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Begin part 3 of 3

THE PLAYS: Looking at a mix of upside and downside as the large cap NYSE indices are at a critical juncture.

Upside:

Play Date: 06/16/2008
CE (Celanese--$49.64; +1.40; optionable): Chemicals
http://biz.yahoo.com/p/c/ce.html
EARNINGS: Third week of July
STATUS: Flying plateau. Taking another run at CE as it starts the breakout from its 5 week tight lateral consolidation that consolidated the April breakout from its 4.5 month base. Volume rallied on upside trade three sessions in the past week, the last on Monday as CE made the breakout move. Strong money flow is leading the way higher and CE is following. Looking to move in as CE continues the breakout move. Very nice, very sold.
Volume: 1.797M Avg Volume: 1.366M
BUY POINT: $50.08 Volume=2M Target=$57.75 Stop=$47.77
POSITION: CE IJ - Sept. $50c (49 delta) &/or Stock
http://www.investmenthouse.com/ci/ce.html

Play Date: 06/16/2008
SVNT (Savient Pharma--$24.69; +0.96; optionable): Biotechnology
http://biz.yahoo.com/p/s/svnt.html
EARNINGS: Announced 5-7-08
STATUS: Test 50 day EMA. A leader in the sector, SVNT is making a higher low at the 50 day EMA (23.27), ready to make the next move higher after the breakout from its 5.5 month base. It broke higher in May after earnings when it dropped to the 50 day EMA and found strong support, breaking to a new all-time high. Low volume test and now looks ready to bounce and follow rising money flow higher. Looking for a big more trade as it makes the move.
Volume: 755.286K Avg Volume: 1.523M
BUY POINT: $25.12 Volume=2M Target=$30.22 Stop=$23.36
POSITION: UVP IE - Sept. $25c (61 delta) &/or Stock
http://www.investmenthouse.com/ci/svnt.html

Play Date: 06/16/2008
TTEK (Tetra Tech--$26.56; +0.66; optionable): Engineering & construction consulting services
http://biz.yahoo.com/p/t/ttek.html
EARNINGS: Late July
STATUS: Test 18 day EMA. Made us a bit of money on its last run in May after the breakout from its 6 month base. It gapped higher to start May, tested, and then started a run up the 10 day EMA (now at 25.93). After that run it has made a deeper test to the 18 day EMA (25.64). Undercut it but then bounced back, jumping Monday on rising, average volume, the best of the month. Solid money flow is rising ahead of price and TTEK looks ready to make a break to a new high. Want to see volume continue improving as it does.
Volume: 609.013K Avg Volume: 591.92K
BUY POINT: $27.05 Volume=700K Target=$32.45 Stop=$25.55
POSITION: TQI IE - Sept. $25c (64 delta) &/or Stock
http://www.investmenthouse.com/ci/ttek.html

Downside:

Play Date: 06/16/2008
DXD (ProShares DJ30 UltraShort ETF--$55.73; +0.26; optionable)
http://biz.yahoo.com/p/d/dxd.html
STATUS: For those wanting to play the downside by playing the upside, this is a way to go similar to SDS. DXD moves inversely to the DJ30 at a 2:1 ratio meaning as the Dow moves, DXD amplifies that move by 2 times. DJ30 has made a low volume test of the 10 day EMA after selling sharply last Wednesday. Looking for the Dow to stall there and move back down. That will push DXD up as the Dow falters and resumes its trend lower.
Volume: 5.251M Avg Volume: 4.852M
BUY POINT: $56.22 Volume=6M Target=$59.95 Stop=$55.15
POSITION: DXD GD - July $56c (53 delta)
http://www.investmenthouse.com/ci/dxd.html

Play Date: 06/16/2008
EDU (New Oriental Education & Tech--$63.58; -1.63; optionable): Chinese management training
http://biz.yahoo.com/p/e/edu.html
EARNINGS: Mid-July
STATUS: Head and shoulders. EDU formed a 10 week head and shoulders top, making a lower high to start June in a weaker right shoulder, indicating a deeper decline than normal. It sold off last week and rebounded through Friday on light trade. It made it to the 10 day EMA (65.54), stalling at that near resistance and turning lower Monday. Money flow is very weak and EDU looks ready to follow it lower. A move to the target lands a 48%ish gain.
Volume: 590.1K Avg Volume: 642.462K
BUY POINT: $62.97 Volume=700K Target=$58.00 Stop=$65.65
POSITION: EDU SM - July $65p (-50 delta)
http://www.investmenthouse.com/ci/edu.html

Play Date: 06/16/2008
IYT (Dow Jones Transportation ETF--$92.36; +0.08; optionable)
http://biz.yahoo.com/p/i/iyt.html
STATUS: Put. The transports were cruising through the first week of June, breaking higher on the day that that NASDAQ and the mid-caps broke out. Then it reversed the next session on that massive reversal as oil spiked 11 points. It broke lower again last Wednesday, breaking below the 50 day EMA support level (92.43) on huge trade. It rebounded with the market through Monday, trying to move back through the 50 day EMA Friday and Monday, but sliding back each session. Looks ready to roll back over and continue the selling as the transports gasp a bit as energy prices squeeze them. Looking to move in as the Dow and the Dow transports turn back down on some rising trade. A move to the target lands a 40%ish gain.
Volume: 700.995K Avg Volume: 1.448M
BUY POINT: $91.54 Volume=1.5M Target=$87.50 Stop=$93.28
POSITION: IYT SS - July $95p (-50 delta)
http://www.investmenthouse.com/ci/iyt.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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