (58 delta) &/or Stock
http://www.investmenthouse.com/ct/givn.html
Play Date: 10/16/2007
PCU (Southern Copper--$131.20; -2.95; optionable): Copper
http://biz.yahoo.com/p/p/pcu.html
EARNINGS: 10-27-07
STATUS: Breakout test. Excellent action Friday given the weakness in the market, holding its pullback over the 18 day EMA. This one we just have to be patient with and let it show us finish the breakout. To recap: PCU is making its second test of the breakout, showing a nice tight doji at the 10 day EMA on the Tuesday low (131.51). This pullback follows the September breakout from an 8 week base and it the second test of near support after that breakout. Looking to move in as PCU makes the next break higher from this test.
Volume: 2.038M Avg Volume: 2.378M
BUY POINT: $134.65 Volume=2.5M Target=$156.75 Stop=$131.38
POSITION: PCU AG - Jan. $135c (58 delta) &/or Stock
http://www.investmenthouse.com/ct/pcu.html
Play Date: 10/18/2007
RRC (Range Resources--$43.89; -1.58; optionable): Independent oil and gas
http://biz.yahoo.com/p/r/rrc.html
EARNINGS: 10-24-07 after the close
STATUS: Test 18 day EMA. Thumped back down tot eh 10 day EMA on the Friday close following that strong break higher Thursday. Volume faded on the pullback, and we are viewing this as a better entry point for the play. Lowered the buy point to take into consideration this pullback. To recap: RRC broke out from 15 week base in late September, and it is making its second test of the 18 day EMA on this move. It tapped that level on the Wednesday low and rebounded to close flat, and then Thursday it surged higher on very strong volume, clearing to a new all-time high on the move. Have to like this action, and its position in the life of the breakout leaves plenty of upside for RRC (a stock will make 4 to 5 such bounces after a strong breakout before needing to test deeper. Strong move Thursday and we are looking to move in as it continues the move higher.
Volume: 1.297M Avg Volume: 1.474M
BUY POINT: $44.88 Volume=1.5M Target=$54.75 Stop=$43.22
POSITION: RRC AI - Jan. $45c (60 delta) &/or Stock
http://www.investmenthouse.com/ct/rrc.htm
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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