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Daily Newsletter, Thursday, 08/16/2001

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PremierInvestor.net Newsletter               Thursday 08-16-2001
                                                  section 1 of 2
Copyright  2001, All rights reserved.
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In section one:

Market Wrap: Only hint of today's rally was positive breadth
Market Sentiment: Back From the Brink
Play-of-the-Day: General Dynamics Corp - GD (Bullish)
Watch List:  Appears in Monday, Wednesday and Weekend Editions

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U.S. Market Numbers
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MARKET WRAP  (view in courier font for table alignment)
-----------------------------------------------------------------
       8-16-2001          High      Low     Volume Advance/Decline
DJIA    10392.52 + 46.57 10395.21 10271.57 1.06 bln   1681/1389	
NASDAQ   1930.32 + 11.43  1930.46  1879.07 1.59 bln   1755/1857
S&P 100   605.03 +  2.01   605.31   596.26   Totals   3436/3246
S&P 500  1181.66 +  3.64  1181.80  1166.08             
RUS 2000  481.68 +  2.73   481.68   474.06 
DJ TRANS 2864.22 + 30.56  2868.36  2826.41 
VIX        23.83 +   .06    24.81    23.42 
Put/Call Ratio      0.96
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===========
Market Wrap
===========

Only hint of today's rally was positive breadth by Jeff Bailey

Current market conditions are "perplexing" at best.  Earlier 
today in the "hot list" on OptionInvestor.com, I could only see 
one positive for technology.  Yesterday we noted that only 5 of 
the 100 stocks comprising the NASDAQ-100 finished in positive 
ground.  Even at today's worst levels, the NASDAQ-100 breadth 
showed 11 stocks trading in the green.  Two hours later, 22 
stocks were in positive territory.

What does this tell me?  When I started looking at the charts of 
those stocks that were in the green, the pattern than seemed to 
be most prominent was this.  The stocks that were showing some 
slight gains early were in the lower end of their trading range.

There was no sudden reversal in bond YIELDS to trigger the 
reversal.  There was no sudden reversal in foreign currencies 
against the US$.  Today's reversal in technology looked to be 
pure short covering by those that had shorted the upper end of 
the range.

This type of action makes it very tough for the trader that 
doesn't watch the market every minute of every day to make money.  
I sympathize with that.  For the most part, the bulk of the 
readership that reads this market wrap each day is swing traders 
or longer-term investors and the intra-day swings of the market 
just doesn't matter to them.  That's what I like about the point 
and figure charting system.  It really gives the bigger picture 
of what is going on, and the little intra-day swings like we had 
today (first to the downside and then back up) usually don't even 
raise an eyebrow.

With that said, I think it is in the best interest of subscribers 
here (swing-traders and longer-term investors) to be 
concentrating either on listed NYSE stocks, or some of the 
largest more liquidly traded stocks of the NASDAQ.  The reason 
for this is that these stocks are perhaps more "predictable" and 
less influenced by a few market makers.  This doesn't mean I 
can't use the retracement techniques we've been talking about in 
recent weeks to identify entry and exit points.  There were some 
stocks that found their reversals right at some retracement 
levels.  However, those retracement levels were little good if 
you weren't watching them, or had previously placed an order to 
buy/sell at that level.

Let's take a look at a couple of stocks that are listed as active 
trades on PremierInvestor.net on their point/figure charts.  
What's the risk and what's the ultimate goal?

Ballard Power - $1 box



Bearish traders have some nice gains riding in a bearish play 
profiled in the Stock Bottom portion of the newsletter on 
PremierInvestor.net for Ballard Power (NASDAQ:BLDP).  As this 
trade develops, risk/reward becomes tougher to ascertain at 
current levels.  A rally back to the $33-$35 range is not out of 
the question.  With the bearish price objective of $35 having 
already been met, I find it hard to give this trade a lot of room 
to work against me if I'm short.  A trader that is up 14% in the 
matter of days (profiled on Tuesday, 8/14 at $32.02) is looking 
at the NASDAQ Composites loss in the same time frame and saying, 
"I shouldn't necessarily be giving this stock the opportunity to 
rally back to where I entered the trade," (remembering that we're 
in a relatively range bound market).  At today's close of $27.08, 
You've "beaten the market" and it's time to reduce some risk from 
the trade.  Should the stock rally back up into the $33-$35 range 
and market conditions remain mixed, then you've replenished my 
cash reserves and perhaps ready for another round.  Jon Farnlof 
picked this play and should be rewarded for his analysis, but 
risk/reward is tough to ascertain from here.  When that's the 
case, it's time to get ready to lock in the gains and reward 
ourselves as well.

Vitesse Semiconductor - $1 and $0.50 box




Not every trade works out like we planned.  The Semiconductor 
Index (SOX.X) had sprung back to life in recent weeks and it sure 
looked like the risk/reward was favorable for a bullish trade in 
shares of Vitesse Semiconductor (8/10 $19.25).  At that time, the 
stock was on a "buy signal" after triggering the bullish triangle 
pattern at $19.50 the stock shot higher to $23.  The pullback 
near the $19 level looked to have some late bears covering, but 
recent broader market weakness found this stock hitting our stop 
at $17.  Unlike Ballard Power (BLDP) the current bearish price 
objective of $10.50 puts this stock in a 50/50 proposition.  The 
bearish trader looking to short the stock at $15.50 is now facing 
a potential rally to $18 and shorting right at a level of two 
previous reversal points.  The bullish trader might like the 
stock here with a stop at $15, but I'm not sure it's worth the 
risk if I end up holding the stock overnight and it gaps lower 
the next day.  The best plan here was to honor the stop at $17.  
If I were a trader still holding this stock and had not taken 
some type of action (sell the stock, write a covered call or buy 
a protective put) I'd give the stock a chance to NOT trade $15, 
but that would be it.  Shares of VTSS are no longer trading in 
unison with the Semiconductor Index (SOX.X) and new bullish 
positions should be avoided near-term.

Let's also learn something from our mistake here.  What could we 
have done to limit or negate our mistake?  One thing I always try 
to tell a trader/investor regarding trend.  If you're bullish a 
stock that is trading below bearish resistance, reduce your trade 
size.  I also liked shares of VTSS near the $19 level several 
days ago on OptionInvestor.com.  What I suggested there was that 
the stock had a favorable risk/reward profile, but the downward 
trend spelled of caution.  Traders that normally risk $5000 in a 
stock should par back to 1/2 position size as trend was against 
us (bearish resistance or red +).  The next thing we could have 
done is to "swear off" the trade all together until the stock 
proved it could get above bearish resistance.  This in itself is 
often times the best thing to do anyway.

How does that six-egg omelet taste?

In my August 2nd market wrap, I talked about a "six-egg omelet" 
and the top six weighted stocks of the NASDAQ-100 Trust (QQQ).  
Subscribers can go back and review that commentary if they wish 
and look at some of the charts and items we talked about at that 
time.  

I note that Microsoft (NASDAQ:MSFT) wasn't able to hold its 
bullish support at $65 and the stock did give the double bottom 
sell signal.  The shares of MSFT have not fallen apart at all and 
today's close of $64.62 is very close to where we were writing 
about the largest weighted stock in the QQQ.  The longer-term 
200-day moving average has been acting as support over the past 5 
sessions (at $62.66), but supply has slowly been outstripping 
demand.

We also talked about Oracle (NASDAQ:ORCL).  At that time, shares 
of ORCL were sitting right on top of bullish support trend at 
$18, but two days later, shares of ORCL broke that bullish 
support and the stock has fallen to as low as $15 on its 
point/figure chart.  Much like Microsoft (MSFT) we're seeing some 
bullish support trends in software stocks being broken to the 
downside.

Another chart we looked at on that day was Qualcomm (NASDAQ:QCOM) 
at the $68 level.  Since that time, the stock has traded lower 
and today's trade at $61 on its point and figure chart (intra-day 
low was $60.50) had this stock puncturing its bullish support 
trend (much like MSFT has done).

Just between these three stocks, we're seeing some eggs start to 
crack as it related to our August 2nd commentary.  All three of 
these big technology related stocks were trading above bullish 
support when we reviewed them.  All three have given a "sell 
signal" on their charts also.  Not one has shown the needed 
strength for this analyst to think the bull is running wild for 
technology stocks.  

"Big tech" as it relates to the 6 stocks mentioned on August 2nd 
aren't getting dismantled, but the lack of follow through still 
should have traders very cautious with many four-lettered stocks.

The stocks that seem to be acting relatively well and seem to be 
less inclined to being swung around are listed stocks.  Stocks 
like Nike (NYSE:NKE), Deere (NYSE:DE) and Office Depot (NYSE:ODP) 
are stocks that seem to find buyers on the pullbacks and then 
manage to work their way higher.

Perhaps their lack of perceived "excitement" is what has these 
stocks trading steady and acting strong.  

Office Depot (NYSE:ODP) caught my attention back on 07/19 when 
the stock gapped up out of a base on BIG volume of 6,000,000 
shares at $12.  I remember a similar situation back in February 
as it relates to volume, when Cendant Coproration (NYSE:CD) 
traded over 37 million shares at the $13.25 level.  At that time, 
the stock was just starting to get through its bearish resistance 
and the broader markets were trading lower.  Today, shares of CD 
trade $20.15.  If you get a chance, take a look at the point and 
figure charts at www.stockcharts.com of the stocks mentioned 
above.  For stocks you're looking at on your own, take a look at 
their supply/demand.

Today's "debacle" for Cienna (NASDAQ:CIEN).  Take a look at that 
point and figure chart there.  There were signs of weakness and 
I'm beginning to think I should simply ignore any attempt to 
trade a stock bullish that trades below bearish resistance.  
Heck... even some of the big tech in our six-egg omelet are 
having trouble finding the needed sponsorship at their bullish 
supports.  If that's the case (and it is), then there is still a 
lot of work to be done for a tech turnaround to take place.

For the trader that just can't watch things on a hour-by-hour 
basis, its probably best to seek out some stocks with favorable 
supply/demand charts that are bullish and trade those long.  
Don't be opposed to mixing in a short every now and then, but 
when you get a nice gain in a day or two, lower that stop and 
remove some risk from the trade.

Continue to monitor the six stocks mentioned on August 2nd in the 
"six egg omelet."  So far their action has pretty well summed up 
the recent trading and direction of the NASDAQ and broader 
technology and should continue to give technology traders a feel 
for the current environment.  I'd say they all spell of 
uncertainty.  It's been my long-held belief that the MARKET hates 
uncertainty and tries to avoid it whenever possible.  For a 
trader/investor that can't watch the market closely, that sounds 
like good medicine for now.


************************************
NOVEMBER STOCK & OPTION TRADING EXPO
************************************

I am really excited to announce our biggest Denver Stock
and Option Trading Expo ever. Over fifteen speakers from
many different trading environments. Jon Najarian, Dr "J"
on the CBOE, David Nassar, Tim Truebenbach, Russ Wasendorf,
Patrick Lafferty, Don Bright, Joe Lombard, Robin Dayne, 
Carolyn Boroden, to name just a few. Of course Austin 
Passamonte, Jeff Bailey, Jon Farnlof, Buzz Lynn, Eric Utley
and myself will also take center stage. We have changed the 
format to a weekday schedule instead of a weekend in order to 
do real time trades and analysis every day. Bring those laptops 
as WE WILL ALSO HAVE INTERNET ACCESS AVAILABLE FOR ALL ATTENDEES 
in the main hall so you can follow our research and trades as 
well as trade yourselves. This is also EXPIRATION WEEK and
we will be taking full advantage of cheap options and
expected market swings. In order to move to an open market
format we had to change the date to November 12-16th. Make
the change on your calendar and plan on being there! Could
you actually make enough trading that week to pay for the
seminar? That is of course up to you but it will not be
due to a lack of opportunity! Seating is limited, sign up now!

http://www.premierinvestorseminars.com/expos/oi_fall01.asp


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

Back From the Brink

Once again the market was able to pull itself back from the brink 
of disaster, and finish the day in positive territory.  In the 
morning the focus was on poor future guidance from Ciena and 
Brocade.  Perhaps it was some short covering, program buying, or 
traders deciding to focus on some of the positive economic news, 
but the major indices managed to finish in positive territory.  
Housing starts came in better than expected, the unemployment 
picture improved, and the CPI showed no signs of inflation, which 
allows the Fed to cut interest rates as needed.

S&P 500 Daily Chart




For the fourth time in 5 weeks, the S&P 500 tested 1,177, the 
61.8% retracement of the April to May gains, and rallied to close 
above it.  No bounce off of this level has gone higher than 
1,230, and the last one was especially weak, failing to clear 
1,204.  For today's move to have any credence, we need some 
follow through tomorrow.  Momentum would have to build off of 
that to clear resistance in 1,204 to 1,211 range. 


Nasdaq Composite Daily Chart



The late-day rally in the Nasdaq came up a little shy of the 
previous support area at 1,934.  If that level doesn't act as 
resistance tomorrow, perhaps the Nasdaq could approach 2,000 over 
the next few days.  Testing 2,100 would be the longer-term, more 
optimistic target.

Buying stocks when the situation looks bleakest has worked over 
the past few months, but in order for stocks to get a bounce 
going tomorrow, they are going to have to fight past a gloomy 
outlook from Dell, HP, and Gap.  Should that happen, the best 
bounce scenario for the S&P 500 looks like a 4% gain.  Bears 
still have the longer-term upper hand, but way want to consider 
lowering some stops should a bounce mount.  

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

Market Volatility

VIX   23.83
VXN   50.64

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

          Put/Call Ratio  Call Volume   Put Volume
Total           .96        680,315       653,498
Equity Only     .85        532,716       453,303
OEX            1.18         32,792        38,551
QQQ             .90         66,132        59,517

The total and equity only put/call ratios have hit levels that 
can mark a possible bullish turning point, but I am a bit 
skeptical due to options expiration.

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

Bullish Percent Data

           Current   Change   Status
NYSE          34       -      Bear Confirmed
NASDAQ-100    40      -2      Bear Confirmed
DOW           36       -      Bull Alert
S&P 500       54       -      Bull Confirmed  

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

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

The 10-Day Arms Index has reached a point that usually signals a 
bottom.  This signal tends to be early, and doesn't mean the 
market is going to rally tomorrow.

 5-Day Arms Index  1.23
10-Day Arms Index  1.52 
21-Day Arms Index  1.32
55-Day Arms Index  1.26

Extreme readings above 1.5 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      1680           1393
NASDAQ    1755           1862

        New Highs      New Lows
NYSE      156             53
NASDAQ    102            184

        Volume (in billions)
NYSE     1.060
NASDAQ   1.608

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

Advisory Sentiment 

Bullish  Bearish  Correction   Net   Change 
  46.0%    27.0%     27.0%    19.0%   +0.4%

A bearish reading of 25% to 30%, combined with a bullish reading 
greater than 55% is typically considered bearish by contrairians.  
A net percentage greater than 30% is also viewed as bearish. 

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

Commitments Of Traders Report: 08/07/01
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. COT data 
can be found at www.cftc.gov.

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
The net bearish position of commercial traders increased slightly, 
but that was the result of more long positions being dumped than 
short positions, and not a significant amount of new shorts being 
added.  The % of Open Interest for small traders is at bullish 
levels similar to February and March.

Commercials   Long      Short      Net     % Of OI 
7/24/01      317,241   392,146   (74,905)   (10.56%)
7/31/01      335,532   409,352   (73,820)   ( 9.91%)
8/07/01      331,881   406,210   (74,329)   (10.07%)


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
7/24/01      141,372     61,665   79,717     39.26%
7/31/01      129,648     54,552   75,096     40.77%
8/07/01      128,454     53,191   75,263     41.43%

Most bearish reading of the year:  36,513 - 5/01/01
Most bullish reading of the year:  91,122 - 3/06/01
 
NASDAQ-100
Commercial traders added a few long positions and dropped a few 
shorts, but the most encouraging sign is the fact that small 
traders are starting to give up hope.
 
Commercials   Long      Short      Net     % of OI 
7/24/01       27,396     39,198   (11,802)  (17.72%)
7/31/01       28,009     39,613   (11,604)  (17.16%)
8/07/01       28,867     38,956   (10,089)  (14.88%)

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
7/24/01       12,170     7,744    4,426      22.23%
7/31/01       11,216     8,938    2,278      11.30%
8/07/01        9,715     8,098    1,617       9.08%

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
Commercials continue to get slightly more bullish, small traders 
continue to get more bearish.

Commercials   Long      Short      Net     % of OI
7/24/01       16,080    12,812    3,268     11.3%
7/31/01       17,748    13,669    4,079     13.0% 
8/07/01       18,644    13,733    4,911     15.2%

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     % of OI
7/24/01        5,599     9,526    (3,927)   (25.96%)
7/31/01        5,049     9,079    (4,030)   (28.52%)
8/07/01        4,841     9,909    (5,068)   (34.36%)

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 (Bullish)
=========================

General Dynamics Corp - GD close: 83.24 change: +1.39 stop: 79.00
	
Original Comments When Selected on August 9th:

Company Description:
Falls Church, Virginia-based defense manufacturer operates in four 
primary areas: marine (warships and nuclear submarines), aerospace 
(business jets), information systems and technology (command and 
control systems), and combat systems (tanks and amphibious assault 
vehicles).  Almost 60-percent of its revenue comes from the US 
government, and it is the largest shipbuilder for the US Navy.  The 
company's Bath Iron Works subsidiary builds the Navy's class DDG 51 
destroyers.  Another subsidiary, Electric Boat, builds Seawolf 
class attack subs.  The company's Land Systems subsidiary builds 
the M1 series tank.  GD has been focusing on its commercial 
aircraft and defense-related electronics operations, but it's also 
expanding into munitions for tanks and other weapons systems.  The 
company has announced a tender offer good through August 17th of 22 
million shares for rival Newport News Shipbuilding (NNS).  This 
equates to approximately $2.1 billion, or 10 times operating 
earnings.

Fundamentals: 
Analysts forecast the firm will earn $4.56 per share on sales of 
$11.9 billion and $5.17 on $12.5 billion in 2002.  Last year, the 
company earned $4.03 on $10.4 billion.  This gives the company a 
current P/E of 20.8 and a forward 2001 one of 18.  This is inline 
with the industry average P/E of 20.  Other fundamental industry 
comparisons are gross profit margin (company: 23.89-percent, 
industry: 19.48-percent), return on equity (24.4-percent, 4-
percent), price/sales ratio (1.55, 0.89), price/book ratio (4.18, 
2.58), price/cash flow ratio (14.42, 11.65) and debt/equity 
ratio(0.28, 0.87).   

Why We Like It: 
This defense monster has one of the best balance sheets in the 
industry and strong cash flow.  The shares have been consolidating 
just short of resistance at $84 in a range of roughly $84 to 
$81.50.  On Thursday, the shares put in a strong day from the 
opening bell through to the close with nary a dip in-between.  
Volume spiked from 595k on Wednesday to 920k on Thursday.  This is 
consistent with other recent bullish indications; as the shares 
have consolidated, on down days volume has been consistently lower 
than on up days.  Taken as a whole, it looks as if the bulls are 
gearing up for another run at besting $84.  Conservative traders 
can wait for a close above $85 before taking a position.  Our 
longer-term price objective is $95; intermediate resistance is at 
$88.00.  We will begin with a stop at $79. 

Updated Comments:
The race to buy Newport News Shipbuilding (NYSE: NNS) has been a
close one between GD and Northrop Grumman (NYSE: NOC).  Yet so 
far, GD had appeared to have the edge over NOC.  On Wednesday,
the U.S. Defense Dept. announced that it wants more data from both
companies on their rival $2.1 billion bids.  The gov't believes
any decision could be months away and this may have been dis-
appointing for GD investors.  Despite the news, the stock continued
to slip to its support level at $81.50 before bouncing higher
this afternoon.  On Tuesday we had mentioned this was a likely 
scenario and a possible entry point for new long positions (that
is buying on a bounce at 81.50).  Current resistance is its 52 
week high above $85.  Volume was above average today and we would
expect bulls to push the stock higher if the market permits.

Picked on August 8th @ $  83.85
Gain since picked:      -  0.61
Earnings Date:         10/17/01 (not confirmed)





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Do not duplicate or redistribute in any form.


PremierInvestor.net Newsletter                Thursday 08-16-2001
                                                   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/1730_2.asp
=================================================================

In section two:

Split Trader
  New Plays: Lennar Corp - LEN (Bullish)
  Play Updates: AHC, GD
  Closed Plays: SSP

Net Bulls
  New Plays: Integrated Silicon - ISSI (Bullish)
  Bullish Play Updates: Univ. of Phoenix - UOPX
  Bearish Play Updates: PSFT, VRSN 
  Closed Plays: VTSS

Stock Bottom / Active Trader
  New Plays: none
  Bullish Play Updates: NEM, PEP, RAIL
  Bearish Play Updates: BLDP
  Closed Plays: BZH 

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

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

  -------------------------
  New Split Candidate Play
  -------------------------

Lennar Corp - LEN Close:$40.66 Change:+2.15 Stop:$38.00

Company Description:
Lennar is one of the nation's largest homebuilders after 
industry leader Pulte Homes.   The company builds homes in the 
$100,000 to $1 million range for all types of homebuyers from 
first-timers, move-ups and retirees.  Its US Homes acquisition 
expanded operations to a total of 13 states.  The company 
buildes homes under name brands such as; Lennar, US Homes, 
Greystone Homes, Village Builders and Renaissance Homes.  The 
firm also offers title and mortgage services. 

Fundamentals: 
Analysts expect US Homes to earn $5.28 per share on sales of 
$5.6 billion in the current fiscal year ending in November, 
$5.75 on $6.2 billion in 2002.  Last year, they earned $3.64 on 
sales of $4.7 billion.  Even though Lennar estimated earnings 
growth over the next five-years at 15-percent is expected to 
outpace the industry average of 13.61 - the shares are 
undervalued with a forward P/E of 8 when compared to the 
industry average P/E of 11.

Why We Like It: 
Shares of homebuilders have been dropping on the assumption 
that last Thursday's report on new residential construction 
would be a dog.  Instead, a reasonably positive report suggests 
that Americans are not letting the economic blues deter them 
from moving into their dream home.  This knocked the bears off 
their game and turned homebuilders shares over to the bulls.   
Lennar is attractive to us for three reasons; first, it is well 
undervalued as compared to its peers. Second, despite recent 
weakness the shares are still in a long-term up trend and 
lastly, the shares are just above support from the lower trend 
line and the 200-day moving average at $38.80.  This sets up a 
play with an attractive risk/reward ratio.  To the downside our 
$38 stop is just below significant support leaves us with 
minimal downside exposure.  Yet if the bulls really get running 
the upside is solid with resistance at $45 and $50.  Given the 
trend less nature of the markets we will look to tighten up our 
stops once we can pocket a 10-percent gain. 

Picked on August 16th at $40.66
Earnings Date              9/19 (Not Confirmed)





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

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

Amerada Hess - AHC - close: 78.13 change: -0.77 stop: 74.25

The price of oil barely moved today but shares of AHC saw a $2
swing but managed a strong bounce by the close.  This morning's
sell-off and late day recovery was mirrored in both the PHLX
Oil Service Sector, OSX, and the CBOE Oil Index, OIX.  The stock
continues to have a bullish bias with the recent number of higher
lows.  Resistance remains at the 50-dma of 78.70 and the $79.25 
level we mentioned on Tuesday.  Wait for confirmation and a close 
over $79.25 before evaluating a new long position.

Picked on August 15th @ $ 78.90
Gain since picked:      -  0.77
Earnings Date:             N/A  (not confirmed)




---

General Dynamics - GD - close: 83.24 change: +1.39 stop: 79.00

The race to buy Newport News Shipbuilding (NYSE: NNS) has been a
close one between GD and Northrop Grumman (NYSE: NOC).  Yet so 
far, GD had appeared to have the edge over NOC.  On Wednesday,
the U.S. Defense Dept. announced that it wants more data from both
companies on their rival $2.1 billion bids.  The gov't believes
any decision could be months away and this may have been dis-
appointing for GD investors.  Despite the news, the stock continued
to slip to its support level at $81.50 before bouncing higher
this afternoon.  On Tuesday we had mentioned this was a likely 
scenario and a possible entry point for new long positions (that
is buying on a bounce at 81.50).  Current resistance is its 52 
week high above $85.  Volume was above average today and we would
expect bulls to push the stock higher if the market permits.

Picked on August 8th @ $  83.85
Gain since picked:      -  0.61
Earnings Date:         10/17/01 (not confirmed)





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

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

E W Scripps - SSP - close: 68.99 change: -0.36 stop: 69.00 

The fourth down day in a row has stopped us out at $69.  There 
has been no news on the company.  Investors were probably just
taking some money off the table of their recent winners to 
protect from any future downside in the market.  Yesterday 
was the real warning flag for position holders when shares 
slipped below the $69.50 level as cautioned by us on Tuesday.

Picked on August 2nd @ $  70.21
Gain since picked:      -  1.21
Earnings Date:          7/12/01 





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

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

  --------------
  New Long Play
  --------------

Integrated Silicon - ISSI Close: $15.10 Change: 0.55 Stop: $13.50

Company Profile:
ISSI designs, develops and markets high-performance memory devices 
including static random access memory (SRAM),specialty dynamic 
random access memory (DRAM), and nonvolatile memory (NVM). 

Fundamentals:
For the 6 months ended 3/31/01, revenues totaled $117.3M, up from 
$53.3M. Net income totaled $29.5M, up from $3.9M. Revenues reflect 
increased unit shipments of SRAM products. Earnings also reflect a 
$22.5M gain on the sale of investments.  Analysts expect company 
earnings to decline from +$0.94 in 2001 to a +$0.63 in 2002.  The 
current P/E ratio is 11.27 and the forward P/E ratio is 16.

Strategy:

Three days of increasing upside volume have driven shares of ISSI 
to the brink of short-term resistance just above $15.00.  And 
buying interest has propelled the 20 DMA through the 200 DMA just 
yesterday.  This during a week that has seen most things tech get 
hammered, particularly semiconductors amid negative guidance and 
revised earnings estimates.  But, shares of ISSI have held fast 
and current technical indicators suggest that the stock is strong, 
despite the continued downturn in the sector.  Analysts believe 
that wireless providers may be close to seeing a bottom in their 
sales figures and, with a major portion of the company's business 
coming from this sector via contract manufacturers, ISSI looks 
ripe for the picking.

Take a look at the daily chart for ISSI and you're sure to notice 
that the stock is rather volatile on a percentage basis.  Our 
approach for this recommendation involves the use of a relatively 
tight stop at $13.50 with target prices above the recent highs 
that now represent resistance at $16.00.  The COMPX will likely 
need to cooperate and, if it does, we see a short-term exit price 
just above the $16.00 level.  Longer term, we're looking for a 
move to $18.00 and would consider this the perfect place to exit 
the trade.  Once again, set your stop under the 100 DMA of $13.82 
so as to allow the stock some trading room and prevent the trade 
from stopping out.


Picked on August 16th $15.02
Earnings Date          10/14 (Unconfirmed)





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

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

Univ. of Phoenix - UOPX - close: 35.97 chg: +1.07 stop: 33.50 *new*

Rising share prices on rising volume!  It doesn't get much better
than that.  Volume today was 409K vs. the average of 153K while 
shares gained another 3 percent.  Even though the MACD is about to
turn positive again we're concerned that the 12 percent move up 
from its low a few days ago may be too tempting to just leave on
the table.  Tomorrow will be a test.  Shares closed right at the
descending trendline starting with the 52-week high made in July.
This could be potential resistance.  Add that to the odds of some
profit taking on another summer Friday and we expect the stock to
pullback tomorrow.  Optimistically, we hope that if a pullback 
does occur we'll see a bounce somewhere between here and $34.
We are going to raise the stop on the stock to 33.50 which is a 
quarter above our entry price to protect capital.  Our upside
target remains at $38.

Picked on August 13th @ $33.25
Gain since picked:      + 2.72
Earnings Date:             N/A  





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

PeopleSoft - PSFT - close: 38.19 change: -0.90 stop: 40.00 *new*

Thursday was a very interesting day for shares of PSFT.  Gapping
lower, shares fell below $36 before doing a complete reverse 
course to close just below the opening price.  Last Friday we
warned that the next true hurdle for PSFT bears was the 200-dma
then at 38.20.  Funny, that's exactly where shares closed today
(give or take a penny).  The 200-dma remains a sticking point 
for shorts to overcome.  Without any positive news to buoy the
stock we looked at the GSO software index.  The GSO showed a 
similar pattern of selling off early in the day only to rebound
by the close.  Not satisfied we looked at the two largest 
components of the GSO index MSFT and ORCL; who together account 
for almost 20% of the index.  We were not surprised to see that
both MSFT and ORCL posted positive days which we felt accounted
for a lot of the strength in the GSO which surely influenced
trading in PSFT.  So what are, as traders, to do?  We still 
expect weakness in PSFT but considering its potentially oversold
position want to be prepared for any relief rally in the stock.
That means we're going to tighten our stop to $40 and protect 
some of our profits.  If the stock rallied up towards $40 and
rolled over again we'd consider new short positions but with the
doji candlestick pattern created today we should take a wait and
see attitude to any new decisions in this play.  At the moment,
our $4 profit in the trade looks tempting and we wouldn't be
the only ones looking to cover our shorts before the weekend.

Picked on August 7th @ $42.38
Gain since picked:     + 4.19
Earnings Date:           N/A  




---

VeriSign - VRSN - close: 47.65 change: +1.58 stop: 52.50

You've heard it before and you'll hear it again.  Nothing moves 
in a straight line when it comes to stocks.  Identifying trends
is part of the game and VRSN is definitely in a downtrend.  Yet
this still means we'll see up days as relief rallies or short
covering.  The stock has filled the gap it created in late July
but the selling pressure continues.  Not surprisingly, $45 has
become the current level of support but if the trend continues
we still expect the stock to hit $42.50 (or even $40).  While
we are profitable in the play be prepared for a second up day
in this relief rally.  New positions should be considered if the
stock fails at $50 (shares run up and then roll over at the $50
mark).  The MACD just recently turned negative a few days ago
which is confirming the downward trend.

Picked on August 14th @ $48.98
Gain since picked:      + 1.33
Earnings Date:            N/A  





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

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

Vitesse Semi. - VTSS - close: 15.97 change: -1.70 stop: 17.00

Yet again, the warning flag went off yesterday when the SOX 
dropped over 20 points.  Wednesday's dismal performance set off
our alarms but eternal bulls kept hoping the NASDAQ would finally
turn green.  Their hope was fulfilled today with a paltry 11 
point gain for the NAZ but our play on VTSS was doomed with 
a faulty earnings warning report on CNBC about VTSS.  CNBC later
retracted their statements but the damage was done and VTSS 
ended the day down almost 10 percent.  To be honest, we don't
know when the false report aired on CNBC and the newsletter's 
play was stopped out at 17.00 early this morning.  Strong support
should exist for VTSS between 15.25 and 15.50 so patient 
investors interested in following this stock might want to watch
for a rebound and hope for a new rally back to $20.

Picked on August 10th @ $19.25
Gain since picked:      - 2.25
Earnings Date:            N/A  





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

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

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

Newmont Mining NEM Close:$20.45 Gain:+0.08 Stop:$20.40 NEW

The Gold Index broke through a resistance level today, and Newmont 
held above its recent resistance level at $20.64.  The key to gold 
has been the strength of the Euro.  As this currency trades higher, 
so will gold stocks.  We are moving our stop up to $20.40.

Picked on July 14th at $20.50
Gain since picked:      +0.64
Earnings Date            11/1/01 (unconfirmed)




---

Pepsi PEP Close:$45.95 Gain:+0.39 Stop:$45.00 NEW

Pepsi gained 39 cents today, but couldn't break free of recent 
congestion zone.  Closing above $36 would do that.  Today's gain 
could have been partially limited by a proposed tax of food in 
Mexico, Latin America's second largest country.  We are moving our 
stop up to $45, just below the 50 and 200-day moving averages, to 
limit our risk, but give Pepsi enough room to move. 

Picked on August 10th at $45.66
Gain since picked:        +0.29
Earnings Date               N/A




---

RailAmerica RAIL Close:$13.55 Gain:-0.03 Stop:$12.90

For the past four days this stock has been trying to break through 
resistance at $14.00.   The Dow Jones Transportation Index has been 
consolidating at support for the past few days.  Transport breaking 
out to the upside might be the catalyst RAIL needs to get through 
resistance.

Picked on July 14th at $11.41
Gain since picked:      +2.14
Earnings Date            N/A





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

Ballard Power - BLDP Close: $27.00 Change: -2.17 Stop: $29.50 new

Two days and a 16-percent gain is sweet, but its time to protect 
those gains with $29.50 stop.  A good case could be made to close 
this one right out as the shares are approaching the $32.75 52-
week low, but if the shares can break through then the bottom 
could be a long way off.  If you are already in this play, make 
your choice according to your tolerance for risk.  If you are not 
in this play, you need to wait for the break.  Before you make any 
decision, be certain to read our master strategist Jeff Bailey's 
take on this play in today's Market Wrap.

Picked on August 14th $32.02
Gain Since Picked      +5.02
Earnings Date          11/06 (Unconfirmed)





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

  -----------------
  Closed Bearish Play
  -----------------

Beazer Homes BZH Close:$65.40 gain:+2.13 Stop:$65.00

Housing data came in stronger than expected, and we were stopped 
out of our bearish play in Beazer Homes.  Building permits did 
fall significantly, suggesting this could only be a bounce in 
homebuilding stocks before a further decline.

Picked on August 6th at $65.08
Gain since picked:       +0.08
Earnings Date             N/A





==================
  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
ABN    ABN AMRO Holding                    $18.50      +0.87
TEO    Telecom de Argentina                $10.12      +0.67
WBST   Webster Financial                   $37.06      +0.63
TK     Teekay Shipping                     $35.70      +0.60
MW     Men's Wearhouse                     $26.42      +0.52
OSG    Overseas Shipholding Group          $26.86      +0.78

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

Ticker    Company Name                      Close      Change 
TSFG   South Financial Group               $19.95      +1.21
DRQ    Dril-Quip, Inc                      $19.33      +1.23
NFLD   Northfield Laboratories             $19.84      +2.89
URBN   Urban Outfitters, Inc               $13.40      +1.86


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

Ticker    Company Name                      Close      Change 
MCD    McDonald's Corporation              $29.70      +1.21
GWW    W.W. Grainger, Inc                  $40.92      +0.35


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

Ticker    Company Name                      Close      Change 
FTE    France Telecom                      $39.84      -1.13
ENE    Enron Corp                          $36.85      -3.40
CAJ    Canon, Inc                          $34.05      -1.11
TV     Grupo Televisa, S.A                 $38.46      -1.57
CLS    Celestica, Inc                      $40.54      -1.52
ACF    AmeriCredit Corp                    $56.87      -3.82


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

Ticker    Company Name                      Close      Change 
DEO    Diageo plc                          $41.27      -0.75
HI     Household International             $66.87      -1.08
MRBK   Mercantile Bankshares               $43.00      -0.20
PCSA   AirGate PCS, Inc                    $55.00      -2.14
DOM    Dominion Resources                  $20.30      -1.22

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