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Daily Newsletter, Tuesday, 07/03/2001

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PremierInvestor.net Newsletter                 Tuesday 07-03-2001
                                                   section 1 of 2
Copyright  2001, All rights reserved.
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In section one:

Market Wrap: Down, But Not Out!
Market Sentiment: Investors Appear Quite Timorous 
Play-of-the-Day: QLGC - Bearish Sentiment Confirmed 
Watch List: Still Watching HRB and WHR

-----------------------------------------------------------------
U.S. Market Numbers
-----------------------------------------------------------------
MARKET WRAP  (view in courier font for table alignment)
-----------------------------------------------------------------
        7-3-2001        High      Low     Volume Advance/Decline
DJIA    10571.11 - 22.61 10595.13 10531.52  .62 bln   1594/1350	
NASDAQ   2140.80 -  7.92  2148.18  2123.75  .88 bln   1604/1846
S&P 100   638.55 -  1.41   639.94   636.22   Totals   3198/3196
S&P 500  1234.45 -  2.27  1236.71  1229.43             
RUS 2000  496.83 -  1.56   499.04   495.00 
DJ TRANS 2809.37 +  2.87  2817.06  2790.05 
VIX        20.95 +   .66    21.41    20.84 
Put/Call Ratio      0.64
-----------------------------------------------------------------

===========
Market Wrap
===========

Down, But Not Out! by Jeff Bailey

Today's shortened trading session ahead of the 4th of July 
holiday held little excitement for traders and the session ended 
with very little taking place.  Two groups of stocks we're 
monitoring closely traded with mixed results today, but both may 
still play key role in how the NASDAQ trades in future sessions.

One casualty came in the form of Rational Software (RATL) as that 
company warned late Tuesday that is would miss analysts estimates 
by a penny and the market punished the stock as it traded lower 
by 19% to finish the day's trading at 22.20.  Volume was brisk in 
the shortened trading session with 9.2 million shares traded.  I 
still think the software group is showing some signs of 
recovering as Microsoft (MSFT) continues to hold tough at the 70 
level and other stocks like Citrix Systems (CTXS) are also trying 
to hold near recent highs, but today's action from RATL did set 
back the GSTI Software Index (GSO.X) by 2.6% and leaves some 
technology investors wondering if things really are improving in 
the sector, or was the recent signs of strength in the group 
simply due to the recent appeals court ruling regarding Microsoft 
(NASDAQ:MSFT).

GSTI Software Index Chart - last eleven months



Rational Software (NASDAQ:RATL) accounts for just 1.72% of the 
GSTI Software Index (GSO.X), but you can see how just one stock 
giving some bad news can put pressure on the group.  The GSO.X is 
by no means "knocked out," but the tentative technicals and 
longer-term downward trend undoubtedly has bullish traders 
walking on egg shells.  I think today's "bad news" from RATL 
probably had some bulls taking profits on stocks in the group 
considering there was some negative news with RATL.  Once the 
long-term trend is broken to the upside, I'd expect bad news like 
the group experienced today to have less of an effect as market 
participants begin to feel that not all bad news is an indication 
of the sector, but more stock specific.  What we'll be doing from 
here on out is to monitor both trends (down and up) for the 
sector and also monitor stocks that have been acting strong as 
well as stocks like RATL that have gotten bad news.  Often times 
all the bad news comes out at the bottom.  For now, we will note 
that RATL traded as low as $12.50 on April 4th and the GSO.X 
traded as low as 153.54.  That low for the GSO.X also came on 
April 4th!  Coincidence?  Not if you believe in "sector/stock" 
theory.

Big Guns to be monitoring in Software

As of June 15th, the GSO.X comprised over 50 stocks.  At that 
time the following five stocks carried the largest weighting and 
traders can follow them to also get a good indication of sector 
strength/weakness.  MSFT 9.13%, ORCL 8.56%, VRTS 7.88%, CA 6.59% 
and SEBL 6.39%.

This then leads into today's title of "Down but not out!"  If you 
believe the MARKET is made up of sectors and those sectors are 
made up of stocks (like the GSO.X is made up of stocks like RATL) 
then perhaps we will want to be monitoring the technicals and 
current trading of the Biotechnology Index (BTK.X).  Right now, 
I'd say the BTK.X is still the strongest sector in technology and 
the broader NASDAQ Composite (COMPX).

Biotechnology Index Chart - last ten months



Whether you're a "technology trader" or only a "NASDAQ trader" 
you should be monitoring the Biotechs.  The NASDAQ won't move 
higher or lower without some sector pulling the wagon.  By simply 
monitoring trends we see that the Biotechnology Index (BTK.X) 
broke a downward trend on April 27th and just recently the upward 
trend was tested near the 570 level.  Notice how the 200-day 
moving average (longer-term moving average) has come into play in 
recent sessions and how it certainly looks to be acting like a 
point of resistance.  I don't feel like I'm going to far out on a 
limb by writing "the NASDAQ goes nowhere without the biotechs."  
It's my belief that the stronger indexes lead and right now the 
BTK.X looks to be the strongest index where the bulk of the 
stocks are listed on the NASDAQ Composite.  If the BTK.X can get 
above the 615 level, then the probabilities of the NASDAQ showing 
some signs of strength are improved.  

Notice too how our retracement technique of "fitting" certainly 
seems to be working here also.  By anchoring the retracement 
bracket at the low of 382 and then "fitting" the 38.2% 
retracement level at the April 24th pullback at 496 it really 
seems to have defined a range that the market has been trading.  
Notice the recent pullback in the BTK.X at 567.  Notice the 
wonderful correlation between the upward trend and 61.8% 
retracement, which is a result of the fitted bracket.  With MACD 
starting to round out and still above the zero level, this is the 
group I'm currently looking to for strength in the NASDAQ.

Whether you're bullish or bearish on the NASDAQ, you'd better be 
monitoring this group.  If there's one group I currently think 
that would be capable of pulling the NASDAQ higher, then this is 
the horse that could pull the wagon.  If this horse doesn't move 
higher, then we'll need to find another candidate.


================
Market Sentiment
================

Investors Appear Quite Timorous by Jeffrey Canavan

Investors still look apprehensive about putting any new money 
into stocks.  Our own surveyed revealed that 47.50% of our 
readers are bullish, 31.25% are neutral, and only 18.75% are 
bearish.  But clicking on a survey and putting hard earned money 
on the line is two different things.

Today's investor apathy, no sector gained or lost more than one 
percent, can largely be attributed to the holiday-shortened 
trading session.  Traders are more focused on making sure they 
have the proper food and beverage to party guest ratio, than 
writing market sentiments...I mean buying or selling stocks.

As my esteemed colleague Mr. Utley pointed out yesterday, the VIX 
is approaching historically low levels.  Is it foretelling a 
market top?  Previous VIX readings below 20 were also accompanied 
by a sharp run up in the broader markets.  We haven't had that, 
so I'm only mildly concerned about a low VIX reading.  However, I 
wouldn't want to see it drift much lower.

One oddity in the market sentiment today was the put/call ratio 
of the Nasdaq-100 dropping to a bearish .15.  The ratio had been 
averaging a reading of .55, so the drop is quite precipitous.  It 
was the result of 37,518 calls being bought today, compared to 
only 5,762 puts.  The shortened trading day has me questioning 
this data a little bit, but combine this with the VIX, and it 
might be time to snug up some stops on long positions in 
technology.

I can't be completely bearish on technology with the Nasdaq-100 
bullish percent getting ready to go bull confirmed, but until 
that happens, I remain quick to take any bullish profits.  It may 
take a week or so to see which way this meandering market is 
going move.

-----------------------------------------------------------------

Market Volatility
VIX   20.95
VXN   45.14

Put/Call Ratio
Total            .64
Equity Only      .56
OEX              .82
QQQ              .15



             Bullish Percent Data          
           Current   Change   Status
NYSE          42       -      Bull Alert
NASDAQ-100    50     +16      Bull Alert
DOW           44     - 2      Bear Confirmed
S&P 500       54       -      Bear Alert  

Readings above 70 are considered overbought, and readings below 
30 are considered oversold.

Bull Confirmed  - Aggressively long
Bull Alert      - Cautiously long
Bull Correction - pause or pullback in upward trend
Bear Alert      - Take defensive action if long
Bear Confirmed  - High risk if long, good conditions for shorting
Bear Correction - Pause or rebound in downtrend

10-Day Arms Index  1.25  

Readings above 1.25 are bullish, and readings below .85 are 
bearish.  These signals don't occur often and tend be early, but 
when the do, they can signal significant market turning points.

        Advancers     Decliners
NYSE      1587           1353
NASDAQ    1597           1850

        New Highs      New Lows
NYSE        94            20
NASDAQ      45            40

Advisory Sentiment   Bullish   Bearish  
                       48%      30%


Commitments Of Traders Report: 06/26/01
Weekly COT report discloses positions held by small specs
and commercial traders of index futures contracts at the 
Chicago Mercantile Exchange and Chicago Board of Trade. 

Small specs are the general trading public with commercials being 
financial institutions. Commercials are historically on the 
correct side of future trend changes while small specs tend 
to be wrong. 

S&P 500
-No significant changes in the S&P 500.  Institutions remain net 
bearish, and increased that stance only slightly last week. This 
should translate into the S&P 500 bouncing between 1200 and 1240 
until this number budges one way or another.

Commercials   Long      Short      Net     % Of OI  
6/12/01      353,074   423,257   (70,183)   ( 9.04%)    
6/19/01      301,376   371,121   (69,745)   (10.37%)    
6/26/01      307,889   379,955   (72,066)   (10.48%)    

Most bearish reading of the year: (111,956) - 3/6/01
Most bullish reading of the year: ( 41,144) - 5/1/01

Small Traders   Long      Short      Net      % of OI
6/12/01        167,720   100,610    67,110     25.01%
6/19/01        128,296    56,038    72,258     39.20%
6/26/01        130,914    56,269    74,645     39.88%

Most bearish reading of the year:  36,513 - 5/01/01
Most bullish reading of the year:  91,122 - 3/06/01
 
NASDAQ-100
-Institutions added more long positions last week than they did 
short positions.  They remain net short, but are slowly getting 
more bullish.
  
Commercials   Long      Short      Net     % of OI  
6/12/01       33,586    44,234    (10,648)  (13.68%)    
6/19/01       23,480    34,097    (10,617)  (18.44%)    
6/26/01       26,263    35,690    ( 9,427)  (15.22%)    

Most bearish reading of the year: (15,521) - 3/13/01
Most bullish reading of the year:  (1,825) - 1/02/01

Small Traders  Long      Short      Net      % of OI
6/12/01        18,374    16,264    2,110       6.09%
6/19/01        14,284     8,403    5,881      25.92%
6/26/01        10,519     6,064    4,455      26.86% 

Most bearish reading of the year:  (1,028) - 1/02/01
Most bullish reading of the year:   8,460  - 3/13/01


DOW JONES INDUSTRIAL
-This is probably the most surprising data of the week.  
Institutions have actually turned net bearish on the Dow for the 
first time since 3/20/01.  May that's why the Dow is having 
trouble getting above 10,600.

Commercials   Long      Short      Net     % of OI  Open Interest
6/12/01       24,724    18,485    6,239     14.4%     37,886
6/19/01       12,346    10,470    1,876      8.2%     22,611
6/26/01       11,371    12,759   (1,388)    (5.8%)    23,163    

Most bearish reading of the year: (8,322) - 1/16/01
Most bullish reading of the year:  8,925  - 5/22/01

Small Traders  Long      Short      Net      %Change
6/12/01        5,332     9,637    (4,305)    (28.76%)
6/19/01        3,844     7,555    (3,711)    (32.56%)
6/26/01        4,756     6,341    (1,585)    (14.28%)

Most bearish reading of the year:  (7,572) - 5/08/01
Most bullish reading of the year:   1,909  - 1/16/01
-----------------------------------------------------------------


===============
Play-of-the-Day
===============

QLogic QLGC $59.11 -$3.42 Stop: $66.00

Original Comments When Selected:

QLogic chips, switches and adapters help keep data flowing 
between computers and storage devices.  Although the company 
sells components for IDE and storage area network (SAN) Fibre 
Channel technologies, the bulk of their sales come from their 
SCSI (small computer system interface) adapters used to manage 
communication inside a computer with its hard disks, scanners 
and tape drives.  Principal customers include Fujitsu (30-percent 
of sales), Sun Microsystems (13-percent), Dell, IBM and Compaq. 

In May, the firm reported that fourth-quarter earnings, 
adjusted for a sales discount to Sun Microsystems, increased 55-
percent from the year ago period to 27-cents per share.  Analysts 
had forecast earnings between 25 to 29 cents per share according 
to First Call.  Gross revenue rose 55-percent from the previous 
year to $100.5 million.  For the year, the company earned $1.03 
per share on sales of $358 million.  For the fiscal first-quarter 
ending in June, the company is projected to earn 23-cents per 
share on sales of $95 million.  In the year ago quarter, the 
company earned 21-cents per share on revenue of $77 million.  The 
consensus estimate of analysts for the current fiscal year is for 
the company to earn $1.05 on sales of $422 million.  This gives the 
shares a P/E of 61.

Qlogic shares have been on a roll since the early April low of 
$17.81.  However, the past two days have shown signs of a topping 
pattern.  Each day has produced a failed test of resistance at 
the 200-day moving average currently at $65.81.  After reaching a 
$66.16 high about midday last Friday, the shares faded badly into 
the $63.60 close.  Monday was more of the same with a midday high 
of $65.67 slumping into a $62.53 close.  The trend of failed highs
and tests with lower closes suggests selling sentiment is on the 
rise.  Conservative traders can wait for additional bearish 
confirmation with a close below $60 on volume in excess of 6.6 
million shares traded.  If the shares can produce this $60 break 
we have a bearish price objective in the range of $54 to $47.     

Updated Comments:

We got the break below $60 we had hoped for when the shares closed 
at $59.11 on Tuesday.  This puts us up $3.42 per share thus far on 
this Bearish selection and reaffirms our Bearish price objective in
the range of $54 to $47.  The next areas of significant support 
are at $58.36 and $55.  We believe the shares are poised to break 
the first area but $55 could be more significant, so tighten up your 
stops should we approach this level.  For now we want to give this 
volatile play plenty of room so we will move our stop to $66.00, 
which is just above resistance offered by the 200-day moving average 
of $65.61.

Picked on July 2nd at $62.53
Gain Since Picked:     $3.42
Earnings Date           N/A (Not Confirmed)
 



==========
Watch List
==========

HRB - H&R Block Inc.  $68.41 +3.86

WHY WE LIKE IT:  There is no denying that the trend on HRB has
been bullish ever since it took off on Nov. 30th, 2000.  While
there has been a few bumps in the road it has certainly turned
in an enviable performance over the last several months.  Bulls
definitely have a strong grip on this stock.

POTENTIAL TRIGGER EVENT:  On Monday the shares spike was too much 
too chase and we were waiting for a pullback to present a more 
favorable buying opportunity.  Although we received the pullback 
we were looking for on Tuesday, we are concerned.  Volume was 
higher than we would have preferred.  The day before a holiday 
we would anticipate much lighter than average volume.  Instead, 
we saw 699k shares traded - this is well above the 583k daily 
average.  So we will wait for the first sign of a bullish turn to 
stake our claim.  The shares have support at 65 and a bounce back 
to 65 before the next leg up would make a good entry point.  
Split traders should know that HRB has a 2:1 split coming on 
August 1st which can't hurt investors' enthusiasm for the stock.  




---

WHR - Whirlpool Corp.  $63.98 -0.62

WHY WE LIKE IT:  This one stays on our watch list.  Tuesday's light 
pre-holiday trading does not change our outlook.  As we said before,
 this is a real company with real products and real profits.  Plus 
it's up 85% from last October but who's counting?  WHR's chart or 
more specifically its investors make it a little more easy to 
identify entry and exit points.  When reading the chart there is 
always noise but opportunities exist for traders willing to watch 
this stock.

POTENTIAL TRIGGER EVENT:  With the share price building on higher
lows from the recent pull back in June the stock is approaching
resistance again at the 65.00 - 65.50 level.  A solid break
above this would be a clear signal for bulls.  Look for a speed
bump at 67.50 and more resistance at 70.





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Do not duplicate or redistribute in any form.


PremierInvestor.net Newsletter                  Tuesday 07-03-2001
                                                    section 2 of 2
Copyright  2001, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
=================================================================
To view this email newsletter in HTML format with imbedded
charts and graphs, click here:
http://www.PremierInvestor.net/htmlemail/070301_2.asp
=================================================================

In section two:

Split Trader
  New Plays:  ICOS - Viagra Competitor Ready For Approval (Bullish)
  Play Updates: Fuse Still Burning For Bullish Stocks
  Closed Plays: BMET - Biodegrading

Net Bulls
  New Plays: SFA - Breaking Out Off Of Bottom (Bullish)
  Play Updates: Give an Inch, Take An Inch
  Closed Plays: No closed NB plays

Stock Bottom / Active Trader
  New Plays: No new SB/AT play
  Play Updates: Trading Range 
  Closed Plays: Stopped out of Citrix for a nice gain

=================================================================
Split Trader (ST) section
==================================================================

============
ST New Plays
============

  -------------------------
  New Split Candidate Plays
  -------------------------

ICOS Corporation ICOS $64.89 +0.64 Stop: $62.00

ICOS has partnered with Eli Lilly to develop Cialis, the first 
competitor to the hugely successful Viagra. it facilitates blood 
flow and is being developed as a treatment for both male and 
female sexual dysfunction.  It has completed its clinical trials 
and has been submitted to the FDA for approval.  Cialis should have 
a warm welcome to the marketplace.  The trails showed it to work 
faster, last longer and have fewer safty concerns than Viagra.  
Estimates by Gruntal & Co analysts are for the drug to produce 
sales of $75 million in 2002, $175 million in 2003, $250 million 
in 2004 and $325 million in 2005.  Other drug candidates include 
Pafase for severe sepsis, a potentially life-threatening bacterial 
infection, being developed with Japan's Suntory.  The company has 
also teamed with Texas Biotechnology to develop therapies for 
cardiovascular conditions. Microsoft chairman and ICOS director 
Bill Gates owns about 10% of the firm, while George Rathmann, 
chairman of genome database developer Hyseq, owns about 5%.

Last year the firm lost $1.33 per share.  The consensus estimates 
of analysts are for the company to lose $1.79 in 2001 on sales of 
$58 million and $1.70 per share on $90 million in 2002.  For the 
earnings announcement on July 26th, analysts forecast the company 
will announce a loss of 43-cents for the quarter ending in June. 
However it bears noting that the company has topped analysts' 
estimates in each of the last four consecutive quarters.

ICOS shares have plenty of bullish momentum.  Since closing at 
$41.88 on April 6th they have risen 55-percent into Tuesday's 
$64.89 close.  With approval of a blockbuster drug in near future 
and a solid earnings report in the imminent future we think the 
shares are highly likely to top the 52-week high of $70.10 set on 
June 5th.  Tuesday's pre-holiday move on solid volume suggests the 
shares are set to begin the next leg up.  Support from a down move 
exists between $64.19 and $63.00.

Picked on July 3rd at $64.89
Earnings Date           7/26 (Not Confirmed)





===============
ST Play Updates
===============

  -----------------------
  Split Candidate Updates
  -----------------------

Alliant Techsystems ATK $87.01 -0.20 Stop: $84.00

Needing to close the gap that formed on Friday, ATK has pulled 
back on light volume.   The lack of volume suggests the previous 
two days action is an intermittent blip before ATK moves higher.  
Today's low also managed to hold above yesterday's, a short-term 
show of strength, and support still looks strong at $85.   Curious 
George's defense friendly policy still makes us bullish on this 
stock.

Picked on June 29th at $89.90
Gain since picked:      -2.89
Earnings Date            N/A (Not Confirmed)




===

The BISYS Group BSYS $61.00 +.34  Stop: $57.50

Two out of three aint bad.  Since being picked on 6/28/01, BSYS 
has been higher two of the past three days.  Today's price action 
pushed the stock past a group of relative highs are $60.50, on 
volume that was better than the average of the last 60 days.  Not 
bad considering the trading day was shortened by 3 hours.  Now at 
a 52-week high, BSYS is free to roam higher.

Picked on June 28th at $59.91
Gain since picked:      +1.09
Earnings Date            N/A (Not Confirmed)




===

ITT Educational Services ESI $43.90 +.65  Stop: $41.88

Educational stocks still look like a smart play, even though ESI 
is only 20 cents higher from where we picked it.  Yesterday saw 
some volatile price action, as ESI broke out to a new high, only 
to later test the consolidation low, and settle somewhere in the 
middle.  Shares moved higher today, and closer to breaking out of 
this pesky trading range.  As long as the breakaway gap remains 
open, we remain bullish on this stock.

Picked on June 12th at $43.70
Gain since picked:       +.20
Earnings Date            N/A (Not Confirmed)




===============
ST Closed Plays
===============

  ----------------------------
  Closed Split Candidate Plays
  ----------------------------

Biomet BMET $46.25 -0.60 Stop: $46.50

Shares of Biomet lost steam, and hit our stop at $46.50.  The 
longer-term update remains in place, but that's more heat than 
we are willing to take.  

Picked on June 21st at $48.79
Gain since picked:      -2.54
Earnings Date            N/A (Not Confirmed)





==================================================================
Net Bulls (NB) section
==================================================================

============
NB New Plays
============

  --------------
  New Long Plays
  --------------

Scientific-Atlantic SFA $44.45 +2.52 Stop: $41.50

In this tough business climate, there are few companies that are 
beating analyst forecasts and raising forward guidance.  When you 
find one, it is a buy on any dip.  One such company is Scientific-
Atlantic.  The firm makes set-top boxes that link TV's to cable 
systems.  Profit hungry cable operators are finding that their 
customers are also hungry for the expanded product offerings these 
digital boxes make possible such as pay-per-view, Internet access 
and e-mail.  So, despite the weakening economy spending on this 
technology is skyrocketing.  SFA has sold over 6 million of its 
Explorer set-top boxes.  AOL-Time Warner and its affiliates account 
for 23-percent of sales. The impact on their bottom line has been 
impressive.  

For its fiscal third-quarter ended March 30th earnings doubled to 
$76.2 million (or 46-cents per share) on a 51-percent pop in revenue 
to $663.7 million.  This beat analysts' forecast by 4-cents.  The 
company also increased its guidance from $1.64 per share to $1.72 
per share in the fiscal year ending in June.  In addition, after 
selling 1.4 million boxes in the third-quarter they raised their 
2001 fiscal year estimate by 200,000 to 4.9 million.  And although 
they see the rate of growth slowing in 2002, they still anticipate 
double-digit revenue growth.  While the lack-of-visibility mantra 
has been a standard refrain in most conference calls this earnings 
season, it was conspicuously absent from Scientific-Atlantic's.  
The company has an investor-reassuring backlog of $1 billion. 

SHA shares took a beating in early June dropping from $57.10 on 
June 7th to a $40.90 close one week later.  The culprit was concerns 
that Motorola is getting a step on the company both in technology 
and in overseas sales.  Whereas these are valid concerns, we believe 
they are fully expressed in the stock price.  And given the company's
strong fundamentals we view this as a buying opportunity.  Company 
shares have an estimated 2001 P/E of 26 and 22 for 2002 against the 
industry average P/E of 95.  The company has a strong balance sheet 
with no long-term debt; $586 million in cash or equivalents and its 
gross margin have increased 5 consecutive years.  Coupled with 
anticipated annual sales growth in excess of 50-percent, the shares 
are clearly undervalued.

After the early June slide the shares entered congestion trading 
within a tight range of approximately $40 to $43.29.  On Tuesday, 
the shares broke from this basing pattern with a $2.52 gain to 
$44.45.  Normally we would have preferred to see this break 
confirmed by a spike in volume.  Although we did not get that 
spike, volume during the half-day pre-holiday session was solid 
at 1.8 million.  The daily average volume is 2.5 million.  Strong 
down side support is nearby at $42.50, weak upside resistance at 
$46.21 and more significant resistance in the $51.75 to $52.25 
range.  This presents a Bullish opportunity with minimal bearish 
risk. 
     
Picked on July 3rd at $44.45
Earnings Date           7/19 (Confirmed)




===============
NB Play Updates
===============

  -----------------------
  NB Bullish Play Updates
  -----------------------

Yahoo! Inc. YHOO $19.81 -0.23 Stop: $17.25

Football and not the stock market is normally thought of as a game 
of inches.  But Yahoo shares must be thinking of trying out for 
the local team.  They have been inching towards a test of resistance 
in the range of $20 to $20.50, but yesterday they went back one 
inch.  Over the last 5-trading sessions, the widest spread between 
the session highs and lows was $1.30 last Wednesday.  This has been 
one slow motion bull run.  Our recommendation still stands - 
conservative traders should wait for a break over $21 before taking 
a position.  This breakout would confirm bullish momentum and place 
resistance levels at $25.94 and $30 square in our sights.  If this 
break does not occur, the shares are liable for a pullback and in 
that case weak downside support is at the 50-day moving average of 
$19.14 and stronger support at $17.50.

Picked on June 25th at $19.77
Gain since picked        0.22
Earnings Date            7/11 (Not Confirmed)
 



===

Applied Materials AMAT $50.23 +0.27 Stop: $48.10

Applied Materials shares recovered from the anomalous drop 
experienced when tech gremlins laid waste to the Nasdaq's computer 
systems.  There were few lessons to be gleaned from Tuesday's 
trading.  The session was flat as traders headed out the door of 
the shortened pre-holiday session.  The good news is that AMAT 
shares managed to close above the significant $50 resistance level, 
the bad news is that it happened on next to nothing volume of 6.6 
million shares traded.  A normal day for AMAT is 17 million shares. 
Still, any gain is good and those that move  above resistance are 
doubly so.  We hope that as the traders and volume return to the 
market following the holiday, they continue to put some distance 
between the current price and $50.  We are maintaining our stop at 
$48.10.

Picked on June 22nd at $49.05
Gain since picked        1.18
Earnings Date            8/14 (Not Confirmed)





  -----------------------
  NB Bearish Play Updates
  -----------------------

Computer Sciences Corporation CSC $34.26 -1.16 Stop: $36.00

The bears grabbed the upper hand on Tuesday.  Although the shares 
remain in congestion they backed off of resistance at $35.  Our 
outlook remains the same and we hope this is the resumption of the 
earlier strong down trend.  We will watch for a close above $35.25 
on strong volume to indicate the bulls are gaining the upper hand, 
whereas a close below $33.15 would suggest the bears are in full 
control.  We will keep our stop at $36.00.

Picked on June 21st at $35.00
Gain since picked:       0.74
Earnings Date            N/A (Not Confirmed)




===

Automatic Data Processing, Inc. ADP $51.81 +0.15 Stop: $52.90 

Longs will not receive much encouragement from Tuesday's slight 
gain.  The shares open of $52.60 was also the session high.  The 
shares then spent the remainder of the session giving back the 
momentary 84-cent gain.  Our outlook remains the same. After 
completing a double top, ADP shares are still consolidating around 
$51.50.  If that level is lost, this stock could go into freefall. 
Any pullbacks should meet stiff resistance around $52.75.

Picked on June 29th at $49.70
Gain Since Picked       (1.11) 
Earnings Date            8/13 (Not Confirmed)
 




==================================================================
Stock Bottom / Active Trader (AT) section
==================================================================

===============
AT Play Updates
===============

  -----------------
  Long Play Updates
  -----------------

BEA Systems BEAS $30.01 -1.35 Stop: $28.25

Home, home on the range seems to be the theme for BEA Systems, 
since it has been bouncing around in a trading range.  The good 
news is that near term support looks good at $30.  The bad news is 
that resistance still looms overhead at $32.  The longer the 
consolidation, the bigger the move.

Picked on June 17th at $30.80
Gain since picked:      -0.79
Earnings Date            N/A (Not Confirmed)




===

Corning GLW $17.00 +0.20 Stop: $14.50

Corning closed up 20 cents, and right at today's high.  It failed 
to take out yesterday's high, but is still up $1.20 since we 
picked it.  Looming overhead at $19.44 is the 50-day moving 
average, but another $2.40 cent gain would gladly be accepted.

Picked on June 28th at $15.80
Gain since picked:      +1.20
Earnings Date            N/A (Not Confirmed)




===

Intuitive Surgical ISRG $13.77 +.47 Stop: $12.90

ISRG has moved ahead with surgical precision, up 24% since we picked 
it on June 17th.  Today's action bumped it up 47 cents, and closer 
to taking out Friday's volatile high of $14.78.  The fact that the 
stock hasn't broken down over the past three days has me thinking 
there might be some more upside potential.  Our stop still sits 
close by to lock in our profits.  

Picked on June 17th at $11.05
Gain since picked:      +2.72
Earnings Date            N/A (Not Confirmed)




===

Medimmune Inc. MEDI $46.57 +.52 Stop: $42.50

Medimmune hasn't been immune to a minor setback in its current 
advance.  The reason for that setback is the meddlesome 200-day 
moving average that has been holding prices back.  In order bust 
through that line, volume is going to have to pick up, but overall 
the up trend still looks healthy.

Picked on June 21st at $47.48
Gain since picked:      -0.91
Earnings Date            N/A (Not Confirmed)




===

Neurocrine Bioscience NBIX $38.90 +.25 Stop: $36.00

After exploding past resistance on June 29th, NBIX has pulled back 
the past two days.  After gaining $3.50 in three days, it could use 
a bit of a break.  As long as the stock stays above $37.79, Friday's 
low, I'm not overly worried about a pullback, because this stock 
certainly looks like it wants to move higher.

Picked on June 29th at $39.99
Gain since picked:      -1.09
Earnings Date            N/A (Not Confirmed)




===

Schuler Homes, Inc. SHLR $14.10 +0.06 Stop: $11.94

On Friday SHLR traded in a $3 range.  Quite large since its a $14 
dollar stock.  After the dust settled, SHLR has continued to move 
higher, and should continue to do so as long as the housing market 
remains strong.

Picked on June 25th at $13.57
Gain since picked:      +0.53
Earnings Date            N/A (Not Confirmed)




===

Tenet Healthcare THC $50.68 -0.02 Stop: $49.75

THC still remains in a strong up trend, but has succumbed to a 
little profit taking this week.  As long as the stock remains 
above our stop at $49.75, all should be well.

Picked on June 17th at $51.09
Gain since picked:      -0.41
Earnings Date            N/A (Not Confirmed)




===

TJX Companies TJX $32.93 +0.44 Stop: $31.70

After peaking on June 21st, TJX has slowly been working its way 
higher.  The last two days have done a lot to help that.  With the 
trend now looking higher, this stock needs to exceed the previous 
high at $34.26.

Picked on June 13th at $34.25
Gain since picked:      -1.32
Earnings Date            N/A (Not Confirmed)




===

ViroPharma VPHM $31.20 -0.30 Stop: $27.50

It has to be a bad tic.  My chart is showing a high of $40 and a 
low of $29 on Friday.  Regardless, VPHM has broken its April 
downtrend, closing above $22 would help to solidify the uptrend.

Picked on June 22nd at $29.94
Gain since picked:      +1.26
Earnings Date            N/A (Not Confirmed)






  ------------------
  Short Play Updates
  ------------------

See Play-Of-The Day QLogic QLGC in section 1

===============
AT Closed Plays
===============

  ----------------
  Closed Long Play
  ----------------

Citrix Systems CTXS $33.61 -1.35 Stop: $33.20

It was a nice run while it lasted.  We were finally stopped out 
of our Citrix position for 3.47 gain.  After 7 straight up days, 
CTXS was due to pullback.  Unfortunately it pulled back too far 
and hit our stop.

Picked on June 20th at $30.14
Gain since picked:      +3.47
Earnings Date            N/A (Not Confirmed)





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