Weekend Issue for November 24, 2002
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THREE IN A ROW! Scottrade is proud to announce its THIRD CONSECUTIVE ranking as Highest in Investor Satisfaction with Online Trading Services by J.D. Power and Associates! Thank you, customers! Scottrade: Member SIPC.
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Read this report online in full color with graphs at
http://www.investmenthouse.com/weekend/112402.htm
1) MARKET SUMMARY
Up and down session, but in the end the market holds onto its gains.
– Volatile Friday holds onto gains.
– Why you focus on price/volume action and the charts versus ‘pet’ indicators.
– Market acting as a healthy market should.
– Holiday week in a healthy, uptrending market can produce further gains.
– Subscriber questions.
http://www.investmenthouse.com/1weekendmarketsummary.htm?123 “> Click here or on link for our full Weekend Market Summary
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2) Stock Splits
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).
For post-splits, we can play them as we would pre-splits (very short term), but we prefer to stretch our horizons, playing the trend. When playing options, we look further out, 2 or more months at least. We let the trend carry us along if there is one, but we will also take profits if the technical pattern degenerates, e.g., breaks a trendline. The main difference between post-splits and pre-splits plays is that we really have to like the pattern. Pre-splits can run right before their splits even with poor technical indicators. For post-splits, we are looking at the stocks from more of a longer term “would I buy this stock at this juncture?” position. Now there are times when a hot stock splits and investors pile in to get in while the stock is ‘cheaper.’ We play those, but with more of a short-term, pre-splits mentality in that we will be ready to get out fast if the momentum fades.
Remember, everything we do has to pass muster with the market that day … don’t fight the market on these plays. Here’s a post-split play to watch and our current analysis.
BYS (Bay State Bancorp–$24.55; 0; no options): Savings and loan.
STATUS: Testing the breakout. Literally no change from Thursday. BYS is attracting no volume as it moves laterally over the 10 day MVA. This tight action can precede major moves. We are being patient and we are ready to move.
Volume: 3.4K Avg Volume: 124.227K
BUY POINT: $25.45 Volume=194K Target=$30.45 Stop=$23.67
POSITION: – Stock (no option chain).
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Learn more about our Stock Split Report – Forbes.com Best of the Web Online Edition says: “. . . seek out the Stock Split Report . . .”
http://www.investmenthouse.com/1stocksplits1.htm
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3) Technical Play
ACTI (Activecard–$9.03; +0.23; no options): Security software.
STATUS: Cup w/handle. ACTI is moving through a 12 month base, starting to rally off the lows in October with a big move in early November. It has since moved laterally, holding above the 18 day MVA (8.45). Friday ACTI showed a big volume surge, the largest since the huge move early in the month, as the stock tested lower and rallied hard to the close. Accumulation is solid and money flow leaped up ahead of the stock during its lateral move. Looks ready to make the strong breakout.
Volume: 585.7K Avg Volume: 125K
BUY POINT: $9.28 Volume=165K Target=$11.88 Stop=$8.56
POSITION: Stock (no option chain).
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Learn more about our Technical Trader Report!
http://www.investmenthouse.com/1tech1.htm
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4) Covered Call Play
CAH – Cardinal Health Inc. is currently trading at $62.29. The January $60 Calls (OKJAL) are trading at $6.00. That provides a return of about 7% if CAH is above $60 on expiration Friday in January.
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Learn more about our Covered Calls Service!
http://www.investmenthouse.com/1coveredcalls1.htm
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5) IPOs
Safety Insurance Group Inc. (SAFT.O) raised $72 million in an initial public offering, completing the sale after the insurer delayed it for a week and reduced the offer price.
Boston-based Safety sold 6 million shares for $12 each, in line with the expected price, said an official at Credit Suisse First Boston (CSGZn.VX),the investment bank which managed the sale.
This IPO column is continued at:
http://www.investmenthouse.com/1ipo.htm
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Scottrade: Ranked Highest in Customer Satisfaction 3 times! Apply now!
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Bookstore FIRESALE!
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The foregoing is commentary for informational purposes only. All statements and expressions are the opinions of Online Investment Services, LP., or Split Ventures, Ltd. This information is 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 the related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolios of writers for this issue may, in some instances, include securities mentioned herein and on the related 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. No one associated herewith receives compensation in any manner from any of the companies that are discussed in this newsletter or on the related websites.
Copyright 1997 – 2002 by Online Investment Services, LP. – All Rights Reserved.
