Weekend Newsletter for June 20, 2004
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
$7 Trades at Scottrade.com with NO inactivity fees! FREE access to real-time streaming Dow Jones News, quotes & charts to manage your portfolio! Over 9000 NO transaction fee Mutual Funds. 177+ offices nationwide. Apply now!
http://www.investmenthouse2.com/cntdir.asp?name=Scottrade
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Read this report online in full color with graphs at
http://www.investmenthouse.com/weekend/062004.htm
1) MARKET SUMMARY
Stocks end volatile week holding the range.
– Stocks overcome some negative news, rebound from Thursday.
– Economic undercurrents continue as current account deficit widens, Fed holding fewer instruments for foreign countries.
– Stocks set up for the coming week if investors are ready.
– Subscriber Questions.
http://www.investmenthouse.com/1weekendmarketsummary.htm?123 “> Click here or on link for our full Weekend Market Summary
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Try “The Daily” with no risk for 2 weeks!
http://www.investmenthouse.com/1daily1.htm
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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.
ANN (Ann Taylor–$28.40; 0.00; optionable): Apparel stores
STATUS: Cup w/handle. Volume surged well above average Friday as ANN showed a nice tight doji on the candlestick pattern as it continues to hold over the 50 day EMA (27.98). Nice 15 week base with 3 to 2 accumulation. Want that higher volume to translate into a price gain.
Volume: 1.575M Avg Volume: 864.949K
BUY POINT: $29.22 Volume=1M Target=$31.85 Stop=$27.42
POSITION: ANN IH – Sept. $40c (76 delta).
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
3) Technical Play
TDS (Telephone & Data Sys.–$70.02; -0.16; optionable): Wireless telecom
STATUS: Cup w/handle. TDS has come back and formed the handle to its 15 week base, using the 50 day EMA (69) as the handle support. Good sign as that shows big money stepping in at that level. Accumulation in the base is a solid 3 to 1 and money flow is really running higher ahead of the price. We are looking at this one as a trade, using options to give us a lot of leverage. If it goes further, great, but in any event it looks to be set up very well to make the bounce and give us a nice return.
Volume: 231.1K Avg Volume: 248.056K
BUY POINT: $70.64 Volume=372K Target=$76.68 Stop=$68.78
POSITION: TDS KN – Nov. $70c (55 delta).
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Learn more about our Technical Trader Report!
http://www.investmenthouse.com/1tech1.htm
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
4) Covered Call Play
BZH – Beazer Homes USA Inc. is currently trading at $97.15 The August $95 Calls (BZHHS) are trading at $6.70. That provides a return of about 5% if BZH is above $95 on expiration Friday in August.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Learn more about our Covered Calls Service!
http://www.investmenthouse.com/1coveredcalls1.htm
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
$7 Trades, NO Inactivity Fees at Scottrade. Get started with just $500!
http://www.investmenthouse2.com/cntdir.asp?name=Scottrade$7a
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
BOOK STORE SPECIAL OFFERS!
We are now offering “Special Offers” each week in our Book Store! You will not find these specials on our web site. They are only available by clicking the link below in this Weekend Newsletter!
http://www.investmenthouse2.com/cntdir.asp?name=BookStoreSpecials
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 – 2004 by Online Investment Services, LP. – All Rights Reserved.
