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Daily Newsletter, Tuesday, 10/30/2001

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PremierInvestor.net Newsletter                 Tuesday 10-30-2001
                                                   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: Stocks slide along with consumer confidence
Market Sentiment: Consumers Singing A Different Tune
Play-of-the-Day:  Consumer Confidence Woes

-----------------------------------------------------------------
U.S. Market Numbers
-----------------------------------------------------------------
MARKET WRAP  (view in courier font for table alignment)
-----------------------------------------------------------------
       10-30-2001           High     Low    Volume Advance/Decline
DJIA     9121.22 -147.52  9264.52  9065.59  1.3 bln    944/2156
NASDAQ   1667.41 - 32.11  1686.68  1646.30  1.7 bln   1276/2323
S&P 100   545.06 -  8.28   553.34   541.25   Totals   2220/4479
S&P 500  1059.79 - 18.51  1078.30  1053.61
RUS 2000  422.83 -  6.58   429.41   420.11
DJ TRANS 2195.26 - 23.70  2219.69  2168.89
VIX        34.80 +  2.41    36.28    34.43
VXN        53.41 +  3.12    65.94    62.09
TRIN        2.15
Put/Call Ratio       .91
-----------------------------------------------------------------

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

Stocks slide along with consumer confidence

The Conference Board said consumer confidence in October fell to 
an 8-year low reading of 85.5, which was well below the 95.5 
level expected by many analysts and the pessimism there spilled 
over into stocks.  September's reading of 97 had been viewed as 
somewhat bullish (surveys above 90 are considered bullish) but 
recent anthrax scares along with the potential for future 
terrorist activities continues to weigh on stocks.  "The economic 
outlook is becoming increasingly pessimistic," said Lynn Franco, 
director of the board's consumer research center.  "With the 
holiday season quickly approaching, there is little positive 
stimuli on the horizon," she said.

A year-ago, consumer's were much more confident about the future 
of the economy as the boar's consumer confidence numbers were at 
the 135.8 level.  This leaves some to really wonder if the 
consumer confidence numbers really are a good gauge of future 
economic growth, or if they too are "rearview mirror" numbers.  
Perhaps the downward direction of trend is what becomes more 
important than the actual level of confidence.  

The outlook going forward and that portion of the survey does 
show a weakening psychology of the consumer.  The outlook for the 
next six months also dropped.  The expectations index dipped to 
70.8 in October from 78.1 in September.  In February of this 
year, this portion of the consumer confidence survey hit its 
cyclical low of 70.7.

More than 1/5th of consumers feel that finding jobs is difficult 
and the number that feels jobs are plentiful plunged from 50% at 
the beginning of the year to just 21% in October.  Likewise, 
1/5th of those surveyed say the economy is "bad" while those 
saying its "good" fell from 22.3% to 18.9%.

Today's "lack of confidence" now sets the stage for speculation 
of a FOMC 50-basis point rate cut.  Current expectations are for 
a 25-basis point cut, but weakening consumer confidence may have 
the Fed getting more aggressive.  Earlier this year, Federal 
Reserve Chairman Alan Greenspan said that the "fabric" of 
consumer confidence had not yet been breached, but today's 
confidence numbers has that fabric looking worn and frazzled at 
the edges.

Retail stocks suffer from lack of confidence

For the second session in a row, retailing stocks took it on the 
chin as the S&P Retail Index (RLX.X) fell 3% to $772.  Dow 
Component Wal-Mart (NYSE:WMT) fell 2.5% to close at $50.60 and 
marks one of the first signs of technical weakness since a 
powerful rally from the $44 level and post-terrorist attacks of 
September 11th.

S&P Retail Index Chart - 




The S&P Retail Index (RLX.X) has found sellers the past two 
sessions and looks vulnerable to the $760 level near-term.  
Retracement from the April 2000 highs to October 2000 lows helps 
define the range of retracement and gives traders some levels to 
be monitoring.  Recent trading sure looks like the 820-825 level 
was a point where bulls were not able to overcome sellers and 
this has us now turning more bearish on the group.

Wal-Mart (NYSE:WMT) comprises a 33.46% weighting in the RLX and 
Home Depot (NYSE:HD) ranks #2 with a 15.49% weighting.  
Subscribers looking for a detailed description and weighting of 
the index can visit www.cboe.com, then look in the "Products" and 
"Index Components" section of their web page.

Home Depot Chart - 




Prior to September 10th, shares of Home Depot (NYSE:HD) had seen 
some heavy selling from the $50 level to close at $40.55.  
Terrorist events on September 11th found the stock losing further 
value to $30.  With consumer confidence looking frayed, shares of 
Home Depot (HD) may have some downside to the $34.50-$30 level 
near-term.  

In Friday's "Market Wrap" on PremierInvestor.net, shares of Home 
Depot (HD) were one of three stocks that had fallen into the 
lower 1/2 of our Dow Industrials Portfolio to the #16 slot.  At 
the close of today's trading, we've seen further slippage to the 
#18 slot.

Tomorrow's economic data

Tomorrow the market will get more news regarding "what was" in 
the Gross Domestic Product (GDP) numbers before the opening of 
trading.  Then at around 10:00 a.m. EST, the Chicago PMI numbers 
are scheduled for release.  Energy stock traders will want to 
keep an eye on the Oil and Gas Inventories for 10/26/01 numbers 
due out at 09:00 a.m. EST.

Broader market action has little trend

The past two weeks has really been a mixed bag for traders.  In 
just two days, the S&P 500 has lost 35 points or 3% after closing 
above its 50-day moving average for 2 consecutive sessions late 
last week.  The closing above the 50-day moving average appeared 
to give bulls reason to grow horns as that index hadn't closed 
above it 50-day moving average since June 13th.  

Bears aren't out of the wood just yet though.  The S&P 500 has 
pulled back to the 1,050 levels three times since October 5th, 
and each time bulls have managed a rally near the 1,100 level.  

Technology stock remain volatile and traders need to be able to 
"take some heat" in their trading or limit their position side to 
help control some risk.  

One reason I'm not ready to "grow claws" and turn into an eternal 
bear is that our play list has some bearish plays in stocks that 
are rather in some "defensive" groups, but these stocks have yet 
to find many buyers from those looking to play some defense.  
This has me believing that the market is just in a phase of 
profit taking at this point in other stocks that had some nice 
upward runs from the late September lows.

The two sectors that have perhaps impressed me the most from the 
bullish side have seen some of their gains trimmed in the past 
two sessions.  The Biotech Index (BTK.X) fell 2.4% today and 
while the group did manage to pair some losses with about two 
hours left in trading (battled back to be down just 0.8%) the 
group was not able to get in the green.  I think it's a bit early 
at this point to be jumping back in the biotechs after 
subscribers recently took a nice gain in Protein Design Labs 
(NASDAQ:PDLI).  We tried playing some further bullishness in the 
group with a bullish play in Millennium Pharmaceuticals 
(NASDAQ:MLNM), but were quickly stopped out of that play at 
$24.90.  

We've tried this in a couple of other stocks too, and with 
similar results.  In the software sector, we tried adding to the 
bullishness of Symantec (NASDAQ:SYMC) with a bullish play in 
shares of Veritas Software (NASDAQ:VRTS), but there two we were 
stopped out of SYMC (taking gains).  

While our "strategy" of adding to sector bullishness where we've 
been getting good results early may not seem to be working, 
subscribers are starting to catch on how we hope to manage our 
account, but also gain perspective of how the market lacks 
direction.  

We've been raising stops under a sector winner to try and help 
assure a gain.  Then we've further added some exposure to further 
expose some capital to the sector with a tight stop.  For 
example... a same dollar amount invested in SYMC and VRTS from 
profile would have surmounted to a 8.83% gain and 4.82% loss 
respectively.  The day after we added Veritas Software 
(NASDAQ:VRTS) to our bullish candidate list, the stock surged 
nearly 10%.  However, our "leader" in Symantec (SYMC) was stopped 
out for a gain only after we got aggressive with our stop on 
October 26th.  Funny how the strong stock got stopped out first 
and the weaker stock in Veritas Software (VRTS) did try and play 
catch up, but boy when it gave back gains, it REALLY gave back 
gains.  Further proof of why it is important to trade/invest 
bullish in strong stocks early, then look to play some of the 
laggards once we get a gain going in the account.

Similar strategy was used in the biotech sector with PDLI and 
MLNM.  Again, a same dollar amount invested in each from time of 
these stocks from time of profile found a 15.12% gain and 8.02% 
loss respectively.  The sector just lost some steam in the past 
two sessions and traders were forced to book gains and raise cash 
in their accounts.

Sick of anthrax!

We (you and I) have no control over market direction or what type 
of news the media pounds at us regarding anthrax.  We know this 
is going to be an ongoing disruption.

I'm not so sure the MARKET cares that much about the anthrax 
situation.  I do think it affects the psychology of the market, 
but not necessarily the underlying fundamentals.  Yes, I'm sure 
the anthrax effect is taking its toll on consumer confidence, but 
for some to truly say that "today's action was due to further 
concern of anthrax infections" may be overstating things.  

If the market hasn't figured out that there will be anthrax 
issues going forward, then I've overestimated the knowledge of 
the market far to long.  The 200-day moving average is considered 
a longer-term moving average and the major market averages all 
show a rounding lower moving average.  The 50-day moving average 
is considered an intermediate-term moving average, and this too 
is trending lower on the major market averages.  

To be quite honest, the Dow Industrials really hasn't see its 
200-day moving average in much of an upward trend since the early 
part of February 2000.  Since that time, the 50-day moving 
average has spent more time beneath the 200-day, so if we're not 
looking at bullish opportunities without some skepticism, then 
we're not be honest with ourselves.

For now, we'll continue to look for both bullish and bearish 
opportunities.  The more they "make sense" with some of the 
things we're finding in our scenarios, then the better.  Until we 
get some type of a more prolonged trend, we need to be satisfied 
with the short-term perhaps turning into the longer-term.

Jeff Bailey
Senior Market Technician


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

Consumers Singing A Different Tune
by Russ Moore

Consumers singing a different tune. Today’s consumer confidence 
number shouldn’t have come as much of a surprise, after all, last 
month’s tragedy, a continuous stream of weak economic data, and a 
rising unemployment rate are enough to spook anyone. Economist’s 
forecast of 95.0 was blown away by a reading of 85.5, the weakest 
in eight years. 

The surprise number fueled further selling in an already weak 
market, leading to a drop of -1.6 percent on the DOW. The NASDAQ 
was off -1.9 percent and the NDX tumbled -2.4 percent. Volume was 
light with 1.29 billion shares moving on the big board and 1.78 
billion shares trading on the NASDAQ. Market breadth was a “no 
contest” as losers pummeled winners by a 22/9 margin on the NYSE 
and 23/13 on the tech index.

The gold sector attracted some buying interest and was the only 
sector to close in positive territory. Oil service and natural 
gas sectors were the hardest in hit on broad markets, while 
chips, and telecom’s topped the tech slide.

Wednesday will see the advance reading of the third quarter GDP 
unveiled. The experts are forecasting a decline of -0.9 percent. 
Make no mistake, if this number is off by a substantial amount 
the bulls will be bailing. Other data will include the Chicago 
Purchasing Mangers index.


VIX 
Tuesday 10/30 close: 34.80


VXN
Tuesday 10/30 close: 63.41


30-yr Bonds
Tuesday 10/30 close: 5.22


Total Put/Call Ratio: .91


Equity Option Put/Call Ratio: .76


Index Option Put/Call Ratio:  2.28


===

NASDAQ 100 Index (NDX/QQQ)
52-Week High: 103.51
52-Week Low:   28.19
Current close: 33.36

Volume/Open Interest
Maximum calls: 35/55,050
Maximum puts : 33/65,319

Moving Averages
 10 DMA 34
 20 DMA 33
 50 DMA 33
200 DMA 44

Fibanocci Retracements
Relative High: 51.95 (05/22/01)
Relative Low:  27.00 (09/21/01)
38% 36.60
50% 39.57
62% 42.59

===

S&P 100 Index (OEX)
52-Week High:  834.93
52-Week Low:   491.70
Current close: 545.06

Volume/Open Interest
Maximum calls: 560/5,832
Maximum puts : 480/8,036

Moving Averages
 10 DMA  557
 20 DMA  555
 50 DMA  558
200 DMA  620

Fibanocci Retracements
Relative High: 680.03 (05/22/01)
Relative Low:  480.07 (09/21/01)
38% 556.14
50% 579.65
62% 603.55

===

S&P 500 (SPX)
52-Week High:  1530.01
52-Week Low:    965.80
Current close: 1059.79

Volume / Open Interest
Maximum calls: 1100/17,391
Maximum puts :  950/22,298

Moving Averages
 10 DMA 1082
 20 DMA 1080
 50 DMA 1089
200 DMA 1203

Fibanocci Retracements
Relative High: 1315.93 (05/22/01)
Relative Low:   944.75 (09/21/01)
38% 1086.75
50% 1130.62
62% 1175.23

==

DJIA (INDU)
52-Week High:  11,518.83
52-Week Low:    8,235.81
Current close:  9,121.98

Volume / Open Interest
Maximum Calls: 94/22,003
Maximum Puts   92/22,987

Moving Averages:
 10 DMA  9,306
 20 DMA  9,260
 50 DMA  9,432
200 DMA 10,273

Fibanocci Retracements
Relative High: 11,350.05 (05/22/01)
Relative Low    8,062.34 (05/21/01)
38%  9,308.92
50%  9,693.99
62% 10,085.60

==

Biotech Index (BTK)
52-Week High:  811.61
52-Week Low:   383.28
Current close: 541.29

Volume / Open Interest
Maximum Calls: 620/  325
Maximum Puts:  420/1,576

Moving Averages
 10 DMA 526
 20 DMA 502
 50 DMA 493
200 DMA 539

Fibanocci Retracements
Relative High: 811.61 (09/25/00)
Relative Low:  383.28 (03/22/01)
38% 546.22
50% 596.57
62% 646.71

==

Semiconductor Index (SOX)
52-Week High: 1280.84
52-Week Low:   362.00
Current close: 429.68

Volume / Open Interest
Maximum Calls: 570/ 503
Maximum Puts:  420/ 763

Moving Averages
 10 DMA 446
 20 DMA 439
 50 DMA 470
200 DMA 581

Fibanocci Retracements
Relative High: 710.78 (05/22/01)
Relative Low:  343.93 (09/27/01)
38% 484.50
50% 527.18
62% 570.57

==

Pharmaceutical Index (DRG)
52-Week High:  455.28
52-Week Low:   339.49
Current close: 388.91

Volume / Open Interest
Maximum Calls: 420/ 284
Maximum Puts:  400/1002

Moving Averages
 10 DMA 395
 20 DMA 394
 50 DMA 389
200 DMA 393

Fibanocci Retracements
Relative High: 448.43 (12/29/00)
Relative Low:  339.49 (03/22/01)
38% 382.22
50% 395.69
62% 409.03

*****

CBOT Commitment Of Traders Report: Friday 10/26
Weekly COT report discloses positions held by small specs
and commercial traders of index futures contracts on the 
Chicago Board Of Trade. 

Small specs are the general trading public with commercials being 
financial institutions. Commercials are historically on the 
correct side of future trend changes while small specs are not. 
Extreme divergence between each signals a possible market turn in 
favor of the commercial trader’s direction.   

S&P 500
Commercials   Long      Short      Net     %Change 
10/09/01     369,049   407,804   (38,755)   (10.6%)
10/16/01     378,866   415,289   (36,423)   ( 6.0%
10/23/01     377,177   413,658   (36,481)     0.1%

 
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      %Change
10/09/01       122,292    74,539    47,753    (5.2%)
10/16/01       124,568    73,779    50,789     6.3%
10/23/01       127,016    71,212    55,804     9.9%
  
Most bearish reading of the year:  36,513 - 5/01/01
Most bullish reading of the year:  91,122 - 3/06/01

NASDAQ-100
Commercials   Long      Short      Net     %Change 
10/09/01      24,662    38,020   (13,358)   21.5%
10/16/01      27,398    40,397   (12,999)   (2.7%)
10/23/01      29,920    40,358   (10,438)  (19.7%)

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      %Change
10/09/01       11,948     7,012    4,936      20.0%
10/16/01       12,901     6,893    6,008      21.7%
10/23/01       11,567     6,934    4,633     (22.9%)

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   Long      Short      Net     %Change 
10/09/01      24,873    10,194   14,679     16.2%
10/16/01      25,402    10,267   15,135      3.1%
10/23/01      25,568    11,832   13,736     (9.2%)

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      %Change
10/09/01       3,517    12,294    (8,777)     23.0%
10/16/01       4,514    12,104    (7,590)    (13.5%)
10/23/01       4,902    11,900    (6,998)     (7.8%)
 
Most bearish reading of the year:  (7,572) - 5/08/01
Most bullish reading of the year:   1,909  - 1/16/01


                    Small Specs               Commercials
S&P 500         (Current)  (Previous)     (Current) (Previous)
Open Interest
Net Value        +55,804     +50,789        -36,481     -36,423

Total Open
Interest %       (+28.15%)  (+25.61%)     (-4.61%)   (-4.59%)
                 net-long   net-long      net-short  net-short


                     Small Specs             Commercials
DJIA futures     (Current) (Previous)    (Current) (Previous)
Open Interest
Net Value          -6,998     -7,590          +13,736    15,135
Total Open
interest %       (-41.65%)    (-45.67%)      (+36.73%)  (+42.43%)
                 net-short   net-short     net-long    net-long


                     Small Spec              Commercials
NASDAQ 100      (Current) (Previous)    (Current) (Previous)
Open Interest
Net Value         +4,633      +6,008         -10,438    -12,999

Total Open
Interest %        (+25.04%)   (+30.35%)     (-14.85%) (-19.17%)
                 net-long   net-long      net-short net-short


What COT Data Tells Us
----------------------
Indices:.Another flat week as Commercials hold steady on their 
S&P net-short contracts.

Gold:.Commercials cut their short contracts in half this week. 
Gold has certainly cooled off in the last month; however, another 
switch to a net-long position could see gold on the rise once 
again.

9/25  36,638 contracts net-long
10/02 67,122 contracts net-short
10/09 64,729 contracts net-short
10/16 51,816 contracts net-short
10/23 25,191 contracts net-short

Data compiled as of Tuesday 10/23 by the CFTC.


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


Home Depot Inc - HD - close: 37.60 change: -1.02 stop: 39.25

Company Description
Founded in 1978, The Home Depot is the world's largest home 
improvement specialty retailer with fiscal 2000 sales of $45.7 
billion. The company employs approximately 250,000 associates and 
has nearly 1,300 stores in the United States, Puerto Rico, seven 
Canadian provinces, and Mexico.
(source: company press release)

Why We Like It:
If the recent economic report about consumer confidence numbers 
is any indication of things to come then the world's largest home 
improvement specialty retailer could be headed for trouble.  The 
dismal numbers from the confidence report this morning sent 
shares of retail stocks tumbling after an already punishing 
Monday.  If you read the wrap tonight you already know that WMT 
is the No. 1 component of the Retail Index (RLX) with HD coming 
in at No. 2.  With the retail index falling HD has even more 
weight to carry on its tired shoulders.  The stock has been 
creating a bearish formation since its October 11th high.  Since 
then the stock has seen a string of lower highs culminating in 
today's gap down.  It's possible that after two big down days the 
RLX might bounce but the new trend is negative.  If the sector 
bounces, HD might see a bounce back to the 38.50 area.  With our 
stop at 39.25 such a bounce could represent a great entry point 
to go short (we would wait to see it start to rollover first).  
If a bounce does not occur we remain bearish on shares of HD as 
long as it is below $39 and with it under support of $37.50 so 
much the better.  You'll notice from our wrap tonight the first 
bearish target is $34.50 which should be achievable considering 
the growing concern that the economy could get worse before it 
gets better.  If $34.50 fails to hold the stock then the 
secondary target is the September low of $30.00.  Investors 
should be aware that HD is expected to announce earnings some 
time in the next two weeks but we are unsure of the actual date.  
Estimates place it near Nov. 14th, 2001.  We would confirm both 
stock and market direction before initiating any short positions 
on this stock.  FYI: the point-and-figure chart shows the stock 
having rolled over at the overhead bearish trendline and is 
currently poised at a previous low.  If the stock trades below 
$37.00 we'll have a confirmed sell signal on the p-n-f chart.

Picked on October 30th at $37.60
Gain since picked:         +0.00
Earnings Date              11/14 (not confirmed)






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Do not duplicate or redistribute in any form.



PremierInvestor.net Newsletter                 Tuesday 10-30-2001
                                                   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/7903_2.asp
=================================================================

In section two:

Net Bulls
  Closed Bullish Plays: MLNM, SUNW

Stock Bottom / Active Trader
  New Plays: HD (bearish)
  Bullish Play Updates: CBRL, BMS
  Bearish Play Updates: BMY, FNM, HCR
  Closed Bearish Plays: 

Split Trader
   - 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)


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


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

  --------------------
  Closed Bullish Plays
  --------------------

Millennium Pharma. - MLNM - close: 24.33 change: -1.98 stop: 24.90

We were expecting a dip in the biotech sector and shares of MLNM 
but today's drop appears a little overdone.  MLNM gapped lower to 
open at 25.93 before rapidly falling through our stop at 24.90.  
By the end of the day the stock was only six cents from its 
intraday low for a 7.5% drop.  In contrast the biotech sector 
only slipped 2.4% with a bounce back above its 200-dma.  This is 
encouraging for the bulls but we need to see this level hold for 
the sector.  It's possible the 10-dma for MLNM (currently at 
24.13) might offer more support for the stock but another big 
down day in the markets could push MLNM to $22.50 or its 50-dma 
of 22.70.

Picked on October 26th at $27.07
Gain since picked:         -2.17
Earnings Date              10/16 (confirmed)




---

Sun Microsystems - SUNW - close:  9.55 change: -0.31 stop: 9.50

The two consecutive days of profit taking in the tech sector and 
the Nasdaq have weighed heavily on shares of SUNW.  As we 
expected there is some support at the 9.50 level with the 
intraday low today coming in at 9.46.  The caution flag should 
have gone up for traders when shares of SUNW closed below the $10 
level on Monday.  We do think that there is a play here in shares 
of SUNW but we're not excited about shorting stocks under $20 
much less under $10 so we'll wait for a suitable bullish entry 
point to develop again.  The stock should find more support at 
$9.00 and very heavy support at $8.50.  Keep your eyes on this 
equity for the bottom.  It may take another multi-day 
consolidation similar to what we saw from 10/17 to 10/22.

Picked on October 26th at $10.40
Gain since picked:         -0.90
Earnings Date              10/16 (confirmed)







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

===============
AT New Plays
===============

  ----------------
  New Bearish Play
  ----------------

Home Depot Inc - HD - close: 37.60 change: -1.02 stop: 39.25

Company Description
Founded in 1978, The Home Depot is the world's largest home 
improvement specialty retailer with fiscal 2000 sales of $45.7 
billion. The company employs approximately 250,000 associates and 
has nearly 1,300 stores in the United States, Puerto Rico, seven 
Canadian provinces, and Mexico.
(source: company press release)

Why We Like It:
If the recent economic report about consumer confidence numbers 
is any indication of things to come then the world's largest home 
improvement specialty retailer could be headed for trouble.  The 
dismal numbers from the confidence report this morning sent 
shares of retail stocks tumbling after an already punishing 
Monday.  If you read the wrap tonight you already know that WMT 
is the No. 1 component of the Retail Index (RLX) with HD coming 
in at No. 2.  With the retail index falling HD has even more 
weight to carry on its tired shoulders.  The stock has been 
creating a bearish formation since its October 11th high.  Since 
then the stock has seen a string of lower highs culminating in 
today's gap down.  It's possible that after two big down days the 
RLX might bounce but the new trend is negative.  If the sector 
bounces, HD might see a bounce back to the 38.50 area.  With our 
stop at 39.25 such a bounce could represent a great entry point 
to go short (we would wait to see it start to rollover first).  
If a bounce does not occur we remain bearish on shares of HD as 
long as it is below $39 and with it under support of $37.50 so 
much the better.  You'll notice from our wrap tonight the first 
bearish target is $34.50 which should be achievable considering 
the growing concern that the economy could get worse before it 
gets better.  If $34.50 fails to hold the stock then the 
secondary target is the September low of $30.00.  Investors 
should be aware that HD is expected to announce earnings some 
time in the next two weeks but we are unsure of the actual date.  
Estimates place it near Nov. 14th, 2001.  We would confirm both 
stock and market direction before initiating any short positions 
on this stock.  FYI: the point-and-figure chart shows the stock 
having rolled over at the overhead bearish trendline and is 
currently poised at a previous low.  If the stock trades below 
$37.00 we'll have a confirmed sell signal on the p-n-f chart.

Picked on October 30th at $37.60
Gain since picked:         +0.00
Earnings Date              11/14 (not confirmed)






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

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


Bemis Co. - BMS - close: 43.55 change: -1.09 stop: 42.10

The flexible packaging maker, Bemis, managed to endure most of 
Monday's market losses with only a small loss.  Tuesday's broader 
market sell-off was more of a different story as weak-handed 
bulls lead the stock lower for a 2.4% slide.  The stock managed 
to find support at 43.40, which was last Thursday's low.  We do 
think $43 should also offer support but would not encourage new 
long positions until we see the stock actually begin to bounce 
higher.  The 50-dma is starting to creep higher and at 42.34 it 
might be our last line of defense before getting stopped out at 
42.10.  Confirm stock and market direction before initiating any 
new positions.

Picked on October 26th at $44.99
Gain since picked:         -1.44
Earnings Date              10/23 (confirmed)




---

CBRL Group Inc - CBRL - close: 25.30 change: -0.60 stop: 24.60 

Shares of the Cracker Barrel line of restaurants managed a 
positive close amid the Monday market losses but succumbed to 
selling pressure on Tuesday for a small 2.3% decline.  Shares 
actually seemed to step down the same way they have been stepping 
up with the stock trading sideways most of the day near 25.25.  
There were a couple of intraday dips to the $25 level but both 
rebounded quickly.  The stock has been showing great relative 
strength but could be affected by earnings reports from other 
high profile restaurants.  Case in point, AppleBees (NASDAQ: 
APPB) announced earnings after the close today with 44 cents a 
share which was in-line with estimates.  This is four cents 
higher than the year ago period but it is unclear whether the 
market will be encouraged or instead sell the news.  Longs 
looking for new positions in CBRL should confirm both stock and 
market direction tomorrow before starting any new positions.  We 
would seriously considering waiting a day or two for a better 
feel on the market's direction.  Traders that are profitable and 
not willing to risk a dip to 24.60 should consider a potential 
stop loss just under $25.  You risk getting stopped out on an 
intraday dip but if the broader markets continue their decline we 
could see CBRL forced lower and beyond support at 24.75 the next 
level of support is 24.25.

Picked on October 12th at $24.36
Gain since picked:         +0.94
Earnings Date              11/21 (not confirmed)





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


Bristol Myers Squibb - BMY - cls: 53.66 chg: -1.24 stop: 55.10 *new*

Our play-of-the-day for Tuesday was a success with a drop of 
2.25% in another day of broad market losses.  The Drug Index 
(DRG.X) fell again although the drop was relatively small.  As 
you know the DRG has been weak for the last few days and 
yesterday's close below its 200-dma has been confirmed today with 
a close below its 50-dma.  The DRG.X ended Tuesday at 388.91.  
This is a key turning point for the sector.  If the market is 
going to turn defensive there may be a renewed interest in the 
drug sector.  However, if there is not new buying interest then a 
break below 388, which has been support multiple times through 
the month of October, could forecast a significant sell-off in 
drug stocks.  We have achieved our first target of $55 in BMY and 
are now aiming at our second target of $51.  The trading action 
in BMY has produced a doji candlestick formation, which normally 
represents indecision between the buyers and sellers on the 
stock's short-term trend.  It's possible the stock could rally 
and try to close the gap between Monday's close and today's open.  
However, it seems more likely that the stock may bounce back to 
$54 before sellers lean on it again (assuming there is no large 
move in the DRG.X).  To protect our gain in the play we are going 
to lower our stop to 55.10.  This is the top end of the late day 
trading range on Monday when shares of BMY we're coiling 
sideways.  If we get stopped out at 55.10 we can still close the 
play with a 5% move.  Confirm market direction and keep an eye on 
the Drug index.  If the drug index is bouncing we would be very 
careful about starting new short positions in BMY.  On second 
thought, given that we're only a couple points or so from our 
second target we would not encourage new short positions in BMY 
unless you felt the stock had a lot more weakness in it.  

Picked on October 23rd at $58.02
Gain since picked:         +4.36
Earnings Date              10/23 (confirmed)




---

Fannie Mae - FNM - close: 79.03 change: -0.77 stop: 82.25 *new*

If you're trading FNM you should be watching the 30-year bond 
yields.  If you're watching the bond yields then you know they 
are trading lower as big investors buy more bonds to "protect" 
their cash instead of buying stocks.  Normally, if the bond 
yields are falling FNM's stock should be rising.  We have an 
interesting divergence in the "norm" as shares of FNM are 
actually falling.  The recent consumer confidence report and the 
housing reports last week have probably given investors doubt on 
the future growth or stability of the mortgage lending business.  
On a technical level bears should be encouraged that FNM has 
closed below its 200-dma again as well as the $80 level.  Traders 
looking at the daily chart of FNM should notice the pennant 
forming with the lower highs and higher lows.  One trick more 
conservative traders may want to use is to draw a trend line from 
the October 3rd high to the October 26th high.  This should brush 
right across the intraday highs between the two dates.  Do you 
see the bearish resistance line?  We're going to lower our stop 
to 82.25 but more conservative traders could use this trend line 
and place a stop above it which would probably be just north of 
$81.00.  That's not much room and you risk getting swung out on 
an intraday move but for some traders it's worth limiting your 
risk to a minimum.  

Picked on October 19th at $80.99
Gain since picked:         +1.96
Earnings Date              10/15 (confirmed)




---

Manor Care - HCR - close: 23.69 change: -0.19 stop: 25.25

Our short play in HCR may be moving our direction but the rate of 
movement has been slower than what we were expecting.  
Truthfully, we're perplexed that shares of HCR have held up so 
well.  The Healthcare index (HCX.X) has performed similar to the 
Drug index as both have been weak over the last few days.  The 
HCX has closed back below both its 200-dma and its 50-dma.  The 
low today for the HCX was a quarter under 808.  The 807-808 level 
has been huge support for the sector throughout the month of 
October.  This could be a turning point for the group.  If the 
market turns defensive there may be renewed interest in 
healthcare stocks.  If not, the index could breakdown below this 
support level, which in turn would be very negative for stocks in 
the industry.  If you're looking for a bearish play in HCR keep 
an eye on the HCX.  We're comfortable with the stop were it is 
but would like to see more confirmation in the stock price.  
Aggressive traders can look for a move under 23.60 and more 
conservative traders can look for a move under support at 22.50.  

Picked on October 26th at $24.23
Gain since picked:         +0.54
Earnings Date              10/26 (confirmed)







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

RCL     Royal Caribbean Cruises    10.43     +1.28
AMRN    Amarin Corp                26.26     +2.09

--------------------------------------- 
Breakout to Upside (Stocks $5 to $20) 
--------------------------------------- 
Ticker  Company Name               Close     Change 

STK     Storage Tech               18.99     +1.19
PENN    Penn National Gaming Inc   19.20     +1.06
SQNM    Sequenom Inc                7.67     +1.52
SUPC    Superior Consultant         6.09     +1.44

--------------------------------------- 
Breakout to Upside (Stocks over $20) 
--------------------------------------- 
Ticker  Company Name               Close     Change 

NWL     Newell Rubbermaid          27.15     +1.26
NEM     Newmont Mining Corp        23.02     +1.36
DKWD    D&K Healthcare             56.20     +1.10

----------------------------------------- 
Breakout to Downside (Stocks over $20) 
------------------------------------------- 
Ticker  Company Name               Close     Change 

MO      Philip Morris              47.70     -1.98
MCD     McDonalds                  25.99     -1.29
TGT     Target Corp                29.10     -1.10
CAH     Cardinal Health Inc        68.20     -2.84
CVS     Cvs Corp                   24.35     -7.27

------------------------------------------------------------ 
Recently Overbought With Bearish Signals (Stocks over $20) 
------------------------------------------------------------- 
Ticker  Company Name               Close     Change 

QCOM    Qualcomm Inc               48.69     -3.61
KSS     Khol's Corp                54.60     -2.72
MCK     McKesson Corp              37.06     -2.38
NYT     New York Times             40.11     -1.15
JNPR    Juniper Networks           22.99     -1.01


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