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Begin part 3 of 3
THE PLAYS:
Upside:
Play Date: 07/17/2008
FCN (FTI Consulting--$70.14; +0.11; optionable): Consulting on litigation, restructuring, mergers, etc.
http://biz.yahoo.com/p/f/fcn.html
EARNINGS: Early August
STATUS: Cup w/handle. Kind of a skewed pattern, but it is accomplishing its purposes, i.e. giving FCN a breather after a strong 2007 run and setting the foundation for a new breakout and another run higher from that. Rallied in June up to the March peak hit just before the 4 month base started and then backed off during the early July market selling. It used that selling, however, to simply test near support at the 18 day EMA (68.06) on low, below average volume. Surged on Tuesday and has made a soft test of the 10 day EMA the past two sessions as the market roared higher. It is setting up at its own pace and this higher low at the 10 day is setting up the breakout move. Very nice leader doing its own thing.
Volume: 626.839K Avg Volume: 1.033M
BUY POINT: $71.42 Volume=1.5M Target=$82.32 Stop=$68.38
POSITION: FCN LN - Dec. $70c (51 delta) &/or Stock
http://www.investmenthouse.com/ci/fcn.html
Play Date: 07/17/2008
LMNX (Luminex--$21.10; +0.50; optionable): Medical instruments
http://biz.yahoo.com/p/l/lmnx.html
EARNINGS: 8-7-08
STATUS: Test 50 day EMA. After a very nice rally on up from mid-2007 but LMNX still looks great as it continues to rally then take nice breathers, forming 7 to 8 week bases and then breaking upside once more for another surge. It is currently in another one of those bases, coming back to the 90 day SMA to start July in the market selling, holding and then working laterally over the past couple of weeks, setting up over the 50 day EMA (20.50) for a new break higher. Good volume Tuesday off the support, and Thursday cleared the April and May peaks. Very strong money flow is leading the way higher and it looks as if a new breakout looms for Luminex. Want to see some decent trade as it makes the move.
Volume: 313.961K Avg Volume: 403.803K
BUY POINT: $21.39 Volume=600K Target=$25.75 Stop=$20.38
POSITION: UQV JD - Oct. $20c (64 delta, 55 OI) &/or Stock
http://www.investmenthouse.com/ci/lmnx.html
Play Date: 07/17/2008
RCII (Rent A Center--$24.03; +1.40; optionable): Rent to own stores
http://biz.yahoo.com/p/r/rcii.html
EARNINGS: 7-28-08
STATUS: Flat base. It has been a long time since we played RCII. We played it quite a bit in 2000 and 2001 during that recession when it quadrupled; it is one of those stocks that thrives when times get tough due to its type of business, i.e. renting what people cannot afford to buy or giving a rent to own service. After a big meltdown all of 2007 RCII bottomed in January and rallied back. It started the current 10 week base in May, trading in a range between 20 and 23. It made a higher low the past week at the 50 day EMA (21.71) and then volume surged Wednesday and Thursday as RCII blasted higher, clearing the base Thursday. Looking to move in as RCII continues the breakout move and then we will look to add to positions when it makes a successful test of the breakout, hopefully at a much higher point than where we bought it.
Volume: 2.895M Avg Volume: 1.216M
BUY POINT: $24.26 Volume=1.5M Target=$29.31 Stop=$22.56
POSITION: RQG LE - Dec. $25c (50 delta) or RQG ID - Sept. $20c (75 delta) &/or Stock
http://www.investmenthouse.com/ci/rcii.html
Play Date: 07/17/2008
WMGI (Wright Medical--$30.29; -0.05; optionable): Medical appliances
http://biz.yahoo.com/p/w/wmgi.html
EARNINGS: 7-28-08
STATUS: Reverse head and shoulders. Setting up nicely for a breakout from its 9 month base formed after a solid 2007. Lost some ground in the late June market selling, but used that to its advantage, holding near the 50 day EMA (28.95) on mostly lower volume and forming the right shoulder to its base. A good shakeout to set up the breakout from the pattern and propel WMGI to a new 4 year high. Strong money flow is leading the way higher and volume has moved above average as it held and then moved off of the 50 day EMA this week.
Volume: 344.608K Avg Volume: 382.602K
BUY POINT: $30.97 Volume=575K Target=$35.68 Stop=$29.11
POSITION: QWM KF - Nov. $30c (55 delta, 288 OI) &/or Stock
http://www.investmenthouse.com/ci/wmgi.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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