Option Investor
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Daily Newsletter, Thursday, 03/09/2000

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The Option Investor Newsletter         Thursday  3-9-2000
Copyright 2000, All rights reserved. 
Redistribution in any form strictly prohibited.

Posted online for subscribers at http://www.OptionInvestor.com
************************************************************
MARKET WRAP  (view in courier font for table alignment)
************************************************************
       3-09-2000           High     Low     Volume Advance Decline
DOW    10010.70 + 154.20 10010.70  9738.90 1,126,833k 1,689  1,267
Nasdaq  5046.86 + 149.60  5047.96  4857.57 1,951,147k 2,471  1,819
S&P-100  756.97 +  17.11   757.11   733.06    Totals  4,160  3,086
S&P-500 1401.69 +  34.99  1401.82  1357.59            57.4%  42.6%
$RUT     606.05 +  11.37   606.05   591.70
$TRAN   2341.44 -  11.09  2357.60  2321.38
VIX       23.78 -   2.17    27.55    23.77
Put/Call Ratio       .38
*************************************************************

Nasdaq 5000, that was too easy. How about N6k by tax day?

I told you it was a Super "Entry point" Tuesday and the market
was nice enough to give us a second chance on Wednesday morning
even though I "voted" to skip that option. The Nasdaq is now 
almost +300 points above the low set just yesterday. Nothing
shabby about that! The Dow just tagged along for a ride and
really did not change direction to the upside until about 2:PM.
The lack of help by the Dow and the almost invisible rebound
from the huge Tuesday drop should be a loud warning that the
Nasdaq rally may have some rocky times ahead.


 


 


The Nasdaq powered forward today seemingly oblivious to the fact 
that the Dow was still struggling. The Nasdaq itself was undergoing
some serious sector rotation internally. The biotech sector which
had led most of the last 700 points was a serious drag and the 
Internets were barely contributing. Stocks like YHOO +6, AMZN +5, 
CMGI +6, were up but not as much as you would expect. Other leaders
were heading in the wrong direction, EBAY -1.50, BVSN -1.56. Of 
course if you consider merger partners NSOL +71, VRSN +37 and
splitter RBAK +32 then everything is relative. That is what makes
the Nasdaq so strong. When one sector is weak another picks up
the slack. The Dow however is still stuck with the perpetual 
losers. T -.38, KO -.88, DD, -.50, EK -1.50, IP -1.31, MMM -1.63,
PG -.06, MO -.13, SBC -.06, UTX -1.19. But you say those numbers
were not that bad? You are right except almost all of them are
at 52wk or longer lows and today was the rebound day from the 
really bad numbers. If this was all they could muster on a rally
day then we still have some trouble ahead.

It only took the Nasdaq 46 trading sessions to move from 4000
to 5000. Most of the heavy leadership today fell to the computer
and software stocks that make up a large percentage of the index.
MSFT +4.44 on news that Gates was "making every effort" to settle
peacefully and that MSFT was entering the video game market and
would compete head to head with other game makers. One point
lost on the investing public was the timeframe for their new
games, Christmas 2001, almost two years off. CSCO +7.25 on a
rumor that Dow Jones was going to replace PG with CSCO in the
Dow. Not hardly. CSCO may make it eventually but never in the
past has a DOW change been leaked in advance or has any company
been dropped for missing earnings. I can see why Dow Jones
would want to replace some of the rusting assets of the Dow with
technology companies but eventually we would have the Dow (TECH)
30. In reality with the market cap CSCO commands you could
probably cut off the bottom six performers, add CSCO and have
the Dow 25. Just dreaming. 

Continuing with the Nasdaq leaders INTC +3.44 on the delivery 
of their gigahertz chip. Dell, yes Dell, also soared +3.50 on 
huge volume after announcing that they were continuing to steal 
market share from Compaq in critical areas. We were watching 
the time&sales on DELL this afternoon and there were huge blocks, 
60K, 75K, 100K going across the tape at the ask all afternoon. 
Over 71 million shares traded today. The buyers overcame a huge 
block of sellers at the 49.88-49.94 range. Millions and millions 
of shares traded hands with only a 1/16 spread and many times
the bid/ask were the same for long periods of time. I don't
know who wanted out but I estimate something close to 30 mln
shares traded at $49.94 before the breakout finally came.


 

All these "regulars" finally came together on the same day to
accomplish the 5000 milestone. It is amazing to me how far and
how fast the Nasdaq has risen. Here are some of the important
dates.

2000 July 1998
2500 Jan 1 1999
3000 Nov 3 1999
3500 Dec 3 1999
4000 Dec 29 1999
4500 Feb 17 2000

Take a good look at that list. The Nasdaq was started in 1971
but 50% of its gains have come since January 1999. +2000 points
in just the last four months and Y2K fell in the middle! After
the bell today Ralph Acompora, if it is a big number event you
can be sure Ralph will be on CNBC, said he could easily see
Nasdaq 6000 before the end of the year. Come on Ralph, get 
with the program. Ramp up those expectations to real world,
new economy, estimates. I am going on record tonight that the
Nasdaq will see 6000 by tax day April 15th. Top that Ralph.
It is simple math. 46 trading days since 4000 = only 22 points
per day. At the current rate of climb of around 56 points per
day on average, we are only talking about 19 more trading days.
Thrown in a couple of mini corrections and a couple +100 point
rebounds and I think we can do it, unless of course the Dow
heads for 8000 and becomes an anchor for every other index.

After the bell today CMGI posted a smaller than expected loss
on an increase in earnings of +2,250% over last year. WOW!
Analysts expected CMGI to lose -$1.28 and they posted a loss
of -$.74 cents. Business is good at CMGI and they said they
expected the AltaVista IPO to be out next month at $18 to $20.
Delays were blamed on the SEC. CMGI has about 65 current
Internet companies in various stages of development and they
are planning to maintain the frantic pace. This news helped
raise their share price by $4.00 to $149.56 in after hours
trading.

Where to from here? This is a catch 22. The Nasdaq rally today
was pretty strong and fairly broad based. The financial stocks
actually showed life today and the OEX was moving up well in
advance of the Dow. The OEX actually put in a bottom at the
end of February even though the Dow took out its Feb lows
this week. The broader market is showing strength but the
Dow is the proverbial "lead balloon."  The catch? Don't look
now but the rampant euphoria today sent the VIX plummeting
to close at 23.78 after almost hitting 29 yesterday. 24 is 
not a sell signal but the speed at which it was declining
could put it under 22 and in sell mode on a good strong open
tomorrow. Couple that with the +300 points since the low
yesterday and weekend profit taking could easily stop this
rally dead in its tracks. Still the euphoria is rampant and
money is flowing into techs at record rates. A continuation
of the rally tomorrow could set up a Monday follow through
and we could be on the way to April earnings. Now before
you start selling the kids to raise cash let me remind you
that CPI and PPI are next week and the FOMC meeting the
following Tuesday. You did not think it was a yellow brick
road all the way to 6000 did you? There will be some potholes
but we will get there. 


 

We had a winner in the Nasdaq 5000 contest from Sunday. To
enter you had to guess the day the Nasdaq would break 5000
the first time, the time of day and then the day it would
close over 5000 the first time. The winner, by 3 seconds
was Louise Hill. Louise has been a subscriber since Oct-1998 
and must have been paying very close attention over the last 
few months. The exact time the Nasdaq broke 5000 was Tuesday 
morning at 9:49:06 EST. Louise guessed 9:37:15, only 11:51 off.
The next closest guess was 10:01:00 or 11:54 after the fact.
Congratulations Louise, now guess how long it takes us to
mail your $500 prize!  Just kidding.

SEMINAR ALERT !!

Due to scheduling conflicts we have had several cancellations
for the March Option Expo Seminar n Denver. We have six openings
for session one, March 25-28th and four openings for session
two, March 28-31st. If you have interest in attending either
of these sessions please register ASAP. It is first come,
first serve. You will not regret fours days of intense option
training by the Option Investor staff. 

For more info click here;

http://www.OptionInvestor.com/bootcamp/oinmain.html

Trade smart and sell too soon.

Jim Brown
Editor

Disclosure notice: 

Current long positions include; 

SNE, TXN, DELL



******************************
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Spring Advanced Seminar Series
******************************

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this seminar is for you. Remember, you can bring a friend
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free. The cost of the two day seminar is about what you would
lose in only one trade. Invest it, don't lose it.

Here are the spring dates: 

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Mar 26/27 Dallas
Apr 2/3   San Francisco

For complete details http://www.OptionInvestor.com/seminar/

There is a 100% money back guarantee and you can take a friend
for free. What else could you ask for?



**********
STOCK NEWS
**********

Test Yourself with Trinity Biotech
By Matt Paolucci

With the rising costs of healthcare, and the difficulties of
scheduling appointments, going to the doctor has become a
frustrating and economically prohibitive chore. For major
medical problems, a doctor it is essential because of the
diagnostic equipment they have access to. But in the cases in
which you could perform a simple medical test on yourself, it
would be nice to be able to simply buy a kit that could render
results without a doctor's visit, or at least diagnose whether
or not you need to consult a doctor. It would save time, cost
less, and be much more convenient. Well, a little-known
company called Trinity Biotech (TRIBY) just may have what you
are looking for.

Trinity Biotech develops, manufactures, and markets over 100
diagnostic products for the point-of-care, self-testing, and
clinical laboratory segments of the diagnostic market. Trinity
markets over 120 products through distributors in 80
countries.

Without getting too technical, the company's products help in
diagnosing conditions which include auto-immune and hormonal
disorders, sexually transmitted diseases, enteric infections,
respiratory infections, drugs of abuse, cardiovascular
diseases, bone metabolism hCG (obesity), Strep A, HbsAg
(Hepatitis), H. pylori, Chlamydia, HIV (AIDS), gonococcal
(gonorrhea), CMV (cytomegalovirus, side effect of HIV), and
HSV (herpes) infections. Trinity also provides control kits to
assist in the interpretation of results.

Trinity has grown rapidly through acquisition. It's most
recent coup was the purchase, on March 7, of MarDx
Diagnostics, which manufactures and markets an FDA-approved
test kit that detects and assists in the diagnosis of Lyme
disease. MarDx is a considered a world leader in the
development and manufacture of diagnostic products for
diagnosing certain infectious diseases. Trinity CEO Ronan
0'Caoimh said the acquisition strongly complemented the
company's existing product portfolio and will be immediately
accretive to earnings.

Still more good news?  Yep.

Trinity also announced in January that it received Food and
Drug Administration (FDA) marketing clearance for its Macra(R)
Lp(a) test kit for use on automated systems. The kit is used
to measure protein levels contained in human serum. Recent
studies have identified Lipoprotein(a) as a significant risk
factor for the development of coronary heart disease.

What's great about Trinity is that its products could
dramatically reduce the need for people to visit the doctor.
Doctor visits are one of the things that people dread the
most. Trinity's products should grow in popularity as the
population grows. In the broader scope, fewer visits to the
doctor means fewer insurance payments will be going to the
doctor. I'm sure the guys in the long white coats don't want
you to know about Trinity.

Investors are always interested at the chance to get in early
on companies with great products and potential. But biotech
stocks can often be risky investments. Trinity is a small
company, but it is also a profitable company. They recently
reported record fourth quarter earnings, before items, of 4.5
cents per share versus 3.2 cents in the prior year period, a
forty percent increase. Revenues rose to $6.6 million from
$6.3 million, also a record. For the year, Trinity, before
items, earned $4.51 million, or 16 cents per share versus
$2.58 million 10 cents in 1998, on revenues of $36 million
versus $33 million.

According to Zack's Investment Research, there are no analysts
covering shares of TRIBY, currently. With net profit margins
of 17 percent, strong earnings growth, and no debt, it won't
be long before Wall Street breaks the seal on this biotech
gem.



**************
Market Posture
**************

As of Market Close - Thursday, March 9, 2000 

                   Key Benchmarks
Broad Market       Bearish/Bullish  Last    Posture/Since  Alert
****************************************************************

DOW Industrials   10,700  11,250  10,011    BEARISH   2.17
SPX S&P 500        1,410   1,450   1,402    BEARISH   3.07
OEX S&P 100          765     780     757    BEARISH   3.07
RUT Russell 2000     500     520     606    BULLISH   2.24
NDX NASD 100       3,800   4,000   4,586    BULLISH   2.24
MSH High Tech      1,850   2,000   2,194    BULLISH   2.24

XCI Hardware       1,300   1,460   1,625    BULLISH   2.24                
CWX Software       1,200   1,470   1,639    BULLISH   2.24
SOX Semiconductor    800     900   1,290    BULLISH   2.24
NWX Networking       940   1,000   1,171    BULLISH   2.24
INX Internet         700     800     851    BULLISH   3.09  *

BIX Banking          500     550     467    BEARISH  11.30
XBD Brokerage        400     450     478    BULLISH   2.31
IUX Insurance        500     550     449    BEARISH  11.30

RLX Retail           950   1,000     820    BEARISH   1.28
DRG Drug             340     380     326    BEARISH   2.18
HCX Healthcare       700     750     672    BEARISH   2.18
XAL Airline          120     140     117    BEARISH   3.07
OIX Oil & Gas        280     315     278    BEARISH   1.27


Posture Alert    
Technology stocks helped lead the broad market higher Thursday, as 
the NASDAQ closed above the 5,000 mark, while the Dow squeaked 
above the 10k mark once again. Most sectors participated in the 
rally, with Drug (+5.45%), Healthcare (+5.24%), and Networking 
(+4.38%) leading the charge. The Drug and Healthcare sectors are 
now up over +10% in two days. With this most recent action, we 
have upped Internet to Bullish from Neutral, as that sector 
finally broke out of its 3-month trading range, and joined the rest
of the technology sectors in the bullish posture zone.



****************
Market Sentiment 
****************

Thursday, March 9, 2000

What's Next for the Dow?

Technology once again led the way to a big day on Wall Street, as the 
NASDAQ broke the 5k mark in spectacular fashion. The Dow also happened 
to close above the 10k mark, thanks to a strong performance by the Drug 
sector (+5.45%). Cisco Systems, which closed up almost +7, was the big 
rumor of the morning, as traders were speculating that the giant 
networking company would replace Proctor & Gamble in the Dow. What a 
bad week that would be for P&G, but like we said, this was a rumor that 
spread viscously. The folks at the Wall Street Journal (who choose the 
makeup of the Dow) must be shaking in their loafers, as the NASDAQ 
continues to outperform the "old index" in a dramatic fashion! It must 
be really hurting their egos that their index just plain stinks, and to 
see these technology stocks continue to soar. Now granted, we would not 
be surprised to see Cisco Systems (or AOL) in the Dow in the near 
future, we just doubt it will be tonight. Now from a sentiment 
standpoint, the day when the Dow Jones Industrial becomes technology 
dominated (thanks to the boys at the WSJ), is the day we short 
technology and buy the "old Dow" stocks!

Everything seems to be going our way this week for trading. In Sunday's 
letter we stated that this market was due for a breather and boy did we 
get it! On Tuesday's letter, we hinted that the market would bounce, 
and we got just what the doctor ordered. Technology continues to be the 
safe haven, but volatility will continue. With one week to the March 
expiration, we will continue to see wild swings across the board. Now 
looking at the Pinnacle Index for the OEX, we view overhead as being 
heavy, with underlying support being light. The market may jump up 
slightly, but we would expect a slight sell-off in the near term for 
the OEX. The Volatility Index continues to be a great trading tool, as 
that index continues to predicate a overbought to oversold market in a 
timely matter. Currently, it is a couple of points shy of being 
overbought, which leads us to believe that we may see some follow 
through to today's action on Friday morning. However, once that VIX 
hits the 20-21 range, we will be sellers again.

One sector that has been locked in a narrow trading range for the Year 
2000 has been the Internet Index (INX). While other sectors such as 
Software, Hardware, Networking, Semiconductors, and Biotech have gone 
through the roof, this sector has continued to lag behind. However, 
this sector is known to make most of its gains in a very short period 
of time, and for the first time in months, this sector was upgraded to 
Bullish (in the Market Posture section) by Pinnacle Capital. We have 
listed the stocks and their respective weightings, so that you may 
target shoot and individual issue should this index make a major run. 


Symbol  Name          Shares    Weight 
AMZN    AMAZON.COM      82      6.23% 
AOL     AMERICA ONLINE  90      5.07% 
ATHM    ATHOME CORP    161      5.48% 
CMGI    CMG INFO SYST.  72      8.04% 
CSCO    CISCO SYSTEMS   77     10.05% 
DCLK    DOUBLECLICK     74      8.19% 
EBAY    E-BAY INC       51      7.79% 
ELNK    EARTHLINK      235      5.75% 
EXDS    EXODUS COMM     93     10.62% 
INKT    INKTOMI CORP    90      9.86% 
LCOS    LYCOS INC       95      6.56% 
RNWK    REAL NETWORKS  100      8.84% 
YHOO    YAHOO!          44      7.51% 



BULLISH Signs: 

Corporate Earnings:
Major corporate earnings continue to come out strong and ahead of 
analyst expectations.

Cash Flow:
The cash that has been sitting on the sidelines has been put to use as 
of late, as record volumes for the major indexes have been shattered. 
With the NASDAQ surpassing volume of 2 billion shares again, this money 
is obviously flowing into technology.

Short Interest:
Short interest continues to climb as quickly as the market. The short 
interest on the NASDAQ increased another +8.51%, for a 5th consecutive 
record.

Interest Rates (6.148):
The current yield is now safely off of 52-week highs and is temporarily 
out of the danger zone.


Mixed Signs: None

BEARISH Signs:

Pre-Release Season: 
With April just around the corner, we have the beginning of pre-release 
season. Over the next 3 to 4 weeks, companies will let Wall Street know 
that their profit/sales goals are not being met, and their stocks will 
get brutally punished. The first major corporation to do just this is 
Proctor & Gamble, with it's 27 point decline.

Volatility Index (23.78):
The VIX continues to prove that the low 30's are an excellent 
buying opportunity, and the low 20's continue to be a great selling 
opportunity. At current levels, the VIX is within one good day of being 
in overbought territory.


Energy Prices:
With the rapid rise in crude oil, everything from manufacturing to 
transportation will be affected by higher costs. These higher costs 
will be felt 1-2 quarters out, and could put pressure on profit 
margins. 

Investor Expectations:
More and more investors are now expecting high double-digit growth if 
not triple-digit expansion in their portfolios. This extreme positive 
sentiment could help fuel a future selloff in technology shares.


The Power of Sentiment Analysis
It has often been said that the crowd is right during the
market trends but wrong at both ends.  Measuring and
evaluating the sentiment of the crowd, therefore, can give
savvy option traders a decided edge.

 
Pinnacle Index
OEX                              Friday      Tues        Thurs
Benchmark                        (3/3)       (3/7)       (3/9)

Overhead Resistance (790-820)    16.85       16.53       19.70
Overhead Resistance (765-785)     6.23        5.26        6.10

OEX Close                       765.95      732.25      756.97

Underlying Support  (740-760)     0.69        1.01        0.70
Underlying Support  (700-735)     2.71        4.68        4.18


What the Pinnacle Index is telling us:
On Sunday, we stated that the OEX was due for a breather, and boy did 
it get one. Then on Tuesday, we stated that a bounce was very likely, 
and we got that! We seem to be getting everything that we ask for! 
Anyway, as it stands now, direct overhead is heavy, and underlying 
support is light, which would indicate that we may be due for another 
pullback.



Put/Call Ratio                  Friday     Tues       Thurs
Strike/Contracts                (3/3)     (3/7)       (3/9)

CBOE Total P/C Ratio             .40       .43        .47
CBOE Equity P/C Ratio            .32       .35        .33
OEX P/C Ratio                   1.36      2.04        .99


Peak Open Interest (OEX)
                     Friday           Tues            Thurs
Strike/Contracts     (3/3)            (3/7)           (3/9)

Puts               680 / 9,154     705 / 10,844     705 / 11,191
Calls              750 / 7,497     750 /  7,277     750 / 10,458
Put/Call Ratio         1.22           1.49             1.07


Volatility Index
                    Major
Date                Turning Point       VIX

October 97          Bottom              54.60      
July 20, 1998       Top                 16.88         
October 8, 1998     Bottom              60.63
January 11, 1998    Top                 26.38
March 4, 1999       Bottom              28.15   
May 14, 1999        Top                 25.01 
July 16, 1999       Top                 18.13 
August  5, 1999     Bottom              32.12 
October 15, 1999    Bottom              32.06
January 28, 2000    Bottom              29.09

March 9, 2000                           23.78


Investors Intelligence 
                    Major             Percent     Percent
Date                Turning Point     Bullish     Bearish

October 97          Bottom            22.0        48.3       
July 20, 1998       Top               52.0        24.0         
October 8, 1998     Bottom            38.5        42.7
January 11, 1999    Top               58.3        30.0
March 4, 1999       Bottom            49.1        32.5
Oct. 13, 1999       Bottom            39.2        37.5

February 25, 2000                     51.8        28.6
March 2, 2000                         52.3        28.3
March 9, 2000                         53.4        27.6



Please view this in COURIER 10 font for alignment
*************************************************
CHANGES THIS WEEK

Daily Results

Index       Last     Mon     Tue    Wed    Thu    Week
Dow      10010.73 -196.70 -374.47  60.50 154.20 -356.47
Nasdaq    5046.86   -9.94  -57.01  49.42 149.60  132.07
$OEX       756.97  -12.99  -20.71   7.61  17.11   -8.98
$SPX      1401.69  -17.89  -35.66  11.08  34.99   -7.48
$RUT       606.05    3.76   -6.17  -0.79  11.37    8.17
$TRAN     2341.44  -58.36 -112.50  88.94 -11.09  -93.01
$VIX        23.94    1.86    3.48  -0.68  -2.01    2.65

Calls                Mon     Tue    Wed    Thu    Week

CHKP       270.38    6.75   16.56  18.44  -1.13   40.63  Set stops
NTAP       240.38   12.13    0.56   5.69  22.06   40.44  Excellent
QLGC       187.59   19.50   14.31   1.19  -2.84   32.16  Rocket 
CLRN       169.50    8.50   13.25  -4.81  14.56   31.50  Low vol
VERT       277.75   -6.59   -7.63  16.00  24.25   26.03  Near $300
EMLX       213.00   13.75    2.69   1.31   5.00   22.75  Entry 
RRRR        89.38    0.50    3.94  10.38   6.56   21.38  Ascending
AMD         58.13    5.63    7.50  -1.38   4.63   16.25  Semi-play
AFCI        79.88   10.25   -6.75   0.88  10.00   14.38  New high
SEBL       167.69   -3.28    9.56   4.13   2.56   12.97  Up again
DSTM        41.25    0.94    3.81   0.13   4.38    9.25  New
DELL        50.44    0.50   -1.00   1.19   3.50    4.19  New
ATML        55.56    1.19    2.94  -2.56   1.56    3.13  Bouncing
ANDW        29.81    2.13    0.13  -2.19   2.25    2.31  At $30
CSCO       139.31   -1.31   -4.06   0.31   6.94    1.88  Rumors
WCG         55.38    3.00    1.75  -3.13  -0.50    1.13  Basing
MDT         50.00   -1.88    0.00  -0.56   1.06   -1.38  Dropped
CCBL        47.50    1.91   -1.88   0.00  -2.25   -2.22  Dropped
INSP       256.94   -6.31    6.00  -7.38   4.81   -2.88  Split run
ADIC        93.75    2.06   -1.56  -0.44  -3.25   -3.19  Dropped
MER        103.13   -0.19   -2.38  -4.00   2.69   -3.88  Rallying
ERICY      100.50   -0.75   -1.63  -2.44   0.50   -4.31  Hold $100
NOK        214.63    6.50   -8.50  -6.63   3.25   -5.38  New
TXN        180.00   -3.69   -5.94  -6.00   8.38   -7.25  New
GLW        194.88    4.38  -12.63  -8.13   6.00  -10.38  Careful
SNE        259.06  -27.56   -4.38   8.69 -17.13  -40.38  New
DNA        187.50  -19.00   -4.00  -1.75 -22.25  -47.00  Dropped

Puts

DD          46.44   -1.00   -3.44   0.63  -0.50   -4.31  Bearish
UAL         46.38   -1.69   -1.88   1.38  -1.88   -4.06  New
PPG         45.56   -1.06   -1.50  -0.44  -0.50   -3.50  Dying
CTS         49.00   -5.81    3.00  -3.13   2.63   -3.31  Dropped
MRK         61.13   -1.00   -2.56   2.88   4.31    3.63  Dropped
RNWK        80.75    2.56   -2.63   0.81   9.81   10.56  Dropped



************
WOMANS WORLD
************

Okay, So Bite Me! I Got Nasdaq Closing Over 5000 Right! 
Do You Want To Know How I Did It? 
By Renee White

In my Tuesday's article, I predicted that Nasdaq would close over 
5000 today. What Can I Say? My scientific background proved 
helpful. Never fight Mother Nature! It was just woman's intuition. 
It tickled me pink to get this one right. I even humored myself. 
More on today's trading, later. 

After writing Tuesday's article mid-day, the bottom fell out of 
Nasdaq. I lied. I said I wouldn't be buying again until after the 
major profit taking at or above the closing over 5000 had 
occurred. Well, you know how women are: we sometimes change our 
minds. I changed mine after the Nasdaq rocket exploded in thin 
air vaporizing into dust by Wednesday morning. Things began 
flying south quickly so naturally the typical chart problems and 
bad option prices began. My thinking centered on where support 
would be found and if a further meltdown would occur after 
Greenspan's speech was over. I love technology. I just hate it 
breaking down when I need it! 

By the time I could actually see things, the JDSU options 
purchased at the close of Tuesday, were off 65%. These were March 
OTM options, which I planned to exit today anyway. OUCH!! My 
thoughts turned to concern, but I rarely exit when things look 
the bloodiest. No use fretting over lost money there. Starring at 
it won't help. Charts were smokin' and thoughts turned to 
reminding myself not to sell when everyone else was panicking. 
I watched Nasdaq go lower and lower. JDSU stabilized, so I 
decided to evaluate it's damage again mid-day, after the panic 
was over. If I trade as I preach, by not playing with money you 
can't afford to lose, then why exit on the bottom in a panic, 
especially early morning? (I exited these today at a 50% loss.)

Back to the Nasdaq, I started pulling up bar charts, looking for 
support levels and waiting for a bounce. It went lower still and 
lower. Then I saw the VIX was over 28, itching to take out 29. Oh 
Boy!! My hair on my legs relaxed and my focusing zeroed in on 
which prime candidate to buy. I'm sure I am not the only person 
thinking that all that cash coming out of the DOW recently, 
probably won't be going back in. Just think, if you were a fund 
manager who just got creamed with a disastrous DOW sell-off, 
right after you just moved into your new huge mansion bought with 
money you made last year, wouldn't you at least try to play some 
tech bulls during April earnings? Remember, you still owe taxes on 
all that money you made also! I bet some of those guys are having 
a real hard time smiling when they get home everyday. "How was 
your day, Dear?"  "Don't ask! I don't want to talk. I have a 
headache! Don't look at me! And NO, We can't go out to dinner!" 
"But Honey, I bought new furniture and I just invited my Mom to 
come stay with us a month and enjoy the new house." Quick call 
911. I think he fainted! 

I went to the Nasdaq Daily chart, to see what my indicators told 
me. I didn't really like what I saw so I moved to the 60-min 
chart. Everything looked oversold and it was piercing the lower 
Bollinger Band, just like it had February 15th and February 22nd, 
my recent alert, support and buying days. My MACD looked to be 
completing it's negative peak, my directional movement indicator 
looked to be finishing a sell signal and my stochastic showed 
over-sold.  Since I have recently made a killing on QQQ bought 
on February 22nd, I considered it again. 

I looked at the QQQ chart to find a support level. Since it has 
been flying lately, the 216 area on March 1st, was the best I 
could find. Then QQQ went right through it! But you know what? 
It too had pierced the lower Bollinger Band on those same two 
days in February. Although the VIX was not over 30 (my buy signal) 
as it was on my previous buy days, it had been rapidly moving up 
all morning and now staring at 29. Did anything show an all out 
"Buy" signal? No. But everything told this aggressive, intuitive 
trader, that it soon would and I may want to enter early. I 
figured this was the last steep, quick, sell-off, before a race 
through 5000. Risky? You Bet!! Early? Perhaps. I wouldn't know 
till later, but if I was off, I didn't think it would be by much. 

I decided to buy April QQQ, this time 220, a little OTM after it 
appeared to be bouncing back through the 216 level. Why did I buy 
OTM when I bought ITM last time? Because April earnings will soon 
be gearing up and there was a huge open interest at this level. 
Also, although QQQ went through the 216 support level, it now was 
rebounding nicely and I thought this would add weight to its 
support at this level. Also, QQQ does not track the Nasdaq 
exactly. Waiting for what I thought was the bottom to be confirmed 
on QQQ allowed me to see that the VIX had now dropped back into a 
mid trading range of a low 27 and the Nasdaq was rallying off it's 
low. To me, this was bounce confirmation. I also entered a basket 
of BVSN. It has a 3:1 split coming up soon, which I think will 
move it more. Tuesday, I took profits on most of my existing 
position, so I rolled up for a short-term churn, when it gave me 
an entry with the sell-off. 

As the rocket took off again, late this afternoon, I exited other 
March plays and my March QQQs at the close. I have several April 
plays which are deep ITM, which I will be exiting at the open, to 
catch an opening gap-up. Yes, during happy hour. I really tried to 
exit my NSOL today with a 504% gain since Feb. 22nd, but I just 
felt the risk was in my favor for an opening gap play since it 
was up 71 points today. Also, I glad I didn't exit my VRSN during 
the carnage Tuesday. That recovered nicely. Yes, VIX started 
dropping this afternoon. Until the last 15 min, I thought it was 
coming back up a little. It wasn't close enough to the low 20's 
for me to completely close out of everything and the momentum into 
the close seemed strongly up. I just thought the opening gap-up on 
a few, would fall to my favor. Risky? Yep! Those exiting at 
today's close were right to do so. 

Now for an email I received:   "I e-mailed you once before. I 
was only doing 2 contracts at that time $7000 in (my) account. 
Thanks to you and the OIN newsletter, I am up to $32,000. Now I 
try to trade 10 contracts if I can or else 3 or 5. Thanks. Paul"

Congratulations Paul. We appreciate hearing that we are helping. 
We've all learned from mentors somewhere, so it feels good to all 
of us, to give back. Now if we can just help you keep it! I don't 
mean to rain on your parade, but 10 contracts sounds like you are 
loading all your eggs into one basket. That's very, very 
dangerous. Allocate a portion of your money to trade with and 
diversify with a few good plays in different sectors. Always save 
some cash for those major sell-off buying opportunities and make 
sure you can justify your purchase. Good luck on your obvious 
continued success! Signed: Mother Nature.

Renee White
Contact Support



**************
TRADERS CORNER
**************

Judgment is The Result of Experience...
By Janar Wasito

Wednesday: Having just formulated my trading rules, I went right 
out and broke them. As the Marines like to say, judgement is the 
result of experience, and experience is the result of bad judgement. 
It wasn't as bad as it could have been, but it did illustrate why I 
formulated my rules in the first place.

I was driving around Monday night, feeling pretty good about 
coming up with a systematic way to look at the market. But I 
was thinking, hey, I have all this cash sitting around in one 
portfolio. Maybe it's not such a bad idea to sell puts on a 
stock that I really know well, and that I really would like to 
own. What is the coolest stock out there? How about VRSN. I could 
sell puts against that thing every month. Terrific stock. At the 
very core of business to business ecommerce. Growth potential and 
everything is huge. Heck, I would rather have VRSN stock than 
cash anyway, right? I even mentally calculated how much VRSN 
stock I could buy, and how many puts I could sell. Why not start 
with the VRSN Mar 240s, those have a nice premium, and VRSN has 
been consolidating pretty nicely at about 250. Hmmmm....

Well, on Tuesday morning, as I was doing my checklist to view 
the market, I noticed a few stocks up, some stocks down. Market 
looking like it was ready to sell off. And VRSN was down 40! Oh 
boy, what's going on? So, I click over to see the news. VRSN buys
NSOL. Brilliant. Absolutely brilliant. Great merger. Unlocks tons 
of value. I didn't completely back up the truck, but in the course 
of the day, I put on these plays:

Jun 220/300 Bull Call Spread
Apr 190/210 Bull Put Spread
Sold Naked Mar 200 Puts
Bought Sept 190 Calls

The first two plays were in a fast option trading account in 
which I could shoot straight into the exchanges. So, I put on 
one side of the spread, and waited for the stock to bounce back 
up to put on the other side. Problem is, the stock didn't bounce 
as far as I thought it would. By Wednesday morning, I had 
completed the Bull Call Spread, but not the Bull Put Spread. 
I could have put both on for favorable terms on Wednesday morning, 
but I missed the opportunity for the Bull Put Spread in the first 
15 minutes of the day. I was already breaking my rules. I slept 
with a naked put position on Tuesday night, and, truth be told, 
did not sleep that well.

The short Mar 200 Put position is of a small enough size in 
another brokerage account that I can just buy the stock. At 
least I calculated how much stock I could purchase before I 
sold the puts. And, truly, I don't mind owning the stock. It 
is the must have Internet backbone company, in my mind (and 
some analysts too). But what I think doesn't count for much in 
the market.

The Sept 190 Calls are as far out as I can go. They are basically 
as close to LEAPs as I can get. I will sell short term calls with 
10 days of life against them every month in a calendar spread plan.

The real problem, of course, is that now, midday Wednesday, I am 
already back to watching the market tick by tick to see (hope? 
pray?) that VRSN recovers enough for me to complete my Bull Put 
Spread. On the plus side, I did follow my money management rules, 
so I don't have too much capital at risk (4% of my portfolio). 
My focus on VRSN is preventing me from making other plays, such 
as the list of plays I generated on Tuesday night (various 
spreads): CIEN, CRA, INSP, PEB, DNA, CSCO, ARBA.

With two hours remaining in the trading day, Wednesday, things 
are looking up. VRSN has finally moved off of its slug like 
stupor at 190 and is up to 205. I have also successfully legged 
into a CSCO Mar 130/135 Bull Put Spread to take advantage of the 
split on 3/23. I am waiting to get into the other side of my 
VRSN Bull Put Spread for a favorable price. I also enter a 
PEB Apr 105/125 Bull Put Spread.

By the end of the day, I am glad its over. VRSN finishes the 
day at 203. Up 3, after dancing around in a 25 point range. At 
least I have put on some good trades (I hope). On the down side, 
I have become too wrapped up in one stock -- exactly the downside 
risk that my trading checklist is designed to prevent. I have 
lost my objectivity. My checklist will work, if I use good 
discipline in following it. For example, the checklist was 
telling me to exit some bull spreads on Monday, and I should 
have taken profits on JDSU and AFFX, but I elected to let them 
ride, since I have so much time. I was already at over 50% ROI 
on both plays. No where near max profit, due to the fact that 
I gave myself so much time, but they still would have been good 
to take profits on. I did, however, take profits on a JDSU Bull 
Put Spread. Anyway, the rest of my portfolio is down today, but
that is OK. That is what I expected. A few days of profit taking, 
then, hopefully some good entry points for April Earnings.

Thursday Morning: Things open down, but by the end of the first 
half hour, a bounce back in the averages has occurred. As well, 
I am ecstatic to see that VRSN is up 22! I was right! The other 
side of my Bull Put Spread order fills, and I am hedged. My 
April Bull Put Spread, with a max reward point at 210 is on for 
better than a one for one risk reward ratio. A few sleepless 
nights, and a great play is set up. I could actually have held 
out and nailed a really good price on the bounce back. I do my 
checklist. The VIX seems to have put in a top over 28, I guess 
Jim was right to buy the dip Tuesday. The DOW has found some 
kind of support at 9800, as if that matters. The OEX is bouncing 
around between resistance up at 765 and support down in the 720 
range. Fine. More importantly, the NASDAQ, having bounced off 
of its 10 day Exponential Moving Average, is now heading up 
again. Sectors look good, but biotechs are still selling off. 
May be some opportunities there. I tried to put on a CRA Bull 
Put Spread for April, but it was difficult getting into the 
contracts that I wanted (wide bid ask spreads), so I held off. 
I did, however, enter a INSP Mar Bull Put Spread 240/260 with 
a risk of 11 for a reward of 9 -- a little under the 1:1 that 
I want. That is a pretty risky play, and I need INSP to go over 
260 by next Friday for max reward. My CSCO Bull Put Spread is 
already at max reward since it is trading at 136. With a split 
less than a week after expiry, I think that I will nail that 
play. In sum, the 4 March Bull Put Spreads (IMNX, JDSU, CSCO, 
INSP) have already yielded one max reward (JDSU), IMNX is 
looking bullet proof with the max reward way back down at 185
and a split shortly after expiry, CSCO is looking good, and 
INSP is a gamble, but support is strong at 250, and the sector 
(VRSN, NSOL, internet generally) is hot and another split is 
on the horizon there, if memory serves. JDSU and AFFX are two 
object lessons in why to take profits at 50%+ ROI on Bull Call 
Spreads, even if they are several months out. I think that 
becomes part of my trading checklist. 50% is a good return, 
especially if you can achieve it in a few weeks. The same basic 
10 rules apply to spread trading -- cash flow is king, take a 
profit over and over and over. Sure, in the way that I set up 
the JDSU and AFFX Bull Call Spreads, I theoretically COULD get
a max ROI of 200%+, but I would have to wait until expiry in the
summer or September to do that. On the plus side, I have a long, 
long time horizon on my JDSU, AFFX, and other spread plays. Well, 
the market is looking up, my plays are doing well, time to hit 
the road.

Contact Support



*****************
BROKERS CORNER
*****************

ARE PURCHASING OPTION SPREADS THE RIGHT TOOLS FOR THE JOB?

     The use of stock options in trading dramatically increases 
the leverage but does not change the fundamental fact that you 
have to pick the direction of the stock; up, down, or nowhere.  
In addition the limited time frame forces decions to be made 
prior to expiration.  The ability to control shares with options 
contracts for a fraction of the price of the stock is very 
attractive but caution and discipline must be exercised to prevent 
emotional trading.

     One tool in the option strategy toolbox is the use of spreads.  
Unfortunately sometimes the different strategies are misused and 
certainly misunderstood.  The benefit of trading either with bull 
call spreads or bear put spreads is the limited risk.  If you 
purchase a call spread it is less aggressive and cheaper than 
purchasing the call outright.  An example of buying a EMC JULY 
120 call and simultaneously sell an EMC JULY 130 call would cost 
less than the outright call purchase but also take away flexibility 
and limits the profit potential.  The maximum profit of 10 points 
is only made at expiration and the stock must be at 130 or above at 
that time.  Unfortunately unwinding the spread in the interim does 
not mean you will make the maximum because of the time value left 
on the option sold. 

  Many traders have learned the hard way by unwinding the spread 
early only to make a small amount.  The most important thing is 
money was made but not nearly as much as common sense would dictate.  
A small profit is ALWAYS better than the alternative but there are 
ways that correctly picking the market direction yields better 
results.

     Essentially the spread locks you into a position and takes away 
the ability to take profits although you could exit prior to 
expiration.  This loss of flexibility causes the greatest misuse 
of spreads and frustration among option traders.  The most 
troublesome situation exists when trading long-term spreads with 
greater than six months until expiration.  Even though the stock 
can move dramatically in your favor the option spread may change 
little and needs to be held for months and months until expiration 
in order to make maximum profit. It is a shame to be that right 
and not to profit sustantially.  The key is you are not losing 
money but more importantly YOU ARE NOT MAKING MONEY FOR A LONG 
TIME EITHER and that could change.

     When you are correct in your market analysis there are much 
better was to capitalize.  Instead possibly choose straight 
outright option purchases with unlimited upside and flexibility to 
exit anytime. In the example above with a bullish opinion purchase 
the call and place a stop loss as protection.  Your initial cost 
may be higher but your ability to exit when you have a profitable 
situation is probably more beneficial in this trading environment.  
Please always have an exit plan if your market assumption was 
wrong to stop the losses.

     Spreads have their place in an option-trading portfolio.  
Often they are chosen when volatility is high and straight outright 
purchases are cost prohibitive.  Spread trading allows you to 
participate in a stock that may have too much risk for your style.  
The only thing you can attempt to control is the risk.  Spreads 
allow just that but unfortunately tie your hands and take away 
flexibility.  You are giving up some ability to decide when to get 
out in order to participate in a stock.  As long as that part of 
spread trading is understood and investors are well informed less 
confusion will result.  SPREAD TRADING IS SUCCESSFUL when done 
properly and with a disciplined approach.

     Again I would like to stress that not all options strategies 
are suitable for everyone. Do not trade a strategy without having a 
beneficial reason to implement it.  Any trade is worth doing after 
the proper research is completed and a trading plan is developed. 
When to exit is the most important factor and should be determined 
prior to entry.  Account size, risk tolerance and most importantly 
market expectations will help in choosing a strategy and discipline 
to fit your needs and market environment.   OPTION STRATEGIES ARE 
JUST TOOLS that need to be implemented properly to achieve the 
desired results of making money.

Alan Knuckman and Andy Aronson
Lasalle Options
Toll-Free 888-281-9569
www.lasalleoptions.com


PICKS WE DROPPED
****************
When we drop a pick it doesn't mean we are recommending a sell
on that play. Many dropped picks go on to be very profitable.
We drop a pick because something happened to change its
profile. News, price, direction, etc. We drop it because we
don't want anyone else starting a new play at that time. 
We have hundreds of new readers with each issue who are
unfamiliar with the previous history for that pick and we
want them to look at any current pick as a valid play.


CALLS:
*****

DNA $188.50 -21.50 (-47.00) DNA suffered a severe tumble after 
Roche Holdings, a unit of the Swiss drugmaker, announced plans 
to sell 17.3 mln of its DNA shares to raise an estimated $3.6 
bln. in cash.  Roche Holding wants to take advantage of the 
quadrupled share price DNA has experienced since last July.  
Unfortunately this news by Roche Holdings to cut its stake in 
Genentech has driven DNA down $21.50, or 10.3% from yesterday's 
close at $209.75.  Clearly this lucrative play is over.  After 
such a severe drop, a resurgence in momentum will be hard to 
come by.  We have no choice but to drop it from our call list 
this evening.   

ADIC $93.75 -3.25 (-3.19) The storm finally arrived.
Unfortunately the lightning bolts hit ADIC right between the
eyes.  Falling out of bed yesterday morning on strong volume,
ADIC didn't find support until it hit the sub-basement level of
$78.75.  Recovering back to $97 by the close, the issue provided
ample rewards for vigilant high-risk players.  Today, despite
continued strength on the NASDAQ, ADIC fell back and spent the
bulk of the day building support at $90.  It looks like the
momentum players have left this issue, and with its 2-for-1
split occurring next Monday, it is time for us to move on as
well.

MDT $50.00 +1.06 (-1.38) Just about as exciting as watching
grass grow, action in MDT has been disappointing.  After tagging
a new high on Monday at $52.94, it has been Dullsville for this
medical device-maker, as it trades in a narrow $2 range with
volume only about 75% of the ADV.  Believe it or not, we
originally picked MDT on the momentum which carried it to new
highs.  The fickle finger of fate (along with buying interest)
has moved on to greener pastures, leaving MDT to meander between
the resistance forming at $50 and support at $48.  Even the
strength on both of the major indices today couldn't push MDT
through its newly-formed resistance.  This makes for an
eminently boring play, and with so much excitement elsewhere
in the market, we'll take our money and go find some action
elsewhere.

CCBL $47.25 -2.25 (-2.47) CCBL ran out of gas!  Though there was 
no rush to get out the door on Tuesday, there was no rush to get 
back in the door either.  Consequently, CCBL sank under its own 
weight and general lack of investor enthusiasm.  Continually 
declining volume confirms this.  While there have been good 
opportunities to profit by buying at the close and selling into 
the next day opening, the pattern was not readily discernable.  
Even if it was, the trend has been down in the last three days - 
not a good sign considering the NASDAQ benefited from an 
adrenaline rush today.  Accordingly, it leaves our play list 
tonight.


PUTS:
*****

MRK $61.13 +4.31 (+3.63) Wait a minute...that's the wrong
direction!  Bouncing with the rest of the drug sector, our
play on MRK didn't even give us a chance to jump aboard
(Thank goodness!) before it moved up over the past two days.
The selling associated with the Proctor & Gamble earnings
warning seems like it was overdone, and MRK looks like it has
caught the attention of value investors.  Now firmly positioned
above its 10-dma ($58.80), the strength of the move, accompanied
by heavy volume (nearly double the ADV), leads us to believe
that MRK is headed higher from here.  At the very least, it looks
like it has put in a bottom, so we will look elsewhere for more
lucrative plays.

RNWK $80.75 +9.81 (+10.56) Wednesday's session brought RNWK down
into the $60s but it never quite tested support at $64.  Instead,
it bounced off $67 and built an intraday support at $68.  That 
was the last of the sixties that we would see as RNWK steadily
pushed onward to close at $70.94.  Today's strong up move began
early in the session with a breakout to the $76 level.  This 
move that spoiled our put party can be attributed to Wedbush 
Morgan initiating coverage of RNWK with a strong buy.  While 
sustaining these gains throughout the day and closing at $80.75,
it's time to move onto greener pastures.  

CTS $49.00 +2.63 (-3.31) Alright, since our last update, we have
seen lackluster downdrafts in CTS only to discover a new-found 
support at $46.  Today's midday climb above $50 and steady hold 
at the $49 support level is not what we wanted to see on this put 
play.  It seems like everything went up today with a successful 
NASDAQ 5000 run, and with a lack of downward conviction, CTS 
doesn't really provide a risk/reward that we like at this point.  
It was a short ride and now it's time to move on to one that's 
more fun.


********************
PLAY UPDATES - CALLS
********************

QLGC $187.59 -2.84 (+32.16) Taking a little time to consolidate
its gains, QLGC looks to be coiling the spring for its next leg
up.  Investor reaction to the news (re-stated below) has been a
dominant factor, and now that it is out, they are waiting for
the next catalyst.  As an indicator of the company's dominant
role in the industry, QLGC's director of planning and
technology, Skip Jones, has been elected president of the Fibre
Channel Industry Association (FCIA).  Of course, the primary
mover in QLGC's price the last 2 days seems to have come from
the Robbie Stephens Tech 2000 conference last week.  Dane Lewis
of Robertson Stephens, in an interview with The Wall Street
Transcript called QLGC and EMLX the leaders in the emerging new
wave of storage solutions, namely Storage Area Networks (SANs)
and Network Attached Storage (NAS).  Holding support at $182,
QLGC has seen successively lower highs since Monday.  The
breakout from this shallow pennant will likely come soon so 
start looking for entries now.  The first serious resistance 
shows up at $194, followed by Tuesday's high of $203.25.  
Volume is still running 50% over the ADV, with positive price 
moves being accompanied by increases in volume.  Watch for QLGC 
to bounce at support and then jump on board as volume picks up.

RRRR $89.38 +6.56 (+21.38) If anything, the rate of ascent is
increasing.  When we picked up RRRR on Tuesday, the stock had
been moving in $5 steps before consolidating.  Over the last 2
days, the increments have increased to $10, and the enthusiasm
has been confirmed by increasing volume.  Trading over 2 million
shares again today, the company definitely has investors'
attention.  This is exactly the kind of action we like to see
in our momentum plays, and it has certainly been helped by the
surge on the NASDAQ.  Now that N5K has been reached, we could
see some profit-taking, so move your stops up to protect your
gains.  Mild support can be found at $87 and then $80, with
resistance at today's new 52-week high of $92.38.  The 5-dma
has provided good support since early February, but now even it
is far behind, at $76.25.  Keep a tight watch on the volume, as
a weakening of this indicator may be your first indication of
profit-taking.  Quicknet Technologies, a privately-held company
with RRRR as one of its primary investors, reminded investors
yesterday that Voice over IP technology is still hot.  Featuring
live demos and tutorials at the Computer Telephony Expo, the
company reportedly drew standing room only crowds.


***********************************************
PLAY UPDATES - CALLS - CONTINUED IN SECTION TWO
***********************************************


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DISCLAIMER
**********
This newsletter is a publication dedicated to the education 
of options traders. The newsletter is an information service 
only. The information provided herein is not to be construed 
as an offer to buy or sell securities of any kind. The 
newsletter picks are not to be considered a recommendation 
of any stock or option but an information resource to aid the
investor in making an informed decision regarding trading in 
options. It is possible at this or some subsequent date, the 
editor and staff of The Option Investor Newsletter may own, 
buy or sell securities presented. All investors should consult 
a qualified professional before trading in any security. The 
information provided has been obtained from sources deemed 
reliable but is not guaranteed as to accuracy or completeness.
The newsletter staff makes every effort to provide timely 
information to its subscribers but cannot guarantee specific 
delivery times due to factors beyond our control.

The Option Investor Newsletter         Thursday  3-9-2000
Copyright 2000, All rights reserved. 
Redistribution in any form strictly prohibited.


********************************
PLAY UPDATES - CALLS - CONTINUED
********************************

AFCI $79.88 +10.00 (+14.38) This stock's intraday volatility 
continues to offer profitable entry points.  On both days we 
saw AFCI confidently bounce off the 5 & 10 DMAs and today we 
got decisive confirmation.  The 10-point gain on rising volume 
proved there's still some spark left in our momentum play; 
although now we face tough resistance at $80.  While AFCI made 
a champion charge for the next price level it just couldn't 
penetrate the mark.  However it did set another new 52-week 
high, which notably makes it the third time to do so out of the 
last four trading sessions.  Again today's performance bodes 
well for the play, but remember one day doesn't seal its fate.  
So conservatively let's keep our guard up and watch for 
supplementary moves to newer heights.  

CSCO $139.63 +7.25 (+2.19) CSCO led the pack as the Nasdaq made 
its first close above 5000!  This move came on rumors that CSCO 
would oust PG as a member of the Dow Industrials and take their 
place.  A battle ensued between buyers of the rumor and the 
invisible force field of $140.  In anticipation of the 
upcoming 2:1 stock split in a couple weeks (ex-div 3-23), we 
expect CSCO to easily shatter $140.  But if there's enough 
intraday volatility, then use dips near the vicinity of the 
converged 5 & 10 DMAs for entry points.  Lehman Brothers is also 
bullish on CSCO.  Analyst Tim Luke remarked yesterday that 
"Cisco remains a core holding in our universe of Internet 
infrastructure stocks" and repeated his Buy rating.  There was 
also big news on Wednesday surrounding Cisco and Cap Gemini SA, 
Europe's largest computer-services company.  They recently 
entered into a Web alliance to sell and service Internet and 
telecommunications systems.  Currently this is a market where 
sales are increasing by 30% a year!  According to the terms, 
Cisco will invest $671 million in Cap Gemini and $164 million 
for a 4.9 percent stake in the new venture company while Cap 
Gemini will contribute 12% of its workforce. 

INSP $256.94 +4.81 (-2.88) Volume levels remain respectable as 
INSP bounces essentially between $250 and $260.  INSP remains on 
our call list because for one, we now have more time to trade 
this split play and two, it's currently at a sensible entry 
level.  From a technical standpoint, the 10-dma ($244.14) is 
serving as the bottom support while the rising 5-dma ($256.38) 
reflects the near-term.  What of course we're patiently waiting 
for is a breakout.  As more time passes with INSP locked in a 
channel and the anticipation of the 2:1 split (ex-div 4-7) 
grows, it's likely the move will be sharp and swift.  We're 
hoping it can reach SG Cowen's price target of $310!  They 
began coverage with a Strong Buy recommendation on Tuesday 
morning.  Keep in mind, INSP is a HIGH-RISK Internet play and 
likely doesn't fit everyone's risk portfolio.

ANDW $29.81 +2.25 (+2.31) The rally commenced again today for 
Andrew, but it has still yet to crack the resistance at $30.  
Something is going to have to give as it builds higher-lows 
and pushes up against this stubborn mark.  Either the lows 
will stop getting higher or the breakout we want will occur.  
Volume has slacked off since Tuesday and the 10-dma is rising 
rapidly to help support the stock.  The 10-dma is currently 
at $26.85.  Look for support at $28.50 if it is going to keep 
this trend in tact.  In the news today, ANDW had a new product 
launch.  It is a Home/Office speaker for your wireless phone.  
This helped sentiment, but was not a major influence on today's 
trading.  The confirmation of the breakout over $31 will be 
determined by volume increasing over the ADV.  Otherwise, use 
patience and buy the dips.

ATML $55.56 +1.56 (+3.13) ATML's pace had slowed down as they
had fallen Wednesday down to about $50 before making a comeback 
to close at $54.  They dipped down to $50 again today, but closed
near $56.  Hopefully, Atmel can put the market weakness behind 
it and trade back to new high territory.  We have seen a good 
double-bottom on this stock and expect a test of the 52-week 
high soon at $58.94.  We haven't gotten any new news or seen 
an increase of volume.  Either of those events may be what 
ATML needs to kick back into high gear.  Tomorrow will be the 
test.  It needs to get moving or get off our call list.

EMLX $213.00 +5.00 (+22.75) Our fibre channel technology leader
stubbed its toe Wednesday.  Or did it?  Granted shares of EMLX
fell about $26 in the first ninety minutes of trading.  If you 
had a position,(you'll noticed we used the word "had") you 
hopefully were stopped out as EMLX fell.  Yesterday's drop is
one of the very reasons we suggest the use stops, whether mental
or actually placed with your broker.  After the run EMLX has had,
it was overdue for a bit of profit taking.  Now did you notice
the volume on the decline?  More importantly did you notice the 
volume when buyers stepped in at the $180 level?  Over 200K 
shares were traded on the bounce off $180.  Unless you are a
gunslinger we aren't necessarily suggesting you should have
try to pick a bottom.  However the volume as buyers did step
in was a good indication that further advances could provide a
good entry point for a new play.  After several chances to join
in, EMLX went on to make a new high today at $221.72.  EMLX 
pulled back to close just above intraday support at $211, with
the next level seen at $203.  If you did re-enter this play
make sure your stops are in place.  Continued moves higher 
would give us another chance to enter this great play.   

CHKP $270.38 -1.13 (+40.63) We said Oh My! over and over again
for most of the day Wednesday, as CHKP continued its march to
another new high.  Investors bid shares of CHKP to a high at $288
before traders that had rode this one to a new high decided it
was time to take some well deserved profit.  Interestingly though
the profit-taking only dropped CHKP to the $270 area.  News of a
pact with Telecom Italia may have helped keep CHKP suspended in
mid-air.  Telecom Italia said it will use the security software
to secure Internet and other services for its customers.  As we
mentioned earlier, Prudential Securities upgraded CHKP from a
Accumulate to a Strong Buy and sometimes it takes a while for 
that kind of news to hit home with the retail investor.  Today
it was a different story CHKP really drifted sideways to lower
in a very narrow range between $269 and $275.  A bounce from
this level could provide another opportunity to enter a new
play.  If CHKP experiences more profit-taking, it may not find
any help until around $263 or down near $250.  To prove 
the strength of the momentum, a drop to $245-$250 would just
bring CHKP back in to its channel formed during its recent move.   

CLRN $169.50 +14.56 (+31.50) When we last visited, CLRN had made
a new high and a gain of about 9.0%  On Wednesday CLRN had some 
uninvited guests show up at the party, with the last name of
Sellers.  The sellers that came to visit drove CLRN down to 
$143.25 before they got tired and left.  Early this afternoon
CLRN got back on track breaking through the $160 level and
gained almost $18.50 in the last 3 hours of trading.  If you
re-entered this play, congratulations.  There is one minor item
we must point out however.  The volume today was minor alright.
CLRN could only muster about 412K shares today.  Now here is the
scenario as we see it.  The bulls may be back in the drivers 
seat and CLRN will find new buyers to push the communications 
company higher and re-establish the momentum.  If the volume
can't pick back up, we would be a bit suspect of any further
moves higher.  We are not suggesting that you stay away from
this play by any means, just check the volume as you establish
a new play.  If it's lighter than normal, be prepared to pull 
the trigger and sell too soon, just in case those nasty old 
uninvited guests return to our party.  Technically CLRN has 
support at $164 and $150.  Depending on your entry point, adjust 
your stops accordingly.

NTAP $240.38 +22.06 (+40.44) We said Tuesday, be patient and
a good entry point for our split run play could develop.  If
you made it through the direction-less day on Wednesday, and
noticed the higher-lows being made by NTAP as the networker
drifted for most of the session, you probably found a very 
good point to enter a new play.  If not, the pop above $226
should have been your next clue it was time to jump back on
board this great play.  By the closing bell today NTAP had made
a new high at $241, on strong volume, with 2.6 million shares
changing hands.  Networking leader CSCO, had rumors circulating
all day, and made a new high gaining about 7.0%.  Our favorite
son NTAP gained over 10% for the day and didn't even need any
rumors to propel it to a new high.  Yesterday Steve Salopek, a
team member of the One Group Small Cap Growth Fund made some
favorable comments about NTAP.  He said, "the secular case for
storage is tremendous, and NTAP's value is that their software
makes a company's data storage needs a manageable application,
and it works in a mixed operating environment."  Nice comments
but the real strength behind this play is the split of the
company's stock in couple of weeks.  NTAP closed near its high
indicating were aren't done yet.  Support is found at $233 
and $226.

AMD $58.00 +4.50 (+16.13) On Wednesday, AMD tested the $49 
support level we mentioned Tuesday and it held up just like it
was supposed too. This morning AMD gave us a nice entry point for
our new chip play.  The battle between Intel and AMD as to who
can produce the fastest chip, and get it to market, has gone on
for some time now and will continue for a long time.  The real
push behind this play however comes from news that semiconductor
sales are strong.  By the sounds of things there will be plenty
of business to go around.  The Semiconductor Industry Association
reported on Wednesday that worldwide sales of semiconductors 
reached $14.8 billion in January, increasing from $11.1 billion
in January of 1999.  The chip industry is off to a strong start
for year 2000.  As we said Tuesday, the first quarter tends
to be the weakest quarter of the year.  A 32.0% increase in
January certainly suggests 2000 will be one of the best ever
for companies like AMD.  The volume and the price picked up 
for AMD in the last hour of trading today which suggests this
one may be just breaking loose.  AMD tested the $54 area several
different time today, which has now proved to be good support.

DSTM $41.25 +4.38 (+9.25) Up, up, up and away we go!  As DSTM
continues on its healthy uptrend, option volume swelled today
as many traders picked their entry points throughout the day.
Yet, along with increased option volume comes an increase in 
implied volatility.  It's simple supply and demand, and the 
market makers have raised volatility.  At this point, exercise 
caution in tomorrow's early going, since options have become 
pricey.  The final two hours of trading had DSTM holding solid 
around $41, so it's important to watch tomorrow and see where 
it settles.  Once a level is established, pick entry points 
suited to your risk.  

ERICY $100.50 +0.50 (-4.31) The past two sessions have been 
quite a roller coaster ride for ERICY.  First, ERICY gapped from
Tuesday's close of $102.43 to open Wednesday at $100.75.  It 
dipped as low as $96.31, providing very nice entry points.  
Today's trading session was similar to yesterday's except that 
ERICY seemed to consolidate at the $99 level for most of today.
And there you have it, short-term support.  Yesterday's gapped
opening at $100.75 poses a resistance point.  With NASDAQ 5000
finalized, watch tomorrow for a follow through and to see if 
ERICY can regain some of its lost ground.  Remember, we are 
still up on this position and the past few days only represented 
entry opportunities into an uptrending stock. 

MER $103.13 +2.69 (-3.88) Wednesday looked bleak with MER falling 
through its $104 support level, and doing so rather quickly.
But that was Wednesday.  Thursday brought some saving grace to 
the financials as MER opened near its intraday low of $98.06 and 
climbed smartly to close near its intraday high.  Today's pattern
established short-term support at $101 and $100.  Strong volume 
in the final hour of trading pushed MER to the $103 level.  Its
previous support level of $104 should provide resistance.  
Overall, MER is still trending upward and the financials, who 
have taken there fair share of bumps and bruises recently, are 
recovering.  Keep in mind key levels and watch to see if the 
market can sustain this rally or if it will fall to the hands 
of profit-takers.

GLW $194.88 +6.00 (-10.38) Careful.  The steady stream of 
photonic news from the OFC 2000 conference ended today, and 
optical companies in general have had some air let from their 
sails in the past two days.  While we like this company a lot as 
a long term play, GLW's failure to close today over its 10-dma of 
$196 is a sign of technical weakness, especially on diminished, 
but still average volume of 2.6 mln shares.  Here's the other 
side of the double-edged sword though...the comeback from 
today's intraday low of $184.44 is a big plus, and leaves a nice 
technical tail on today's candlestick chart.  Flip a coin?  
Tails, we keep it! (even though we never got that breakout we 
were looking for back over $200).  More weight in GLW's favor is 
that earning will be announced on Apr 17th causing what we think 
will be a splendid earnings run.  Add to that the likelihood 
then of a split announcement too, followed by shareholders 
authorization of new shares on Apr 27th, and we have a good 
buying opportunity at these levels.  You'll probably want to 
consider the April strikes at this point since the March strikes 
expire next week.  GLW could still go either way from here, so 
pick your entry carefully.

SEBL $167.69 +2.56 (+12.97) Reaching as high as $175 yesterday 
and $170 today, both during amateur hour, SEBL found footing at 
$160-$162.  Stuck right in the middle, $167 is providing mild 
resistance in which a rise convincingly above that is becoming 
harder, though the 5-dma of $160 is looking strong.  While volume 
at the close picked up, adding over $2 in the last 15 minutes to 
boost it to a new closing high, today's volume was 17% under the 
ADV.  The signal here is that SEBL may be running temporarily out 
of steam.  In a 5-day move from $140, that's entirely possible.  
After all, the 10-dma is way back at $148.53.  We suggest a bit 
of caution now and to keep a trailing stop in place to protect 
your profits.  SEBL will fall back to meet it's average; we just 
don't know when.  Mild intraday support is at $163, firmer at 
$160.  If it falls under that, wait for the dust to settle and a 
convincing bounce (with volume) before making a new play.  Though 
SEBL is a split candidate again, the announcement may have to 
wait until earnings on April 25th - too far away to affect the 
play.  A shareholder meeting to authorize new shares would be 
required too should management opt for anything greater than 3:2.

VERT $277.75 +24.25 (+26.03) VERT goes vertical!  What a powerful 
move VERT made today on volume exceeding the ADV by 82% - roughly 
$40 in two days.  Part of the hoopla was yesterday's announcement 
that they would buy privately held Tradeum for $500 mln.  The 
deal was immediately expected to add to earnings, and was thus 
worthy of wall Streets blessing - a rarity on both counts for an 
acquiring company.  The second blessing?  Lehman Bros. reiterated 
their Buy rating and upped their price target to $350 based on 
the purchase.  Intraday support is at $240, $263, and from today, 
$280, which held nicely most of the day.  Obviously, VERT is a 
moving target, and we need to be quick on the draw to pick it 
off.  That said, we don't want to let our profit vaporize - keep 
a trailing stop in place.  You can always buy back cheaper on the 
bounce.  We have only three points of concern.  The first is that 
VERT holds great altitude over its 5 and 10-dma (only $253.12 and 
$239.31, respectively).  The second is that despite its $24 gain, 
VERT gave back $6 into the close and fell far short of its 
highest altitude of $294, thus leaving a very long upward tail.  
With the associated volatility, we strongly suggest you wait for 
a pullback.  The third item related to the second is that despite 
a new all-time closing high ($1 over the high close set in late 
January), VERT could struggle here at its highest resistance.  In 
short, gravity could take over following today's gain.  Assess 
your risk profile before you board the E-ticket.

WCG $55.38 -0.50 (+1.13) That broadbandy goodness got a bit sour 
on us yesterday, as WCG fell slightly over $3.  Today was no 
inspiration of confidence either as WCG held steady at best while 
NASDAQ set a new record.  No news, and volume remains around the 
ADV too.  The good news is that $53.50 showed us a nice bounce 
from good support - it's held well over the last five days, and 
we think makes a great target at which to shoot.  Gunslingers may 
want to consider that entry.  If you'd rather play it safe, you 
can wait to nibble at prices over $58, then again over $61.  Just 
make sure you see the volume return.  We'll give it another day 
to see if it can get back over its 5-dma of $56.36 or bounce hard 
off its 10-dma of $50.88.  It's along ride down, so wait for your 
entry.


*******************
PLAY UPDATES - PUTS
*******************

PPG $45.56 -0.50 (-3.50) You certainly wouldn't know by looking
at PPG's chart that the DJIA had an up day.  This poor, beat-up
issue had to fall all the way to $44.38 before finding support
today, a level last seen in early 1996.  Needless to say, PPG
is really getting down there and may find a bottom soon.  Support
began forming in the early afternoon near $44.63, before finally
moving up into the close.  Volume has started dropping the past
2 days, with today posting about 15% less than the ADV.  If we
see support hold in the $44 range and can break resistance at
$48, also the site of the 10-dma, then it may be our signal to
move on.  Otherwise, look to enter new plays as sellers return,
forcing PPG to rollover near $48.  There has been a dearth of
meaningful news on PPG, other than minor product announcements,
and with the NASDAQ closing above 5000 today, diminutive stocks
like PPG just don't seem to grab investors' attention.  Keep an
eye on volume as it will likely give an early indication of
whether the bulls or the bears are winning this tug-of-war.

DD $46.44 -0.50 (-4.31) Dupont got a bit of relief on Wednesday
with a pop up to $47.75, but quickly plummeted to an intraday 
52-week low of $45.25.  This point provided support again today 
with a brief bounce and a close at $46.44.  So, have we gone 
anywhere?  Not really, yet what is important here is that the
downtrend does not appear to be reversing.  Even in light of 
strength in pharmaceuticals, DD has not been a participant and 
simply is trying to keep its head above water.  Going forward, 
we will watch DD to see if it retests support at $45.25 and we 
will remain bearish until DD moves above its 10-dma at $48.94.



**************
NEW CALL PLAYS 
**************

SNE - Sony Corporation $259.06 -17.13 (-40.38 this week)

If you like to be entertained, Sony has your fix.  Its
PlayStation home video game system alone accounts for about
11% of the electronics and entertainment giant's worldwide
sales.  As the #2 consumer electronics firm, SNE makes a host
of products including cameras, DVD players, MiniDisc and Walkman
stereo systems, computers, TVs, and VCRs.  Rounding out the
company's assets are Columbia TriStar and record labels Columbia
and Epic.

A call play, you say?  Although it may look like we are trying
to catch a falling knife, in actuality we are grabbing a rare
entry point on this huge entertainment conglomerate.  Since
tagging a new all-time high of $314.75 at the end of February,
SNE has been dropping as investors take profits.  So what about
SNE caught our attention?  How about the strong bounce at $250
today, confirming the support level which was first established
in mid-February.  That's a good start, but the real clincher is
the volume story today.  Even though the volume was heavy on a
day where the stock lost over $17, there was a nice increase in
volume in the last hour of trading as the price continued to
rise.  Look for a confirmation of support at $250 before jumping
aboard.  The stock has had some exciting runs in the past few
months, and this could be an exciting ride.  Although SNE is
splitting 2-for-1 on May 18th, that event is likely too far
away to influence our play.  One cautionary note about SNE;
since it is an ADR, it tends to gap at the open, meaning it can
run right over your stops.  Take this into account when
evaluating your risk tolerance.

For the big kids out there, SNE has a DVD-Video system for you.
On March 2nd, the company announced 8 new systems designed to
maximize the home theater experience for any lifestyle and
budget.  With more than 7 million new DVD buyers expected in
2000 and more than 5000 software titles available, SNE looks
to capitalize on the exploding market.  Each of the new systems
feature single- or multi-disc players, Dolby Digital 5.1
channel surround sound processing, pre-programmed A/V remotes,
and six-piece speaker packages.  Can I order two? 

BUY CALL APR-250*SMW-DJ OI=166 at $26.25 SL=20.50
BUY CALL APR-260 SMW-DL OI= 33 at $21.50 SL=16.75 low OI
BUY CALL APR-270 SMW-DN OI=132 at $16.63 SL=13.00
BUY CALL APR-280 SMW-DP OI= 49 at $12.75 SL=10.25

SELL PUT MAR-250 SMW-OJ OI= 88 at $ 3.13 SL= 5.00
(See risks of selling puts in play legend)

Picked on Mar 9th at $259.06     P/E = 76
Change since picked    +0.00     52-week high=$314.75
Analysts Ratings   1-1-0-0-0     52-week low =$ 89.25
Last earnings 01/00 est= N/A
Next earnings 04-?? est= N/A
Average Daily Volume = 451 K
/charts/charts.asp?symbol=SNE

****

DELL - Dell Computer $50.44 +3.50 (+4.19 for the week)

Dell Computer is the world's #1 direct-sale computer vendor and 
one of the world's top PC makers.  Therefore it's understandable 
that the company designs, develops, manufactures, markets, 
services, and supports a variety of computer systems including 
desktops, notebooks, workstations, network servers, and storage 
products.  Dell's clients include the government, corporations, 
the medical and education industries, as well as the individual 
consumer.  Founder Michael Dell is still the CEO and maintains 
a 14% stake in the company.

Pumped up by a sector revival and signs that corporate customers 
are buying more PCs and we've got lots of promise in the near-
term.  Earlier in January, Dell warned its investors that Y2K 
concerns were paramount and companies were buying fewer PCs; 
thus, earnings would only increase by 30% from year earlier 
quarters instead of the stellar 50% expectations.  But now those 
concerns are easing according to Trent May, manager of the 
Invesco Growth Fund, who states that "over the last two weeks, 
we've seen reports of improving corporate PC demand, which 
obviously Dell would be the biggest beneficiary of".  Ashok 
Kumar, analyst for USB Piper Jaffray, further added that Dell 
"should have no problem exceeding the recalibrated earnings" and 
noted he rates DELL as a Strong Buy.  Earlier in the week, he 
upped DELL's price target to $65 from $55. These comments follow 
yesterday's press release that Dell Computer became the global 
market leader in both portable and desktop personal computer 
shipments to medium and large businesses in the 4Q of 1999 
according to the market research firm IDC.  This puts rivals 
Compaq (CPQ) and IBM in the backseat as they struggle to move 
from largely indirect to direct sales models.  According to IDC 
analyst Roger Kay " Dell has a lot of momentum, that's the bottom 
line" and ours too!  Today DELL's dynamism demonstrated growing 
intensity as the share price edged closer to December's record 
high of $53.97!  The stock sprung off the 5-dma ($47.24) and 
didn't look back at the comfortable support zone.  The bold move 
was backed by heavy volume (more than double the ADV) of over 71 
mln shares exchanging hands, making it the most active US stock 
in today's session.  At the moment, earnings aren't expected 
until the beginning of May and DELL isn't a split candidate 
until it trades consistently above the $65 and $70 range.  
Therefore this play is based on sheer momentum.  Near-term 
support is firm at $47 hence, be on alert if DELL pulls back to 
$44 and $45 at the 10-dma ($44.72).  If today's "straight-up 
from the open" pattern continues over the next few days, you'll 
obviously have to enter on the climb.  Although be cautious as 
DELL faces its overhead resistance ($53.97) and always keep your 
eyes peeled for the profit mongers.  

In the industry this week, Intel announced the 1GHz Pentium III, 
which they claim is faster than anything fierce competitor, 
Advanced Micro Devices (AMD) has in its inventory.  For now 
anyway, Dell's computers along with IBM and Hewlett-Packard PCs 
will be the "chosen ones" to have the new chip.  Talking about 
chips...Dell warned owners of a faulty memory chip in its 
Latitude and Inspiron computers shipped between February 1 and 
November 20, 1999.  As many as 400 K, or 48% of the notebook 
computer are likely to contain the defective memory chip.  On a 
more positive note, Dell announced it began online product sales 
in Hungary.  This new online venture marks the first of its kind 
in central and Eastern Europe according to Glenn Jones, Dell 
marketing director in Europe, the Middle East and Africa.

BUY CALL APR-45 DLQ-DI OI=16967 at $6.88 SL=5.25
BUY CALL APR-50*DLQ-DJ OI=15914 at $3.75 SL=2.25
BUY CALL APR-55 DLQ-DK OI= 2009 at $1.69 SL=1.00
BUY CALL MAY-50 DLQ-EJ OI=20279 at $5.00 SL=3.25
BUY CALL MAY-55 DLQ-EK OI=17390 at $3.13 SL=1.50

Picked on March 9th at   $50.44    P/E = 83
Change since picked       +0.00    52-week high=$53.97
Analysts Ratings    13-18-2-0-0    52-week low =$31.38
Last earnings 12/99   est= 0.15    actual= 0.16
Next earnings 05-18   est= 0.16    versus= 0.16
Average daily volume = 31.7 mln
/charts/charts.asp?symbol=DELL

****

TXN - Texas Instruments $180.38 +8.38 (-7.25 this week)

Texas Instruments is in the semiconductor business.  They
specialize in real-time technologies, digital solutions for
applications where waiting isn't an option.  Their DSP and 
analog chips are the brains behind many of today's most 
attractive opportunities such as digital wireless phones and
broadband.  To quote their President, "Texas Instruments is 
gaining significant market momentum, and is well positioned
going forward as the global market for DSL continues to ramp 
up."  TXN is currently engage with several other manufacturers 
to provide advanced DSL solutions and plans to announce 
additional customers throughout the year.

Why do we get so excited when we add this old friend back
on our play list?  Well this time the reasons are many.  TXN is 
in the semiconductor industry that today helped lead the Nasdaq
to a new closing high.  TXN had a bit of profit-taking this
week after making a new high at $200 on Monday.  Today the bulls
jumped back on board and grabbed hold of the reins and began to
drive TXN higher.  The reasons the chip sector has received
so much positive attention this week are because business is
outstanding for most in the industry.  A report out Wednesday
showed January sales for the semiconductor industry jumped 33%,
and that's suppose to be their slowest time of the year!  Earlier
this week analysts at Gerad Klauer reiterated their Buy rating
on TXN.  That's a nice little extra for our play, but here's the
good part.  Last Thursday, TXN filed the necessary forms with
the SEC to have the number of authorized shares increase from
1.2 billion to 2.4 billion.  Shareholders of TXN stock will have
the chance to approve this request at the annual stockholders
meeting on April 20th.  TXN is scheduled to report earnings on
April 24th.  What we are looking for here is a split announcement
to come with earnings.  Although earnings are weeks away, the 
request for an increase in authorized shares could propel TXN to
new highs. TXN is also on track to report solid earnings compared
to last year, as they came in well ahead of analysts estimates
last quarter as well.  TXN hovered near the $170 level for
most of yesterday and today, when the volume and price began to
pick up late in the session today.  We would use any further
movement to the upside as a chance to jump on board this new
play.

Companies in the chip sector continually strive to produce the
fastest chips and get them into the marketplace first.  If they
can't provide them to their customers in a timely manner, then
sales and profits suffer.  Today Maxtor Corporation named TXN
as their supplier of the year.  Maxtor officials said TXN has 
provided consistent execution and technical leadership quarter
to quarter and has been a major contributor to Maxtor's growth
and success.  

BUY CALL APR-170 TNZ-DN OI=1298 at $21.75 SL=16.25
BUY CALL APR-180*TNZ-DP OI=1905 at $16.50 SL=13.00
BUY CALL APR-190 TXR-DR OI= 536 at $12.00 SL= 9.50
BUY CALL APR-195 TXR-DS OI= 392 at $10.63 SL= 8.25

SELL PUT MAR-170 TNZ-ON OI= 955 at $ 3.00 SL= 4.75
(See risks of selling puts in play legend)

Picked on Mar 9th at    $180.38    PE = 107
Change since picked       +0.00    52-week high=$199.56
Analysts Ratings    15-13-4-1-0    52-week low =$ 45.50
Last earnings 01/00   est= 0.47    actual= 0.51 
Next earnings 04-24   est= 0.53    versus=-0.32
Average daily volume = 4.57 mln
/charts/charts.asp?symbol=TXN

****

NOK - Nokia $214.63 +3.25 (-5.38 this week)

Finnish Phone Firm, Nokia is the world's number one maker of 
wireless cellular phones, ahead of Motorola, Ericsson and 
Kyocera.  In addition they make wireless networking equipment, 
PC monitors and workstations, digital satellite and cable 
network systems, and set-top boxes.  However mobile phones 
make up 80% of their $19.8 bln in annual sales.  

Here's an old favorite stock and a simple play that doesn't 
require so much as rocket scientist's IQ.  Feb 1st was the day 
NOK announced it would split its shares 4:1 pending shareholder 
approval at a special meeting to be held on Mar 22nd.  The actual 
split date will follow in roughly two weeks, or the first week 
in April.  Following a three-day pullback ending at $207 (nice 
support), NOK closed at its high of the day on strong finishing 
volume.  $214 looks to have some support too on the "old support 
equals new resistance" theory.  Now's the time to look for an 
entry.  If it holds $214 or bounces off $207 (after amateur hour 
in both cases), feel free to take a position.  Here's some 
background for a flavor of what this market leader in wireless 
handsets offers to investors.  On February 1, NOK also announced 
a 46% increase in previous year profits, a 2-mln share 
repurchase, and a dividend increase.  Net sales grew at 49%, 
which comes as no surprise given their CEO's comments late in 
1999 that they would meet their 2003 total revenue figures by the 
end of 2002 (cramming 3 yrs of income into 2 yrs).  In short, 
earnings were a blowout as they reported a 7.5% surprise of $0.72 
vs. estimates of $0.67.  At the same time, NOK was keeping the 
Street's expectations in check by guiding analysts to a "30-40% 
growth" rate.  Also, their 1999 market share grew to 30% from 23% 
in 1998.

There are all kinds of announcements of alliances and recently 
won contracts in the news - the most noteworthy is that NOK will 
collaborate with AOL to bring instant messaging to the handset.  
While that helps, the real play is in the split run.  Analysts 
have helped too.  Today, Prudential Volpe Tech reiterated their 
Strong Buy with a price target of $230, citing that NOK currently 
trades at 10% discount to ERICY based on 2001 First Call EPS 
estimates

BUY CALL APR-200 NZY-DT OI=2506 at $23.13 SL=18.00
BUY CALL APR-210*NZY-DB OI=2033 at $17.25 SL=13.50
BUY CALL APR-220 NZY-DD OI=3078 at $12.50 SL=10.00
BUY CALL JUL-210 NZY-GB OI= 354 at $31.75 SL=24.75
BUY CALL JUL-220 NZY-GD OI= 708 at $27.25 SL=21.25

Picked on Mar 09 at     $214.63     P/E = 95
Change since picked       +0.00     52-week high=$227.06
Analysts Ratings     16-9-1-0-0     52-week low =$ 67.69
Last earnings 02/00   est= 0.67     actual= 0.72
Next earnings 05-02   est=-0.61     versus= 0.48
Average Daily Volume = 3.45 mln
/charts/charts.asp?symbol=NOK



*************
NEW PUT PLAYS 
*************

UAL - United Airlines $46.38 -1.88 (-4.06 this week)

United Airlines is the largest air carrier in the world and 
the largest majority employee-owned company, offering nearly 
2,300 flights a day to 135 destinations in 27 countries and 
two U.S. territories.  It is an industry innovator with break-
throughs such as E-Ticket Service, Airport Gate Readers, The 
Chariot(SM) mobile airport podium, United Shuttle, and the 
introduction of the technologically advanced Boeing 777.  

Ready for another NYSE stock taking a nosedive?  Allow us to
present UAL, a transport stock (Strike 1) feeling the pinch
of increasing fuel costs (Strike 2), and announcing this week
that its load factor in February dropped 1.8 percent from the
same period last year (Strike 3).  With crude oil prices
hitting 9-year highs, the transports are really starting to
feel the pinch.  Add to that a declining occupancy rate in
their aircraft, and voila, you have another NYSE stock hitting
multi-year lows (in this case, the lowest share price since
late 1996).  So where do we go from here?  If support near
$45-46 can't hold, we are looking for a drop to $39-40 before
UAL pulls out of its dive.  The poor beleaguered stock barely
has the strength to challenge the 10-dma ($48.50 after today's
drop), so look for a move up to this level to trigger your
entry.  Use volume as a measure of the longevity of our play.
Selling volume has been strong, with total volume at or above
the ADV throughout most of the decline this year, and a
resumption of buying interest may mean the value investors
have arrived.  With UAL trading at a PE under 5, somebody may
get it in their head that the stock looks like a bargain.

BUY PUT APR-50*UAL-PJ OI=137 at $5.25 SL=3.50
BUY PUT APR-45 UAL-PI OI=138 at $2.44 SL=1.25

Average Daily Volume = 783 K
/charts/charts.asp?symbol=UAL



**********************
PLAY OF THE DAY - CALL
**********************

AMD - Advanced Micro Devices $58.13 +4.63 (+16.25 this week)

AMD is a global supplier of integrated circuits for the personal 
and networked computer and communications markets. They produce 
processors, flash memories, programmable logic devices, and 
products for communications and networking applications. The 
company ranks #2 in the microprocessor market behind Intel, 
however it has captured about a 60% share of the sub-$1000 PC 
market. AMD also makes embedded chips and nonvolatile memories. 
They have manufacturing operations in Europe, China and Japan, 
with about 55% of its sales outside the U.S. AMD gets about 12% 
of its revenues from Compaq Computers.

Most Recent Write-Up

On Wednesday, AMD tested the $49 support level we mentioned 
Tuesday and it held up just like it was supposed too.  This 
morning AMD gave us a nice entry point for our new chip play.  
The battle between Intel and AMD as to who can produce the 
fastest chip, and get it to market, has gone on for some time 
now and will continue for a long time.  The real push behind 
this play however comes from news that semiconductor sales 
are strong.  By the sounds of things there will be plenty of 
business to go around.  The Semiconductor Industry Association
reported on Wednesday that worldwide sales of semiconductors 
reached $14.8 billion in January, increasing from $11.1 billion
in January of 1999.  The chip industry is off to a strong start
for year 2000.  As we said Tuesday, the first quarter tends
to be the weakest quarter of the year.  A 32.0% increase in
January certainly suggests 2000 will be one of the best ever
for companies like AMD.  The volume and the price picked up 
for AMD in the last hour of trading today which suggests this
one may be just breaking loose.  AMD tested the $54 area several
different time today, which has now proved to be good support.

Comments

AMD has had a nice run over the past week and has done so on
heavier volume.  With almost three times the ADV on Monday and
Tuesday, and twice the ADV the past two sessions, AMD has made 
a steady and convincing climb to close near its 52-week high.  
This strong volume has laid good support levels at $54.50 and 
$53.  The positive outlook for semi-conductors in the near 
future will help AMD test the psychological resistance of $60.  
Watch for market direction in the early going and pick entry 
points that suit your risk levels.

***March contracts expire in next week***

BUY CALL MAR-55 AMD-CK OI=6097 at $5.00 SL= 3.75
BUY CALL MAR-60*AMD-CL OI=2458 at $2.56 SL= 1.75
BUY CALL APR-60 AMD-DL OI=5955 at $6.88 SL= 5.13 
BUY CALL APR-65 AMD-DM OI=  79 at $5.13 SL= 3.81

Picked on Mar 7th at     $53.25     P/E = N/A
Change since picked       +4.88     52-week high=$59.00
Analysts Ratings      8-6-8-0-0     52-week low =$14.56
Last earnings 01/00   est=-0.06     actual= 0.43 
Next earnings 04-19   est= 0.35     versus=-0.81
Average daily volume = 3.74 mln
/charts/charts.asp?symbol=AMD



************************
COMBOS/SPREADS/STRADDLES
************************

Another Day, Another Record...

Wednesday, March 8

Blue-chip stocks rebounded Wednesday as bargain hunters scoured
the market for oversold issues.  The Nasdaq also managed modest
gains in the volatile session.  The Dow Jones industrial average
ended up 60 points at 9856 while the bullish technology index
rose 42 points to 4897.  The S&P 500 index finished up 11 points
at 1366.  Volume on the Big Board was active with 1.19 billion
shares exchanged and declining issues edged advances 1,535 to
1,438.  In the bond market, the 30-year Treasury fell 1/32, bid
at 101 10/32, where it yielded 6.14%.


Tuesday's new plays (positions/opening prices/strategy):

CMG Inc.     CMGI   MAR115P/120P   $0.75   credit   bull-put
KLA Tencor   KLA    MAR70P/75P     $0.88   credit   bull-put
Level 3      LVLT   MAR110P/115P   $0.88   credit   bull-put

All three of our new picks slumped during the session and each
position offered entry prices at or above our suggested targets.


Portfolio plays:

The majority of stocks moved higher today, recovering some of the
losses suffered earlier in the week.  Traders sensed that much of
the previous selling was overdone and the perception now is that
many of traditional manufacturing companies have fallen so far
they are attractively valued.  Lower oil prices also added to the
optimism with crude futures falling on news there were additions
to U.S. crude and gasoline inventories and a belief that OPEC and
other oil producers were near a consensus on an output hike.  The
Nasdaq rose on strength in telecommunications and Web-B2B issues
while drug stocks led the Dow higher with a number of upgrades in
the sector.  Market bellwether Procter & Gamble (PG) opposed the
rally, falling $3 to close at $58; a 3-year low.  Surprisingly,
analysts said many traders believe the stock is overvalued even at
the current levels.

Federal Reserve Chairman Greenspan has contributed significantly
to the recent slump in blue-chip stocks and today he continued
his assault on the rising market.  He warned bankers not to assume
that current robust conditions in the U.S. economy will last and
he urged them to give thought to how borrowers might perform under
more stressful conditions.  Greenspan also noted the recent rise
in equity values and mutual funds has put competitive pressure on
the banking industry's deposit base, forcing lenders to turn to
other sources of funding.  Sounds like he is again on a mission
to arrest any market rallies.

Fortunately, the majority of issues in our Spreads portfolio are
sailing comfortably along on the heels of the recent technology
boom.  Virtually all of the March positions are profitable and
only the long-term plays require any attention.  The necessity
for upside adjustments is now a priority with many of the bullish
spreads and most of the diagonal positions are prime candidates
for 'roll-ups' to higher-priced options.  With my recent absence
from the market, I have been unable to monitor the portfolio and
thus many of the opportunities for timely moves are no longer
available.  Hopefully, those of you participating in our spread
positions have made the necessary adjustments.  We will also use
the upcoming transition to April options to improve each play's
profit potential.


Thursday, March 9

Technology issues soared today, driving the Nasdaq to another
record close as investors battled for networking and e-commerce
issues.  The composite of technology stocks rocketed 149 points
to 5,046 with Internet issues leading the way.  The Dow Jones
Industrial Average participated in the rally, up 154 points to
10,010.  The S&P 500 index finished up 35 points at 1,401.
Advancing issues outnumbered decliners by a 4-to-3 margin on
the New York Stock Exchange on active volume of 1.12 billion
shares. The bond market closing numbers were unavailable.


Portfolio plays:

Today's rally was broad and decisive with stocks from all major
groups enjoying significant moves.  Blue-chip recoveries were
widespread and the Nasdaq soared on strength in networking and
Internet stocks, even as profit-taking continued to plunder the
high-flying biotech sector.  Our portfolio continues to benefit
from the bullish movement of technology issues and the #1 stock
in the group was Network Solutions (NSOL) with a $71 move to close
at $494.  Web-security company VeriSign (VRSN) recently announced
a $21 billion merger with Network Solutions and both issues have
been extremely volatile in the last few sessions.  Intervu (ITVU)
and Polycom (PLCM), both up $12, competed for a distant second
while MRV Communications (MRVC) secured third place with a $10
spike to $190.  Bea Systems (BEAS), CMG Inc. (CMGI), ISS Group
(ISSX) and KLA Tencor (KLAC) all finished near the front of the
pack with $6 rallies.  The leading mid-cap stocks were Computer
Associates (CA) which rebounded $5.75 to $66 and Cabletron (CS)
with a $4.50 move to $48.  Today's rally in Computer Associates
provided a perfect opportunity to transition to April options in
our LEAPS/CC's play.  The new position is LJAN60C/APR65C at a
credit of $2.38 and now there is no downside risk in the spread.

A number of smaller issues enjoyed significant rallies.  The most
surprising was P-Com (PCMS) with a $4 spike to end at $20. The
issue had been in a slump recently but the brisk reversal may be
the first indication of a significant change in character.  Unisys
(UIS) rose $2.12 to a recent high near $29 and the move provided
an excellent early-exit on the April diagonal spread.  The spread
closed with a $3.50 profit.  Tera Computers (TERA) rallied $1.12
to end at $9 after a brief test of the $7 range and Star Telecom
(STRX) reversed a recent trend to end $1 higher at $6.88, a great
opportunity to roll-out to the April options.  One of our straddle
stocks made it to the leader-board.  Applix (APLX) gapped $4 to a
3-month high near $20 after unveiling new plans for creating two
dedicated business units, the eBusiness Division and the Linux
Division.  The company also plans to increase investments in these
businesses for improved market visibility and accelerating revenue 
growth.  Our (JUL-$15) straddle moved into positive territory with
$1.75 profit on $6.50 invested in just one month.  Of course there
were numerous other issues that participated in today's rally; far
too many to list on an individual basis.  The important thing to
remember is that we can utilize these volatile market gyrations to 
improve our profit potential in current spread positions.  Making
timely adjustments with regard to changing technical character and
inflated option premiums is what position management is all about.
For those who are interested, I plan to explore that topic further
in the coming weeks.

Questions & comments on spreads/combos to Click here to email Ray Cummins


*********
NEW PLAYS
*********

AMD - Advanced Micro Devices  $58.12   *** On The Move! ***

Advanced Micro Devices offers a wide variety of industry-standard
integrated circuits (ICs) that are used in many diverse product
applications such as telecommunications equipment, data and
network communications equipment, consumer electronics, personal
computers (PCs) and workstations.  AMD is engaged in the three
principal technology areas within the digital IC market, memory
circuits, logic circuits and microprocessors, through its two
operating segments, AMD and Vantis.  The AMD segment includes the
Computation Products Group (CPG), Memory Group and Communications
Group, and the Vantis segment, which consists of the company's
programmable logic systems.

Advanced Micro Devices reached the milestone gigahertz mark this
week with a new Athlon processor that makes computers 10 times
faster than just six years ago.  The processor is essentially the
heart of the computer, performing a certain number of instructions
per second.  The faster the clock speed of the processor, measured
in megahertz, the quicker it goes.  AMD's 1-GHZ Athlon chip came a
day before the six-year anniversary of rival Intel's breaking of
the 100 megahertz barrier with its Pentium chip, and just two days
ahead of that company's announcement that it will ship its own
1-GHZ chip.  These gigahertz chips; Intel's Pentium III and AMD's
Athlon, speed up complex computer tasks such as high-end games
and other sophisticated software.  AMD says it has committed to
orders from its flagship customers, Compaq and Gateway and the
chip will also reportedly be the CPU of the prototype of the new
X-Box gaming console that Microsoft will unveil this Friday.

Analysts were in favor of the news and both Gruntal & Prudential
raised their targets on the issue.  We agree with the outlook but
prefer a conservative approach with this (ITM) debit spread.


PLAY (conservative - bullish/debit spread):

BUY  CALL APR-37.50 AMD-DU OI=1689 A=$21.38
SELL CALL APR-50.00 AMD-DJ OI=4445 B=$11.12
INITIAL NET DEBIT TARGET=$10.00-$10.12 ROI(max)=25%

Chart =
/charts/charts.asp?symbol=AMD

****

TTWO - Take-Two Interactive  $18.38   ** New All-Time High! ***
  
Take-Two Interactive Software is a worldwide developer, publisher
and distributor of interactive software games.  TTWO's software
operates on multimedia personal computers and video game console
platforms manufactured by Sony, Nintendo and Sega.  The company
publishes its software under the Rockstar Games, Talonsoft,
Gathering of Developers, Mission Studios and Take-Two labels.  The
company has released titles in a variety of genres; Grand Theft
Auto, GTA2, Railroad Tycoon II, Monster Truck Madness and the very
popular Thrasher: Skate & Destroy. TTWO also intends to release
new titles, including Oni and Halo, and titles based on the Duke
Nukem franchise and Austin Powers movies.

This issue has been hot in recent weeks and the options are very
active.  It appears all the commotion is based on TTWO's recent
decision to combine subsidiaries Rockstar Games, DMA Design and
Pixel Broadband Studios into one newly created company, Broadband
Studios, Inc.  Broadband Studios will independently focus on
broadband interactive entertainment and continue to develop and
publish original content for next-generation game consoles, with
particular emphasis on the ongoing development of tools and
technologies for consumers who have broadband access.  BBS will
pursue relationships with broadband service providers to market
and deliver its products to the multi-player broadband consumer
of the future.

Take-Two will own 100% of the outstanding stock of Broadband
Studios, but it is their intent that the company operate as a
separate entity.  They will maintain a distribution relationship
for all traditional physical console goods marketed to retailers
and consumers worldwide.  The agreement will give the company
continuing access to Take-Two's current distribution network.

That's sounds like an ambitious project but investors appear to
favor the plan.  With the recent bullish trend and a new all-time
high, the risk/reward potential for this conservative position is
excellent.


PLAY (conservative - bullish/diagonal spread):

BUY  CALL JUN-7.50  TUO-FU OI=30  A=$11.25
SELL CALL APR-17.50 TUO-DW OI=610 B=$3.00
NET DEBIT TARGET=$8.00-$8.12 INITIAL ROI TARGET=21%

To reduce the risk/reward potential, sell half of the position
at $15.00 and half of the position at $17.50.  For example:

BUY  (10) CALL JUN-7.50  TUO-FU OI=30  A=$11.25
SELL (5)  CALL APR-15.00 TUO-DC OI=868 B=$4.25
SELL (5)  CALL APR-17.50 TUO-DW OI=610 B=$3.00
 
Chart =
/charts/charts.asp?symbol=TTWO

****

BMCS - BMC Software  $51.50   *** On The Rebound! ***

BMC provides software products that significantly increase the
productivity, reliability and recoverability of its customers'
core information technology (IT) operations, including their
software applications and the systems on which they run.  BMC's
goal is to help its customers improve the efficiency and
productivity of their mainframe and distributed IT systems.
BMC's software products address the three predominant operating
environments of enterprise computing: the IBM OS/390 mainframe
operating system; the various Unix operating systems employed by
leading hardware manufacturers such as Hewlett Packard Company,
Sun Microsystems, IBM and Compaq Computer Corporation; and
Microsoft's Windows NT operating system.

A slew of upgrades came out in late January (after the big fall)
but no one has publicly supported the stock in recent weeks and
yet it continues to recover.  Now the lawyers are out in force
and everybody wants a piece of the action.  If you like bottom
fishing for undervalued issues, this may be just what the doctor
ordered.  Rather than try to decipher the reason for the change
in character, we will simply follow the trend and take a
conservative, in-the-money position in this speculative,
"technicals only" play.
    

PLAY (speculative - bullish/debit spread):

BUY  CALL APR-35 BCQ-DG OI=6   A=$17.25
SELL CALL APR-45 BCQ-DI OI=845 B=$8.75
INITIAL NET DEBIT TARGET=$8.25 ROI(max)=21%

Chart =
/charts/charts.asp?symbol=BMCS


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************
See Disclaimer in section one
************

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