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New Long Plays

Advance Auto Parts - AAP - cls: 32.93 change: +1.46 stop: 30.95

Company Description:
Headquartered in Roanoke, VA, Advance Auto Parts is the second-largest retailer of automotive aftermarket parts, accessories, batteries, and maintenance items in the United States, based on store count and sales. As of July 15, 2006, the company operated 2,971 stores in 40 states, Puerto Rico, and the Virgin Islands. (source: company press release or website)

Why We Like It:
A relatively widespread market rally and some positive analyst comments on AAP produced a big bullish breakout in the stock. Shares of AAP added 4.6% and broke out over significant resistance at the $32.00 level on strong volume. The move over $32.00 is a breakout into the gap down created in June. We think there is a good chance that AAP will try and "fill the gap". Traders can choose to go long the stock here or wait for a potential dip back toward $32. Now that $32.00 is broken resistance is should offer some support. Don't be surprised if AAP finds some overhead resistance at the descending 100-dma, which might be another reason to wait for a dip back toward $32.00. Our target is the $35.80-36.00 range. We do not want to hold over the early November earnings report.

Picked on September 12 at $32.93
Change since picked: + 0.00
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume: 1.4 million

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SafeNet Inc. - SFNT - close: 19.35 chg: +1.00 stop: 17.89

Company Description:
SafeNet is a global leader in information security. Founded more than 20 years ago, the company provides complete security utilizing its encryption technologies to protect communications, intellectual property and digital identities, and offers a full spectrum of products including hardware, software, and chips. (source: company press release or website)

Why We Like It:
SFNT displayed a lot of relative strength today with a 5.4% rally and shares managed to hit a new four-month high on an intraday basis. It's possible that the rally was fueled by news out this morning. SFNT announced it had increased security for BlackBerry users with their new Smart Card 330 to be used with the BlackBerry Smart Card Reader. Of course it didn't hurt the stock that the GSO software index produced a strong 2.2% rally. Shares of SFNT already had a bullish pattern of higher lows. At the moment shares look poised to breakout above resistance. Normally we would be looking at the $20.00 mark to act as resistance but for SFNT the line in the sand appears to be near $19.50. We're suggesting a trigger to go long the stock at $19.60. If triggered our target is the $22.00 level. More conservative traders may still want to wait for a rally over $20.00 before opening plays.

Picked on September xx at $xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume: 300 thousand

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WebEx Comm. - WEBX - close: 38.49 chg: +1.61 stop: 34.99

Company Description:
WebEx Communications, Inc., is the global leader in software-as-a-service (SaaS) applications for collaborative business on the web. These software-as- a-service (SaaS) applications enhance high-touch business processes, such as sales and training, with efficient web-touch interactions. (source: company press release or website)

Why We Like It:
WEBX has been showing a lot of strength lately. The trading over the last four weeks looks like a bull flag pattern with the breakout from the consolidation yesterday. Today's follow through rally (+4.3%) is a new five-year high and has produced a new MACD buy signal. Volume has been improving as well and today's volume was well above the daily average, which is another bullish sign. The P&F chart has a bullish triangle breakout buy signal that points to a $70 target. We are suggesting long positions with WEBX above $37.00. Traders can choose to go long at current levels or hope for a pull back. Our target is the $42.50-44.00 range. We do not want to hold over the late October earnings report.

Picked on September 12 at $38.49
Change since picked: + 0.00
Earnings Date 10/25/06 (unconfirmed)
Average Daily Volume: 625 thousand
 

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