Two New Speculative Swing Longs And Five Stocks I Am Adding To My Existing Positions

May 30, 2007

new speculative swing longs: AKS ARWR

AKS is bouncing off support and breaking out past the past two weeks of closing highs, on below average volume. I am basically getting in this early in anticipation of a breakout as a weekly chart shows how tight and coiled this stock is after the recent run-up. The max green BOP on the chart is beautiful but today it did move down from max green so that kind of kills the buzz. The one thing that can’t be ignored is all the accumulation in this chart this year. Fund ownership has increased from 68 to 83 so that is where all of that is coming from. EPS grew 700% this quarter and YOY EPS gains of 858% are expected this year and sales have grown between 1% and 20% the past five quarters. This is not the best long for emotional inexperienced traders as the stock is a bit volatile. Cut your loss with a close below the 32.25 level, if the stock does not move higher immediately.

ARWR is breaking out of a double bottom with handle pattern, on strong volume. This is a very nice breakout from a very quiet base with green BOP but there are some slight problems. The BOP has gone from max green to a lower level and the RS line is not hitting a new high with the price. The bigger problems lies in the fundamentals. There are no earnings and there will be no earnings any time soon and the sales are going in the wrong direction by a severe amount. I am not sure why this chart pattern has even showed up. Emotional inexperienced investors should stay away and if anyone goes long this stock you should keep it very small. This is a complete play on a chart. Cut your first loss with a close below the 6.30 level and your final loss with a close below the 50 dma, if the stock does not move higher immediately.

adding to existing CANSLIM swing longs: SPSS SNDA

SPSS is breaking out of a base on base pattern, on strong volume. This has been a very pretty chart since February and since then there has been nothing but heavy accumulation, low volume pullbacks, and green to max green BOP. The RS line is even making a new high with price. The only visual discomfort I have with this chart is that BOP has gone from max green and every day is a lower green. The fundamentals are fantastic with EPS growing 4% to 63% the past three quarters and sales growing between 3% and 14% the past eight quarters. YOY EPS gains of 40% and 17% are expected in 2007 and 2008. The only problem is fund ownership is decreasing from 123 to 105 the past four quarters but maybe the smart funds are still buying more than the other funds are selling. Hence the price gains. Cut your first loss with a close below the 42 level and your final loss with a close below the 41.43 level, if the stock does not move higher immediately.

SNDA is bouncing off the 50 dma with a great intraday reversal, on strong volume. This stock has been acting very well since my initial buy in December. Since then the stock has gone up, consistently finding support at the 50 dma, is under huge accumulation, and has had tons of green and max green BOP. There is very little I can find wrong with this stock chart except that BOP went from max green BOP to slightly less max green. It would be best if the BOP would have stayed maxed out. EPS has grown over 999% the past two quarters and sales has grown 35% and 62% the past two quarters, reversing four quarters of negative growth. YOY EPS estimates for 2007 and 2008 are for gains of 70% and 17% respectively. ROE is a strong 23%. These strong fundamentals are why the fund ownership has grown from 10 to 14 the past four quarters and why the chart is so nice. Cut your loss with a close below the 50 dma, if the stock does not move higher immediately.

adding to existing speculative CANSLIM swing longs: ATK

ATK is breaking out of a base on base pattern, on strong volume. This is a very pretty chart with all the green BOP, heavy accumulation, low volume pullbacks, and sound price action. Two problems that pop out are that BOP is weakening from a high green to a lower green and the RS line is not following ATK into near new closing highs. EPS has grown between 7% and 20% the past four quarters and sales has grown between 8% and 17% the past eight quarters, with estimates for 07 and 08 for 19% and 12% gains in earnings. Fund ownership has barely increased from 150 to 154 funds, but funds still own 45% of this stock. I would keep this long smaller, as the attempted breakout is from a shorter base. Cut your loss with a close below the 98.08 level, if the stock does not move higher immediately.

adding to existing speculative longs: HRBN MNTG

HRBN is bouncing off the 50 dma, on extremely strong volume. This is a nice chart for an IPO as it is loaded with green BOP and max green BOP. However, the slight problem in this chart lies with BOP as it is going from max green to a lower green level. I would prefer BOP to still be max green. EPS has turned negative in the most recent quarter but 08 EPS YOY estimates are for an 82% gain. Sales growth is increasing between 39% to 293% the past seven quarters and ROE is a powerful 53%, giving the chart reason to work higher. However, the stock is very thin and very new so it is still dangerous for inexperienced emotional traders. This stock is a very pretty chart the past fifteen days but I would not load the boat on this one, if you do go long. Cut your loss with a close below the 50 dma, if the stock does not move higher immediately.

MNTG is bouncing off the 50 dma, on very strong volume. This is a very pretty chart and I have a 47% gain in this one already so I would not load the boat on this one right here. But the chart is very beautiful and is definitely in a very safe position for a long. What is so pretty about this chart is all the green and max green BOP since September, the constant support that it finds at the 50 dma, the great intraday price action, and amount of accumulation that is in this chart. The EPS does not have consistent growth and put in a nasty number the most recent quarter. However, estimates this year and next are for 156% gain and 85% gain in earnings. Sales has increased from 3% to 15% the past three quarters. So there is reason for this to keep moving higher. Cut your loss with a close below the 50 dma, on this purchase, if the stock does not move higher immediately.