The Play Of The Day

July 10, 2000
08:22 AM EST.

Good Morning Stock Fans!


Stock Fans, On Friday, July 7, 2000, the NASDAQ looked to get stuck once it gapped over 4,000 for the first time in over 10 trading days following a weaker then expected labor report. The economy indeed appears to be slowing. Therefore, the FED has done its job and has slowed down the economy. It seems to have caught itself however in a scenario of "Darned if you do" "Darned if you don't." Meaning corporate profits have been and should continue to be affected by the economy’s slowing. This action should now be a result of a dropping NASDAQ market.

However, this past Friday a slowing and weaker labor report was seen as positive. How can that be true in the longer term, as a slowing should cause lower profits, setting up lower stock prices.

I am looking for the NASDAQ to test its current 30 day low of 3695.00 before it breaks its current 30 day high of 4074.00. This is a result of the economic slow down which in turn slowed YHOO, INTC, MSFT to name a few all warned in April of a slowdown in profits. It would seem that with that soon their expected numbers should tell the tale. The upcoming CPI this Friday could be the catalyst that sets the NASDAQ up to test 3695.00.

Today, I see the NASDAQ opening under 4000.00. Then I will look for a bounce off 3982.00, back to 3999.00. The NASDAQ then should pull back and fall to the 3945.00 area and may struggle to hold 3900.00 today.

(The NASDAQ outlook, is presented each day by the Stock Jock! It is not to be taken as a direction of all stocks. It is just one of the many indicators that the Stock Jock uses to gauge the market’s daily direction. He always plays by the simple rule:
"Don't fight the tape." Meaning: Play each stock separately, if it’s in an uptrend then play it higher, if a down trend play it lower or off support long. His NASDAQ Outlooks are only a personal opinion and shouldn't be misconstrued as being investment advice or that this report is intended to encompass or provide information on the entire US Stock Market.)

3 DAY HIGH: 4023.00
3 DAY LOW: 3820.00

Today's "Play of The Day!" is: CMGI Group (NASDAQ:CMGI)

The CMGI group is the world's premiere Internet Incubator. It has been hammered of late, as many of the dot-coms have been taken to new lows. CMGI traded on Friday less than 10.00 off its current 52 week low. It closed at its low on Friday dropping under 42.00 to close at 41.00. This stock's next level of support looks to be strong and based on its August lows of almost a year ago of 33.45 it should be able to hold 36.00 and bounce off 36.50 where it has solid support. I am looking for the stock to shake out some of its remaining long term investors as it loses 40.00, then this stock should bounce just under 38.00 and could go back to 45.00 rather easily.

In making this call, I looked at to other past popular dot-coms like PCLN and AMZN. Both dropped big in the last 10 days, but both also bounced more than 7.00 off those lows. I don't think I would have much disagreement if I stated CMGI alone is better than those two put together. It has been here before and bounced up big. For example, this stock traded at 33.00 at August and just 6 months later broke 200.00 PLUS!

Buy Area: 38.25-38.93750
Sell Stop: 35.8750
1-3 DAY TARGET: 42.50
4-5 DAY TARGET: 44.50-45.00
6 month TARGET: 89.00-96.00
Type of Trade: Swing Trade

"RUN THE OPTIONS:" CMGI The CMGI July 45.00 CALLS when CMGI loses 40.00

JDS Uniphase (NASDAQ:JDSU), SHOCKED the Street today as it announced it would buy SDLI for almost a 200% markup of 41 billion. Based on SLDI 100 times latest earnings. JDSU is going to open today down more than 15.00 from it close on Friday. It has already in pre market filled in a gap it had at 103.6250-105.00. The next level of support is one I am looking for it to hold. That level is a DOUBLE BOTTOM that it has formed in its 60 day trading range of 96.00. It should be able to hold this area, as it probably loses 100.00 today and then have buyers looking for a bounce as JDSU would then be down more than 15% off Friday's close.

Buy Area: 100.00-101.00
Sell Stop: 95.8750
1-3 DAY TARGET: 111.00
Type of Trade: daytrade/ swing trade

The best play here looks to be to daytrade--the
JDSU July 105.00 OPTION CALLS, when JDSU loses 100.00


(*SJ is currently SHORT JDSU from 119.50. He will cover under 101.00 as he stated last week for a less than 2 day profit of $18.50! on 700 shares 700 x 18.50 = 12,950.00!!!!!!! **SJ Also has 10 of the JDSU July 105.00 PUTS! Looking for less than 2 day return of 400%!)


Broadcom (NASDAQ:BRCM), has run up big of late partly on it being added to the S and P’s 500 and also because it’s a great stock. No surprise here! BRCM has to have some profit taking, and I look for BRCM to not be able to break 240.00 before it tests the 205-210.00 area. The stock is way ahead of itself, and it should have plenty cash in on its latest run.

Sell Short Area: 232.00-229.00
Buy Stop: 240.00
1-3 DAY TARGET: 219.00-215.00
5-7 DAY TARGET: 209.00-207.00
Type of Trade: daytrade/ swing trade.

The July 210.00 OPTION PUTS look best.

BONUS PLAY # 4 EXFO Electro-Optical Engineering (NasdaqNM: EXFO)

EXFO is a designer, manufacturer and marketer of fiber-optic test, measurement and monitoring instruments for the telecommunications industry. For the six months ended 2/29/00, sales increased 55% to $29.1 million. Net income applicable to common increased 97% to $3.7 million. Revenues reflect a higher demand for scientific products and an increase in sales of other products. Net income also reflects a higher gross margin due to increased economies of scale. Stock Fans, EXFO is a recent IPO. EXFO has a PE of 281 and a growth rate of 43%. Most of the recent IPO's don't have any track record. This one does! The stochastic have turned up and it looks primed to go. I am buying a 1/3 to 1/2 position and adding as needed.

Key Indicators: EXFO
Buy Area:$48.00 to $48.75
TARGET:$53.625 to $56.0625
Time Frame: 3 to 5 days
Type of Trade: Swing Trade
Daytrade for $1.00 point scalps. Avg. daily price range not determined.
Recent IPO.

BONUS PLAY # 5 Conexant Systems (NASDAQ: CNXT)

Conexant Systems provides semiconductor products and systems solutions for communications electronics. Conexant delivers integrated systems and semiconductor products for a broad range of communications applications. These products facilitate communications worldwide through wireline voice and data communications networks, cordless and cellular wireless telephony systems, personal imaging devices and equipment and emerging cable and wireless broadband communications networks. The Company operates in five business segments that include Personal Computing, Network Access, Wireless Communications, Digital Infotainment and Personal Imaging.

Stock Fans, We have played this before and done well with this. Conexant estimates earnings will grow by 379% in 2000. Earnings date is 7/19. It has formed a nice 9 week base at current price levels. Conexant has pulled backed and the timing indicators say that it is primed to pop

Key Indicators: CNXT
Buy Area: $47.75 to $48.50
Stop: $44.8625
TARGET: $52.1375 to $54.56
Time Frame: 2 to 6 days
Type of Trade: Swing Trade
Daytrade for $.75 - $1.25 point scalps. Avg. price range $3.96



MSFT- It broke 82.50 Friday an over 120 day resistance for MSFT. If it holds 80.00 today it may mean NASDAQ is going higher in the near future. If it loses 80.00 and drops near 76.00 then it could be indicating the NASDAQ is setting up to test 3695.00 as MSFT traded at 76.00 when the NASDAQ was there less then 30 days ago!

1. GNSL- under 23.43750 I will buy and look for 30.00
2. ORCH - It has been on fire. I will watch for more.
3. IMNX- 70.00 might be too much to ask off 52.00 low last week.
4. BBSW- If it breaks 36.00 It could go to 50.00 fast
5. BSTE- Solid Bio Tech. I will watch for further upside.
6. CLGN- May run more.
7. AFCI- resistence is 48.0 if it breaks it 52.00 If it can't hold 46.00 short to 42.00.
8. DURA- 2.5 x normal 30 day average was block volume Friday
9. GERN- I will watch this bio tech today.
10. NVLS-I like 60.00 as the top buy back 55.25.
11. ANCR- If it breaks 41.00 it could run!
12. YHOO- earnings report comes tomorrow … If it runs look for 122.00 as the top current resistance is 118.50 If it pulls back look for 112.8750 as support and a buy area Current support is 115.00. 3 day high 128.00 3 day low 115.00.
13. EBAY- It could make a move up or down depending on YHOO. 48.8750 support.
14. ORCL- 77.50 resistance support 72.50
15. CEGE- If it can hold 30.50 it could run to 37.00 fast.
16. GMST- I like it as short to drop 5-10
17. AMZN- It could test 33.00 area again, if YHOO drops.
18. EMLX- I like a test of 52.00 before it breaks 65.00.
19. BVSN- This one if it can hold 40.00 could bounce 5.00. If it can't 36.50 is next level of support. (plus players look for an Alert Email today on this one.)
20. ALGX breaks 76.00 it going it could goto 94.00 fast. If it loses 70.00 I short it back to 63.00 at least.
21. SSTI-buy area: 73.50-72.00 sell stop:69 1-2 day target: 76.00
22 RIMM- Looking for 55-56 next 2 days
23. NXTL- This one could break out in next few days and add on more.
24. JNPR- This stock has numbers next week it could reach an all time high this week!
25. LTXX- It has a TRIPLE BOTTOM off 26.75. I go long at 27.00 and look for 32-34 on this oversold issue.

Have a great day!

More to come....

Stock Jock!

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