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us stock market, trade stock
Begin part 3 of 3
THE PLAYS: Looking at upside in solid patterns even after the market selling and downside ready to fall again after this bounce.
Upside:
Play Date: 02/02/2008
BIDU (Baidu.com--$269.59; -10.36; optionable): Chinese internet search
http://biz.yahoo.com/p/b/bidu.html
EARNINGS: 2-13-08
STATUS: Double bottom. BIDU is setting up again, forming a double bottom at the 200 day SMA (249), using that as the support for its two legs the past three weeks. Wicked selloff from late December through mid-January, BIDU found its footing at the key 200 day. Strong bounce Thursday on volume, then a pullback on lower volume Friday in sympathy with GOOG and its earnings disappointment. Weathered the news quite well and we are just waiting for it to turn back up and move through the 10 day EMA (283.29) on rising trade. That is our buy indication for this former leader that is trying to set up and reassert itself as a market leader.
Volume: 7.553M Avg Volume: 7.775M
BUY POINT: $283.48 Volume=11M Target=$348.00 Stop=$277.89
POSITION: BDU CX - Mar. $280c (54 delta)
http://www.investmenthouse.com/ci/bidu.html
Play Date: 02/02/2008
CREE (Cree, Inc.--$30.00; +0.45; optionable): Chip equipment
http://biz.yahoo.com/p/c/cree.html
EARNINGS: 4-22-08
STATUS: Cup w/handle. This is one of the stocks that has set up a nice 18 week base during the sharp selloff that took so many stocks lower. Strong rally from mid-January and then a test back on low volume this past week to form the handle, holding at the 10 day EMA (29.34) on the Thursday and Friday lows. Volume surged Friday as it bounced off the 10 day. Looking for a new strong surge higher on strong volume to give us the buy point.
Volume: 3.158M Avg Volume: 2.342M
BUY POINT: $30.48 Volume=3M Target=$35.75 Stop=$28.65
POSITION: CQR FF - June $30c (60 delta) &/or Stock
http://www.investmenthouse.com/ci/cree.html
Play Date: 02/02/2008
FLIR (Flir Systems--$32.59; +2.31; optionable): Thermal imaging and infrared camera systems
http://biz.yahoo.com/p/f/flir.html
EARNINGS: 2-7-08
STATUS: Cup. FLIR is trying to make the bounce off the lows in its 14 week pattern, coming off the 50 day EMA (31.11) Friday, showing a good finish to the week. Surged to a new all-time high in October and early November, but after a long run it needed a breather. Another stock that has formed a nice base when much of the market was ripped up. Solid price jump Friday after a good Thursday volume session. Want to see more trade as it continues higher to show that was not a fluke day for the volume.
Volume: 1.396M Avg Volume: 1.322M
BUY POINT: $33.21 Volume=1.6M Target=$39.85 Stop=$30.89
POSITION: FFQ DZ - Apr. $32.50c (56 delta) &/or Stock
http://www.investmenthouse.com/ci/flir.html
Play Date: 02/02/2008
ILMN (Illumina--$67.59; +3.89; optionable): Biotech
http://biz.yahoo.com/p/i/ilmn.html
EARNINGS: 2-4-08
STATUS: Breakout test. Solid session Friday on strong volume as ILMN broke higher once more, continuing the breakout move after a three week test. Gapped sharply higher the first week of January, clearing a 12 week base in one move. The gap resulted from a lawsuit settlement with AFFX. During the test it came back and filled the gap on low volume, clearing the way for the continued breakout run. Friday it started that, and Monday ILMN is set to announce earnings after the close. Riskier moving in ahead of earnings, but if ILMN can continue the move we are willing to take some positions ahead of the announcement.
Volume: 2.342M Avg Volume: 1.105M
BUY POINT: $68.11 Volume=1.2M Target=$78.45 Stop=$64.57
POSITION: IQA FN - June $70c (49 delta) &/or Stock
http://www.investmenthouse.com/ci/ilmn.html
Play Date: 02/02/2008
WFR (Memc Electronic--$75.25; +3.87; optionable): Semiconductor integrated circuits
http://biz.yahoo.com/p/w/wfr.html
EARNINGS: Announced 1-24-08
STATUS: Reverse head and shoulders. WFR broke higher in late October from a 7 month flat base, gapping higher on strong earnings. Surged well after that , moving from 65 to 95. It peaked at that level in late December then rolled over and sold very hard. It has formed something of a head and shoulders top the past three months, rallying back off the mid-January low to the left shoulder area near 75. What caught our eye, however, was the short reverse head and shoulders formed in January. If this former leader can show us the break higher through resistance on strong volume, we are ready to move in for the upside play and let this puppy run as far as it will.
Volume: 4.888M Avg Volume: 5.801M
BUY POINT: $77.68 Volume=8M Target=$89.95 Stop=$74.55
POSITION: WFR DO - Apr. $75c (57 delta) or WFR DP - Apr. $80c (47 delta) &/or Stock
http://www.investmenthouse.com/ci/wfr.html
Downside:
Play Date: 02/02/2008
CVX (Chevron-Texaco--$82.49; -0.76; optionable): Major integrated oil
http://biz.yahoo.com/p/c/cvx.html
EARNINGS: 2-1-08
STATUS: Put. CVX reported record profits as did XOM, but it could not make anything of it. It gapped higher to the 18 day EMA on the open but then rolled over and sold back down to a support level at 82, selling on strong volume. It is below the 200 day SMA (86.75), rebounding after getting ripped down through it mid-January. That typically means more selling ahead, and after this rebound and reversal on good earnings, we are looking for the selling to resume. A move to the target lands a 40%ish gain.
Volume: 16.063M Avg Volume: 10.935M
BUY POINT: $81.92 Volume=12M Target=$78.00 Stop=$83.31
POSITION: CVX OQ - Mar. $85p (-54 delta)
http://www.investmenthouse.com/ci/cvx.html
Play Date: 02/02/2008
NOV (National Oilwell--$62.69; +2.49; optionable): Oil and gas service company
http://biz.yahoo.com/p/n/nov.html
EARNINGS: 2-6-08 before the open
STATUS: Put. Earnings are early in the week making this a riskier play, but it is struggling. As with many stocks it sold through the 200 day SMA (61.58) on the market selling, rebounding over the last half of January. It recaptures that level but sold again on very strong volume. Friday it bounced on lower, average trade. Very weak money flow. Looks ready to turn back down from this lower high. A move to the target lands a 37%ish gain.
Volume: 5.789M Avg Volume: 5.9M
BUY POINT: $61.32 Volume=6.5M Target=$56.25 Stop=$63.35
POSITION: NOV OM - Mar. $65p (-49 delta)
http://www.investmenthouse.com/ci/nov.html
Play Date: 02/02/2008
XOM (Exxon--$85.95; -0.45; optionable): Major oil
http://biz.yahoo.com/p/x/xom.html
EARNINGS: 2-1-08
STATUS: Put. Similar to CVX, XOM reported strong earnings but could not do anything with them other than reverse and give back early gains. A bit triple top for XOM over the past 7 months as it traded in a range. It broke below that range in the January selling, trading massively lower. It recovered to test the 200 day SMA (87.10) last week, but after gapping higher on the earnings results, it rolled back over Friday, unable to punch through that key level. Looking for it to continue lower on strong trade to give us the entry point.
Volume: 28.442M Avg Volume: 25.024M
BUY POINT: $85.48 Volume=27M Target=$81.38 Stop=$87.15
POSITION: XOM OQ - Mar. $85c (-42 delta)
http://www.investmenthouse.com/ci/xom.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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