Option Investor
Newsletter

Daily Newsletter, Wednesday, 11/19/2003

HAVING TROUBLE PRINTING?
Printer friendly version
The Option Investor Newsletter                Wednesday 11-19-2003
Copyright 2003, All rights reserved.                        1 of 2
Redistribution in any form strictly prohibited.


In Section One:

Wrap: Stocks End Losing Streak
Futures Wrap: Back from the brink
Index Trader Wrap: NASDAQ-100 is main index to monitor for weakness
Traders Corner: Adapting To Change


Posted online for subscribers at http://www.OptionInvestor.com
*******************************************************************
MARKET WRAP  (view in courier font for table alignment)
*******************************************************************
     11-19-2003            High     Low     Volume Advance/Decline
DJIA     9690.46 + 66.30  9707.64  9614.24 1.62 bln   1712/1105
NASDAQ   1899.65 + 17.90  1903.43  1880.31 1.78 bln   1805/1269
S&P 100   516.82 +  4.60   517.57   512.22   Totals   3517/2374
S&P 500  1042.44 +  8.29  1043.95  1034.15
RUS 2000  525.62 +  3.94   527.15   519.84
DJ TRANS 2866.87 -  0.08  2878.21  2843.77
VIX        18.80 -  0.31    19.51    18.65
VXO        19.45 -  0.45    20.41    19.35
VXN        29.96 +  0.31    30.40    29.15
Total Volume 3,832M
Total UpVol  1,288M
Total DnVol  2,486M
52wk Highs     302
52wk Lows       47
TRIN          0.81
PUT/CALL      0.87
*******************************************************************

Stocks End Losing Streak
by James Brown

U.S. stock market averages ended a four-day losing streak as
Jim's mysterious buyers* arrived on time to buy the dip (*see
yesterday's wrap).  Strong housing data and a round of positive
corporate news ushered in a wide rally.  Only airlines and oil
service stocks seemed to attract any heavy selling while buyers
concentrated on technology with Internets, semiconductors,
networking and biotech lead the way.  Rumors were circling that
the Bank of Japan intervened last night to lift the dollar off
its five-year lows against the yen near 107.55.  The greenback
also bounced back from its all-time lows against the euro.

Foreign exchanges were not so lucky.  The Japanese NIKKEI index
fell 282 points to close at 9614.  This comes on the heels of
Monday's 380-point loss.  The Hang Seng dropped another 154
points to follow up on its 200-point drop from Monday.  The drop
was likely fueled by the new import caps on Chinese textiles
announced yesterday.  The Hang Seng closed at 11,872.  European
stocks were mostly lower following the weakness from their Asian
counterparts.

The broad-based rally here at home lifted 25 out of 30 Dow
components and the majority of sector indices closed green.
Advancing stocks ran past decliners 17 to 11 on the NYSE and 18
to 12 on the NASDAQ.  Up volume was about twice down volume on
both exchanges.  The 66-point bounce in the DJIA lifted the index
back towards the 9700 level but it failed to close above it.
Likewise the 17.9-point rally in the NASDAQ took it right to the
1900 mark but failed to close above it.  That doesn't sound very
convincing if you're looking for new bullish positions.  Yet
looking at the rising trend from March you'll notice that most of
the short-term lows took a good three or four days to consolidate
before the next rebound truly appeared.

Chart of the DJIA:



Chart of the NASDAQ:



The economic news of the day was the U.S. housing starts for
October.  The Commerce Department reported that the number of new
homes started in October jumped 2.9%.  This pushed the rate to an
adjusted rate of 1.96 million homes a year.  This was the highest
level since 1986 and well above analyst estimates of 1.85
million.  The report also said that new starts for single-family
homes jumped 5.7% to a rate of 1.62 million - another record
level not seen since the mid-1980s.  While the homebuilders
failed to rally on the report it is good news.  High home starts
and sales promote strong consumer spending, which will continue
to give the economy an underlying strength.

Thank goodness for a resilient retail investor because the feds
are busy on Wall Street again.  In addition to the growing mutual
fund scandal the FBI busted 37 brokers and charged 10 more in a
currency trading scam.  The bust came last night and authorities
arrested traders from J.P.Morgan UBS Warburg, even a former
employee of the Federal Reserve.  Thankfully, the markets
appeared to ignore the news and shares of JPM lost a mere 13
cents.

There were plenty of stocks making headlines today but none
bigger than General Electric (GE).  GE offered strong earnings
guidance for 2005 but said 2004 would likely be flat as it
adjusted its "portfolio" into a position to generate double-digit
growth again.  The company did raise its dividend by 5 percent
and said it would split off part of its mortgage and life
insurance business.  The IPO, expected to launch next year, is
called Genworth Financial and said to be worth as much as $10
billion.  GE plans to initially spin off 30% of the company
before slowly divesting themselves fully of the business.  GE's
stock was the most active on the Big Board today and closed up
3.6%.

Discount broker Charles Schwab (SCH) also made news when they
announced a $321 million acquisition of SoundView Technology
(SNDV).  This values SNDV at $15.50 and equals a 17 percent
premium above SNDV's stock price from yesterday.  SCH claims SNDV
will be a good addition to their own research operations.  Shares
of SCH dropped 8 cents to $11.34 and SNDV jumped 16% to $15.41.

Internet stocks made some gains today after a Smith Barney
analyst, Lanny Baker, said online advertising revenues should
jump 20 percent in 2004 and remain strong throughout 2005.
Yahoo! Inc. (YHOO) saw its price target raised $3 to $46 while
DoubleClick (DCLK) had its price target lifted $3 to $12 after
Lanny upgraded DCLK from a "sell" to a "buy".  The INX internet
index rose 2.54% after three days of heavy losses.

It was interesting to note the UTY utility index bounced 1.4%
after a government report came out today fingering Ohio's
FirstEnergy Corp as the culprit for the nation's largest
blackout.  FirstEnergy denies the claim but the report said
FirstEnergy failed to monitor its electrical transmission
systems.  The August 14th blackout spread to eight states and
took out 263 power plants.

Investors welcomed positive news from Analog Devices (ADI), Big
Lots (BLI) and United Health (UNH) as all three raised their
earnings guidance.  The ADI and UNH news helped fuel strong gains
in the SOX semiconductor index and the HMO healthcare index.
Wall Street received even more good news after the close with
earnings reports from retailer Hot Topic (HOTT) and Hewlett-
Packard (HPQ).  HOTT reported Q3 earnings of 31 cents a share,
which beat estimates by 3 cents.  Sales jumped 32 percent with
same-store sales climbing 10.8 percent.  Meanwhile Dow component
HPQ beat estimates by a penny, with 36 cents a share sans one-
time items.  HPQ's Q4 net profit came in at $862 million, which
was twice its year-ago numbers.  The company gave credit to
strong sales of technology services and PC's.

Tomorrow is up for grabs in my book.  Bulls would like to see
some follow through on today's bounce but as I mentioned earlier
previous lows all took three or four days to consolidate before
buyers could initiate the next rebound.  The markets continue to
receive positive economic and corporate earnings news but the
urge to harvest gains appears to be growing as we approach the
end of the year.  This belief that investors are comfortable with
their year-to-date gains and therefore less likely to chase
stocks higher could lead to a range bound market.  Overall the
mutual fund scandal and rising geo-political tensions are
psychological hurdles that could put the brakes on this
traditionally bullish season.  As Jim mentioned in his wrap
yesterday the situation regarding Syria is heating up and I read
a newsflash today stating the U.S. had just doubled the number of
troops on the Iraq-Syrian border.

Thursday will bring a number of earnings announcements from the
retail sector.  Announcing are: American Eagle Outfitters (AEOS),
Barnes & Noble (BKS), Borders Group (BGP), Claire's Stores (CLE),
The Gap (GPS), Foot Locker (FL), and Limited Brands (LTD).  Also
announcing is Dow component Disney (DIS).


************
FUTURES WRAP
************

Back from the brink
Jonathan Levinson

Equities decided not to take yesterday's carnage to the next
level, setting a low overnight and recovering for the remainder
of the day.  The US Dollar and equities rose, treasuries and
commodities declined.

Daily Pivots (generated with a pivot algorithm and unverified):


Note regarding pivot matrix:  The support, pivot and resistance
levels above are derived from the high, low and closing price
levels by a simple mathematical formula.  They are not intended
to be predictive of market turning points or to serve as targets,
but rather represent the range retracement levels as generated by
the pivot algorithm.  Do not think of them as market "calls"
or predictions.  Like any technically-derived indicator or price
level, the pivot matrix values should be regarded as decision
points at which to evaluate current market conditions.  Visit us
in the Futures Monitor for our realtime views of the various
markets covered here.


10 minute chart of the US Dollar Index


The US Dollar Index found bidders in Europe and managed to
continue its rise off the overnight lows, trading as high as
90.95.  Gold, silver and the CRB all declined, thought the HUI
and XAU managed a turnaround at the close to finish in positive
territory.

Daily chart of December gold


December gold dropped 2.30 to close at 395.30, printing an
intraday high of 399.80.  Silver dropped 8.7 cents or 1.62%, bu
the mining indices advanced, HUI +1.59 at 236.81 and XAU +.53 at
105.17.  Today's pullback in the metal was to be expected and did
not impact the current daily cycle upphase.  A move below 388
would alter the picture, but in the meantime the consolidation
below 400 continues.  The CRB dropped 3.45 to close at 251.92.


Daily chart of the ten year note yield


The bearish trade in metals and commodities was matched by
selling in treasuries, with the TNX adding 6.8 bps in a bullish
engulfing reversal of this week's prior loss to close at 4.235%.
So long as treasuries continue to trade against equities, I will
expect equities to underperform, as the Fed has been insistent on
prioritizing low yields above all else.  I continue to believe
that the Fed would prefer a crash in equities to a rally in
yields.  The recent action suggests that it will be one or the
other, but we're just guessing at this level.

Daily NQ candles


In retrospect, it was an entirely predictable day- a good day for
robots trading OPM (other people's money).  The 30 minute cycle
trough reversed off the overnight low and ran straight to the
top, with the daily candle a "return to the scene of the crime"
test of failed support on the rising bear wedge.  The move did
not impact the daily cycle oscillators, and if the 30 minute
rolls over from here, a break of 1360 support will be the next
tell to confirm what felt yesterday like a bone fide downtrend.
A break above 1392 should not occur under this scenario, and if
does, we'll be forced to reevaluate.



30 minute 20 day chart of the NQ


Today's bounce could be a bull wedge breakout on the 30 minute
candle chart, but the oscillators do not support it, and I expect
weakness to reassert itself either from the get-go or slightly
after the open.  1384 appears to be horizontal resistance under
the sloppy head and shoulders-esque top currently in place, and
again, 1392 should cap any residual upphase from out now-very-
trusty 300 minute stochastic.


Daily ES candles


The ES printed the same tweezer bottom as the NQ, but it did so
above 1032 support, coinciding with the lower wedge support line.
The move reversed most of yesterday's losses, but still set a
lower high.  Most noteworthy was that it didn't collapse entirely
at the open, given the ferocity of yesterday's end-of-session
selling.  I believe that options expiration manipulation helped
prop the markets last night and this morning, but the 300 minute
stochastic predicted it as well.  1030-32 is the key support to
watch, with 1055 now resistance on any bounce.


20 day 30 minute chart of the ES


The 300 minute stochastic on the 30 minute chart is in rollover
territory here, lining up nicely with the resistance line at
1043.  A failure here would again line up with the downphasing
daily and weekly oscillators and should, in theory, pack some
downside weight.  If it does not, and a higher low above 1032 is
printed, we can expect more upside at current levels.  I'm
expecting possible upside follow-through tomorrow, but I'd be
surprised to see today's highs exceeded.  Above 1048, it would be
more than a mere throwover, and we'd be forced to reevaluate our
nearterm bearish bias.


150-tick ES


There's not much to say about today's intraday chart, other than
to observe that the short cycle oscillators are in a so-far
shallow downphase.  Again, more upside is possible, but it
shouldn't amount to much.


Daily YM candles


The YM resembles the ES to a "t".  Nothing to add here.


20 day 30 minute chart of the YM



I'm becoming increasingly comfortable with the increasingly
predictable inverse relationship between bonds and equities.  The
side-by-side rallies this spring threw me off, and the markets
make much more sense to me now that things are back in swing.
The fact that traders cannot simply buy anything, be it
treasuries, equities or commodities, and have it go up right away
implies that the Fed has finally pulled its foot off the gas, at
least for the moment.  Given the importance of the astronomic
credit bubble, I expect scarce resources to favor bond prices
over equity prices.  So long as the two are trading inversely,
I'll expect to see weakness in equities for a change.  The fact
that the cycles I follow agree with this intermarket
interpretation is all the better.

Careful tomorrow, as scam week is still upon us.  The cycle
picture should be clear, but be ready for the unexpected with
opex Friday approaching.   See you tomorrow.


********************
INDEX TRADER SUMMARY
********************

NASDAQ-100 is main index to monitor for weakness

The major indices reversed their recent slide in today's session,
bolstered in part to the Bank of Japan intervening on the yen in
yet another attempt to stem the yen rise against the U.S. dollar.

The six foreign currency weighted U.S. Dollar Index (dx00y) 90.91
+0.64% showed the dollar strengthening against the major
currencies.  The two most heavily weighted foreign currencies had
the December euro futures contract (eu03z) 1.1871 -0.60% and
December yen futures contract (jy03z) 0.009154 -1.13% trading
back from yesterday's highs.

And while a rebound in the dollar helped the major indices finish
green, I view today's gains somewhat shaded, as if colored with
artificial food coloring.

I've bitten into a few pieces of candy that were colored green,
but instead of a refreshing peppermint taste, the green-color
candy was nothing more than raw sugar that was artificially
colored, and I was left wanting more.  Not more of the sugared
candy, but something with some bight to it.

Recent e-mail has had market monitor participants wanting
continual hourly updates on short-term trading the NASDAQ-100
Tracking Stock (AMEX:QQQ) $34.21 +0.97%.  On a day like today,
this was a difficult task, but some potentially worthy
observations were made, which we'll review in a moment.  All day
I felt like something was missing for a strong bullish move
higher with the dollar rebounding as it was and perhaps tonight's
updates on the market internals will show that it may well be
that bullish leadership may be tiring and has today's gains being
somewhat sugar coated.

Let's quickly review the pivot matrix, where the Dow Industrials
(INDU) 9,690.46 +0.68% kissed its WEEKLY S2 of 9,619 early this
morning for the first time this week, to close back near its
WEEKLY S1 after trading a session high of 9,707.64 late this
afternoon.

When reviewing tonight's closing values for the major equity
indices, we will note the INDU, DIA, SPX, SPY and OEX all closed
very near their WEEKLY S1s, with the NDX/QQQ lagging in the
WEEKLY Pivot matrix.  Keep this in mind when we later look at the
NH/NL breadth indicators.

Pivot Analysis Matrix



While today's gains in the dollar undoubtedly helped put some
near-term fears to rest that the dollar would simply fall apart,
I think it important to understand that the dollar's rebound was
largely due to intervention by Japan, and not necessarily the
response of untainted market.

But as I've discussed with some extremely bullish gold bugs, that
have said the only reason gold isn't at $800 per ounce and the
dollar worthless, is that while bank interventions and various
hedging or "manipulation" of markets may seem unnatural, the true
trade will always work its way out in the end, and all is fair in
love and war.

If the Bank of Japan has the clout to sell yen and buy dollars,
which on this particular day stemmed the yen's advance and
dollar's slide and influenced markets, then so be it.  However,
we take note of the Bank of Japan's actions may have had on
today's trade, what impact similar interventions have had on the
yen/dollar, and move on.

It has been awhile since we've looked at the NYSE and NASDAQ new
high and new low breadth.  While I sensed something missing for a
more bullish session with the dollar's rebound, I think it may
have been the lack of bullish leadership in the NASDAQ's NH/NL
breadth.

NYSE and NASDAQ New High / New Low Daily Breadth



While tonight's focus will be the NSDQ NH/NL 10-day Average of
NH/NL ratio (scale 0%-100%, just like the bullish % is scaled)
I'm also showing the 5-day Average where I like to color it green
and red to get the visual perspective similar to a 5-day moving
average crossing above (green) or below (red) the 10-day average.

It is today's 91.4% reading which has me alert that today's trade
and 117 new highs versus 29 new lows has the 10-day average
reversing back lower to what would be considered "bull
correction" status for this indicator of leadership.  Please note
that this is the NH/NL breadth for the NASDAQ Composite (COMPX)
1,899.65 +0.95%, but can be tied with the NASDAQ-100 for an
observation of new highs versus new lows.

Here's a quick look at my hand charting of this 10-day average
ratio of new highs versus new lows.  Those of you that look at
the FREE bullish % charts on a point and figure basis at
www.stockcharts.com, will probably begin to see some similarity.

NASDAQ NH/NL 10-day Avg. Ratio Chart - 2% box scale



Today I'm charting a 3-box reversal back lower to "bull
correction" in the NASDAQ Comp. NH/NL 10-day Avg.  As you can
see, on September 24th to be exact (red 9) I charted a reversal
back up to 98%, and its has taken almost 2-months for another
chart entry to be found.  However, a chart entry at 90% would
have this indicator of NH/NL breadth turning "bear confirmed" and
then below its August (red 8) 92% reading.  On August 14, 2004,
the NASDAQ Comp. NH/NL 10-day Avg. was 90.1% and came just shy of
the a 90.0% reading.

As a quick side note for the NYSE NH/NL 10-day average, it would
currently take a 10-day average reading of 92% to reverse back
lower to "bull correction" and a reading of 62% to then turn
"bear confirmed."  As a comparison, in August (red 8), the NYSE
NH/NL fell to 64% before reversing back higher to an October
reading of 98%.

While today's reversal is not OVERLY concerning to bulls, I feel
it is certain WORTHY of note, and gives me a visual observation
that may confirm what I "sensed" in today's NASDAQ-100 Tracking
Stock (AMEX:QQQ) $34.21 +0.97% trade.

Here's a chart of the NASDAQ-100 Tracking Stock (AMEX:QQQ) that I
showed in today's market monitor.  While this chart was captured
at approximately 10:21:55, it may tie in very well after viewing
the above NH/NL breadth chart.

NASDAQ-100 Tracking Stock (AMEX:QQQ) - Daily Intervals



In an effort to concentrate on the QQQ in today's market monitor,
we looked at multiple time intervals.  The above chart has
conventional retracement used where the bottom is anchored that
the March lows (make this tie with the NH/NL reversal up) and the
recent 52-week high of $36.17.

While we usually look at the QQQ with WEEKLY/MONTHLY pivot
analysis retracement, where the QQQ violated its WEEKLY S2
yesterday, the above retracement at its 19.1% level of 19.1% may
indeed be a level that found buyers yesterday, and after breaking
below a rather longer-term trend from the March low, can be
observed as an important near-term level of support.

From a Fibonacci retracement perspective, it is considered normal
for a stock or index to retrace 38.2% or even 50% of an upward
move.  However, when trying to figure out where the actual top
is/was, that's the most difficult part.

I begin to think that the NASDAQ-100 is going to break lower, and
show DIVERGENCE from the PINK circled area of mid-August and that
observation becomes what I think is a very good near-term test
into next week, where I would look for the 21-day SMA to become a
level of resistance.

Still, we may begin to see some lacking of bullish leadership
taking place in the NH/NL breadth indications for the NASDAQ
Composite.  The NASDAQ-100 Bullish % ($BPNDX), which is "bear
confirmed" status also saw a net loss of 2 stocks to point and
figure sell signals today, and this different indicator of market
internals has been weakening of late.

As such, traders and investors are VERY ALERT TO WEAKNESS in this
part of the market, and weakness below yesterday's lows would be
views as a NEGATIVE.

S&P 500 Index Chart - Daily Interval



On a near-term basis, the starting to round out 21-day SMA
becomes a focal point of near-term resistance, as does the little
sliver zone of resistance near 1,047, where Monday's trade saw a
pretty share break below that level.  With option expiration this
WEEK, I might add a little room for resistance to the WEEKLY
Pivot of 1,052.50 for volatility.  A break below 1,032 would be
viewed as further weakness as discussed in last night's wrap.

I would continue to hold yesterday's profiled put in the SPX.

Today's trade saw no net change in the S&P 500 Bullish %
($BPSPX).  Still "bull confirmed" at 79.2%.

Today's trade saw no net change in the narrower S&P 100 Bullish %
($BPOEX).  Still "bull correction" status at 79.0%.

Dow Industrials Chart - Daily Intervals



I'm viewing 9,800 (give or take 10-points based on size of scale)
and 9,600 (give or take 10-points) as a near-term consolidation
range for the INDU.  In past I've been more willing to buy this
dip, but I'm a little more cautious with China trade
developments, and yesterday's rather sharp decline in the dollar.

Today's trade saw no net change in the Dow Industrials Bullish %
($BPINDU) and still "bull correction" status at 80%.

Jeff Bailey


************************Advertisement*************************

Live Securities Brokerage Service with Licensed Option Principals

OCO Stop & Profit Orders                        OneStopOption
All types of Spreads and Buy Writes             888-281-9569
Auto-Trade Market Monitor Signals
Personal Service and Education


**Services available for Foreign Traders including Canada**

http://www.OneStopOption.com

**************************************************************


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

Adapting To Change
by Mark Phillips
mphillips@OptionInvestor.com

The past few months have been trying for intraday traders in the
futures arena due to the contracting daily ranges in the major
indices, accompanied by the CBOE Volatility index (VIX.X) plunging
to multi-year lows.  Whether this is a short-term aberration or a
long-term change is really not germane to the approach we choose
to employ towards profitable trading.  What is critical is that we
modify our approach to account for the change, whether that means
changing the technical indicators we use or considering a
modification of our chosen trading vehicle.  The modification may
be as simple as recognizing that market conditions have changed
and accept that we need to be less aggressive and more
discriminating in our trade selection.

But first we need to quantify and understand the nature of the
changes that have taken place.  First let's look at current
conditions in the ES.  More days than not, the price action is
characterized by tight-range, noisy movement, punctuated by the
occasional buy or sell program.  Let's face it, when the total
range for the ES on a given day is 6-8 points, it is tough to make
a buck in there unless you're a very highly skilled scalper.  Just
for clarification, that isn't me.  I describe myself as a swing
trader.  I like to take one to three trades in a given session,
taking a chunk out of the middle of whatever intraday trends might
exist.  For instance, if the day has a total range of 10-12
points, then I might look to capture 60-70% of an intraday trend
from the low to the high.  Let's look at a recent intraday chart
to get an idea of what I'm talking about.

5- Minute Chart of the ES - November 18th




This is typical of the type of session that is very
straightforward to trade.  Just take every overbought alignment on
the Stochastics and trade the downside in keeping with the overall
trend.  These types of sessions used to come along 3-4 times per
week, but as we all know, they have been arriving with less and
less frequency over the past few months.  Rather than the rule,
these steady trending sessions have become the exception.

Each of the overbought alignments on the chart above provided
profitable entries into the downtrend.  The first entry would have
been on the aggressive side due to it being early in the day and
at that point in time, we really didn't have any indication as to
whether the trend would be down or if the gap would be followed
with more bullish action.  I would also label the last one at
roughly 12:30pm PT (3:30pm ET) as questionable due to its
proximity to the end of the regular trading session.  So let's
call this session one with 2 profitable entries into a solid
downtrend.  In a total range of 17 points, both of those entries
would have been capable of delivering a 10-point gain for the day.

The next chart shows the sort of session we have been confronted
with all too often since Labor Day rolled around.  The trend
remains questionable throughout the session, with false signals
around every corner.  Exacerbating the problem is the fact that
the distance between the turns is so small that by the time we can
discern a change and switch directions, that move is practically
over as well.

5-minute chart of the ES - November 13th




Using the same entry strategy employed in the first example, let's
just look at each of the Stochastics entries this day provided.
By my count, that's 5 short trades and three long trades --
definitely ugly just on the number of trade setups that presented
themselves.  To be generous, I'll throw out the first and last
short signals, as the first was a bit early in the day for my
taste and the last one came on a pretty big sell program inside
the final hour.

That leaves us with four short signals, with none of them
producing anything but losses.  The "best" trades of the day were
the long signals at 8:00am and then near 10:30, and if we had the
foresight to exit at the peaks of those two respective moves (not
likely), we could have netted gains of 3 points and 5 points
respectively.  In reality, that might have been enough to offset
the 3 losing short trades and the one losing long trade.  In a
word, "Yuck!"

Reality is that in an market we choose to trade, these untradable
or losing sessions are bound to crop up.  It's just part of the
game.  But we need to have a predominance of the former trending
session in order to make consistent profits in the market that
we've chosen.  While the ES provided the appropriate balance
between the two up through the early part of the summer, I've
noticed with disdain the number of "piggish" sessions has been
larger than the number of tradable sessions.  That is not a recipe
for success.  Before we go on though, let's look at a method we
can use to quantify the change I'm describing.

Most charting applications (I'm showing it here in eSignal) have a
neat little indicator called Average True Range, which is a
measure of the range averaged over the specified number of periods
(I've used 14).  Over time, we can see whether the range in a
market is expanding or contracting.  As you can see from the chart
below, the range in the ES has definitely been contracting.

Daily Chart of the ES December Contract




While the uptrend in the market has remained intact, we can see
from the sharp decline in the ATR indicator through August, that
the ES has moved into a mode of much lower range than what we saw
through the summer, which itself seemed rather narrow.  In order
to see if this is a short-term aberration or something more
significant, I stepped back from the ES contract, which only gives
us a few months of data per contract and looked at the daily chart
of the S&P 500 (SPX).

Daily Chart of the S&P 500 (SPX)




Lo and behold, this is a major change in the overall dynamic of
the market.  Since the peak last July, the ATR has put in a
pattern of lower highs and lower lows, bringing the indicator down
near the 10 points per day level.  I didn't show it here, but in
scrolling the chart back, I found that the last time the ATR was
this low for the SPX was in early 1998.  Hmmm...  Could there be
any correlation to the fact that the last time we saw the VXO (the
old VIX based on the OEX options volatility) probing the 16-17
area was back in 1998 as well.

That gives us a very important piece of information with respect
to when we might be able to expect the intraday range on the ES to
expand to more normal levels.  When we see the VIX pushing back
over 20 and preferably closer to the midpoint of its historically
normal range (roughly 25), that should be a good indication that
we can expect a daily range on the ES to run in the 15-18 point
area.

In the meantime, we have a couple of different ways in which we
can cope with the less than ideal trading conditions in the ES.
The first is to become more selective in the trades we're willing
to take, forcing the market to give an indication of a trending
session or else only trading in agreement with the trend shown on
a longer-term chart (say 30 or 60 minute).  We'll end up taking
fewer trades, but hopefully shift the bias sufficiently so that
there are more winners than losers.  The other possibility that
deserves consideration is evaluating whether there is a better
trading vehicle we can consider.  The qualities such a market
would have are wider intraday ranges and a propensity to still
trend more often than not.  I had intended to get to that part of
the discussion tonight as well, but in typical fashion I bit off
more than I could chew.  I've run out of both time and space for
tonight, but we'll pick up where we left off next week.

One final note about ways to deal with the current challenges in
the ES.  You'll note that I did NOT list as one of possible
remedies a change in the technical indicators or trade signals
used.  You see, except for a very skilled scalper, it really
doesn't matter what tools are being employed when the ES is
chopping in a 6-8 point range -- there isn't enough trending
movement to allow for we mere mortals to take technical entries,
hold judicious stops and not get knocked out at the extremes of
the chop before the one or two program-driven moves of the day.

The moral of the story is that we need to pick the trading
strategy that we've satisfied ourselves (through back-testing)
works in markets that move in a methodical manner.  Then we select
the market to trade, based on whether its pattern of movement that
is in concert with our chosen trading system.  If that market
ceases to be consistently cooperative, then perhaps it is time to
evaluate whether that is the right market to trade.  Tonight we've
defined what the problem is and next week we'll address a
potential solution.

See You Next Week!

Mark


************************Advertisement*************************

Stock Option and Futures Brokerage

OneStopOption teams the best trading technology with varying
levels of professional assistance at very competitive prices.
Commission costs are comparable to discount brokerage and
tailored to individual customer needs.

The power of one brokerage group with experience and expertise
in the Securities* and Futures Markets offers unprecedented
convenience for traders.

Access To All Futures Markets            Toll Free 888-281-9569
Stock Option Principals

www.OneStopOption.com

**************************************************************


*******************
FREE TRIAL READERS
*******************

If you like the results you have been receiving we
would welcome you as a permanent subscriber.

The monthly subscription price is $49.95. The quarterly
price is $129.95 which is $20 off the monthly rate.

We would like to have you as a subscriber. You may
subscribe at any time but your subscription will not
start until your free trial is over.

To subscribe you may go to our website at

www.OptionInvestor.com

and click on "subscribe" to use our secure credit
card server or you may simply send an email to

 "Contact Support"

with your credit card information,(number, exp date, name)
or you may call us at 303-797-0200 and give us the
information over the phone.

You may also fax the information to: 303-797-1333


**********
DISCLAIMER
**********

Please read our disclaimer at:
http://www.OptionInvestor.com/page/oin/aboutus/disclaimer.html


**************************************************************
ADVERTISING INFORMATION

For more information on advertising in OptionInvestor Newsletter,
or any Premier Investor Network newsletter please contact:

Contact Support
The Option Investor Newsletter                Wednesday 11-19-2003
Copyright 2003, All rights reserved.                        2 of 2
Redistribution in any form strictly prohibited.


In Section Two:

Stop Loss Updates: None
Dropped Calls: None
Dropped Puts: AMGN
Play of the Day: Put - AVID
Spreads, Combinations & Premium-Selling Plays: Stocks Rebound As
    Dollar Recovers!
Watch List: A Few Three-Lettered Stocks

Updated on the site tonight:
Market Posture: Flat Bounce


************************Advertisement*************************

Live Securities Brokerage Service with Licensed Option Principals

OCO Stop & Profit Orders                        OneStopOption
All types of Spreads and Buy Writes             888-281-9569
Auto-Trade Market Monitor Signals
Personal Service and Education


**Services available for Foreign Traders including Canada**

http://www.OneStopOption.com

**************************************************************


*****************
STOP-LOSS UPDATES
*****************

None


*************
DROPPED CALLS
*************

None


************
DROPPED PUTS
************

Amgen Inc - AMGN - close: 60.10 chg: +1.26 stop: 61.01

The rebound in the BTK biotech index was too much for traders
bullish on AMGN.  The stock traded up to 61.10 today before
falling back toward the $60 level.  That was enough to stop us
out for a small loss.  It didn't help having both Bank of America
and Merrill Lynch reiterate their buy ratings on AMGN in the last
couple of days.

Picked on November 09 at $59.95
Change since picked:     + 0.15
Earnings Date          10/21/03 (confirmed)
Average Daily Volume:       8.8 million
Chart =



************************Advertisement*************************

Full Service Brokers

Man Financial announces the formation of the OneStopOption
Brokerage Group, addressing the demand for personalized,
experienced service for both securities* and futures trading
within the same firm. Licensed Option Principals Andrew Aronson
and Alan Knuckman specialize in live assistance of stock*,
option* and futures traders. The combination of the proven Man
Financial global presence and the convenience of one group for
all trading needs provide customers with the tools needed for
success.

Live Broker and Online Trading Available     888-281-9569

http://www.OneStopOption.com

**************************************************************


*********************
PLAY OF THE DAY - PUT
*********************

Avid Technology - AVID - cls: 47.98 chg: -0.42 stop: 51.26

-Company Description-
Avid Technology, Inc. is the world leader in digital nonlinear
media creation, management and distribution solutions, enabling
film, video, audio, animation, games, and broadcast news
professionals to work more efficiently, productively and
creatively.  (source: company press release)


- Most Recent Update (Tuesday, Nov. 18, 2003) -
The consolidating trend in shares of AVID continues but the stock
has not yet given up its support level at the $48 mark.  Instead
we've seen selling pressure push its highs lower and lower and
the last two days have both produced failed rallies at the $50
level.  The skeptic inside us paused to wonder...why isn't AVID
weaker with the markets down four days in a row?  That's a good
question and we don't have an answer except that the tug-of-war
between buyers and sellers is about to climax as the stock coils
tighter into its wedge-pattern.  More aggressive traders can use
the failed rallies at round-number support-resistance at $50 to
initiate new positions but more conservative types may want to
wait for that $48 level to crack first.  No change in our stop
loss.

- Play of the Day Comments -
We finally got the breakdown under the $48.00 level in shares of
AVID and while the market was bouncing!  This relative weakness
isn't likely to sit well with shareholders.  Traders can look for
some confirmation tomorrow morning but the next leg down could be
about to start.


- Suggested Options -
We like the December and March 50s and 45's.

! Alert - November options expire on Friday!

BUY PUT DEC 50 AQI-XJ OI= 523 at $4.00 SL=2.10
BUY PUT DEC 45 AQI-XI OI= 527 at $1.75 SL=0.90
BUY PUT MAR 50 AQI-OJ OI=1771 at $6.80 SL=4.50
BUY PUT MAR 45 AQI-OI OI=2111 at $4.40 SL=2.25

Annotated Chart:




Picked on November 16 at $48.45
Change since picked:     - 0.47
Earnings Date          10/16/03 (confirmed)
Average Daily Volume:       637 thousand
Chart =



************************Advertisement*************************

Full Service Brokers

Man Financial announces the formation of the OneStopOption
Brokerage Group, addressing the demand for personalized,
experienced service for both securities* and futures trading
within the same firm. Licensed Option Principals Andrew Aronson
and Alan Knuckman specialize in live assistance of stock*,
option* and futures traders. The combination of the proven Man
Financial global presence and the convenience of one group for
all trading needs provide customers with the tools needed for
success.

Live Broker and Online Trading Available     888-281-9569

http://www.OneStopOption.com

**************************************************************


*********************************************
SPREADS, COMBINATIONS & PREMIUM-SELLING PLAYS
*********************************************

Stocks Rebound As Dollar Recovers!
By Ray Cummins

U.S. equities closed higher Wednesday as the dollar bounced back
from record lows and investors searched for bargains after the
recent market slump.

The Dow Jones Industrial Average ended up 66 points at 9,690 on
strength in General Electric (NYSE:GE), which rose over 3% after
saying it sees a return to double-digit growth in 2005.  In the
technology segment, gains in networking, internet, and biotech
shares lifted the NASDAQ index 17 points to 1,899.  The Standard
& Poor's 500-stock index added 8 points to close at 1,042 amid a
rebound in retail and utility shares.  Winners outnumbered losers
by a ratio of 3 to 2 on the Big Board and by 7 to 5 on the NASDAQ.
Trading was moderate on the New York Stock Exchange with over 1.3
billion shares changing hands while more than 1.8 billion shares
were crossed on the technology exchange.  Treasury issues fell in
the wake of strong housing data.  The benchmark 10-year note was
down 26/32, bringing its yield up to 4.24%.


***************

SUMMARY OF CURRENT POSITIONS - AS OF 11/18/03

***************

The following summary is a reasonable account of the positions
previously offered in this section.  However, no representation
is being made as to the actual performance of a position and in
fact, there are frequently large differences between the summary
results and those of our subscribers, due to the variety of ways
in which each play can be opened, closed, and/or adjusted.  In
addition, the summary might not be completely representative of
the manner in which the average trader would react to changing
conditions in a position and to the options market in general.
The editor of this section does not take actual positions in any
published plays and the summary comments are simply a service to
help new traders understand when positions might be opened and
closed.  In most cases, actions taken based on the commentary
would be far too late to be effective, thus it is not intended
as a substitute for personal trade management nor does it in
any way replace your duty to diligently monitor and manage the
positions in your portfolio.


MONTHLY YIELD FOR UNCOVERED OPTIONS: MAXIMUM & SIMPLE

The Maximum Yield (listed in the summary and with "naked" option
selling plays) is the greatest possible profit available in the
position.  This amount, expressed as a percentage, is based on
the initial margin requirement as determined by the Board of
Governors of the Federal Reserve, the U.S. options markets and
other self-regulatory organizations.  Although increased margin
requirements may be imposed either generally or in individual
cases by various brokerage firms, our calculations use the widely
accepted margin formulas from the Chicago Board Options Exchange.
The "Simple Yield" is based on the cost of the underlying issue
(in the event of assignment), including the premium from the sold
option, thus it reflects the maximum potential loss in the trade.


Naked Puts
**********

Stock   Strike Strike Cost  Current   Gain    Max    Simple
Symbol  Month  Price  Basis  Price   (Loss)  Yield   Yield

DRIV     NOV    25    24.50  22.78  ($1.72)  0.00%   2.04%
ERES     NOV    32    31.50  39.35   $1.00   6.89%   3.17%
NTAP     NOV    20    19.50  23.43   $0.50   5.70%   2.56%
BRCM     NOV    27    27.00  34.13   $0.50   4.69%   1.85%
CYD      NOV    17    17.20  27.70   $0.30   4.95%   1.74%
ERES     NOV    35    34.20  39.35   $0.80   6.19%   2.34%
LRCX     NOV    22    22.20  29.13   $0.30   3.86%   1.35%
NVLS     NOV    35    34.15  41.11   $0.85   5.35%   2.49%
RMBS     NOV    20    19.55  24.04   $0.45   6.20%   2.30%
TXN      NOV    22    22.10  27.86   $0.40   4.23%   1.81%
VECO     NOV    22    22.00  25.90   $0.50   5.04%   2.27%
APPX     NOV    22    22.05  34.85   $0.45   7.08%   2.04%
CKFR     NOV    22    22.20  26.25   $0.30   4.03%   1.35%
CYD      NOV    20    19.75  27.70   $0.25   4.37%   1.27%
ERES     NOV    35    34.55  39.35   $0.45   4.25%   1.30%
LEND     NOV    20    19.70  27.37   $0.30   5.40%   1.52%
NFLX     NOV    40    39.45  46.57   $0.55   4.89%   1.39%
NSCN     NOV    20    19.70  24.08   $0.30   4.96%   1.52%
ONXX     NOV    17    17.15  24.30   $0.35   6.57%   2.04%
ANPI     NOV    40    39.35  46.83   $0.65   6.30%   1.65%
CYD      NOV    22    22.25  27.70   $0.25   4.91%   1.12%
GPRO     NOV    22    22.10  28.73   $0.40   6.92%   1.81%
LEXR     NOV    20    19.70  19.96   $0.26   4.83%   1.52%
MSTR     NOV    45    44.55  50.39   $0.45   4.32%   1.01%
NTE      NOV    35    34.40  33.24  ($1.16)  0.00%   1.74%
NTLI     NOV    50    49.50  58.30   $0.50   4.38%   1.01%
ICOS     NOV    40    39.65  44.40   $0.35   5.12%   0.88%
IMCL     NOV    30    29.75  35.49   $0.25   5.35%   0.84%
GPRO     NOV    25    24.75  28.73   $0.25   5.75%   1.01%
MRVL     NOV    40    39.65  42.35   $0.35   4.74%   0.88%
MSTR     NOV    50    49.55  50.39   $0.45   4.79%   0.91%
NVLS     NOV    40    39.65  41.11   $0.35   4.55%   0.88%
PHTN     NOV    37    36.90  38.42   $0.60   7.92%   1.63%
PMCS     NOV    17    17.25  19.35   $0.25   8.84%   1.45%
NTAP     NOV    22    22.25  23.43   $0.25   5.86%   1.12%
QCOM     NOV    42    42.15  45.43   $0.35   4.20%   0.83%
VRNT     NOV    20    19.75  20.83   $0.25   6.53%   1.27%
LLTC     NOV    42    42.20  40.97  ($1.23)  0.00%   0.71%
MRVL     NOV    42    42.20  42.35   $0.15   2.84%   0.71%
SAP      NOV    37    37.20  36.73  ($0.47)  0.00%   0.81%
NVLS     DEC    40    39.20  41.11   $0.80   4.65%   2.04%
PHTN     DEC    35    34.25  38.42   $0.75   5.41%   2.19%
PMCS     DEC    17    17.10  19.35   $0.40   6.88%   2.34%
AMAT     DEC    22    22.05  23.03   $0.45   4.81%   2.04%
EYE      DEC    20    19.65  22.84   $0.35   5.21%   1.78%
ICOS     DEC    35    34.55  44.40   $0.45   3.81%   1.30%

As noted last week, there are a number of issues on the "watch"
list due to the recent profit-taking in stocks and traders are
encouraged to exit (or adjust) any suspect positions in the
interest of capital preservation.  There was no opportunity to
initiate the bullish positions in New Century (NASDAQ:NCEN),
Photon Dynamics (NASDAQ:PHTN), or Netscreen (NASDAQ:NSCN), due
to the "gap-up" in the underlying issues on the day after the
plays were offered.  The Palm (NASDAQ:PALM) position, although
profitable, has been removed from the summary due to its complex
split resulting in shares of both PalmSource (NASDAQ:PSRC) and
PalmOne (NASDAQ:PLMO).  Genzyme (NASDAQ:GENZ) has previously
been closed to limit losses.


Naked Calls
***********

Stock  Strike Strike Cost  Current   Gain    Max     Simple
Symbol Month  Price  Basis  Price   (Loss)  Yield    Yield

FLML     NOV    40   40.80  24.78   $0.80   8.88%    1.96%
IMCL     NOV    45   45.65  35.49   $0.65   6.97%    1.42%
SOHU     NOV    45   45.55  30.95   $0.55   5.85%    1.21%
BGEN     NOV    40   40.50  34.43   $0.50   3.96%    1.23%
MGAM     NOV    45   45.30  44.11   $0.30   3.99%    0.66% *
NPSP     NOV    35   35.25  26.43   $0.25   4.53%    0.71%
NTES     NOV    60   60.70  40.40   $0.70   7.65%    1.15%
SEPR     NOV    30   30.60  22.51   $0.60   9.84%    1.96%
PCLN     NOV    25   25.30  17.35   $0.30   9.55%    1.19%
FLML     NOV    30   30.25  24.78   $0.25   8.57%    0.83%
SEPR     NOV    30   30.25  22.51   $0.25   6.38%    0.83%
IACI     DEC    37   35.90  30.83   $0.40   3.22%    1.11%
WEBX     DEC    25   25.30  17.34   $0.30   5.79%    1.19%

Multimedia Games (NASDAQ:MGAM) is on the "early-exit" list
and unless there is a pause in the rally, only aggressive
traders should consider remaining in the position.  There
was no opportunity to initiate the bearish position in
Surmodics (NASDAQ:SRDX) due to the "gap-down" in the issue
on the day after the play was offered.  The price for Biogen
(NASDAQ:BGEN) is quoted from the last trading day prior to
its change to Biogen-Idec (NASDAQ:BIIB).


Put-Credit Spreads
******************

Symbol  Pick   Last   Month L/P S/P Credit  C/B    G/L   Status

CYMI    45.27  44.98   NOV  35  40   0.60  39.40  $0.60   Open
ERTS    46.79  45.92   NOV  45  47   0.27  47.23 ($1.31) Closed
SYK     78.92  79.57   NOV  70  75   0.45  74.55  $0.45   Open
APOL    63.95  65.04   NOV  55  60   0.60  59.40  $0.60   Open
SEE     52.31  51.07   NOV  45  50   0.50  49.50  $0.50   Open
GDT     51.47  52.58   NOV  45  50   0.60  49.40  $0.60   Open
IFIN    35.10  35.42   NOV  30  32   0.25  32.25  $0.25   Open
MXIM    48.24  49.92   NOV  40  45   0.45  44.55  $0.45   Open
ELAB    43.74  47.93   NOV  35  40   0.40  39.60  $0.40   Open
WFMI    59.00  63.39   NOV  50  55   0.45  54.55  $0.45   Open
KLAC    60.08  55.35   DEC  50  55   0.75  54.25  $0.75   Open
MIK     50.55  45.50   DEC  42  45   0.30  44.70  $0.30   Open
SMH     44.65  41.20   DEC  37  40   0.25  39.75  $0.25   Open

As noted last week, positions in Cummins (NYSE:CUM), Hitachi
(NYSE:HIT) and Black & Decker (NYSE:BDK), which is profitable,
were candidates for early exit and they have been closed to
limit potential losses.  KLA-Tencor (NASDAQ:KLAC) and Michael's
(NYSE:MIK) are on the "early exit" watch-list.  The position in
J2 Global Communications (NASDAQ:JCOM) has previously been
closed to conserve portfolio capital.


Call-Credit Spreads
*******************

Symbol  Pick   Last   Month L/C S/C Credit  C/B    G/L   Status

MEDI    33.09  24.50   NOV  40  37   0.30  37.80  $0.30   Open
KMX     32.31  31.57   NOV  40  35   0.70  35.70  $0.70   Open
NBR     36.75  37.79   NOV  42  40   0.25  40.25  $0.25   Open
AMGN    60.30  58.84   NOV  70  65   0.45  65.45  $0.45   Open
FRE     57.03  53.28   NOV  65  60   0.60  60.60  $0.60   Open
FNM     72.75  68.50   NOV  80  75   0.65  75.65  $0.65   Open
BBOX    42.35  42.75   NOV  50  45   0.45  45.45  $0.45   Open
GILD    52.00  53.96   NOV  60  55   0.60  55.60  $0.60   Open
MANH    28.30  28.44   NOV  35  30   0.50  30.50  $0.50   Open
ATH     68.61  67.78   NOV  75  70   0.60  70.60  $0.60   Open
MDT     44.03  44.58   NOV  47  45   0.40  45.40  $0.40   Open
MMC     44.10  44.13   NOV  50  45   0.65  45.65  $0.65   Open
NE      33.79  34.23   DEC  37  35   0.40  35.40  $0.40   Open

There was no (new) position available in Biogen (NASDAQ:BGEN) as
the company began trading as Biogen-Idec (NASDAQ:BIIB) on the day
after the play as listed.  Positions in Anheuser-Busch (NYSE:BUD)
and Wellpoint Health Networks (NYSE:WLP) have previously been
closed to limit potential losses.  The speculative positions in
Manhattan Associates (NASDAQ:MANH), Medtronics (NYSE:MDT) and
Marsh & McLennan (NYSE:MMC) should be monitoring daily for timely
exit (or adjustment) signals.


Synthetic Positions
*******************

No Open Positions


Debit Straddles
***************

No Open Positions


Questions & comments on spreads/combos to Contact Support
**************

READERS WRITE -- E-MAIL REPLIES

**************

Hi Ray,

Love your naked option picks so much I have changed my online
nickname to The Naked Strangler.  One question on this week's
pick in Radware (NASDQ:RDWR).  I noticed that the OTM open
interest for the $20 strike is over 25500 contracts while all
the rest of the strikes are less than 200.  Being that there
is most likely an institutional investor who bought/sold to
initiate the huge open interest, is it more or less likely
that the stock will trade below 20?  Do they know something
that us mere mortals do not?

I once heard of the "maximum pain" strike price that says that
because of the huge open interest, the institutions won't let
it get exercised. I am most interested if you can discuss this
in an upcoming article and specifically, how you think it would
effect your picks...

Thank you

The Naked Strangler


Dear Naked Strangler:

First, I like the fact that you have noticed this big spike in
open interest.  You are right when thinking that some stocks seem
to be attracted or repelled away from certain strike prices at
expiration.  What we do not know if this was a recommended trade,
whether one retail investor or large institution has initiated
this position.  In addition, this may be initiated as a spread or
as a covered put, or even a naked put.  A large open interest is
good to keep an eye on, however because we do not know the true
position that was taken, it is difficult to predict the stock
will fall below the $20 level (based on any institutional activity).
The more open interest in a position, the better the liquidity in
the options.  This will result in lower spreads and better fills.

I would never avoid a position that I had researched because of a
very large open interest -- if anything, I would be more likely
to initiate the play.  The main point is to have a game plan for
every trade and stick to that game plan.

Andrew Aronson
V.P. Investments
OneStopOption
Division of Man Financial
141 W. Jackson Blvd Ste 1800-A
Chicago, IL 60604

Andrew Aronson and Alan Knuckman are skilled option principles,
as well as long-time OIN associates, and they recently started a
specialty brokerage for derivatives traders.  Their personalized
service will enable traders to be more confident, comfortable and
successful with options.  They will also help new market players
learn the "right" way to trade options with education and coaching
for maximum portfolio performance.  Alan and Andrew's expertise is
a valuable resource that will easily pay for itself through timely
executions and the piece of mind that comes from someone watching
your trades throughout the day.  The commissions are comparable to
those of discount brokers but you get to speak directly with option
professionals, not customer service clerks.  Clients can call them
directly to review positions and update orders and they also offer
"auto-trading" for many of the plays in the newsletter.

OneStopOption Strengths:

* Dedicated option brokerage with "live" option principals/brokers
* Order routing to "best-priced" exchange and timely executions
* All types of orders (stop/limit/OCO) to encourage disciplined
  trading and proper money management
* Advanced option trading level approval for inexperienced traders
* Foreign accounts including Canada -- Futures trading available
* Direct electronic trading and personalized customer services
* Ability to filter recommendations and provide strategy advice
* Free OIN subscription for those who qualify (based on account
  size and portfolio activity)

Get Execution, Education, and Option Experience at OneStopOption

Visit their new site -- www.onestopoption.com -- or send an E-mail
to: Aaronson@OptionInvestor.com


Editor's note:

Further research determined that the large Open Interest in the
Radware (NASDAQ:RDWR) option series was a "mistype" by the option
exchange.  However, I have often experienced similar situations
and obviously, institutions have lots of leverage when it comes to
options expiration and maintaining the price of the underlying in
the short-term.  In many cases, they are buyers of puts to support
their bullish stock holdings, however there are also many funds
(and corporations) that sell uncovered puts during favorable market
conditions.  Also, with regard to large-volume trades, it's usually
very difficult to determine what the actual position was, without
knowing who crossed the trade.  At the same time, I wouldn't avoid
a trade just because there was large open interest due to a block
position -- "smart money" players are sometimes less savvy (or
simply have different goals) than adept retail participants.

*************

NEW POSITIONS

This following group of plays is simply a list of candidates to
supplement your search for profitable trading positions.  As with
any new investment, you must decide if the selections meet your
criteria for potential plays.  Only you can know what strategies
are suitable for your personal skill level, risk-reward tolerance
and portfolio outlook.  In addition, we recommend that you avoid
any trading techniques in which you are not completely comfortable
with the potential capital loss, the necessary adjustments, and
the common entry-exit strategies.  The positions with "*" will be
included in the weekly summary.  Those with "TS" (Target-Shoot)
are below our minimum monthly return, but may offer a favorable
entry price with a limit order, due to the daily volatility of
the underlying issue.

**************

BULLISH PLAYS - NAKED PUTS

All of these issues have robust option premiums and relatively
favorable technical indications.  However, current news and market
sentiment will have an effect on these stocks, so review each play
thoroughly and make your own decision about its future outcome.

WARNING: THE RISK IN SELLING UNCOVERED OPTIONS IS SUBSTANTIAL!

The sale of uncovered puts entails considerable financial risk,
far more than the initial margin or collateral required to open
a position.  The maximum financial obligation for the sale of a
naked put is the strike price (of the underlying stock) that is
sold.  Although this obligation is reduced by the premium from
the sale of the option, a writer of puts should have the cash or
collateral equivalent of the sold strike price in reserve at all
times.  In addition, there is one very important rule when using
this strategy: Don't sell puts on stocks that you don't want to
own!  Why?  Because stocks occasionally experience catastrophic
declines, exponentially increasing the margin maintenance and
possibly causing a devastating shortfall in your portfolio.  It
is also important that you consider using trading stops on naked
option positions to help limit losses when a stock's price falls.
Many professional traders suggest closing the position when the
underlying share value moves below the sold strike, or using a
"buy-to-close" stop order at a price that is no more than twice
the original premium received from the sold option.

**************
ANPI - Angiotech  $47.82  *** Consolidation Complete? ***

Angiotech Pharmaceuticals (NASDAQ:ANPI) is engaged in the fusion
of medical device technologies and pharmaceutical therapies.  The
company's first product was a drug-coated stent.  A stent is a
cylindrical medical device, usually made of metal, inserted into
a body duct or tube to prevent collapse, blockage or overgrowth
of the duct or tube.  Angiotech's primary goal is to develop new
products to enhance the performance of medical devices and other
biomaterials through the use of pharmatherapeutics.  In 2002, the
company agreed to a merger with Cohesion Technologies, which will
continuing as a wholly owned subsidiary of Angiotech.

ANPI - Angiotech  $47.82

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 35    AUJ XG    1956   0.30  34.70   3.1%   0.9% TS
SELL PUT  DEC 40    AUJ XH    2444   0.95  39.05   7.9%   2.4% *
SELL PUT  DEC 45    AUJ XI     427   1.95  43.05  10.8%   4.5%


**************
APPX - American Pharma Partners  $34.08  *** On The Rebound! ***

American Pharmaceutical Partners (NASDAQ:APPX) is a specialty
drug company that develops, manufactures and markets injectable
pharmaceutical products, focusing on the oncology, anti-infective
and critical care markets.  The company is one of the largest
producers of injectables, with more than 130 generic products in
more than 350 dosages and formulations.

APPX - American Pharma Partners  $34.08

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 25    AQO XE     992   0.45  24.55   6.3%   1.8% *
SELL PUT  DEC 30    AQO XF    1285   1.40  28.60  13.0%   4.9%


**************
EASI - Engineered Support Systems  $48.50  *** All-Time High! ***

Engineered Support Systems (NASDAQ:EASI) along with its various
subsidiaries, designs and manufactures military support equipment
and electronics for the United States armed forces.  The company
also engineers and manufactures air handling and heat transfer
equipment, material handling equipment and custom molded plastic
products for commercial and industrial users. Engineered Support
Systems' six wholly owned subsidiaries are Systems & Electronics
(SEI), Engineered Air Systems (Engineered Air), Keco Industries,
(Keco), Engineered Coil Company (d/b/a Marlo Coil), Engineered
Electric Company (d/b/a Fermont) and Engineered Specialty
Plastics.

EASI - Engineered Support Systems  $48.50

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 43.37 FPE XY     109   0.70  42.68   4.7%   1.6% *
SELL PUT  DEC 45    UFE XI      37   1.10  43.90   6.6%   2.5%


**************
GPRO - Gen-Probe  $30.12  *** Recovery In Progress! ***

Gen-Probe (NASDAQ:GPRO) is a leader in the development, manufacture
and marketing of rapid, accurate and cost-effective nucleic acid
testing products used for the clinical diagnosis of human diseases
and for screening donated human blood.  Using its patented NAT
technology, Gen-Probe has received FDA approvals or clearances for
over 60 products that detect a variety of infectious microorganisms,
including those causing sexually transmitted diseases, tuberculosis,
strep throat, pneumonia and fungal infections.  Additionally, the
company developed and manufactures the only FDA-approved blood
screening assay for the simultaneous detection of HIV-1 and HCV,
which is marketed by Chiron Corporation.  Gen-Probe and Bayer
Corporation have formed a collaboration to develop, manufacture and
market nucleic acid diagnostic tests for certain viral organisms,
and under the agreement Bayer has the right to distribute these
tests.  Gen-Probe has 20 years of nucleic acid detection research
and product development experience, and its products are used daily
in clinical laboratories and blood collection centers throughout the
world.

GPRO - Gen-Probe  $30.12

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 25    PSU XE     99    0.35  24.65   4.9%   1.4% *
SELL PUT  DEC 30    PSU XF     23    1.75  28.25  13.0%   6.2%


**************
INSP - InfoSpace  $25.40  *** Uptrend Intact! ***

InfoSpace (NASDAQ:INSP) develops and delivers a wireless and
Internet platform of software and application services to a
range of customers that span each of its wireline, merchant
and wireless business units.  Many of the company's products
and application services are offered to its customers, which,
in turn, offer these products and application services to
their customers as their own solutions.  InfoSpace provides
its services across multiple platforms, including personal
computers and non-PC devices.

INSP - InfoSpace  $25.40

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 22.5  IOU XX     47    0.65  21.85   8.3%   3.0% *
SELL PUT  DEC 25    IOU XE     81    1.55  23.45  13.9%   6.6%


**************
MGAM - Multimedia Games  $43.38  *** Premium-Selling Only! ***

Multimedia Games (NASDAQ:MGAM) is the leading supplier of
interactive electronic games and player stations to the rapidly
growing Native American gaming market.  The company's games are
delivered through a telecommunications network that links its
player stations with one another both within and among gaming
facilities.  Multimedia Games designs and develops networks,
software and content that provide its customers with a range of
gaming systems.  The company's development and marketing efforts
focus on Class II gaming systems and Class III video lottery
systems for use by Native American tribes throughout the United
States.

MGAM - Multimedia Games  $43.38

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 35    QMG XG     341   0.40  34.60   4.3%   1.2% *
SELL PUT  DEC 40    QMG XH     159   1.40  38.60   9.2%   3.6%


**************
NEM - Newmont Mining  $45.20  *** Gold "Bulls" Only! ***

Newmont Mining (NYSE:NEM), along with its subsidiaries, is a
worldwide company engaged in the production of gold, exploration
for gold and acquisition of gold properties.  The company also
has an interest in a copper/gold mine that commenced production
in late 1999.  In addition, the company produces zinc, lead and
copper concentrates at its property in Western Australia.  The
company approved in late 2002 a restructuring to facilitate the
acquisitions of Normandy Mining Limited and Franco-Nevada Mining
Corporation Limited and to create a flexible corporate structure.

NEM - Newmont Mining  $45.20

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 40    NEM XH    4519   0.40  39.60   3.1%   1.0% TS
SELL PUT  DEC 42.5  NEM XV    3053   0.90  41.60   5.6%   2.2% *


**************
NVLS - Novellus Systems  $42.73  *** Chip Industry Leader! ***

Novellus Systems (NASDAQ:NVLS) manufactures, sells and services
semiconductor processing equipment.  The company's products are
comprised primarily of advanced systems used to deposit thin
conductive and insulating films on semiconductor devices, as well
as equipment for preparing the device surface prior to these
deposition processes.  Novellus is a supplier of high productivity
deposition and surface preparation systems used in the fabrication
of integrated circuits.  Chemical Vapor Deposition systems employ
a chemical plasma to deposit all of the dielectric (insulating)
layers and certain of the metal (conductive) layers on the surface
of a semiconductor wafer.  Physical Vapor Deposition systems are
used to deposit conductive metal layers by sputtering metallic
atoms from the surface of a target source via high DC power.
Electrofill systems are used for depositing copper conductive
layers in a dual damascene design architecture using an aqueous
solution.

NVLS - Novellus Systems  $42.73

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 37.5  NLQ XU    3516   0.55  36.95   4.5%   1.5% *
SELL PUT  DEC 40    NLQ XH    2008   1.10  38.90   7.2%   2.8%


**************
PHS - PacifiCare Health Systems  $58.40  *** Safety Sector! ***

PacifiCare Health Systems (NYSE:PHS) offers managed care and
other health insurance products to employer groups and Medicare
beneficiaries in eight western states and Guam.  The company's
commercial and senior plans include various health maintenance
organizations (HMOs), preferred provider organizations (PPOs),
and Medicare Supplement products.  The firm also offers a variety
of specialty managed care products and services that employees can
purchase as a supplement to basic commercial and senior medical
plans or as stand-alone products.  These products include pharmacy
benefit management (PBM), behavioral health services, group life
and health insurance, dental and vision benefit plans.

PHS - PacifiCare Health Systems  $58.40

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 50    PHS XJ    1780   0.60  49.40   3.9%   1.2% *
SELL PUT  DEC 55    PHS XK    1409   1.65  53.35   7.7%   3.1%


**************
UTSI - UTStarcom  $35.14  *** Bottom-Fishing! ***

UTStarcom (NASDAQ:UTSI) is a global provider of wireless and
wireline access and Internet protocol switching solutions.  The
company designs, manufactures, sells and installs an integrated
suite of future-ready access network and next-generation switching
solutions.  It enables wireless and wireline operators in growth
markets worldwide to offer voice, data and Internet access services
rapidly and effectively by utilizing their existing infrastructure.
UTStarcom's products provide a seamless migration from wireline to
wireless, from narrowband to broadband and from circuit to packet
based networks by employing next-generation network technology.

UTSI - UTStarcom  $35.14

PLAY (sell naked put):

Action    Month &   Option    Open   Last  Cost    Max.  Simple
Req'd     Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL PUT  DEC 30    UON XF    5152   0.35  29.65   3.8%   1.2% *
SELL PUT  DEC 35    UON XG    1026   1.75  33.25  11.3%   5.3%


**************

BULLISH PLAYS - CREDIT SPREADS

These candidates are based on the underlying issue's technical
history or trend.  The probability of profit in these positions
may also be higher than other plays in the same strategy, due to
small disparities in option pricing however, each play should be
evaluated for portfolio suitability and reviewed with regard to
your strategic approach and trading style.

***************
BRCM - Broadcom  $34.62  *** Networking Sector Favorite! ***

Broadcom (NASDAQ:BRCM) is a leading provider of highly integrated
silicon solutions that enable broadband communications and the
networking of voice, video and data services.  Using proprietary
technologies and advanced design methodologies, Broadcom designs,
develops and supplies complete system-on-a-chip solutions and
related hardware and software applications for all broadband
communications markets.  Their diverse product portfolio includes
solutions for digital cable and satellite set-top boxes; cable
and DSL modems and residential gateways; high-speed transmission
and switching for local, metropolitan, wide area and storage
networking; home and wireless networking; cellular and terrestrial
wireless communications; Voice over Internet Protocol (VoIP)
gateway and telephony systems; broadband network processors; and
SystemI/O(TM) server solutions.

BRCM - Broadcom  $34.62

PLAY (conservative - bullish/credit spread):

BUY  PUT  DEC-27.50  RCQ-XY  OI=2098  ASK=$0.25
SELL PUT  DEC-30.00  RCQ-XF  OI=1677  BID=$0.50
INITIAL NET-CREDIT TARGET=$0.25-$0.30
POTENTIAL PROFIT(max)=11% B/E=$29.75


**************
BRL - Barr Laboratories  $81.14  *** Multi-Year High! ***

Barr Laboratories (NYSE:BRL) is a specialty pharmaceutical company
primarily engaged in the development, manufacture and marketing of
generic and proprietary prescription pharmaceuticals.  The company
manufactures and distributes more than 100 different dosage forms
and strengths of pharmaceutical products in core therapeutic
categories, including oncology, female healthcare (including
hormone replacement and oral contraceptives), cardiovascular, anti
infective and psychotherapeutics.  In addition, the company has a
proprietary, novel vaginal ring drug delivery system it is using
to develop products intended to address a variety of female health
issues and unmet medical needs.

BRL - Barr Laboratories  $81.14

PLAY (conservative - bullish/credit spread):

BUY  PUT  DEC-70.00  BRL-XN  OI=245  ASK=$0.30
SELL PUT  DEC-75.00  BRL-XO  OI=120  BID=$0.75
INITIAL NET-CREDIT TARGET=$0.50-$0.55
POTENTIAL PROFIT(max)=11% B/E=$74.50


**************
TOL - Toll Brothers  $38.27  *** Bullish Housing Industry! ***

Toll Brothers (NYSE:TOL) designs, builds, markets and arranges
financing for single-family detached and attached homes in
middle-income and high-income residential communities catering
to move-up, empty-nester and age-qualified homebuyers in the
United States.  The communities generally are located on land
the company has either developed or acquired fully developed
and, in some cases, improved.  The company operates its own
land development, architectural, engineering, mortgage, title,
security monitoring, landscape, cable television, broadband
Internet access, lumber distribution, house component assembly
and manufacturing operations.  Toll also owns and operates golf
courses in some of its master-planned communities.

TOL - Toll Brothers  $38.27

PLAY (conservative - bullish/credit spread):

BUY  PUT  DEC-30.00  TOL-XF  OI=468  ASK=$0.15
SELL PUT  DEC-35.00  TOL-XG  OI=396  BID=$0.65
INITIAL NET-CREDIT TARGET=$0.55-$0.60
POTENTIAL PROFIT(max)=12% B/E=$34.45


**************

BEARISH PLAYS - NAKED CALLS

Based on analysis of option pricing and the underlying stock's
technical background, these positions meet our fundamental
criteria for bearish "premium-selling" strategies.  Each issue
has robust option premiums, a well-defined resistance area and
a high probability of remaining below the target strike prices.
As with any recommendations, these positions should be carefully
evaluated for portfolio suitability and reviewed with regard to
your strategic approach and personal trading style.

WARNING: THE RISK IN SELLING UNCOVERED OPTIONS IS SUBSTANTIAL!

The sale of uncovered calls entails considerable financial risk,
far more than the initial margin or collateral required to open
the position.  The maximum financial obligation for the sale of a
naked option is the strike price (of the underlying stock) that
is sold.  Although this obligation is reduced by the premium from
the sale of the option, a writer of options must have the cash or
collateral equivalent of the sold strike price in reserve at all
times.  The simple fact is: stocks often experience large price
swings, exponentially increasing the margin maintenance and very
possibly causing a devastating shortfall in your portfolio.  It
is also important that you consider using trading stops on naked
option positions to help limit losses when a stock price moves in
a volatile manner.  Many professional traders suggest closing the
position when the underlying share value moves beyond the sold
strike, or using a "buy-to-close" stop order at a price that is no
more than twice the original premium received from the sold option.

***************
MERQ - Mercury Interactive  $44.46  *** Revenge Play! ***

Mercury Interactive (NASDAQ:MERQ) is a provider of integrated
performance management solutions that enable businesses to test
and monitor their Web-based applications.  Its software products
and hosted services help Global 2003 companies enhance the user
experience by improving the performance, availability, reliability
and scalability of their Web-based applications.  Its many hosted
services provide its customers with a cost-effective solution that
quickly meets business needs without dedicating significant time
and internal resources.  Its integrated performance management
solutions enable customers to more quickly identify and correct
problems before users experience them.  The company also provides
outsourced load testing and Web performance monitoring services
that complement its software products.

MERQ - Mercury Interactive  $44.46

PLAY (sell naked call):

Action     Month &   Option    Open   Last  Cost    Max.  Simple
Req'd      Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL CALL  DEC 45    RQB LI     680   1.85  46.85   9.8%   3.9%
SELL CALL  DEC 47.5  RQB LR    1260   0.90  48.40   5.8%   1.9% *
SELL CALL  DEC 50    RQB LJ    6128   0.40  50.40   3.2%   0.8% TS


**************
SEPR - Sepracor  $22.40  *** A 3-Month Low! ***

Sepracor (NASDAQ:SEPR) is a research-based pharmaceutical company
dedicated to treating and preventing human disease through the
discovery, development and commercialization of pharmaceutical
compounds, including product candidates directed toward serving
unmet medical needs.  The firm's proprietary compounds are either
single-isomer or active metabolite forms of existing drugs, which
Sepracor refers to as improved chemical entities, or new chemical
entity compounds, which are unrelated to current products.

SEPR - Sepracor  $22.40

PLAY (sell naked call):

Action     Month &   Option    Open   Last  Cost    Max.  Simple
Req'd      Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL CALL  DEC 25    ERQ LE    2969   0.55  25.55   8.1%   2.2%
SELL CALL  DEC 27.5  ERQ LY    2251   0.25  27.75   5.4%   0.9% *


**************
TTWO - Take-Two Int. Software  $32.69  *** Sales Slump! ***

Take-Two Interactive Software (NASDAQ:TTWO) is an integrated
developer, marketer, distributor and publisher of interactive
entertainment software games and accessories for the personal
computer, PlayStation, PlayStation2, Nintendo Game Boy Color,
Nintendo GameCube, Nintendo Game Boy Advance and the Xbox.  The
company publishes and develops products through various wholly
owned subsidiaries including Rockstar Games, Rockstar Studios,
Gathering of Developers, TalonSoft, Joytech, PopTop, Global Star
and under the Take-Two brand name.  The company maintains sales
and marketing offices in Cincinnati, New York, Toronto, London,
Paris, Munich, Vienna, Copenhagen, Milan, Sydney and Auckland.

TTWO - Take-Two Int. Software  $32.69

PLAY (sell naked call):

Action     Month &   Option    Open   Last  Cost    Max.  Simple
Req'd      Strike    Symbol    Int.   Price Basis  Yield  Yield

SELL CALL  DEC 35    TUO LG     705   1.50  36.50  12.4%   4.1%
SELL CALL  DEC 37.5  TUO LU     692   0.80  38.30   8.9%   2.1%
SELL CALL  DEC 40    TUO LH    3297   0.40  40.40   5.8%   1.0% *


**************

BEARISH PLAYS - CREDIT SPREADS

All of these positions are favorable candidates for "bear-call"
credit spreads, based on the current price or trading range of
the underlying issue and its recent technical history or trend.
The probability of profit from these positions may be higher
than other plays in the same strategy, due to disparities in
option pricing.  However, current news and market sentiment will
have an effect on these issues, so review each play individually
and make your own decision about its future outcome.

**************
HDI - Harley-Davidson  $45.17  *** Next Leg Down? ***

Harley-Davidson (NYSE:HDI) operates in the motorcycles and other
related products segment and the financial services segment.
The motorcycles and related products segment includes the group
of companies doing business as Harley-Davidson Motor Company,
subsidiaries of H-D Michigan, and Buell Motorcycle Company LLC.
The motorcycles segment designs, manufactures and sells primarily
heavyweight touring, custom and performance motorcycles, as well
as a complete line of motorcycle parts, accessories, clothing and
collectibles. The financial services segment consists of the firm's
subsidiary, Harley-Davidson Financial Services, and its various
subsidiaries.  HDFS is engaged in the business of financing and
servicing wholesale inventory receivables and consumer retail
installment sales contracts (primarily motorcycles and aircraft).

HDI - Harley-Davidson  $45.17

PLAY (conservative - bearish/credit spread):

BUY  CALL  DEC-50.00  HDI-LJ  OI=617   ASK=$0.20
SELL CALL  DEC-47.50  HDI-LW  OI=1662  BID=$0.45
INITIAL NET-CREDIT TARGET=$0.30-$0.35
POTENTIAL PROFIT(max)=14% B/E=$47.80


**************
SYMC - Symantec  $60.35  *** Sell-Off In Progress! ***

Symantec (NASDAQ:SYMC) provides content and network security
software and appliance solutions to enterprises, individuals and
service providers.  The firm provides client, gateway and server
security solutions for virus protection, firewall and virtual
private network, security management, intrusion detection, e-mail
filtering and Internet content, remote management technologies
and security services to enterprises and service providers
worldwide.  The company views its business in five operating
major segments: enterprise security, enterprise administration,
consumer products, services and other activities.

SYMC - Symantec  $60.35

PLAY (moderately aggressive - bearish/credit spread):

BUY  CALL  DEC-70.00  SYQ-LN  OI=2216  ASK=$0.35
SELL CALL  DEC-65.00  SYQ-LM  OI=1089  BID=$1.10
INITIAL NET-CREDIT TARGET=$0.75-$0.90
POTENTIAL PROFIT(max)=17% B/E=$65.75


**************

SEE DISCLAIMER - SECTION 1

**************


**********
Watch List
**********

A Few Three-Lettered Stocks

Pulte Corp - PHM - close: 88.99 change: +0.42

WHAT TO WATCH: The new housing starts numbers for October were
very strong.  Stronger than analysts had expected and at levels
not seen since the mid-1980's.  Shares of PHM look like a bullish
play candidate on a breakout above the 90.35 mark (maybe 90.50).
Once triggered bulls could aim for the psychological round-number
resistance (and magnet) at $100.00.

Chart=


---

Alberto Culver - ACV - close: 61.30 change: +0.24

WHAT TO WATCH: The lengthy rally in ACV peaked in early November
just north of $64.  Now shares have slowly consolidated back to
its 50-dma.  The pull back has been orderly suggesting a lack of
willing sellers.  Bullish traders may want to scope out a new
higher high potentially above the $62.00 mark as a trigger to go
long.  Bears can look for a breakdown under the $60 mark.

Chart=


---

Hershey Foods - HSY - close: 77.39 change: +0.14

WHAT TO WATCH: Patient traders may want to take a look at HSY.
The stock continues to climb in a steady rising channel and has
not been shook up by the recent volatility in the markets.  The
rising 21-dma has been the preferred entry point for traders
buying the dip and shares bounced there two days ago.
Conservative traders can use the 21-dma to guide their stop loss,
while more aggressive traders can use the 30-dma.  Be careful,
there is some old resistance just under the $80 level.

Chart=


---

Fedex Corp - FDX - close: 74.90 change: -0.14

WHAT TO WATCH: Today's 14-cent loss isn't very big but it is
noticeable when the markets produce a wide-spread rally.
Aggressive traders could initiate shorts at current levels but a
trigger under the $74.00 mark wouldn't be a bad idea either.
There is some support just under $72.00 but if the markets
continue to drop then FDX is likely to hit its 50-dma just north
of $70.

Chart=



**************
MARKET POSTURE
**************

Flat Bounce

To Read The Rest of The OptionInvestor.com Market Posture Click Here
http://www.OptionInvestor.com/marketposture/mp_111903.asp


*******************
FREE TRIAL READERS
*******************

If you like the results you have been receiving we
would welcome you as a permanent subscriber.

The monthly subscription price is $49.95. The quarterly
price is $129.95 which is $20 off the monthly rate.

We would like to have you as a subscriber. You may
subscribe at any time but your subscription will not
start until your free trial is over.

To subscribe you may go to our website at

www.OptionInvestor.com

and click on "subscribe" to use our secure credit
card server or you may simply send an email to

 "Contact Support"

with your credit card information,(number, exp date, name)
or you may call us at 303-797-0200 and give us the
information over the phone.

You may also fax the information to: 303-797-1333


**********
DISCLAIMER
**********

Please read our disclaimer at:
http://www.OptionInvestor.com/page/oin/aboutus/disclaimer.html


**************************************************************
ADVERTISING INFORMATION

For more information on advertising in OptionInvestor Newsletter,
or any Premier Investor Network newsletter please contact:

Contact Support

DISCLAIMER

Option Investor Inc is neither a registered Investment Advisor nor a Broker/Dealer. Readers are advised that all information is issued solely for informational purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy, nor is it to be construed as a recommendation to buy, hold or sell (short or otherwise) any security. All opinions, analyses and information included herein are based on sources believed to be reliable and written in good faith, but no representation or warranty of any kind, expressed or implied, is made including but not limited to any representation or warranty concerning accuracy, completeness, correctness, timeliness or appropriateness. In addition, we do not necessarily update such opinions, analysis or information. Owners, employees and writers may have long or short positions in the securities that are discussed.

Readers are urged to consult with their own independent financial advisors with respect to any investment. All information contained in this report and website should be independently verified.

To ensure you continue to receive email from Option Investor please add "support@optioninvestor.com"

Option Investor Inc
PO Box 630350
Littleton, CO 80163

E-Mail Format Newsletter Archives