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We are starting our second round of LIVE online investment seminars! Click here for full details! | ||
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| 1) MARKET SUMMARY Unemployment numbers finally catch up with the layoffs.- Employment (or is that unemployment?) report sacks S&P and Dow.
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2) Stock Splits Be sure to read our Stock Splits Manual. 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: Broke out of a lengthy cup (dating back to mid ’99), in late March 2001, and after a brief breakout test, pulled up to 45.20 in early August. From there, the stock dipped back into a saucer over the short-term MVAs, setting up a nice breakout move Wednesday on solid volume. The stock immediately pulled into a lower volume test over the 10 day MVA (45.03), with volume much lower than on the breakout (Friday volume 252,100, average 240,300). We are looking for support to hold, and set up a pre-split run. Relative strength and money flow are excellent. Target: 52. PLAY: After holding support at the 45 level, a move to 47.13 on above average volume. Stop: 44.75. POSITIONS: Stock and/or October $45 calls to buy (SFD JI). Click here for more information on our Stock Split Report!
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KO (Coca-Cola Company--$49.73; +0.22, optionable) Food & Beverage.
Click here for more information on our Technical Traders Report!
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CTX - Centex Corp. is currently trading at $40.10. The October $40 Calls (CTXJH) are trading at $3.10. That provides a return of about 8% if CTX is above $40 on expiration Friday in October.
Click here for more information on our Covered Call, Credit Spread and Leaps Service! | ||
| As the IPO market stretches to wake from its annual summer hiatus, one sector stands out from the pack. Healthcare companies started off the year slowly but the sector's vital signs improved this summer to lead all other areas of IPOs. In July four companies from the sector completed IPOs, as many as in all six of the previous months. More than just a blip on the radar, healthcare filings picked up significantly as well. Ten of the 26 IPOs filed so far this quarter have been healthcare companies. That marks a sharp increase from the same period last year where just one of the 112 deals priced was a healthcare companies. The surge in filings shows that these companies believe their window of opportunity will remain open for at least a few more months, if not longer.
(This IPO story is continued on our website in the IPO Forum.) | ||
Covered Calls: Our covered call service provides nightly updates - energize your portfolio! Tech Traders: Breakouts, wedges, pennants etc...focusing on stocks ready to move now! The Daily: "The Daily" is a must read for all investors -- learn what is really going on in the market! Taped Seminars: Investing seminars on audio and video to help you profit. Book Store: Check-out the prices in our firesale section! Win $1,000: Enter our Investment Challenge -- $50,000 Portfolio for you to trade. Quote Tracker: A FREE Windows program that provides streaming real-time quotes, Level II and more. Live Seminars: NEW! Investing seminars live on the net! | ||
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