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us stock market, trade stock
Begin part 3 of 3
THE PLAYS: Splitting the difference between some solid upside and some solid downside as the market is all over the place.
Upside:
Play Date: 11/12/2007
HMSY (HMS Holdings--$29.51; -0.70; optionable): Cost containment services for government health agencies
http://biz.yahoo.com/p/h/hmsy.html
EARNINGS: Announced 11-1-07
STATUS: Test 18 day EMA. Sharp break higher in early August on earnings, HMSY has rallied well the past month as it cleared an 8 week flat base formed on the heels of that breakout. The November earnings broke it higher again but then last week it was testing in the market selling, coming back to tap the 18 day EMA (29.03) on the Friday low then rebounding. Lost a little ground Monday but on very low trade so no one really selling it. This is giving us a great post-earnings entry point and that is a great time to enter: strong earnings then a test. Looking for the bounce higher on volume to move into this strong leader.
Volume: 184.081K Avg Volume: 274.422K
BUY POINT: $31.04 Volume=375K Target=$32.95 Stop=$28.85
POSITION: QHT CF - Mar. $30c (54 delta, 52 OI) &/or Stock
http://www.investmenthouse.com/ci/hmsy.html
Play Date: 11/12/2007
NKE (Nike--$62.60; +0.39; optionable): Just do it
http://biz.yahoo.com/p/n/nke.html
EARNINGS: Mid-December
STATUS: Test 50 day EMA. Broke out from a 13 week cup with handle base in early October and rallied to 67 the last day of October. Nice move and it has spent this month testing the move, coming back to tap at the 50 day EMA (61.20) on the lows the past three sessions, bouncing back each day. Monday it showed a good shot of above average volume as it tapped the 50 day on the low and bounced. Surged over 64 on the high before fading back to close. Good action showing some buyers are at the ready. Looking for another good move on volume to stick and give us an entry point.
Volume: 4.242M Avg Volume: 3.571M
BUY POINT: $63.44 Volume=5M Target=$71.95 Stop=$61.12
POSITION: NKE DL - Apr. $60c (66 delta) &/or Stock
http://www.investmenthouse.com/ci/nke.html
Downside:
Play Date: 11/12/2007
EBAY (Ebay--$32.89; -0.57; optionable): Online auctions
http://biz.yahoo.com/p/e/ebay.html
EARNINGS: Announced 10-17-07
STATUS: Put. EBAY has formed the left shoulder and head of a potential head and shoulders base. It tried to hold the 200 day SMA (34.08) to start October, but broke down last week, really falling on Thursday. It rebounded Friday on strong volume but after clearing the 200 day SMA intraday it faded. Monday it tapped the 200 day SMA on the high and then rolled over to close down. It has sold a bit already, but this breach and test of the 200 day SMA is significant. If it continues lower we are willing to venture some downside positions. A move to the target lands a 42%ish gain.
Volume: 17.467M Avg Volume: 15.374M
BUY POINT: $32.66 Volume=19M Target=$31.05 Stop=$33.32
POSITION: XBA XZ - Dec. $32.50p (-42 delta)
http://www.investmenthouse.com/ci/ebay.html
Play Date: 11/12/2007
GYMB (Gymboree--$34.73; 0.00; optionable): Kids clothing stores
http://biz.yahoo.com/p/g/gymb.html
EARNINGS: 11-20-07
STATUS: Put. GYMB sold down the 10 and 18 day EMA, failing at that point each time it tested it. Then it collapsed lower to start the month. After that plunge it rebounded the past week, rallying up to the 50 day EMA (35.52) on Friday and again Monday, but both days failing to hold a move above that level. Monday it showed a tombstone doji below the 50 day EMA; the name says it all with respect to what that symbol means. GYMB has had its bounce to come up for air after the trend lower below the 18 day EMA, and just as with a stock that is trending higher above the 18 day EMA and needs a test down to the 50 day EMA to reset the move, GYMB's test to the 50 day EMA is resetting the downside move. Want to see volume move up as it turns back down. A move to the target lands a 43%ish gain.
Volume: 1.025M Avg Volume: 939.6K
BUY POINT: $34.36 Volume=1.1M Target=$31.35 Stop=$35.65
POSITION: GQU XG - Dec. $35p (-46 delta)
http://www.investmenthouse.com/ci/gymb.html
Good Investing!
Jon L. Johnson and your IH Alerts 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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