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stock recommendation, stock option
Begin Part 3 of 3
Best Plays:
1) FCS: Breaking out.
2) EXPE: Tested the breakout and moving up.
3) GPC: Good base.
4) NATI: Nice breakout.
5) SYY: Strong volume can break it out.
6) URS: Ready to fly post-test.
7) CACI: Poised to fall.
8) PLCM: Broke support on selling.
9) HET: Ready to move from support.
10) SFD: Tight in the handle, and low volume at support.
NEW PLAYS:
Breakouts:
FCS (Fairchild Semiconductor--$30.35; +1.35; optionable): Integrated Circuits
http://biz.yahoo.com/p/f/fcs.html
STATUS: In a 22-month base with highs near 50 but FCS is more recently in an 8-week cup with handle pattern from which it broke out Friday. Volume was strong at 1.9 million with the stock just clearing the handle high (30.05) and the buy point. Remains a buy, and we like the strong money flow and high relative strength. Volume clocked in at 1.9 million (avg. 1.37 million). Target is 36.
BUY POINT: 30.55 on continued rising volume (minimum for breakout is 2 million). Stop Advisory (7%): 28.41. Remains a buy on the move up to 31.66.
POSITION: Stock and/or May $25 calls to buy (FCS EE).
http://www.investmenthouse.com/ct/fcs.html
EXPE (Expedia--$62.51; +4.09; optionable): Internet Software
http://biz.yahoo.com/p/e/expe.html
STATUS: EXPE broke out of a cup with handle base in late January, but retraced all the gains and more afterward when it sold back to the 50 day MVA. However, it formed a flying 'w' pattern it the wake, from which it broke out a few days ago. After testing that move back to the 10 day MVA (57.56), EXPE is taking off again on strong volume (1.47 million; avg. 710,200); it just took out the breakout high at 61.49. Good money flow, high relative strength. Target: 71
BUY POINT: 62.60 on continued rising volume. Stop Advisory (7%): 58.22.
POSITION: Stock and/or July $55 calls to buy (UED GK).
http://www.investmenthouse.com/ct/expe.html
NATI (National Instruments--$42.62; +2.26; optionable): Computer Peripherals
http://biz.yahoo.com/p/n/nati.html
STATUS: Breaking out of a double bottom with handle on good volume. The stock remains a buy on the move (buy point in the handle is 41.59). The pattern is the first to form since NATI crossed back over its 200 day MVA in November, and we are looking for this breakout to help complete the right side of its 13-month base (highs at 56). The stock pulled off the high at 43.50 so may try an early test at the 42 range, highs at the start of the 8-week base. Volume was at 266,200 (avg. 159,000). Excellent money flow, relative strength breaking out. Target: 50
BUY POINT: 42.72 on continued rising volume. Stop Advisory (7%): 39.73. A buy to 43.67 on the breakout.
POSITION: Stock and/or June $35 calls to buy (SJQ FG).
http://www.investmenthouse.com/ct/nati.html
Basing stocks:
GPC (Genuine Parts--$37.10; -0.07; optionable): Auto Parts Wholesale
http://biz.yahoo.com/p/g/gpc.html
STATUS: In the handle to a 10-week cup with handle base, formed after GPC broke out of a flat base in early December. The handle is showing decreasing volume (down Friday to 255,900; avg. 357,000) with the stock holding support at 37 the last four days and showing another doji Friday. The 10 day MVA is just below at 36.75. GPC shows strong money flow; we are looking for a breakout. Target: 45
BUY POINT: 37.71 on volume of 536,000 or higher. Stop Advisory (7%): 35.07
POSITION: Stock and/or May $30 calls to buy (GPC EF; low open interests).
http://www.investmenthouse.com/ct/gpc.html
FMKT (Freemarkets--$25.39; +1.11; optionable): Internet Software
http://biz.yahoo.com/p/f/fmkt.html
STATUS: In the handle of an 8-week cup with handle pattern. The stock pulled back 2 days on low and decreasing volume in the handle, then on stronger volume Friday started a move up to a 26.12 high from which it pulled back. Volume was up to 1.35 million (avg. 1.4 million); we are looking for it to break above average levels to push the stock back up to a breakout, but it might take another couple of days in the handle first. Excellent money flow and good buying. Target:
BUY POINT: 26.22 on volume of 2.1 million or higher. Stop Advisory (7%): 24.38
POSITION: Stock and/or July $22.50 or $25 calls to buy ((FAQ GX or GE). Check for deltas.
http://www.investmenthouse.com/ct/fmkt.html
Moving average bounces:
BDK (Black & Decker--$46.51; -0.31; optionable): Small Tools
http://biz.yahoo.com/p/b/bkd.html
STATUS: Broke out of a year-long cup base in February and is testing the move on a pullback to the 18 day MVA; the stock closed with tight doji just below its 10 day MVA; the 18 day is at 45.53. Volume has been high though lower than on the breakout, falling back again Friday to 1.2 million (avg. 712,000). After crossing back over the 200 day MVA in January, BDK bounced once from the 18 day for the breakout, and now we're looking for another. High money flow and good buying. Target: 57
BUY POINT: Aggressive: 47.50 on volume of 1.3 million or higher. Stop Advisory (7%): 44.18
POSITION: Stock and/or May $40 calls to buy (BDK EH).
http://www.investmenthouse.com/ct/bdk.html
ADSK (Autodesk--$44.00; +0.41; optionable): Technical Software
http://biz.yahoo.com/p/a/adsk.html
STATUS: Had a very nice run off the 50 day MVA late February resulting in the March high at 46.70. ADSK is testing the move after some profit-taking on Wednesday that had it back down to the 18 day MVA (43.33) but the stock was able to hold there, and volume fell back immediately (at average levels Friday, 901,300). Showing 2 consecutive shooting star dojis at the support, ADSK can consolidate here on decreasing volume for another day or two, but we look for another strong run when it's done. Strong money flow and buying. Target: 51
BUY POINT: Aggressive: 45 on rising volume. Stop Advisory (7%): 41.85
POSITION: Stock and/or July $40 calls to buy (ADQ GH).
http://www.investmenthouse.com/ct/adsk.html
SYY (Sysco--$30.01; +0.51; optionable): Food Wholesale
http://biz.yahoo.com/p/s/syy.html
STATUS: In a 10-month cup base with ascending wedge handle, with peaks at 30; the stock has peaked three times at the upper resistance since early 2001. At the upper reaches in the pattern SYY is in an ascending wedge that is supported by the 18 day MVA (29.43), and on Friday, volume shot up above average to 2.9 million (avg. 2 million). No news on the surge, but it pushed the stock off of the support, and we are looking for a breakout. Shows strong money flow. Target: 37
BUY POINT: Breakout: 30.45 on continued strong volume. Stop Advisory (7%): 28.32
POSITION: Stock and/or May $27.50 calls to buy (SYY EY).
http://www.investmenthouse.com/cd/syy.html
Back on: Breakout
URS (Urs Corp--$32.48; +1.48; no options): Technical Services
http://biz.yahoo.com/p/u/urs.html
STATUS: We covered URS on its ascending wedge breakout, and now the stock is capitalizing on the test. After a wishy-washy attempt right after the breakout, URS finally put it together Friday, making the strong move on an early morning earnings report (it was a good one!). Volume was super at 317,300 (avg. 97,400) and the stock cleared the earlier March closing high, 32.13, on a move off of the 10 day MVA. May pull back early Monday after the strong move, but look for it to run back up on the breakout from the 32 range. The stock broke out of a cup with handle, then out of the ascending wedge, so looking for a nice run on the big move after the test. Money flow is strong, buying looking good. Our target is 38.50.
BUY POINT: 32.55 on continued strong volume. Stop Advisory (7%): 30.27
POSITION: Stock.
http://www.investmenthouse.com/ct/urs.html
Puts:
CACI (Caci Intl--$35.05; -0.61; optionable): Technical Services
http://biz.yahoo.com/p/c/caci.html
STATUS: We covered CACI in the head and shoulders pattern late January through mid-February, but the stock didn't break down. For days it hung below the up trendline but finally broke above it, crossing over the 50 day MVA as well although resistance at the 50 day MVA simple (37) pushed the stock back down below it again. Volume was huge Friday (2.45 million; avg. 512,000) after the news was out once more (as on Feb. 7) that the company was offering the big block of shares in a secondary offering. CACI broke the 18 day MVA, and looks ready for a breakdown if it moves below 35.
BUY POINT: Aggressive: 34.75 on continued strong volume. Target: 30.25 (200 day MVA at 29).
POSITION: June $42.50 puts to buy (KFQ RA).
http://www.investmenthouse.com/ct/caci.html
PLCM (Polycom--$26.74; -1.70; optionable): Telecom
http://biz.yahoo.com/p/p/plcm.html
STATUS: PLCM is in a downtrend since early December, and now its down trendline coincides with the 50 day MVA (30), a level of resistance tapped on Thursday's high. The stock didn't break it and Friday fell through its 200 day MVA (28.28) then the short term MVAs (18 day at 27.15) on strong volume (4.7 million; avg. 3 million) on no specific news. On a move down from here, aggressive positions for a drop to 21.50.
BUY POINT: Aggressive: 26.50 on continued strong volume. Watching 22.50 range for possible support on the way down.
POSITION: July $40 puts to buy (QHD SH).
http://www.investmenthouse.com/ct/plcm.html
NVDA (Nvidia--$58.29; +1.69; optionable): Semiconductor
http://biz.yahoo.com/p/n/nvda.html
STATUS: NVDA is having trouble holding a move over its 50 day MVA. It is being pressured by that resistance and while it is posting some higher lows since late February, there is potential for a move down to the 50 range if it breaks below the 18 day MVA on another bout of selling similar to recent action (see late February on the chart). The 200 day MVA at 49 will likely support it on a fall, but that is plenty of room on the move.
BUY POINT: Aggressive: 57 (18 day MVA is at 57.16) on preferably rising volume (lower Friday at 10.6 million; avg. 9.4 million).
POSITION: June $75 puts to buy (RVU RO).
http://www.investmenthouse.com/ct/nvda.html
CONTINUED PLAYS:
Covered Calls: We still like COHU for the covered call down to 25; current buy point is 28.50. Same for ITT (buy point 61); it is hanging in there, but ready for the fall.
CEY (Certegy--$40.60; +0.15; optionable): Software
http://biz.yahoo.com/p/c/cey.html
STATUS: Still showing signs of churning with the higher volume Friday (265,200; avg. 209,409) and doji on the small gain. CEY broke out of a flat base for a nice run, and now we are looking for a move back to test the 38 range (18 day MVA is at 37.59). If it holds support there, a move back up will be the cue to buy back the calls. Previous sell point was 39.75, but with the stock inching higher, we can do the same for with entry points.
SELL POINT: 40 on preferably rising volume.
POSITION: April $35 calls to sell (CEY DG).
http://www.investmenthouse.com/ct/cey.html
MOVING AVERAGE BOUNCE PLAYS: None this weekend.
TEST OF BREAKOUT: Some of these stocks are moving back on low volume to test the breakout. We often take profits on option plays when they start to pullback on the breakout move and then get back in when the stock bounces up off of the breakout point. This second move is where some of the biggest gains are made.
TUES (Tuesday Morning--$21.65; -0.20; no options): Retail
http://biz.yahoo.com/p/t/tues.html
STATUS: Testing the breakout it made from the cup with handle last Monday. The breakout wasn't a big one (though the initial move was very nice), but the pullback is looking good with volume decreasing steadily, down to 98,500 Friday (avg. 141,000). The stock has tapped the 21 level on the last two days' lows, so on a continued pullback that is where we look for initial support at least. The buy point was 19.64. Excellent money flow and buying, and our target is 26.
BUY POINT: A hold for positions taken at 21.10. New positions: Over 21 on above average volume. Stop Advisory (7%): 19.76 for buys at 21.25.
POSITION: Stock.
http://www.investmenthouse.com/ct/tues.html
HET (Harrah's--$42.30; +0.89; optionable): Resorts, Casinos
http://biz.yahoo.com/p/h/het.html
STATUS: Testing the breakout from the 6-week cup with handle, still holding support at the 10 day MVA (41.52). Friday HET started a move up from there, as volume rose sharply to 1.7 million (avg. 811,000). Looking for the strong volume to break things higher from here. March high at 43.98 was posted on the breakout. Strong money flow. Target: 49
BUY POINT: For new positions (aggressive): 42.75 on continued strong volume. Stop Advisory (7%): 39.76
POSITION: Stock and/or May $37.50 calls to buy (HET EU).
http://www.investmenthouse.com/ct/het.html
SWK (Stanley Works--$49.42; -0.24; optionable): Tools
http://biz.yahoo.com/p/s/swk.html
STATUS: After the late February breakout from the 7-week cup with handle, SWK is testing the move by pulling back to the 18 day MVA (48.48), support we would expect to hold the stock above the cup with handle buy point at 47.30. Volume was lower Friday at 387,500 (avg. 427,136), so as long as it continues to fall along with price, the chance is good. Looking for the bounce back up in a day or two. Continued strong buying. Target: 60
BUY POINT: After a test of the 18 day MVA: 50.50 on volume of 575,000 or higher. Stop Advisory (7%): 46.97
POSITION: Stock and/or July $45 calls to buy (SWK GI).
http://www.investmenthouse.com/ct/swk.html
BASING/TRADING RANGES:
IPCR (Ipc Holdings--$31.03; -0.24; optionable): Insurance
http://biz.yahoo.com/p/i/ipcr.html
STATUS: Still in the lateral pattern (flat base) that is a test of the breakout from a 6-week saucer. Holding above the 10 day MVA on Friday on low volume (90,200; avg. 348,000) that is preventing it for now from breaking out over resistance at the level of the intraday high at 31.77. Looking for a hold then a strong volume breakout. Outstanding money flow and good buying. Target: 37
BUY POINT: 31.90 on volume of 470,000 or higher. Stop Advisory (7%): 29.67
POSITION: Stock and/or June $25 calls to buy (QHE FE; low open interests).
http://www.investmenthouse.com/ct/ipcr.html
SFD (Smithfield Foods--$24.92; -0.16; optionable): Food
http://biz.yahoo.com/p/s/sfd.html
STATUS: In a 12-week cup with handle base, highs near 27. Volume is low in a handle marked by some volatility but which is tightening up above support at the 18 day MVA (24.79). Showing a star doji Friday on volume of 223,100 (avg. 695,000), we are looking for SFD to move up for the breakout. Good buying. Target: 31
BUY POINT: Breakout: 26.09 on volume of 1 million or higher. Stop Advisory (7%): 24.26
POSITION: Stock and/or July $22.50 calls to buy (SFD GX).
http://www.investmenthouse.com/ct/sfd.html
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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stock recommendation
stock option
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