20-Day Play: EHTH

In order for a stock to make The 20-Day Play, it must trade above its 20-day simple moving average for at least 20 days, and then bounce on or near the 20-day average.



EHTH saw its IPO just one year ago. After finishing a cup-shaped pattern, the stock has pulled back to its 20 DSMA. This touchdown is also a revisit of a pivot point.

Last week's 20-Day Play, DAR, is still in play.

20-Day Play: DAR

The 20-Day Play seeks to capture a stock that has consolidated momentum and is ready for another leg up. Specifically, the stock will have traded above the 20-day simple moving average for at least 20 days and will be set up to bounce from the average.



DAR certainly meets the basic screen necessary for the 20 Day Play. However, the RSI and MACD are both showing signs of possible weakness ahead. Be careful as more consolidation maybe required before DAR can continue moving up.

Also present is the almost symmetrical reverse head and shoulders pattern.

Overall, I find this stock worth watching to determine if the 20 day average will begin to offer support as it did in March, April, May, and June.

The 20-Day Play- SMSI

In order for a stock to make The 20-Day Play, it must trade above its 20 day simple moving average for at least 20 days, and then bounce on or near the 20 day simple moving average.

SMSI has only traded above its 20dsma for the last 18 days. While failing to meet the time criteria for the setup, I still believe it is a good candidate, albeit premature. The stock rocketed on a great earnings report on monumental volume. It has since pulled back on decreasing volume. The MACD and the Stochs show there may be a day or two more left in the pullback. This puts the price touching down on the 20dsma just as the Stochs edge near oversold.

One other observation. A Golden Cross (50dsma rises from under and crosses the 200dsma) looks to be confirmed tomorrow.

The 20-Day Play

The 20-Day Play will be a regular feature of this blog. In order for a stock to make The 20-Day Play, it must trade above its 20 day simple moving average for at least 20 days, and then bounce on or near the 20 day simple moving average. (Please consider the words "The 20-Day Play" to be trademarked, 2007.)

First up is LDSH. This chart features a strong run-up and a pull back to the 20-day. Prior resistance highs from May and June of 2006 are meeting the 20 day and have become support.

Ladish Co., Inc. is a leading producer of highly engineered, technically advanced components for the jet engine, aerospace and general industrial markets.

The last earnings report for LDSH shows that the company almost doubled YoY diluted EPS.


Up next is KNXA.
KNXA's chart features a strong run-up and a pullback to the 20-day. The stock bounced firmly from support generated from the pivot-point at 35 and regained its footing to close above the moving average.

KNXA last reported earnings on Valentine's Day. It was a sweet report, although they guided FY07 Q1 on the weak side.