The Play Of The Day
8:50 am est.
Today's Play of The Day is: ASD Systems (NASDAQ:ASDS)
ASD Systems provides software and manages the infrastructure behind e- commerce. ASD's software and comprehensive service solution enables Internet retailers and direct marketing businesses to outsource their complete commerce-related operations. ASD's software integrates clients' Web sites with multiple call centers, fulfillment centers and drop-ship vendors. Clients can also outsource their operations to ASD's integrated network of call centers and strategically located fulfillment centers. The ASD solution is priced on a per-transaction basis, reducing clients' initial costs and speeding their time to market.
Yesterday, December 16, 1999 shares of the recent IPO (NASDAQ:ASDS) sold off on LESS VOLUME in what was yet another NASDAQ rally into record highs. The stock on volume of 871,000 considerably off its 30 day average volume of over 2 million shares fell more then 2.00 points as it would close right at it low of November 24, 1999.
Looking at the stocks recent trading we see on its volume chart that it has been pulling back on LESS VOLUME (more often then not a healthy move to make stock go higher later) since December 8, 1999 when it last traded over 1 million shares and closed at $20.68750. Since that time the last 6 trading day counting yesterday it has traded less everyday then its 30 day trading average and dropped everyday to reach a 30 day low yesterday of 14.81250 before it managed to go up a tick and close at $14.8750.
One thing that may shed a bit more light as to the recent pull back is recent news filed on November 29, and released in a press release on December 8, 1999.
VantagePoint Increases Position in ASD Systems, Inc.
GARLAND, Texas, Dec. 8 /PRNewswire/ -- ASD Systems, (NASDAQ:ASDS) today announced that VantagePoint Venture Partners III (Q), L.P. and VantagePoint Communications Partners, L.P., elected on November 29, 1999 to exercise all of their common stock purchase warrants in ASD Systems, Inc., acquiring an additional 2,597,400 shares of common stock in the company. The warrants were acquired by the funds in connection with the Company's preferred stock financing closed August 23, 1999, and carried an exercise price of $2.94 per share. ASD Systems will not receive any cash proceeds upon the exercise of the warrants as the VantagePoint funds have elected to satisfy the exercise price by using the warrants cashless exercise feature, which reduces the number of shares granted to the funds upon exercise. After the exercise, the VantagePoint funds will collectively own 4,847,400 shares of common stock, representing approximately 23.0 percent of the outstanding stock of the Company. "We are excited about the future of ASD Systems," said Alan E. Salzman, managing partner for VantagePoint. "We have therefore decided to exercise 100 percent of our warrants and increase our ownership in ASD Systems to the fullest extent possible.
This recent news may have something to do with the pullback that the stock has seen of late. One thing is for certain that the stock has been as high as 32.50 it all time high as recently as last month. It had a similar move that members of our LIVE TRADING ROOM TEAM of Traders spotted in our room back when it found a high of 19.50 then fell to 14.81250 before it then made that run to its all time high of $32.50.
The stock fits the criteria of what we look for in that it is LOW RISK at current levels and has the potential for a good reward. It appears to be oversold at current levels, and has good support at $14.81250 a place it bounced off of yesterday. It looks good to take a position and look to be in the stock for a move that should take it back up to 21.00 a price it traded at the last time it traded over 1 million shares.
KEY INDICATORS: (NASDAQ:ASDS)
Buy Area: $14.81250-$15.25
Sell Stop: $13.1250
Time Frame: 2 to 7 days
Type of Trade: Swing Trade
As a Daytrade: Look for a little more then 2 points today or a price of $17.50
BONUS PLAY #1 Metromedia Fiber Network. (NASDAQ:MFNX)
MFNX is a facilities-based provider of technologically advanced, high-bandwidth, fiber optic communications infrastructure to carrier and corporate/ government customers. Stock fans, Metromedia Fiber Network has been selected to be in the Nasdaq 100. This means that this is a happening Company (as the Naz does not accept slackers) and that the Money Managers have to buy this stock to balance their Index Fund!
The Stock made a move in late day trading and then exploded in after hours. It may have more room to run from here. The stock looks to have a lot of momentum that could very well carry it into the 50's. it looks to open higher today establish a trading range and then it should power forward form there.
KEY INDICATORS (NASDAQ:MFNX)
Buy Area: $45.50 to $46.25
TARGET: $50.875 to $53.19
Time Frame: 2-5 trading days
Type of Trade: Swing Trade
BONUS PLAY #2 America Online (NYSE:AOL)
Yesterday AOL got hit pretty hard off a morning high of over 92.00 share. However when the rest of the market was rallying shares of (NYSE:AOL) even on strong news with a partnership with power house retailer Walmart AOL was floundering. It traded heavy volume yesterday and at one point late in the day lost support that it had bounced off 4 times earlier at $85.00.
The stock was one I called at $79.93750 about 1 week ago. That loss of 80.00 saw the stock loose most all of its short term holders at the breaking of $80.00. It then on a 3 day span went to over $93.00 a share. Since then the stock has fallen back, it looks to have a sideways range of late between $85.00 and $87.437650 a share.
The stock may indeed break under 85.00 today if it does then it looks to be a great buy at just under $80.00 a share. It then would test it 10 day low and be ready to make a move back up to that $90.00 area all over again.
One thing is for certain that if AOL breaks under 84.6250 it should indeed find its way to less then 80.00 a share. many short term holders of AOL expecting the NYSE's number one percentage leader over the last 3 years to trade higher and make easy gains will be fast to exit. when they do I will be ready to steal this one again as they sell trying to limit losses when they should be buying more.
SPECIAL NOTE: AOL is not Play to the upside unless it breaks $91.50 then the stock looks good to take a shot at $95.00. Use this method to play AOL if it manages not to test that 80.00 area and goes higher today. AOL in the range of $84.75 to $89.68750 is not worth playing as it is just stuck in a trading range there.
KEY INDICATORS: (NYSE:AOL)
Buy Area: $79.93750-$80.25
Sell Stop: $74.3750
Time Frame: 2 to 5 days
"RUN THE OPTIONS!"
The Stock Options that make the most sense for this predicted upcoming move would be the AOL January 2000 $90.00 Call Options. To be bought as the stock hits the predicted Buy Area.
STOCKS ON OUR SCREENS TODAY:
SIII - It may be a great play after it opens and pulls back look for 11.25 or so as a buy area. TARGET if this happens $13.75. A fast one on momentum back up off opening highs.
SPLT- looks solid here to come back
ESFT- It retraced and now may make a run back to 30's again.
EXNT - closed up late.
ICCI -might be finally making a move
ITVU - should keep running on a split move.
SPLN - in a up trend may take a shot at 60's
ESHR - watch for a pull back and a bounce perhaps higher.
Have a great day!
More to come....
and BigPlayStocks.com Team of Traders