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Daily Newsletter, Thursday, 08/23/2001

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PremierInvestor.net Newsletter                Thursday 08-23-2001
                                                  section 1 of 2
Copyright  2001, All rights reserved.
Redistribution in any form is strictly prohibited.

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In section one:

Market Wrap: Market, sector and stock, will biotech rock?
Market Sentiment: One Up, One Down 
Play-of-the-Day: ImClone Systems Inc. - IMCL (Bullish)

-----------------------------------------------------------------
U.S. Market Numbers
-----------------------------------------------------------------
MARKET WRAP  (view in courier font for table alignment)
-----------------------------------------------------------------
       8-23-2001          High      Low     Volume Advance/Decline
DJIA    10229.15 - 47.75 10286.79 10213.52 1.03 bln   1345/1744 
NASDAQ   1842.97 - 17.84  1883.48  1842.51 1.30 bln   1303/2348
S&P 100   592.93 -  1.75   596.81   592.67   Totals   2648/4090
S&P 500  1162.09 -  3.22  1169.86  1160.96             
RUS 2000  473.42 -  3.76   479.82   473.39 
DJ TRANS 2797.01 -  4.91  2806.30  2794.09 
VIX        24.92 -   .17    25.91    24.64 
VXN        49.26 -  1.83    54.16    48.40
Put/Call Ratio      0.64
-----------------------------------------------------------------

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

Market, sector and stock, will biotech rock? by Jeff Bailey

Today's 4.29% gain in the biotechs may not be over.  Some 
interesting developments took place and some market, sector and 
stock comparisons can put traders on the right side of the trade.

Here's a fairly "simple" technique that traders and investor can 
perform on their own to get a feeling for some fairly meaningful 
short-term shifts taking place in the biotech sector.  Was 
today's move in the biotechs for real?  Time will tell, but 
there's some signs that this might well be the group for bullish 
traders to be focusing on in coming weeks.  Remember... the 
longer-term begins with the short-term.

Let's take a look at the Biotechnology Index's (BTK.X) relative 
strength versus the S&P 500.  If we believe that the S&P 500 is a 
fairly accurate representation of the broader market, then 
bullish traders would want to see the group outperforming the S&P 
500 Index or showing good relative strength.  If the group is 
showing strength, then we can begin trying to pinpoint stocks in 
the group that look to be leaders in the group.

Relative Strength of Biotech vs. S&P 500



The "45" level is not a dollar price.  It's simply a unit of 
measure by which to chart the relative strength of the BTK.X vs. 
the SPX.  Relative strength is calculated by taking the BTK.X 
trading level and dividing it by the SPX trading level.  Example 
could be today's closing prices.  The BTK.X closed at 531.7 and 
the SPX closed at 1,162, therefore (531.7/1,162= .4575)  We could 
multiply that result by 100 to get a chartable value of 45.75.  
That 45 level was enough to have our chart reversing a meaningful 
amount (3-box reversal) to 45 and get the relative strength chart 
back into a column of X's.  We're now alert to a relative 
strength change in the biotech sector vs. the S&P 500.  The can 
be VERY IMPORTANT for traders looking long the sector AND for 
traders holding short/put positions in the group.

Traders that are short/put some stocks in this group are now 
alert that there may be a change in posture taking place in the 
market toward the biotechs that is more bullish than bearish.

Now that we're alert to strengthening in the group, we must 
understand the future impact of MARKET direction.  Relative 
strength MUST be understood!  Just because a group of stocks is 
showing good relative strength DOESN'T mean it will show price 
appreciation.  What if the BTK.X just sits here at 531 and the 
SPX dives lower from today's close of 1,162 to 1,000?  Relative 
strength for the BTK.X would show strength, but the sector hasn't 
moved has it?  The reason a trader should be looking long the 
group is this.  Since the BTK.X is showing relative strength 
gains, what might the sector do if the SPX.X moves higher from 
1,162 to 2,200?  I'm thinking that a group that is just beginning 
to show strength might benefit the most on an upward move!  
That's where a bullish trader wants to be.

So why point this out?  Today's shift in relative strength puts 
us on the alert that the biotechs may be a leader in the next 
market rally and a place where the odds of findings higher prices 
is greater than in some other parts of the market.  Smart bulls 
usually try and concentrate on areas of the market where there is 
strength, while smart bears often avoid such areas of the market.  
This is key for traders that believe in the laws of supply and 
demand.

We know from trade/account management that we want to start with 
some "toe dipping" and perhaps take some partial positions.  
Again... the market environment is what I'd consider negative and 
if I'm looking long, I want to be partially positioned in a group 
just starting to show strength relative to the market.

OK... now that we've found one sector (there are others) of the 
market that is strong relative to the market, it makes sense that 
we begin looking for stocks that are strong RELATIVE to the 
sector!  That's right!  We've tackled the market/sector portion, 
now let's work down the scale and tackle the sector/stock 
portion.  By default, if the sector is strengthening vs. the 
market, then finding a stock strong relative to the sector puts 
that stock in the upper echelon of stocks in the market.

I didn't "pick" today's new bullish play for the Net Bulls 
section (Jon Farnlof did), so I'm going to critique that bullish 
play in shares of Techne Corporation (NASDAQ:TECH).  This perhaps 
is the way every subscriber should "critique" any stock profile 
bullish/bearish on our play lists with the techniques we're 
trying to teach along the way.  Let's take a look at the relative 
strength of Techne Corp. (TECH) vs. the BTK.X.  One might argue 
that shares of TECH should also be considered "healthcare" as it 
relates to sector.  This is a valid argument and may explain why 
the stock trades the way it does.  The company does distribute 
products for both healthcare and biotech industry.

Relative strength Techne Corp. vs. Biotech Index



On the above chart, I've placed red horizontal bars at 
"resistance" levels where we saw a reversal lower in relative 
strength of TECH vs. the BTK.X.  These "resistance" levels are 
where relative strength "buy signals" occur when the stock shows 
greater relative strength vs. the sector.  From the left, we see 
that shares of TECH gave 6 different types of "buy signals" on 
relative strength as benchmarked back to other levels.  
Eventually (in mid/late May, red 5) TECH had given a relative 
strength "sell signal" and the gig was up.  Any takers on a bet 
that the biotech sector started seeing weakness in late May or 
early June also?

Now what do we see?  In late June/early July the relative 
strength chart whipped around (red 7 is first entry in month of 
July) near the 48 level on the chart.  Make note of this as we 
will use this as a time reference on the actual point/figure 
chart for TECH.  Since that time, shares of TECH have given four 
different levels of "buy signals" as it gets stronger vs. the 
BTK.X based on past history levels.  This stock sure looks like a 
potential leader to me.  Now, let's see if there is anything we 
can use in the actual point/figure chart of TECH that helps 
confirm what we're seeing in the relative strength chart.  
Remember!!!  A stock can show improvement in relative strength if 
the index we're benchmarking against trades lower.  I want to see 
something in the actual point/figure chart of TECH that tells me 
demand is in control of the stock!  Jon Farnlof might be onto 
something here.

Techne Corp. Chart - $1 Box



Oh my!  Triple top buy signal above bearish resistance.  Relative 
strength strong vs. the sector and the SPX.  Current bullish 
vertical count of $48.  I think the stock's worth a shot for 1/2 
position long.  Should the SPX continue to decline, at least the 
stock has shown that it can hold up and at least stands a chance.

Now for today's play of the day.  Try using the above comments 
with shares of ImClone Systems (NASDAQ:IMCL).  Don't load the 
boat in biotech, but understand what is taking place.  If you get 
a chance, go back to the August 9th Market Wrap.  Understand the 
stock we were talking about (Geron Corporation, GERN).  
Understand what sector that stock belongs to (biotechnology).  
Understand the bearish resistance trend and what took place in 
GERN on break above $15.50 (quadruple top and breaking of bearish 
resistance.)  Do you see some of the domino effects taking place?

OK... what to look for in coming sessions.  

Now is a great time to review Friday, August 10th Market Wrap 
(after you review August 9th Market Wrap).  I think my commentary 
on August 10th is just as important, especially as it relates to 
relative strength (you'll perhaps see why I chose "bullish 
semiconductor" and "bearish software")  

Relative strength for semiconductor index needs to turn pretty 
soon or it will go on a sell signal on its relative strength 
chart. (You can get free relative strength charts at 
www.stockcharts.com)

Today I really want to see the software sector get flushed and 
today's late action gives the MARKET the opportunity to do so.  
It's a perfect set-up to take the GSO.X to a new 52-week low, and 
suck in a bunch of late shorts that have watched stocks in the 
group decline over the past couple of weeks.  I'd look to lock in 
some gains in the sector for those stocks that have gotten tally 
whacked in recent sessions.  I see our stop was triggered on 
PeopleSoft (NASDAQ:PSFT) today.  That's OK as it created a profit 
for our subscribers and that's important.  The MARKET doesn't 
have to flush the software stocks tomorrow anyway.

Why might the software stocks get flushed?  I have no clue, other 
than to point at the 30-year YIELD at 5.403% and a close at the 
session low.  You could really feel the market get "worried" over 
something in the FOMC notes today about the slowing economy and 
further rate cuts.  Watch the 30-year YIELD near the 5.346% 
level.  That's a level where I think we could see a good round of 
selling in that bond (selling would have YIELD then rising) and 
could trigger a reversal just as the software stocks are getting 
"flushed."  Please understand, this is a scenario I'm laying out.

As Software stocks get flushed (I'm talking generalities here in 
the GSO.X) keep an eye on some of the biotech stocks.  Right now 
we're only suggesting 1/2 positions bullish.  The reason we're 
doing this is just in case we see YIELDS dive lower and software 
stocks get "flushed" you can almost bet that biotechs will see 
some selling pressure from the nervous Nellies that sell their 
winners (biotech and semiconductor stocks) as they hold onto 
their software stocks that are getting drilled.  Relative 
strength between the biotechs and semiconductor and software 
stocks are all at different stages.  

The software sector is on a road to nowhere (weak vs. the SPX), 
the Semiconductors are at the fork in the road (have given a 
relative strength buy signal, but currently on a pullback), and 
the biotechs look to be taking the high road (relative strength 
is strong vs. SPX and giving buy signals).  Do you get the feel 
for the different stages?

I have some very simplistic thoughts on why the biotechs are 
finding sponsorship.  My primary thinking is that "the cure for 
cancer and other life threatening disease is not limited by the 
economy."  Fund managers are smart and may simply be looking to 
dodge economic uncertainty and the technology guys are going to 
the sector.

Perhaps semiconductor stocks are holding in there because smart 
money does think there's a chance that inventory levels really 
are getting cleared out and the recent book/bill ratio is 
signaling the bottom.

Software is too dependent on IT budget spending and we're still 
hearing (FOMC meeting) that corporations still aren't spending, 
so smart money is just staying away unless the stock has been 
oversold and offers long-term valuation.  I don't know about you, 
but I want to be positioning myself where I can make money near-
term.  Once relative strength starts to improve, then I'm 
interested.

I've covered a lot of stuff tonight and this only scratches the 
surface.  I like to go back and review my commentary, try to see 
what has worked, what hasn't and adjust my thinking.  So far I 
like what I see.  Yes, if I made all my bets long in the 
Semiconductor sector, I'm probably not doing that well.  But if I 
played things close to the vest, perhaps shorted/put some 
software stocks in the meantime, I'm pretty close to break-even 
or profitable.  It's difficult to say for sure, as stock 
selection is key.  Not every software stock short/put has been a 
winner I'm sure, but the group direction has helped.

Watch those YIELDS.  That's the one thing in this MARKET that 
still has bearish traders around.  If that 30-year makes a sharp 
move higher, my guess is that bears will turn and cover quickly.  

I'm thinking of giving a talk at this fall's OptionInvestor.com 
trading expo on the use of the above techniques.  If it's 
something you're interested in, please let me know.


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

One Up, One Down by Jeffrey Canavan

Back in my college days, I played a drinking game called One Up, 
One Down.  A group of people would sit around the table, and the 
first person would say, "One up one down."  The next person would 
say "two down," and so it would go around the table with 
different players giving different signals.  The newcomer to the 
game had to figure out the pattern, or was forced to drink.  Of 
course there was no pattern, and the game was a complete farce.  
It was just a way to take advantage of some unsuspecting dolt.  
Wall street is playing a similar game of up day, down day, and 
it's not quite as fun.

It looked like a down day when retailers Kmart, Limited and 
Intimate Brands came in with poor financial numbers and a gloomy 
outlook.  Kmart even raised concerns about price deflation.  
Perhaps consumers are starting to curb their spending over 
concerns of unemployment.

New claims for unemployment rose 8,000 to 393,000, well below the 
400,000 levels we saw in May, but continuous claims rose to 3.18 
million.  That's the highest reading in over nine years.  Dallas 
Fed president Robert McTeer fanned the flames when he said that 
unemployment was likely to rise even further.

And speaking of the Fed, they released the minutes from the June 
27th meeting.  What traders took from the report was that the Fed 
might be getting close to the end of their rate cutting cycle.  
But according to the Philly Fed's comments today, economic growth 
continued to slow over the past three months.

That should have been enough to curtail traders' attention, but 
they gulped now some of Celgene's new attention disorder drug, 
and focused on pushing the Biotech Index up 4.29 percent.  That 
wasn't enough to close the major indices in positive territory, 
but it helped to mitigate the damage.

Nasdaq Composite Daily Chart



The Nasdaq Composite was getting ready to test resistance at 1890 
in the first hour of trading, but finally succumbed to slew of 
economic blather, and closed down 0.98 percent.  That kept the 
index above yesterday's low of 1817, but gave us another down day 
in our up/down game.

Tomorrow has the makings of an up day after some helpful words 
from Cisco. The networking equipment maker sees signs that its 
business is stabilizing, and is restructuring into 11 different 
business groups.  The realignment is designed to increase profit 
contribution, grow the business, as well as better define 
customer segments.  After hours traders are buying into the 
restructuring, pushing the stock up 5%.

That might be enough to get the Nasdaq through resistance at 1890 
tomorrow, but it's still hard to see any significant upside with 
each positive story having a negative one to offset it.  
Investors vented their frustration by withdrawing $3.6 billion 
from stock funds this week and placing $36 billion in money 
market funds and $1.4 billion in bond funds.  Unless the current 
sentiment changes, rallies are for shortin'.

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

Market Volatility

VIX   24.92
VXN   49.26

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

          Put/Call Ratio  Call Volume   Put Volume
Total           .64        453,230       289,187
Equity Only     .55        419,495       229,639
OEX            1.26          3,310         4,182
QQQ             .34         27,898         9,582

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

Bullish Percent Data

           Current   Change   Status
NYSE          34       -      Bear Confirmed
NASDAQ-100    24      -2      Bear Confirmed
DOW           30       -      Bear Confirmed
S&P 500       48       -      Bull Correction  
S&P 100       38      -2      Bull Correction  

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

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


 5-Day Arms Index  1.41
10-Day Arms Index  1.32
21-Day Arms Index  1.33
55-Day Arms Index  1.29

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      1411           1686
NASDAQ    1525           2118

        New Highs      New Lows
NYSE      180             45
NASDAQ     83            128

        Volume (in millions)
NYSE       985
NASDAQ   1,424
-----------------------------------------------------------------

Advisory Sentiment 

Bullish  Bearish  Correction   Net   Change 
  49.0%    29.1%     21.9%    19.9%   +0.9%

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: 08/14/01
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
No significant changes (refer to graph at the bottom of the page).  
Since this is the most heavily traded contract, it tends to carry 
the most weight.

Commercials   Long      Short      Net     % Of OI 
7/31/01      335,532   409,352   (73,820)   ( 9.91%)
8/07/01      331,881   406,210   (74,329)   (10.07%)
8/14/01      337,327   411,504   (74,177)   ( 9.91%)

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
7/31/01      129,648     54,552   75,096     40.77%
8/07/01      128,454     53,191   75,263     41.43%
8/14/01      130,432     55,750   74,682     40.11%

Most bearish reading of the year:  36,513 - 5/01/01
Most bullish reading of the year:  91,122 - 3/06/01
 
NASDAQ-100
The net bearish position of commercial traders continues to 
improve.  Breaking the 7,000 level would be even better.
 
Commercials   Long      Short      Net     % of OI 
7/31/01       28,009     39,613   (11,604)  (17.16%)
8/07/01       28,867     38,956   (10,089)  (14.88%)
8/14/01       29,909     37,822   ( 7,913)  (11.68%)

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
7/31/01       11,216     8,938    2,278      11.30%
8/07/01        9,715     8,098    1,617       9.08%
8/14/01       11,165     9,508    1,657       8.02%

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
Commercial are slowly adding more long positions, and improving 
their net bullish stance.

Commercials   Long      Short      Net     % of OI
7/31/01       17,748    13,669    4,079     13.0% 
8/07/01       18,644    13,733    4,911     15.2%
8/14/01       21,652    15,856    5,796     15.5%

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
7/31/01        5,049     9,079    (4,030)   (28.52%)
8/07/01        4,841     9,909    (5,068)   (34.36%)
8/14/01        4,441     8,528    (4,087)   (31.51%)

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)
=========================

ImClone Systems Inc. - IMCL Close:$49.48 Change:+3.09 Stop:$45.00

Company Description:
ImClone develops chimerized treatments and vaccines for cancer.  
Chimmerized means it is made from human and mouse antibodies.  
Working with Germany's Merck KGaA , they are developing the drug 
IMC-C225, a growth factor inhibitor that may fight colorectal and 
head and neck cancers.  ImClone is also making other products, 
including cancer-related angiogenesis inhibitors, vaccines for 
small-cell lung cancer and melanoma, and endothelial stem cells to 
speed wound healing and muscle regeneration.  The firm licenses its 
DNA diagnostics technology to Abbot Laboratories.

Fundamentals: 
Analysts expect the firm to lose $1.40 a share on sales of $27 
million and for that loss to narrow to 62-cents in 2002 on revenue 
of $84 million.  Last year, the company lost $1.22 per share on 
sales of $1.4 million.

Why We Like It: 
IMC-C225 should be approved for colorectal cancer in the first half 
of 2002.  It has additional potential for a use in head, neck, 
lung, pancreatic and ovarian cancer.  If it reaches its full 
potential, some estimates expect sales to top $500 million by the 
middle of the decade.  This bright future has made these shares a 
stellar performer within the biotech sector.  Our master tech 
strategist Jeff Bailey gives a detailed explanation of the 
techniques we used to select TECH and IMCL as Bullish plays in 
today's (8/24) Market Wrap.  It’s a great and informative read 
bound to improve your trading.  

On a more pedestrian level, the biotechs are running with the bulls 
and IMCL shares are near the head of the herd.  On Thursday, it 
blasted out of a base it had been forming since early-July.  
Longer-term we have a Bullish price target of $61.  In the short-
term the shares have the momentum to test resistance at $56.  In 
between, additional resistance exists at $52.80 and we will monitor 
these shares to see if they can maintain their current oomph as 
they pass through.  On the downside, we have support at the 50-day 
moving average of $46.02.  We will start this play with a stop just 
below at $45.00.

Picked on August 23rd at $49.48
Earnings Date              N/A (Not Confirmed)





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of stock traders. The newsletter is an information service
only. The information provided herein is not to be construed
as an offer to buy or sell securities of any kind. The
newsletter picks are not to be considered a recommendation
of any stock but an information resource to aid the investor
in making an informed decision regarding trading in stocks. It
is possible at this or some subsequent date, the editors and
staff of PremierInvestor.net may own, buy or sell securities
presented. All investors should consult a qualified professional
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The Premier Investor Network.
Do not duplicate or redistribute in any form.


PremierInvestor.net Newsletter                Thursday 08-23-2001
                                                   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/082301_2.asp
=================================================================

In section two:

Split Trader
  New Plays: none
  Play Updates: NVDA, AAS, AHC, GD, LEN
  Closed Plays: none

Net Bulls
  New Plays: ImClone Systems Inc. - IMCL (Bullish) 
  Bullish Play Updates: ISSI, TECH
  Bearish Play Updates: ADBE, EBAY, VRSN
  Closed Plays: PeopleSoft - PSFT

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

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

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

  -----------------
  Split Run Updates
  -----------------

NVIDIA Corp. - NVDA - close: 82.91 change: -1.88 stop: 79.00

As an optimist today's trading in NVDA could be seen as an
entry point, especially if you're a trader.  The company has
strong fundamentals and a 2:1 split coming in September which
should help attract buyers if the market can make a prolonged
rally, or at least stop falling.  With our first upside target
at $90 and our longer-term target at $100, traders should be
picking their entries on dips above $80.  If you're concerned
about market weakness wait for the NASDAQ to hit a bottom first.
Or you could just wait for a bounce at $80 in NVDA leaving you
a $1 stop at $79 which is good and tight.

Picked on August 22nd @ $ 84.79
Gain since picked:       - 1.88
Earnings Date:             8/14 (confirmed)





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

AmeriSource - AAS - close: 61.00 change: -0.40 stop: 56.00

AmeriSource looks very positive for bullish investors.  Wednesday,
the stock gapped up above potential resistance at $60 and closed
near its high on double the average volume.  This is exactly the 
king of positive action long investors are looking for.  The rally
tried to continue this morning for AAS with shares spiking up to
$63 but the buyers couldn't hold it and the stock fell back to
$62 midday before sinking another point with the late day market
slide.  Tuesday we mentioned that $62/$62.50 would be resistance
and new players may want to wait for a breakout before initiating
any new positions.  Secondly, our stop may be too wide for some
players.  Adjust according to your own risk tolerance.  While $60
should technically be new support, the stock has a stronger base
at $58.

Picked on August 17th @ $ 59.00
Gain since picked:      +  2.00
Earnings Date:             N/A  (not confirmed)




---

Amerada Hess - AHC - close: 77.62 change: +0.93 stop: 75.80

The range-bound trading continues for shares of AHC.  The bulls
are still buying at $76.50 and the bears are still selling at
$79.  Unless you're willing to play the game and scalp the 
couple of points in between we recommend waiting for shares
to close over $79 before considering a long play.

Picked on August 15th @ $ 78.90
Gain since picked:      -  1.28
Earnings Date:             N/A  (not confirmed)




---

General Dynamics - GD - close: 82.30 change: -0.16 stop: 79.00

Concerned would be a good word for players in this GD strategy.
Between 12:30 and 1:00 pm ET on Wednesday, shares of GD took a
$2 plunge in quick order.  Did someone find out about the $500
million in 3-year notes that GD sold before the rest of the 
market?  What about the sale concerned them so much?  There's
no telling but the stock has made a nice bounce back so far.
More aggressive investors might consider a long play at this
level with the tight stop at $79 offering them a better risk/
reward scenario.  Otherwise, it might be worth giving up the
4 points and waiting for shares to close over $85 again.

Picked on August 8th @ $  83.85
Gain since picked:      -  1.55
Earnings Date:         10/17/01 (not confirmed)




---

Lennar - LEN - close: 40.40 change: +1.36 stop: 38.00

Wednesday had us worried for our long play on LEN.  Shares dipped
to a low of 38.30 before bouncing back to end the day at $39.
We felt much more confident today as shares gapped up and traded
as high as 41.35 before closing over the $40 level.  We remain
bullish on LEN and believe this offers a nice entry point for
long plays with minimal risk at a stop of $38.  Yesterday's 
intraday bounce was bolstered by the 200-dma and it may be time
for buyers to make another run at $45 again soon.  If we weren't
so concerned over the broader markets this would look like a 
green light on LEN.  More conservative traders may want to wait
for one more positive day as confirmation that the bears grasp
has been shook loose.  

Picked on August 16th @ $  40.66
Gain since picked:       -  0.26
Earnings Date:          09/19/01 (not confirmed)





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

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

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

ImClone Systems Inc. - IMCL Close:$49.48 Change:+3.09 Stop:$45.00

Company Description:
ImClone develops chimerized treatments and vaccines for cancer.  
Chimmerized means it is made from human and mouse antibodies.  
Working with Germany's Merck KGaA , they are developing the drug 
IMC-C225, a growth factor inhibitor that may fight colorectal and 
head and neck cancers.  ImClone is also making other products, 
including cancer-related angiogenesis inhibitors, vaccines for 
small-cell lung cancer and melanoma, and endothelial stem cells to 
speed wound healing and muscle regeneration.  The firm licenses its 
DNA diagnostics technology to Abbot Laboratories.

Fundamentals: 
Analysts expect the firm to lose $1.40 a share on sales of $27 
million and for that loss to narrow to 62-cents in 2002 on revenue 
of $84 million.  Last year, the company lost $1.22 per share on 
sales of $1.4 million.

Why We Like It: 
IMC-C225 should be approved for colorectal cancer in the first half 
of 2002.  It has additional potential for a use in head, neck, 
lung, pancreatic and ovarian cancer.  If it reaches its full 
potential, some estimates expect sales to top $500 million by the 
middle of the decade.  This bright future has made these shares a 
stellar performer within the biotech sector.  Our master tech 
strategist Jeff Bailey gives a detailed explanation of the 
techniques we used to select TECH and IMCL as Bullish plays in 
today's (8/24) Market Wrap.  It’s a great and informative read 
bound to improve your trading.  

On a more pedestrian level, the biotechs are running with the bulls 
and IMCL shares are near the head of the herd.  On Thursday, it 
blasted out of a base it had been forming since early-July.  
Longer-term we have a Bullish price target of $61.  In the short-
term the shares have the momentum to test resistance at $56.  In 
between, additional resistance exists at $52.80 and we will monitor 
these shares to see if they can maintain their current oomph as 
they pass through.  On the downside, we have support at the 50-day 
moving average of $46.02.  We will start this play with a stop just 
below at $45.00.

Picked on August 23rd at $49.48
Earnings Date              N/A (Not Confirmed)





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

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

Integrated Silicon Sol. - ISSI - cls: 15.25 chg: +0.21 stop: 13.75

The SOX may be bouncing higher but ISSI is still consolidating 
sideways.  Tuesday we mentioned a possible bounce at $14.50 and
we were not far off.  Wednesday saw shares of ISSI bounce near
14.65 or its 10-dma.  We were encouraged by the positive close
today but what concerns us now is the lack of volume.  Activity
in this stock has dried up to 1/3 of normal.  At this point we'd
like to see ISSI close over $15.50 to confirm that the upward
trend is intact.  More conservative traders might consider raising
their stop to 14.25 or just under 14.50 to protect from any 
disastrous news in the semiconductor sector as we approach
warnings season for the 3Q.

Picked on August 16th @ $15.10
Gain since picked:      + 0.15
Earnings Date:             N/A  




---

Techne Corp. - TECH - close: 35.49 change: +0.44 stop: 32.00

The streak continues for TECH investors.  Holding above the
$35 level after yesterday's big gain is a definite show of 
strength from the bulls.  The NASDAQ may be slipping again but
the Biotech index (BTK.X) posted its second +20 point gain in
a row.  Long-time readers know that we believe nothing moves in
a straight line.  This means that eventually, and it could be
soon, shares of TECH need to take a dip.  Looking at a 30 minute
chart one can easily see the narrow trading channel from the 
10th of August.  Bulls should be picking their entry points 
based on new moves up from $35 or a potentially better entry
point with a bounce at $34, the bottom of the trading channel.
Be patient.  The BTK will need to rest soon and we doubt TECH 
will run away from you.

Picked on August 22nd @ $35.05
Gain since picked:      + 0.44
Earnings Date:             N/A  





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

Adobe Systems Inc - ADBE - close: 34.50 change: -0.08 stop: 36.00

Let us urge caution for new players looking to short ADBE.  The
stock may be out to get us.  We've now seen two intraday lows,
the latest at 32.10, followed by large bounces higher.  Our
stop at $36 has been appropriate so far but any significant 
rally in the GSO.X will surely spur ADBE and stop us out.  If
you believe that ADBE might suffer again in a new leg down for
the software sector then maybe this offers a good risk/reward
entry point for you.  We will want to wait before starting any
new short plays to see if this resistance holds and the next leg
down begins.

Picked on August 21st @ $33.45
Gain since picked:      - 1.05
Earnings Date:            N/A  




---

eBay Inc - EBAY - close: 55.06 change: -1.85 stop: 59.00 *new*

Right on the money, EBAY has continued to see weakness now that
the bears have finally broken through support of $60.  Wednesday
saw a sharp drop to 53.24 but the stock rebounded in the last
two hours of the day.  Today's move was more stable ending the
day right at support of $55.  We're still shooting for a target
of $50 but expect a potential bounce to probably $57.50 or $58
now that the stock is down three days in a row.  We're going to
tighten our stop to $59.  This is above yesterday's high and the
100-dma.  Consider new positions on any failed rally or a close
under $55.

Picked on August 21st @ $57.92
Gain since picked:      + 2.86
Earnings Date:            N/A  




---

VeriSign - VRSN - close: 44.01 change: -0.06 stop: 46.00 

Shorts should be cautious now.  VRSN has been trading sideways
the last couple of days and is just underneath the top side of its 
downward channel.  We've got our stop set at 46 but if shares make 
it over 45.50 be on the alert.  We'd probably be looking at any 
failed rallies as potential entry points.  However, keep an eye on 
the NASDAQ.  You probably don't want to be initiating new shorts 
if the NAZ is making a rebound - at least until it fails.  Any 
new weakness should bring shares of VRSN to 41.50 or less ($40).  

Picked on August 14th @ $48.98
Gain since picked:      + 4.97
Earnings Date:            N/A  





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

  --------------------
  Closed Bearish Plays
  --------------------

PeopleSoft - PSFT - close: 35.20 change: -1.64 stop: 37.50 

Gosh darn those brokers, don't they read this newsletter.  PSFT 
looks weak along with a battered sector to boot.  Why couldn't
Prudential wait to initiate coverage of PSFT with a "buy" when
shares slipped to $30.  This pre-market news drove shares up 
early this morning only to have the selling pressure return 
as the NASDAQ slid yet again.  Today helped establish that $38
is the new overhead resistance and both the bears and the bulls
will be watching this level closely.  Our potential eight point
winner was stopped out with a final gain of 4.88.  Just between
you and me, Prudential should have waited.  Even their report
this morning said they see short-term downside risk based on
the economy and overly-optimistic guidance from PSFT's sector
mates.

Picked on August 7th @ $42.38
Gain since picked:     + 4.88
Earnings Date:           N/A  





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

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

Newmont Mining NEM Close:$21.43 Gain:+0.13 Stop:$20.40

Gold stocks were today's second best performing sector, and Newmont 
gained 0.61%.  That's not quite like winning Powerball, but gains are 
gains these days.  Gold stocks continue to be a bastion of safety in an 
otherwise turbulent market.

Picked on July 14th at $20.50
Gain since picked:      +0.93
Earnings Date            11/1/01 (unconfirmed)




---

Pepsi PEP Close:$47.25 Gain:+0.68 Stop:$46.00 NEW

Pepsi has had a decent two days, gaining $1.20 in difficult market 
conditions.  Now clear of resistance at $47, Pepsi is free to move 
higher, as long as the do reintroduce Pepsi Free.  We are moving our 
stop up to $46 just in case they do.  

Picked on August 10th at $45.66
Gain since picked:        +1.59
Earnings Date               N/A





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

Administaff ASF Close:$31.20 Gain:0.00 Stop:$32.25

Administaff is getting some temporary relief from its recent sell 
off, but it still looks like this stock's up trend is come to an 
end.  Once it drops below $29, it should be cleared for a drop to 
$26.

Picked on August 21th at $29.15
Gain since picked:        -2.05
Earnings Date              N/A




---

Ballard Power BLDP Close:$20.65 Gain:-1.12 Stop:$22.50 NEW

Ballard just can't catch a break.  Today's $1.12 drop makes it 
seven days in a row.  The stock is due for a relief rally, but 
we'll keep riding it down and lowering our stop until that 
happens.

Picked on August 14th at $32.02
Gain since picked:       +11.37
Earnings Date            11/16/01 (unconfirmed)




---

PACCAR PCAR Close:$53.21 Gain:-1.14 Stop:$56.00 NEW

PACCAR resumed its downtrend today by dropping $1.14.  By taking 
out some mild support today, PACCAR should be ready to test the 
next support level at $50.80.  We are lowering our stop to 
$56.00.  

Picked on August 17th at $55.46
Gain since picked:        +2.25
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
NFS       Nationwide Financial Services   47.19  +1.07
UCU       Utilicorp United                32.06  +0.79
CYT       Cytec Industries                32.65  +1.85
KB        KB Home                         28.43  +1.28
JEF       Jefferies Group                 34.73  +0.88
SPF       Standard Pacific                23.23  +0.79

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

Ticker    Company Name              Close  Change
PRGX      Profit Recovery Group     15.60  +1.55
WTSLA     Wet Seal Inc              18.25  +1.76
GYMB      Gymboree Corp              6.86  +1.07
CTEC      Cholestech Corp           12.70  +1.01

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

Ticker    Company Name              Close  Change
PG        Procter & Gamble Co       76.94  +1.29
TD        Toronto Dominion Bank     32.53  +1.51
MEDI      Medimmune Inc             40.57  +1.39
IDPH      Idec Pharmaceuticals Corp 57.37  +4.48
GILD      Gilead Sciences Inc       58.84  +3.88

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

Ticker    Company Name              Close  Change
MRK       Merck & Co                68.51  -2.71
FTE       France Telecom Ads        35.10  -1.75
Q         Qwest Communications      20.47  -1.63
EBAY      eBay Inc                  55.06  -1.85
TBH       Telecom Brazil Sa Teleb   33.28  -1.34

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

Ticker    Company Name               Close  Change
UL        Unilever Plc               34.28  -0.42
CXIPY     Coflexip Stena Offshore    82.66  -2.13
NYCB      New York Community Bancorp 44.50  -1.93
CFR       Cullen Frost Bankers       37.73  -0.76
KKD       Krispy Kreme Doughnuts     37.73  -0.76

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