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| Free Weekend Newsletter for May 25, 2003 | ||
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| 1) MARKET SUMMARY Quiet, positive close leaves market in same position.- Modest gains to close week as leaders bounce further while small & mid-cap utilities rally on tax cut.
Try "The Daily" with no risk for 2 weeks! Playing stock splits can be very profitable, but it takes know-how. Our stock split service focuses on three main types of plays: 1) pre-announcement (where we forecast an upcoming split prior to the company making the announcement); 2) pre-split (these plays are made in the days leading up to the actual split day); and 3) post-split plays (plays made after the actual stock split where the stock is showing continued or renewed strength). We play pre-split plays as short-term plays. We get in when the technical indicators show us things look right, grab as much as we can, and get out, always being conscious of resistance and support. These stocks are highly volatile at this time, and can turn on you quickly. Don't let good profits disappear. Watch for turns, especially when a stock trades in a wide range and finishes off its high. That is a sign these stocks often give you that they are running out of steam. We usually get out and ask questions later. We can always get back in. We like to play in the money calls, preferably two strike prices in the money as this usually gives us a greater delta (the percent an option will mover versus the stock's movement). We prefer deltas of 75 or better. This means if the stock moves 1 point, the option should move three-fourths of that point. That means up or down. Remember, wait to see the stock start to move up. Don't just blindly make a play and don't try to guess tops and bottoms. We can look at indicators to give us a clue as to what will happen, but we need the stock to confirm it for us. Here's a pre-split play to watch and our current analysis.
Company Profile STATUS: Flat base. Nice move up off the 50 day MVA for us last week, adding to the move Friday with above average volume. This was a great way to start off the run. New positions can still be taken on a further move from here but not too much further as it approaches the recent high at 52. At that point we want to see it move to 52, take a breather, then power higher again. Volume: 818.9K Avg Volume: 627.681K BUY POINT: New: After reaching 52, a pause then move higher on volume (orig. $51.06) Volume=1M Target=$55.25 Stop=$49.88 POSITION: ECL GJ - July $50c (58 delta). Click here for more information on our Stock Split Report!
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BGEN (Biogen--$40.5; +1.22; optionable): Biotechnology.
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BLUD - Immucor Inc. is currently trading at $20.18. The June $20 Calls (QMQFD) are trading at $1.30. That provides a return of about 6% if BLUD is above $20 on expiration Friday in June.
Click here for more information on our Covered Calls Service! | ||
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* * * SCOTTRADE * * * | ||
5) IPOs When lead manager Bear Stearns did not announce the pricing terms for iPayment’s (Nasdaq: IPMT) IPO on Friday, May 9, 2003, it raised a few eyebrows. When the financial press reported what happened, the news was enough to wag more than a few double chins. It was widely reported that a Bear Stearns securities analyst was videotaped commenting on the proposed offering. (This IPO story is continued on our website in the IPO Forum.) | ||
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