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Daily Newsletter, Wednesday, 08/08/2001

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PremierInvestor.net Newsletter              Wednesday 08-08-2001
                                                  section 1 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
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In section one:

Market Wrap: Bonds rally and stocks suffer the consequences
Market Sentiment: The Old One-Two Punch
Play-of-the-Day: PeopleSoft, Inc. - PSFT (Bearish)
Watch List:. Like the Boy Scouts - Be Prepared

-----------------------------------------------------------------
U.S. Market Numbers
-----------------------------------------------------------------
MARKET WRAP  (view in courier font for table alignment)
-----------------------------------------------------------------
        08-08-2001        High      Low     Volume Advance/Decline
DJIA    10293.50 -165.24 10479.64 10267.97 1.11 bln   1193/1885	
NASDAQ   1966.36 - 61.43  2038.64  1958.67 1.64 bln   1224/2447
S&P 100   607.53 - 11.18   619.86   606.36   totals   2417/4332
S&P 500  1183.53 - 20.87  1206.79  1181.27           
RUS 2000  472.62 -  7.71   481.73   471.54
DJ TRANS 2882.04 - 39.42  2931.05  2876.98
VIX        24.36 +  1.71    24.62    22.54
Put/Call Ratio      0.55
-----------------------------------------------------------------

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

Bonds rally and stocks suffer the consequences

Dear Jeff:  I was away from my PC when suddenly I heard all of my 
Q-charts alerts on bond yields start to trigger.  There was 
apparently a very sudden drop.  I haven't been watching bond 
yields for very long, but I've taken quite an interest in what 
you have taught me about money rotating from stocks to bonds and 
vice versa.  What's up with the sudden drop?

Treasury bonds surged this afternoon after strong demand for the 
10-year auction of $11 billion and its yield ($TNX.X) was gobbled 
up by the market as if it were gold.  At 01:30 PM EST, all heck 
broke lose in the bond market as the YIELD for the 10-year YIELD 
plunged from 5.159% to 5.11% in the matter of 15-minutes (bond 
yields fall as prices are bid higher).  The demand this bond 
found today was the highest level of demand found in the past 
eight years with the bid-to-cover ratio (a measure of demand) 
surging at 2.85 versus an average of 2.23.  In essence, there 
were a lot of market participants on the wrong side of the bond 
market and when that realization became known, the bond market 
surged and YIELDS dropped.  The YIELD on the 10-year finished to 
close at 5.054% and represents a very significant move by the 
market toward a lower risk investment vehicle.

That action its success then had other Treasury bonds finding 
buyers and stocks were left out in the cold as cash moved away 
from stocks and toward bonds at a frenzied pace.  Almost like 
domino theory would have it, where dominos are lined up on end 
and then tipped over, traders jumped on the 30-year Treasury.  
The YIELD on the 30-year ($TYX.X) plummeted from a YIELD of 5.59% 
to a session closing YIELD of 5.517%.  With such demand for 
today's 10-year bond auction, many participants felt that the 
upcoming 30-year auction would have the same type of sponsorship.  
That said, many traders unloaded their stocks to raise cash to 
buy bonds and stocks began to weaken.

Then in another round of "domino theory," the Federal Reserves 
Beige Book report was released.  For those that aren't aware, The 
Beige Book contains information collected in the prior period (in 
today's case, prior to July 30th) by the Federal Reserve Bank of 
San Francisco.  Topics discussed in the report were consumer 
spending that generally remained weak in June and July, although 
the report did show some areas of scattered pickup in sales 
around the country.  Services, which include demand for business 
services like advertising, computing, temporary employment 
agencies all found stagnant or declining demand for their 
services.  One bright spot in this section of the report came 
from the Dallas, TX market and legal firms in that area.  Dallas 
lawyers noted a pickup in demand due to energy market 
developments and increased bankruptcy filings.  "Every cloud has 
a silver lining" doesn't it?

But wait... it got worse.  Manufacturing, Real Estate and 
Construction, Banking and Finance all experienced stagnant to 
continued slowing demand.  You get the picture, there wasn't a 
lot of positives in the report and that 5% Treasury bond YIELD 
all of a sudden looked very attractive from the perspective of 
potential risk/reward.

The Beige Book report and information provided in it wasn't that 
much of a surprise today and I'm not thinking for a moment that 
it was the driving factor for today's stock declines.  It sure 
helped fuel the decline, but it wasn't the ultimate cause.  What 
set things off was the Treasury auction and I truly feel it was 
the sharply lower YIELD and the markets perception of what that 
sharp decline in YIELD was saying that had traders flushing some 
stocks and running to bonds.  We've talked before in great detail 
about how the market differentiates and perceives risk/reward 
between stocks and Treasury bonds.  Treasuries are backed by the 
full faith and credit of the U.S. Government, stocks are backed 
by a piece of paper called a stock certificate usually with a par 
value of $0.01.  The "reward" for the Treasury bond is the stated 
interest payment, while the potential reward for a stock is 
unlimited.

One subscriber sent me an interesting e-mail.  He wrote, "I was 
away from my PC when suddenly I heard all of my Q-charts alerts 
on bond yields start to trigger.  There was apparently a very 
sudden drop.  I haven't been watching bond yields for very long, 
but I've taken quite an interest in what you have taught me about 
money rotating from stocks to bonds and vice versa.  What's up 
with the sudden drop?

This subscriber was alert to the potential move coming in stocks.  
I'm not sure if he acted on his alertness, but at least he knew 
something was about to happen.  You can tell from his e-mail that 
he got more than one alert from the bond market as he most likely 
had alerts set on the 5-year ($FVX.X), 10-year ($TNX.X) and 30-
year ($TYX.X).  This morning in the 09:00 EST I felt it was 
important to point out the 30-year YIELD alert at 5.581%.  That 
YIELD alert was triggered at 1:42 EST and the S&P 500 ($SPX.X) 
was trading 1,200.  By session's end, the SPX had lost 1.4% of 
its value to close at 1,183.  

Stocks like PeopleSoft (NASDAQ:PSFT) (in today's Net Bulls 
section titled "StockSoft") suffered more than a 1.4% loss from 
its 1:45 EST trading level of $41.  The stock fell to a session 
low of $38 and finished trading at $39.51.

PeopleSoft Chart - last 7 months



Shares of PeopleSoft (NASDAQ:PSFT) outperformed the market to the 
downside today, but bulls in this stock may have just experienced 
the first bit of pain that could come from a broader market 
decline.  Tomorrow, I'd ideally like to see the stock rally to 
the $41 level as a good entry point.  this would help reduce risk 
for a bearish trader.  The S&P 500 Index (SPX.X) should have some 
good resistance starting to build at the 1,200 level and that 
should keep things in check for PeopleSoft.  Traders looking to 
play the stock at the open, should the market be looking weak, 
can still play the stock short, but I'd only initiate 1/2 
position short in the stock.  I've slapped a retracement bracket 
on the stock from the recent low to recent high.  For this trade 
to really get going in the bears favor, I feel the stock needs to 
close below the $38.25 level.  This would be wonderful 
correlation not only with retracement, but also the 200-day MA, 
which is currently at $38.23 (see black box in lower left hand 
corner of chart).  The reason I'd only be looking to short 1/2 
position at current levels of $39.51, is that the stock could 
conceivably rally to downward trend near $41-$43.  If you 
normally only like to short $5,000 worth of stock, then only 
short $2,500 at current levels.  If the stock falls to $34 or 
$30, then you've got a piece of the action.  Should the stock 
rally against you from a short at $39.50 to resistance, you will 
not be panicked and be able to better assess MARKET action 
against stock action.  Then if PSFT were to consolidate near 
resistance, and begin showing weakness once again, the trader who 
has properly managed his trading activity can round up to full 
position short at the higher price (at the higher price, there is 
more potential reward and less risk to your stop).  I feel this 
stock has at least the $34.31 level in it based on the 
technicals.  If I'm wrong I'm gone at $45.25.  Hey!  That rhymes.

Tomorrow could be wild.  Today's bond market activity caught a 
lot of traders off-guard and tomorrow morning I want to be 
watching bond YIELD very closely to see if there is any type of 
follow through.  If not, then I want to be very careful with any 
shorting of stocks.  I'm looking at tonight's bullish percent 
readings.  The most volatile of the bullish percent indicators 
comes from the NASDAQ-100 bullish % ($BPNDX).  Tuesday nights 
reading was 49%.  Without looking, what do you think today's 
action had on this indicator?  Answer:  No effect.  The reading 
remains at 49% and there was no net loss of stocks showing a buy 
signal on their chart.

To comprehend this, go to www.stockcharts.com and pull up a 
point/figure chart of eBay (NASDAQ:EBAY).  That stock actually 
gave a point/figure buy signal today at $66.  This was the short-
term traders goal from bullish support at $60 (see 08/03 09:00 
EST Update).  The stock traded $66.10 today and then we got the 
bond market action and The Beige Book report.  The stock finished 
at $62.20.

Watch Microsoft (NASDAQ:MSFT) too.  The stock just continues to 
trade above bullish support.  This stock fell just 2% today.  The 
bar chart looks terrible, but for some reason the stock hasn't 
broken $64.  As long as this stock stays above $64, I would be 
cautious on going overboard with shorting.  The best shorts 
remain those that offer the best risk/reward.  If a stock has 20% 
downside to support and only risking 5% to stopping point just 
above resistance, then those are the stock I feel are best served 
as short candidates.  Conversely, stocks that are trading near 
support that only have 5% risk downside and 30% upside and have 
been finding sponsorship in the past week can turn into big 
trouble if your short and the MARKET turns against you.

Don't be surprised if stocks find buyers at some point tomorrow.  
A key level I'd be watching as it relates to the S&P 500 ($SPX.X) 
is the 1,176 level.  Look at this morning's 09:00 update and 
learn to correlate the bond YIELD chart with that of the SPX.  
Right now it is a game of progression.  I'd argue that the recent 
range for the SPX has been approximately 1,176 to 1,228.


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

The Old One-Two Punch

Cisco delivered a left hook to market's chin right at the opening 
bell.  The market was a little dazed and confused, but managed to 
stay on its feet.  Stocks even managed to fight back, and deliver 
a few bullish blows themselves. But then they looked down for a 
second, and the Fed landed a haymaker that knocked stocks to the 
canvas.

The Fed's haymaker was the latest edition of its beige book, 
which is a survey of economic conditions that the Fed uses for 
setting interest rates.  The gist of the book is that this 
economic downturn is going to make the great depression look like 
a picnic.  Okay, it wasn't nearly that bad, but when investors 
are as nervous as a long-tailed cat in a room full of rocking 
chairs, it doesn't take much to start a selling spree.  The Fed 
basically said that manufacturing continues to weaken, that 
weakness is starting to spill over into other sectors, and retail 
sales are sluggish.  For the full story go to 
http://www.federalreserve.gov/fomc/beigebook/2001/20010808/default.htm

If retail sales were in fact sluggish, we should find out 
tomorrow when July retail sales are released.  Should the numbers 
confirm that consumer spending is waning, retail stocks, and the 
rest of the market, could be in for a rough day. Retailers 
weren't the worst sector today, but the Retail Index did lose 
2.5% in the last two hours of trading.  

What was the worst sector of the day was oil service, followed 
closely by software, networking, and semiconductors.  Internet 
and biotechnology was also bruised and battered, and the only 
sector left standing at the end of the day was gold and silver.

So is the market down for the count?  It might need a standing 
eight count, but there are a lot of rounds to go.  The question 
is whether the market has the chin of Rocky Balboa or Trevor 
Berbick.  After suffering a second round knockout at the hands of 
Mike Tyson, Trevor Berbick was asked by a report what he thought 
of the fight.  His response was, "I like eggs."  Hopefully the 
market can take a punch better than that.

*************************Sector Watch****************************

            Weekly   Daily     Overbought    Support  Resistance 
            Trend    Trend      Oversold                         

DJIA        Bearish  Bearish    Neutral      10,200   10,600
NASD        Bearish  Bearish    Neutral       1,940    2,125
S&P 500     Bearish  Neutral    Neutral       1,170    1,240
Rus 2000    Neutral  Neutral    Neutral         465      495

The daily trend of DJIA and NASD have been changed to bearish 
after dropping below their 25-day moving averages, and breaking 
their up trends.  Overbought/Oversold status is neutral, but 
rapidly approaching oversold.

            Weekly   Daily     Overbought    Support  Resistance 
            Trend    Trend      Oversold                         

Semis       Neutral  Neutral    Neutral         535      660
Biotech     Bearish  Bearish    Oversold        490      550
Internet    Bearish  Neutral    Overbought      140      170
Networking  Bearish  Neutral    Neutral         300      365
Software    Bearish  Bearish    Oversold        180      200
Banking     Bullish  Neutral    Overbought      640      675
Retail      Bullish  Neutral    Neutral         875      920
Drugs       Neutral  Neutral    Neutral         380      410

Keep and eye on software and biotechnology tomorrow.  Both 
sectors are sitting right at support.  Semiconductors broke 
through their support level today.  Internet and networking 
continue to trade sideways, thus their neutral trend ranking.


               Percent Change
            Last    Last    Last    Rel Strength   Point and 
           5 Days  10 Days 30 Days   vs S&P 500   Figure Signal
DJIA       (0.6%)    2.1%   (0.4%)    Neutral         Buy
NASD        0.0%     3.5%   (1.1%)    Neutral         Sell
S&P 500    (0.6%)    2.8%   (1.2%)      N/A           Sell
Rus 2000   (0.9%)    1.3%   (0.8%)    Neutral         Sell

Semis       1.5%    12.1%    2.1%     Positive        Buy
Biotech    (3.0%)    3.6%  (11.6%)    Neutral         Sell
Internet    4.1%    (1.1%) (16.2%)    Negative        Sell
Networking  2.0%     8.8%    0.3%     Neutral         Buy
Software   (1.0%)    4.8%  (11.0%)    Neutral         Sell
Banking     1.0%     4.1%    2.8%     Positive        Buy
Retail     (1.0%)    2.6%    3.8%     Neutral         Sell
Drugs      (1.2%)    3.3%   (0.5%)    Neutral         Buy

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


=========================
Play-of-the-Day (Bearish)
=========================

PeopleSoft, Inc. - PSFT Close:$39.51 Change:-2.77 Stop:$45.50

Comments When Originally Selected On August 7th:

Company Description:
PeopleSoft is the third largest developers of enterprise resource 
planning (ERP) software after SAP and Oracle.  ERP software helps 
clients manage human resources, financial, manufacturing, 
purchasing, sales and inventory planning.  The Pleasanton, 
California-based company's vertical applications target the health 
care, financial services, public-sector, and communications 
industries.  PeopleSoft generates 65-percent of sales from related 
software maintenance, training, and consulting services. 

After six consecutive years of doubled sales, the company saw 
demand for its flagship ERP products diminish due to increased 
competition and a saturated market; it slipped into the red in 1999 
for the first time in the decade.  In response, the company 
launched an aggressive array of new products and services, 
particularly in the customer relationship management (CRM) 
industry. The company is counting on its Internet-based PeopleSoft 
8 CRM offering to make further inroads into competitor Siebel 
Systems' dominant market share. 

Fundamentals: 
Analysts forecast the company will earn 60-cents on sales of $2.1 
billion in the current fiscal year and 83-cents on $2.4 billion in 
2002.  Last year, the company earned 31-cents on sales of $1.74 
billion.  This gives the company a 2001 earnings growth rate of 93-
percent (industry average is 3.9-percent), a current P/E of 136 and 
a forward 2001 one of 71 (industry average is 43) and a PEG of 2.86 
(industry average is 2.18). For the fourth quarter, the company has 
said it was comfortable with analysts' current estimates of 19 
cents per share.

Why We Like It: 
PeopleSoft's emphasis on web-based applications have scored big 
with customers and enabled it to rebound after a tough 1999.  
However, the shares are richly valued making them vulnerable to 
dips during market pullbacks.  Although the company is predicting a 
solid year with license-revenue growth "slightly ahead" of the top 
of the 30-percent to 35-percent annual growth the company had 
projected, and that full year EPS would be at the "high end" of the 
company's 55 to 60-cent range, investors are still concerned.  They 
question whether the firm can maintain this robust growth when even 
the company admits the selling environment has become more 
difficult.  

After bouncing off a session low of $29.80 on July 20th , the 
shares put together an impressive run to a session high of $44.78 
on August 1st.  Unfortunately for longs, this high represented the 
second failed attempt to top $45 this month.   Since then, the 
shares have been noticeably weaker and seem poised to test lower 
levels.  On Tuesday, after opening at $42.41, longs managed to 
drive the shares in the morning hours to a session high of $44.26 
before a strong wave of selling pushed the shares lower for the 
remainder of the trading day.  This selling was on a spike in 
volume from Monday's 4.5 million shares traded to 6.8 million on 
Tuesday, suggesting the bears have momentum.  This makes likely a 
test the next level of downside support at the 200-day moving 
average of $38.41, and possibly support offered at $35 and the July 
$29.80 low.  We will start this Bearish play with a stop at $45.50, 
which is just above the thus far unreachable $45 resistance level.  

Updated Comments:
Our outlook hasn't changed much. Our first day for this Bearish 
selection gave us a $2.77 gain and we believe there is more 
downside weakness than upside risk.  A point and figure analysis 
will not generate a buy signal until the shares reach $45.  The 
downside shows good potential of a move to $34 and a not 
unreasonable shot at $30.  A big inflection point will be reached 
when the shares approach the $34 level.  We will tighten our stops 
to protect profits when we get closer. 

Picked on August 7th at $42.38
Gain since picked:       -2.77
Earnings Date             N/A (Not Confirmed)





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

COMMENTARY:

Worried that the market is headed for an extended downturn?
Check out these stocks on the watch list.  Ask any truly 
experienced trader and they'll tell you that to succeed you
need to be able to play the downside of the market too.

We're not making any predictions about market direction here
but if certain indices breakthrough key support levels then
these stocks (and a lot more) should be making large moves
to the downside.  Will you be ready to capitalize on them?

==================================================================

BEA Systems - BEAS - close: 19.79 change: -2.76

WHAT TO WATCH:  If the software index is going to continue its
recent fall then BEAS could easily be setting new lows soon.
The GSO.X is perched just above support at 180.  A fall below
this level would be bad news for software stocks.  The previous
low back in April was south of 155.  In contrast, the April low
for BEAS was 20.18, a low already surpassed.  More recently back
in July, BEAS traded as low as 19.01.  Today was a pretty big
move for the stock and there could be a bounce but if the new
trend is down then BEAS is looking pretty weak already.




---

Siebel Systems - SEBL - close: 30.69 change: -3.78

WHAT TO WATCH:  Another software casualty, shares of SEBL have 
been hammered today gapping down to fall almost 11%.  The stock
is sitting precariously above support at $30.  Shares have not
been under the $30 mark since late April and the yearly low
is $22.95 on April 3rd.  A potential trigger to watch is the
stock under $30.  From there, sellers are likely to take it
down to support at $25.




---

Brocade Communications - BRCD - close: 33.70 change: -4.24

WHAT TO WATCH:  Bring a towel, the bears are probably drooling
over this one.  BRCD has been fighting to breakout above 
resistance at $39/$40 for days.  Today's punishing 11% drop 
plops the stock back under the top of its descending channel.
If the new trend is down, bears could be eyeing the bottom
of this channel near $25.  If things really turn sour, the
April low for BRCD was $16.75.




---

Amgen, Inc. - AMGN - close: 60.89 change: -1.76

WHAT TO WATCH:  Keep your eye on the Biotechs.  Always subject to
volatility, the biotechs could really be hurt if investors loose
hope in another market downturn.  At 497, the Amex Biotech Index
(BTK) is flirting with support at 490.  If the group drops below
this level, AMGN is likely to feel the pain.  Currently, AMGN 
shares are trading above support of $60.  If the stock breaks 
down, we're likely to see the selling take it down to $56 or $54
which are July support levels.  In contrast, the April low for
AMGN was $50.31.



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Copyright  2001  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.


PremierInvestor.net Newsletter               Wednesday 08-08-2001
                                                   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/1136_2.asp
=================================================================

In section two:

Split Trader
  Split Announcements: ATK, EQR
  New Plays: No new plays.
  Play Updates: No play updates
  Closed Plays: No closed plays

Net Bulls
  New Plays: No new plays
  Play Updates: See Play of Day in section 1 - PSFT
  Closed Plays: EMC, CTXS, RFMD

Stock Bottom / Active Trader
  New Plays: No new plays.
  Play Updates: No play updates
  Closed Plays: No closed plays

Trading Ideas
  Value Plays With Bullish Signals
  Breakout to Upside (Stocks $5 to $20)
  Breakout to Upside (Stocks over $20)      
  Breakout to Downside (Stocks over $20)      
  Recently Overbought With Bearish Signals (Stocks over $20) 

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

===================
Split Announcements
===================

ATK Surges on Split Announcement, Earnings and Outlook

Before the opening bell, military ammunition supplier Alliant 
Techsystems (NYSE:ATK) announced a 3-for-2 stock split of its 
common shares, payable September 8 to shareholders of record as 
of August 17. The news was no surprise to Premier Investor 
analysts as it was noted on this week's "Expected Splits" list 
that ATK would be announcing a split today.

Shareholders met yesterday to vote on an amendment to increase 
the number of authorized shares to 60 million in order to 
accommodate the additional shares generated from the split.  
There are currently 14.2 million shares outstanding and a float 
of 12.3 million.

The split announcement came in conjunction with strong Q1 
earnings of $1.22 per share, surpassing estimates by $0.03 and 
increasing from the prior year by 13 percent. Sales for the first 
quarter, which ended July 1, increased 46 percent to $395 million 
from $270 million last year. The rise in profits is attributed in 
part to the acquisition of Thiokol Propulsion. 

The Company also raised its second quarter outlook to $1.28-$1.30 
and the fiscal year 2002 to $5.35-$5.40. Analysts have been 
calling for a profit of $1.26-$1.28 for Q2.

ATK shares climbed as high as $99.30 upon today's announcement 
and are currently trading at $96.66, up +0.46 from the prior 
close.

ATK is a $1.6 billion aerospace and defense company with leading 
positions in propulsion, composite structures, munitions, and 
precision capabilities. The company, which is headquartered in 
Hopkins, Minn., employs approximately 9,600 people and has two 
business groups: Aerospace and Defense.

 

===

Equity Residential Declares First-Ever Stock Split

Equity Residential Properties Trust (NYSE:EQR) announced after 
Tuesday's closing bell that its Board of Trustees approved a 2:1 
stock split of its common outstanding shares. Dividends will be 
paid on October 11, 2001 as the company's first stock split since 
it began trading publicly on the New York Stock Exchange. There 
are currently 133.6 million shares outstanding, a float of 108.2 
million and 350 million shares are authorized for issuance. 

The Company also increased its quarterly cash dividend to $0.865 
per share from the previous dividend of $0.815.  The payable date 
is October 12 for shareholders of record as of September 20.

EQR opened at $54.54 on Wednesday, just off the 52-week high of 
$57.85 hit on August 6, 2001. Over 326 thousand shares trade 
hands on a 3-month average.

About the Company:

Equity Residential Properties Trust is the largest publicly 
traded apartment company in America. Nationwide, Equity 
Residential owns or has investments in 1,079 properties in 35 
states consisting of 225,069 units. For more information on 
Equity Residential please visit our website at www.eqr.com .

chart = 


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

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

===============
NB Closed Plays
===============

  -----------------
  Closed Long Plays
  -----------------

E M C Corp. - EMC - close: 18.30 change: -1.28 stop: 18.50

From the word go, this play was in trouble today. Due to the 
earnings miss and warning from Emulex on Tuesday, EMC gapped 
down $0.56 at the open. For additional punishment, by mid-
morning the news hit the wires that Sun Microsystems and Hitachi 
joined forces in a multi-billion dollar deal to license and sell 
each other's storage software. Ouch. The sell-off continued to 
the day's low of $18.06 and looked like it would close the day 
there until buyers finally stepped in at the last minute, sending 
prices up a few pennies to $18.30. 

Picked on July 27th @ $20.01
Gain since picked:    - 1.51
Earnings Date:         07/18 

---

Citrix Systems - CTXS - close: 32.06 change: -3.07 stop: 34.00

Selling action was pretty solid throughout the day but shares
of CTXS didn't trip our stop until just before 2:00 pm ET.  The
dismal performance by the GSO software index, gapping down and
then failing a rally back to 190 put the bulls on the run in
a hurry.  Of course, the catalyst for this tech rally's rout was
the disappointing CSCO outlook and the dismal numbers from the
Fed's Beige book report.  The GSO found support at 180 back on
July 24th and the index is already close to it now at 181.54.
Keep your eye on this level for the software index's future short-
term direction.  

Picked on August 2nd @ $36.69
Gain since picked:     - 2.69
Earnings Date:          07/19 




---

RF Micro Dev - RFMD - close: 26.70 change: -3.22 stop: 28.50 

Shucks!  RFMD was holding up so well too.  The semiconductor index
(SOX.X) started the day in positive territory before loosing its
grip after 11:30 this morning.  Someone hit the sell button and
it didn't stop until the index had blown through (hopeful) support
at the 600 level.  RF Micro quickly followed suit and dropping
through our stop just after 12:00.  The continuing controversy over
the semi group among analysts will keep this and similar stocks 
in a volatile mode until someone can convince the rest of us one
way or the other.  With the NASDAQ under 2000 bulls are probably 
praying for support at 1940 once again.  Despite the ups and downs
we still managed a small gain on the play.

Picked on July 26th @ $27.79
Gain since picked:    + 0.71
Earnings Date:         07/17 





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

==================
  Trading Ideas 
==================

This section contains stocks that meet criteria which may make 
them of interest to long and short side traders.  These are not 
recommendations, nor have they been reviewed by PremierInvestor 
editors for investment potential.  However, each of them has 
technical and fundamental characteristics that make them worthy 
of further review by traders and investors looking for fresh ideas. 
New stocks will appear daily following the market close.  

  ---------------------------------
  Value Plays With Bullish Signals
  ---------------------------------

Ticker    Company Name              Close  Change
ASFC      Astoria Financial Corp.   60.36  +0.54
PC        Perez Companc Sa          12.93  +0.88
HSC       Harasco Corp              32.20  +1.38
TTC       Toro Co                   47.76  +0.61
FBC       Flagstar Commercial Cp    23.00  +1.06
STW       Standard Commercial Cp    19.00  +2.00

  ---------------------------------------
   Breakout to Upside (Stocks $5 to $20)
  ---------------------------------------

Ticker    Company Name              Close  Change
APCS      Alamosa Holdings Inc      18.20  +1.25
STW       Standard Commercial Cp    19.00  +2.00
CURE      Curative Health Services   9.40  +1.05

  ---------------------------------------
   Breakout to Upside (Stocks over $20)
  ---------------------------------------

Ticker    Company Name              Close  Change
AOC       Aon Corp                  37.99  +1.44
CBE       Cooper Industries         60.25  +6.26
KOF       Coca-Cola Femsa Sa De Cv  22.20  +1.02
RL        Polo Ralph Lauren Corp    25.10  +1.95
HSC       Harsco Corp               32.20  +1.38
JBX       Jack In The Box Inc.      31.16  +1.21

  -----------------------------------------
   Breakout to Downside (Stocks over $20)
 -------------------------------------------

Ticker    Company Name              Close  Change
SC        Shell Transport & Trading 46.50  -1.18
EPG       El Paso Corp              45.20  -2.90
CPN       Calpine Corp              30.10  -2.78
IVX       Ivax Corp                 30.59  -1.36
BVF       Biovail Corp.             44.00  -2.15
BRW       Broadwing Inc.            20.62  -1.13

  ------------------------------------------------------------
   Recently Overbought With Bearish Signals (Stocks over $20)
  -------------------------------------------------------------

Ticker    Company Name              Close  Change
TXN       Texas Instruments Inc.    33.66  -1.79
NOK       Nokia Corp Ads            20.10  -1.36
MER       Merrill Lynch & Co        53.60  -1.28
VRTS      Veritas Software          38.99  -4.19
SCM       Swisscom Ag Ads           27.15  -0.66
PSFT      PeopleSoft                39.51  -2.77

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