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Daily Newsletter, Thursday, 01/31/2002

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PremierInvestor.net Newsletter               Thursday 01-31-2002
                                                  section 1 of 2
Copyright  2001, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
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In section one:

Market Wrap:      Boring but good!
Market Sentiment: Recipe for a rally.
Play-of-the-Day:  Transports Flying Higher

-----------------------------------------------------------------
U.S. Market Numbers
-----------------------------------------------------------------
MARKET WRAP  (view in courier font for table alignment)
-----------------------------------------------------------------
       1-31-2002           High     Low     Volume Advance/Decline
DJIA     9920.00 +157.14  9922.49  9763.20  1.5 bln   2093/ 998
NASDAQ   1934.03 + 20.59  1935.17  1906.90  1.7 bln   2117/1461
S&P 100   573.49 +  9.11   573.49   564.38   Totals   4210/2459
S&P 500  1130.20 + 16.63  1130.21  1113.30
RUS 2000  483.10 +  3.38   483.10   478.51
DJ TRANS 2797.83 + 35.72  2797.83  2756.32
VIX        22.91 -  1.96    25.27    22.77
VXN        42.82 -  1.85    45.34    42.46
TRIN        0.75
Put/Call Ratio       .67
-----------------------------------------------------------------

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

Boring but good!

Wow!  Did you see some of the robust gains from some of those 
boring stocks we talked about last week?  Phelps Dodge (NYSE:PD) 
jumped 6% today as copper futures broke above their 200-day 
moving average.  The world's second-largest copper producer said 
yesterday afternoon that it sees a balance in the 2002 copper 
market given the large amount of inventory restocking that will 
be needed once a global economic recovery picks up speed in the 
second half.  Unfortunately I don't read every press release that 
comes out of Phelp Dodge, but last Friday, in the 01:00 Update 
http://www.PremierInvestor.net/markets/intradayupdates/012502_3.a
sp we thought something might be going on in the copper market 
and even thought a partial position in Phelps Dodge (PD) might be 
worth a trader's time.

Arthur Miele, senior vice president of marketing, told analysts, 
"We look for copper prices to trade in the $0.67-$0.72 cents per 
pound range in the first quarter of the year, improving as the 
year progresses and the recovery takes hold."

March Copper futures - Daily Interval




Perhaps yesterday's comments helped fuel some buying in the 
copper futures.  Things already look a little overdone as it 
relates to Mr. Miele's comments on a copper price between $0.67 
and $0.72 a pound.  What I've done with retracement is what I 
call "stacking."  This is a technique sometimes used by traders 
to get more "levels" from which to manage their trading 
strategies.  In essence, the lower retracement (red) defines the 
range from $0.73 to $0.613.  I like the way the March futures 
really seems to want to trade those ranges.  Then all I did was 
"clone" that retracement bracket and "stack" it on top of the 
lower range.  I can't show the chart prior to May of 2000 due to 
space restrictions, but I did look at the various levels of 
retracement to look for correlation of trading to those levels 
and found very good correlation at the $0.777 and $0.791 levels.

Then what I've done is try and determine a level that might be 
considered a pivot point to base a scenario of economic growth or 
slowing from.  A mid-point, based on retracement would be the 
$0.732 level.  

Now, if we follow Mr. Miele's thoughts, he believes that copper 
prices will trade between $0.67-$0.72.  That's within a penny of 
our lower retracement bracket levels of $0.68-$0.73 so I'll cut 
him some slack.  But now you and I perhaps have a way to keep an 
eye on things going forward.  Mr. Miele has a bullish economic 
outlook for the latter half of the year.  I'm always a skeptic so 
I will test his thesis against the charts.

If you believe (like I do) that copper prices are indicative to 
an economy (I won't argue with the price decline from last June 
that correlates pretty close with what the stock markets did 
during that time), then prices much above the $0.73 level may 
well indicate an economic picture that is improving.

Perhaps this will also tie in nicely with the Fed's comments 
regarding "weakness in demand is abating and economic activity 
looks to be firming," which was then offset by "the degrees of 
strength in business capital and household spending is still 
uncertain."  Those Fed comments were 50/50 and that lines up 
perfectly with how we have retracement set up on the Copper 
futures.

It wasn't just "copper stocks"

It wasn't just copper stocks on the move today.  Alcan Aluminum 
(NYSE:AL) jumped 4.74% to $38.86 today and Dow component Alcoa 
(NYSE:AA) gained 4.67%.  I did some technical comparisons against 
these two stocks last week and felt that Alcan (AL) was the best 
candidate of the two for bulls to be playing from the long side. 

Alcan Chart - Daily Interval




Every so often, I'll read a research note from a major 
institution that peaks my interest.  On January 23rd (the "gap" 
above 38.2% retracement at $36) I saw a research note come across 
from Merrill Lynch when they raised their rating on Alcan (AL) to 
"near-term strong buy" from "neutral" as the firm believed 
earnings had bottomed out and looks for rising earnings per share 
and cash flow due to completion of a capital spending program and 
cost savings initiatives.  The firm also saw an improving 
aluminum price outlook.  

I wouldn't chase the stock with a full position here, but would 
opt for a 1/2 position in the stock, then look to round out to 
full on a pullback near $37.  Then follow the lot with a stop 
just below $35.  The point and figure chart shows that $39 has 
been a level of resistance, but a trade there could be sign that 
this stock is turning the corner for a longer-term move higher.

Alcan Chart - $1 box




Forrest Gump said something like, "life is like a box of 
chocolates.  You never know what you're going to get."  I say 
"Life is like triple and quadruple top buy signals.  You never 
know for certain what kind of move you're going to get but the 
odds of a mover higher are in favor of a bullish trader."

And what about those transports?

The Dow Transportation Average (TRAN) didn't do too bad today.  
Not spectacular with a 1.29% gain, but that beats the tech-heavy 
NASDAQ Composites 1.07% gain and even beat the highly volatile 
Semiconductor Index's (SOX.X) 0.72% gain, even with an Intel 
(INTC) upgrade today.

Dow Jones Transportation Average (TRAN) - Daily Interval




The TRAN sure looks like she's trying to deviate from that 
downward trend and the kick higher from retracement has to be 
encouraging.  I want to have a transport trade ready for tomorrow 
and if you don't mind a stock that trades a little light on the 
volume side, but looks like she could make a strong move higher 
is shares of "railroad" stock Genesee & Wyoming (NASDAQ:GNWR) 
$31.74.  Looking bullish on a break above $32.30, stop $29.95 and 
willing to sell strength for short-term traders at $37.00.

Still and inside day

In last night's market wrap, we set up a trade for shares of 
Qualcomm (NASDAQ:QCOM) $44.13 -1.25%.  The stock traded sideway 
again today and built another "inside day" (traded inside of 
Wednesday's range of $43.00-$44.75).  Still going to be looking 
long with MACD curling higher.  Let's keep the trigger for a 
bullish trade at $44.75 and see if the stock can't prove 
something to us.  It didn't prove worthy of a bullish traders 
cash today did it?  Again... just try to find a tech stock near 
the lower end of retracement where a break from the bottom could 
find some bears rushing for cover.

Jeff Bailey
Senior Market Technician


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

Recipe for a rally.
by Russ Moore

Take one part analyst upgrades, one part healthy P&G earnings, 
and one part improving economic data. Combine these ingredients 
with a pinch of "window dressing" and voila; A Wall Street rally.

The DOW added +1.6 percent while the NASDAQ gained +1.1 percent 
and the NDX +0.7 percent. Volume was moderate with 1.52 billion 
shares moving on the NYSE and 1.73 billion on the NASDAQ. 
Advancers led decliners by a 20/10 margin on the big board and 
21/15 on the tech index. 

Green arrows dominated the boards with oil service, financial, 
Internet and computer sectors experiencing solid gains.

A two-day rally although welcomed by the bulls, was not enough to 
pull the major indices out of the red for the month of January. 
We can expect to hear the bears running through the streets 
chanting "as January goes, so goes the year". Those who scoff may 
want to give this some thought; over the last 50 years the 
January result matched the yearly result 80 percent of the time.

You might think I’m becoming addicted to the volatility indices 
but I feel I must once again raise the yellow flag on these all-
important tools. The VXN (Nasdaq 100 volatility index) hit its’ 
all time low of 42.95 today. The current level would suggest all 
is well in tech land. That may be so, but I would be very 
cautious about holding long positions with “no fear” in the tech 
markets. The VIX is at 22.91 but still has a way to go before 
extreme levels are reached.


VIX
Thursday 01/31 close: 22.91


VXN
Thursday 01/31 close: 42.95


30-yr Bonds
Thursday 01/31 close: 5.43


Total Put/Call Ratio: .67


Equity Option Put/Call Ratio: .55


Index Option Put/Call Ratio: 1.34


===

NASDAQ 100 Index (NDX/QQQ)
52-Week High: 103.51
52-Week Low:   28.19
Current close: 38.51

Volume/Open Interest
Maximum calls: 39/56,325
Maximum puts : 35/73,406

Moving Averages
 10 DMA 38
 20 DMA 39
 50 DMA 39
200 DMA 40

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: 573.49

Volume/Open Interest
Maximum calls: 580/6,812
Maximum puts : 520/9,277

Moving Averages
 10 DMA  572
 20 DMA  580
 50 DMA  583
200 DMA  599

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: 1130.20

Volume / Open Interest
Maximum calls: 1150/26,665
Maximum puts : 1100/30,249
Moving Averages
 10 DMA 1125
 20 DMA 1139
 50 DMA 1142
200 DMA 1166

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:  9,920.00

Volume / Open Interest
Maximum Calls:  98/12,644
Maximum Puts    90/17,035

Moving Averages:
 10 DMA  9,786
 20 DMA  9,916
 50 DMA  9,938
200 DMA 10,104

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: 499.90

Volume / Open Interest
Maximum Calls: 520/301
Maximum Puts:  560/530

Moving Averages
 10 DMA 518
 20 DMA 536
 50 DMA 568
200 DMA 546

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: 558.88

Volume / Open Interest
Maximum Calls: 570/970
Maximum Puts:  540/492

Moving Averages
 10 DMA 533
 20 DMA 553
 50 DMA 543
200 DMA 554

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: 377.19

Volume / Open Interest
Maximum Calls: 390/675
Maximum Puts:  380/825

Moving Averages
 10 DMA 376
 20 DMA 376
 50 DMA 384
200 DMA 390

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, 02/25. 
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 
01/08/02     333,742   398,283   (64,541)   (6.1%)
01/15/02     340,005   397,024   (57,019)  (11.7%)
01/22/02     342,841   394,041   (51,700)   (9.3%)

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
01/08/02       130,335    60,780    69,555    (3.1%)
01/15/02       129,987    64,311    65,676    (5.5%)
01/22/02       125,451    65,423    60,028    (8.6%)

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 
01/08/02      30,786    37,457    (6,671)    (13.3%)
01/15/02      32,068    34,859    (2,791)    (58.1%)
01/22/02      30,671    34,103    (3,432)     23.0%

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
01/08/02       10,073     6,404    3,669    (22.5%)
01/15/02       10,230     9,782      448    (87.8%)
01/22/02       11,885     8,787    3,098  

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 
01/08/02      15,921     7,981    7,940     (3.9%)
01/15/02      15,866     9,175    6,691    (15.7%)
01/22/02      18,152    11,013    7,139      6.6%

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
01/08/02       4,380     9,188    (4,808)     (9.3%)
01/15/02       4,979     8,747    (3,768)    (21.6%)
01/22/02       5,424     8,969    (3,545)     (5.9%)

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        +60,028     +65,676        -51,700    -57,019

Total Open
Interest %       (+31.45%)  (+33.80%)      (-6.95%)   (-7.74%)
                 net-long   net-long       net-short  net-short


                     Small Specs             Commercials
DJIA futures     (Current) (Previous)    (Current) (Previous)
Open Interest
Net Value          -3,545     -3,768          +7,139    +6,691
Total Open
interest %       (-24.63%)    (-27.45%)      (+24.48%)  (+26.72)
                 net-short   net-short     net-long    net-long


                     Small Spec              Commercials
NASDAQ 100      (Current) (Previous)    (Current) (Previous)
Open Interest
Net Value         +3,098      +448         -3,432    -2,791

Total Open
Interest %        (+14.99%)   (+2.24%)     (-5.30%) (-4.17%)
                 net-long   net-long      net-short  net-short


What COT Data Tells Us
----------------------
Indices:.Commercials continued their gradual reduction in net-
short positions this week. Over the last couple of months we have 
seen the big players move as low as 4 percent net-short and then 
gradually increase their positions. So far, we’ve yet to see any 
evidence of an accumulation phase (bullish) beginning.

Gold: Anyone following the behavior of gold or the XAU.X (gold 
and silver index), better have a whiplash collar on. The XAU hit 
a low of 56.85 during the week however, Friday saw the index take 
off and close at 59.10. Commercial activity does not seem to 
coincide with this type of a move but keep in mind that these 
figures are as of Tuesday. I’ll be interested to see what next 
week’s numbers show.

12/25 11,976 contracts net-short
01/01 14,555 contracts net-short
01/08 24,042 contracts net-short
01/15 53,938 contracts net-short
01/22 50,959 contracts net-short

Data compiled as of Tuesday 01/22 by the CFTC.



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

Fedex Corp - FDX - close: 50.82 change: +0.62 stop: 48.75

Company Description:
With annual revenues of $20 billion, FedEx Corp. is the premier 
global provider of transportation, e-commerce and supply chain 
management services. The company offers integrated business 
solutions through a network of subsidiaries operating 
independently, including FedEx Express, the world's largest 
express transportation company; FedEx Ground, North America's 
second-largest provider of small-package ground delivery service; 
FedEx Freight, a leading provider of regional less-than-truckload 
freight services; FedEx Custom Critical, the world's largest 
provider of expedited time-critical shipments; and FedEx Trade 
Networks, a provider of customs brokerage, consulting, 
information technology and trade facilitation solutions. 
(source: company press release)

- ORIGINAL WRITE UP: January 18th, 2002 -

Why We Like It:
We think FDX is an attractive trading buy.  What does that mean?  
It means traders might be able to capture a short-term bounce in 
the stock price after the recent selling but to do so with 
diligent stop placement and realistic targets.  As a major air 
freight carrier, shares of the company were obviously hit hard 
during the September tragedy.  However, FDX has risen strongly 
from those September lows hitting new relative highs while 
stopping along the way to consolidate gains and head higher 
again.  Earnings on December 19th were okay but were boosted by 
their portion of the airline bailout package.  Last Friday 
Salomon Smith Barney downgraded FDX to a neutral.  Their concerns 
seemed to stem from current valuations being too high ahead of 
actual economic recovery.  The stock gapped down and fell to 
sellers for the next few days.  On Wednesday of this week shares 
had reached their 50-dma near $48.75 (FDX closed at $48.70).  
Ending the day at its low, FDX had appeared to confirm the new 
downtrend on a high volume break of support at $50.  The very 
next day the stock posted a reversal back above the $50 level on 
even stronger volume.  This bounce off the 50-dma was confirmed 
with a another positive day on Friday made even more bullish by 
the negative market action in the broader indices.  We're being 
optimistic but the MACD is showing a potential bullish divergence 
in its histogram.  We are going to try and play any bounce with 
an initial target of $55.  Our initial stop will be $48.75 or 
Thursday's low.  Given the recent downturn in the Dow Jones, we 
think that a market bounce next week might accelerate any rebound 
in FDX.  

- Most Recent Update: January 31st, 2002 -

As the Dow Jones Industrials have rallied back these last two 
days, so have the Dow Transports.  Likewise, shares of FDX have 
rebounded but fortunately they never fell under that much selling 
pressure to begin with.  We're still waiting for the stock to 
trade up to our exit price of $55 but overhead resistance has 
shifted from $53.50 to $54.00.  

- Play-of-the-Day Comments: January 31st, 2002 -

We really like the bullish trend in the Transports but the Dow 
Jones Transport index needs to breakout above resistance at 2800.  
Fortunately, we think it will happen shortly.  If it occurs, then 
FDX might have enough gas to reach our target of $55.00.

Picked on January 18th at $50.82 
Gain since picked:         +2.73
Earnings Date           03/20/02 (unconfirmed)






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

PremierInvestor.net Newsletter                  Thursday 01-31-2002
                                                     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/5047_2.asp
=================================================================

In section two:

Net Bulls
  Bullish Play Updates:  COGN

Stock Bottom / Active Trader
  Bullish Play Updates:  CHS, FDX, PBY, QMDC, TGH, UNH
  Bearish Play Updates:  C, SIVB


High Risk / High Reward
  Bullish Play Updates:  QCOM
  Closed Bearish Play:   MMS

Split Trader
  split announcement:   RMCF, 4-for-3


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) / Tech Stock section
==================================================================

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

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

Cognos Inc. - COGN - close: 26.36 change: +0.00 stop: 23.70

Shares of COGN have been trading relatively sideways the last 
three days but given the volatility in the broader markets that 
may not be a bad thing.  The GSO.X software index didn't do much 
today either even though MSFT posted a small gain after 
yesterday's intraday rebound.  We think one software stock to 
watch for possible leadership is the recent laggard, ORCL.  ORCL 
had some press today and we would look for the stock to breakout 
over the $17.50 level.  If it can't then we're still left looking 
for leadership in the group.  More conservative traders may want 
to consider tightening their stops on COGN and the last few 
sessions may offer ideas on where you'll find new support.  
Technically we see our short-term trading indicator of the 5-dma 
producing a bullish crossover against the 15-dma.  Unfortunately, 
the MACD has flattened out.  Overhead resistance remains at $27.

Picked on January 25th at $25.47
Gain since picked:         +0.89
Earnings Date           04/10/02 (unconfirmed)






==================================================================
Stock Bottom / Active Trader (AT) Non-tech stock section
==================================================================

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

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

Chico's F A S Inc - CHS - close: 29.95 change: +0.17 stop: 26.49

The retail sector has been a real leader in the market rebound 
these last two sessions if you look at the RLX.X retail index.  
The RLX has broken through resistance at the 940 level and looks 
pretty bullish.  Whether investors will bite at the bullish 
breakout bait is the question stock pickers and traders are 
asking.  CHS held up reasonably well during the pull back this 
week and found support at its ascending 5-dma.  Unfortunately, we 
were hoping for a bit more strength in today's session but what 
we got was a gap higher and a slow fade into the close with a 
drop under the $30 level in the last half-hour.  If recent trend 
is any indication then a pull back to $29.50 may be an entry 
point but this is based on a positive bias.  We're still happy 
with our stop at $26.49 but it wouldn't bother me to tighten it 
up if I was a reader.  The $28.00 to $28.50 level should still be 
good support.

Picked on January 25th at $29.55 
Gain since picked:         -0.05
Earnings Date           03/05/02 (unconfirmed)




---

Fedex Corp - FDX - close: 53.55 change: +0.39 stop: 49.99 

As the Dow Jones Industrials have rallied back these last two 
days, so have the Dow Transports.  Likewise, shares of FDX have 
rebounded but fortunately they never fell under that much selling 
pressure to begin with.  We're still waiting for the stock to 
trade up to our exit price of $55 but overhead resistance has 
shifted from $53.50 to $54.00.  

Picked on January 18th at $50.82 
Gain since picked:         +2.73
Earnings Date           03/20/02 (unconfirmed)




---

Pep Boys Man Moe - PBY - close: 16.45 change: +0.44 stop: 14.99

Yeah, it's about time!  Shares of PBY have finally started moving 
along with its other industry-related competitors like AZO and 
ORLY.  Shares of PBY dipped to $15.35 during the market weakness 
on Wednesday but quickly rebounded with the DJIA.  Today's rally 
pushed the stock up another 2.74% but closed just short of its 
50-dma at $16.47.  This positive breakout over the $16 level has 
produced a bullish crossover in the MACD.  We are bumping our 
stop from $14.99 to yesterday's low of $15.35.  Traders who have 
been waiting for the breakout might want to look for any pull 
back and bounce at the $16.00 level.  We are looking for an exit 
price of $18.00 but the next test will be to close above the 50-
dma.

Picked on January 18th at $16.00 
Gain since picked:         +0.45
Earnings Date           02/14/02 (unconfirmed)




---

QuadraMed Corp. - QMDC - close: 10.46 change: -0.11 stop: 9.98

We're a bit concerned that QMDC has not participated in the 
recent market rebound.  Shares have traded relatively sideways 
for the last four sessions.  The recent trading activity almost 
looks like a very short-term pennant forming with lower highs and 
higher lows.  This would indicate a breakout one direction or the 
other is imminent but it's a bit of a stretch.  Given the lack of 
follow through for QMDC we would probably turn cautious and shy 
away from new positions.  Conservative traders trying to protect 
their capital may want to inch up their stops to $10.19 but the 
newsletter will leave ours at $9.98.  A number of healthcare 
stocks were up today, which makes us believe that QMDC is 
probably trading in closer relation to the software group of 
which it truly belongs.  

Picked on January 25th at $10.33 
Gain since picked:         +0.13
Earnings Date           02/28/02 (confirmed)




---

Trigon Healthcare - TGH - cls: 73.53 chg: +0.24 stop: 69.99 

Like the rest of the market, TGH fell to selling pressure on 
Wednesday morning but bounced back with the broader indices when 
given the chance.  Thursday's session saw the stock hit new 52-
week highs (74.75) but shares closed off their best levels of the 
day.  Depending on your market outlook, healthcare may be the 
place to be.  If you think the market may roll over again over 
the intermediate term then traditionally healthcare is a 
defensive play and investors will look to it for safety.  If you 
think the market will continue to focus new money on stocks with 
steady earnings then healthcare has a lot of candidates Wall 
Street might focus on.  We would look to the $72 level as a 
possible entry on a pull back.  One possible catalyst for a 
short-term move in TGH is the up coming UBS Warburg Annual Health 
Care Conference.  TGH's CFO, Tom Byrd, is scheduled to speak on 
Monday, Feb. 4th, at 1:30 p.m.  Any positive comments he has to 
offer could filter into the stock price.  Of course this is a 
double-edged sword if analysts perceive his comments as negative.

Picked on January 11th at $71.42 
Gain since picked:         +2.11
Earnings Date           02/08/02 (confirmed)




---

UnitedHealth Group - UNH - cls: 74.35 chg: +1.85 stop: 70.99


There is not a lot of difference between our play in TGH and our 
play in UNH.  Both are healthcare stocks that have shown a great 
deal of relative strength against recent market weakness and both 
are at or near new 52-week highs.  Both are traditional defensive 
plays and both have strong earnings.  During the sell-off on 
Wednesday, the stock retreated to support near the $72 level and 
brave investors could have jumped again.  Overhead resistance is 
still at $75.

Picked on January 11th at $71.75 
Gain since picked:         +2.60
Earnings Date           01/24/02 (confirmed)





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

Citigroup Inc - C - close: 47.40 change: +0.06 stop: 49.25

The broader banking sectros, like the BIX.X and the BKX.X, have 
both made significant rebounds during the last two trading 
sessions.  Citigroup has also bounced back from its Wednesday 
lows but with a lot less conviction.  Shares of C remain under 
the $48 level as well as the price resistance that was previous 
support at $48.50.  The 200-dma overhead at $48.46 supports this 
stance.  A failed rally at the $48 level may be an attractive 
entry point for shorts to consider new positions.  For more info 
on the fundamentals behind the play, check out Tuesday's write 
up.

Picked on January 29th at $46.71
Gain since picked:         -0.69
Earnings Date           01/17/02 (confirmed)


 

---

Silicon Valley - SIVB - cls: 23.03 chg: -0.15 stop: 24.01 *new*

SIVB did trade back below the $22 level during the nadir of 
Wednesday's market sell-off but rebounded just as fast.  
Personally, I find the sideways trading to be a strain on my 
patience level and it wouldn't bother me to drop this play for 
lack of movement.  However, they say patience is a virtue and 
whether you're waiting for the right entry point or exit point it 
tends to pay off.  Of course as short-term traders it doesn't 
hurt to enter passively and exit more aggressively.  What does 
concern me is the sideways trading is giving the MACD time to 
flatten out and a fake or weak bullish crossover in the next few 
days might attract unworthy bullish attention.  The recent 
sideways trading could just be consolidation after the big drop 
on heavy volume that brought it this low.  Jeff made a valid 
point in the office that we should probably move our stop to 
$24.01 just to give us that one-cent edge if traders choose to 
let it rise to $24.00 before hammering it again.

Picked on January 18th at $22.93
Gain since picked:         -0.11
Earnings Date           01/16/02 (confirmed)


 



==================================================================
High Risk / High Reward (HR) section
==================================================================

===============
HR Play Updates
===============

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

QUALCOMM - QCOM - close: 44.13 change: -0.56 stop: 42.49

Our contrarian high-risk long play continues to coil sideways, or 
as Jeff puts it, produced another inside day.  Given the narrow 
range today we would look for a break out one way or the other 
very soon (like tomorrow?).  We did hear a tidbit that said ABN 
AMRO was cautious on QCOM.  Gosh, like who isn't?  However, they 
reiterated their "add" rating and a $52 price target despite what 
they feel could be short-term weakness ahead.  Talk about 
covering all your bases.  We've already stated that most major 
brokers are negative on the group and we personally see no 
fundamental to own QCOM short-term either.  See Thursday's 
original write up for more strategy tactics.

Picked on January 30th at $44.69 
Gain since picked:         -0.56
Earnings Date           01/24/02 (confirmed)





===============
HR Closed Plays
===============

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

Maximus Inc - MMS - close: 35.35 change: +1.35 stop: 35.01 

The 350-point bounce in the Dow Jones from Wednesday's lows was 
enough to fuel a bounce in MMS up through our new stop.  Shares 
of Maximus added almost 4% but closed below its descending 10-
dma.  We haven't seen any more news on the company and volume was 
nothing to get excited about but the move over $35 has us looking 
elsewhere.  The point-and-figure chart shows a three-box 
turnaround but it could just be a speed bump on the way down.  

Picked on January 25th at $33.10
Gain since picked:         -1.91
Earnings Date           02/05/02 (confirmed)





==================================================================
Split Trader - Stock Split (ST) section
==================================================================

=============
Announcements
=============

How Sweet It Is, a 4-for-3 Split at RMCF

Rocky Mountain Chocolate Factory, Inc. (NASDAQ:RMCF), based in 
Durango, Colorado, has just declared a 4-for-3 stock split of its 
common stock.  

The timing of the press release came out within the last half hour 
of trading and shares moved higher on the news to close at $13.90.

The Board of Directors met a few days ago and approved a 4:3 stock 
split payable on March 4th, 2002 for shareholders on record of 
Feb. 11th.  

The split is desperately needed to increase liquidity as the stock 
normally trades less than 10K shares a day.  After the split takes 
affect RMCF will have 2.4 million shares outstanding.

The stock closed at $13.90 on Thursday.  For a current quote,
click here:
http://user.financialcontent.com/pin1/quote.cgi?account=pin1&ticker=RMCF


About the company
Rocky Mountain Chocolate Factory, Inc., headquartered in Durango, 
Colorado, is an international franchiser of gourmet chocolate and 
confection stores and a manufacturer of an extensive line of 
premium chocolates and other confectionery products. 
(source: company press release)





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

OXY     Occidental Petro           25.95     +0.87
JCI     Johson Controls Inc        84.06     +0.79
EPD     Enterprise Products        50.49     +2.18
PDS     Precision Drilling Corp    24.96     +0.85
PPP     Pogo Producing Co          25.46     +0.56
AXL     American Axle & Mfg        27.00     +2.00

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

WIN     Winn-Dixie Stores Inc      13.35     +1.14
XOMA    Xoma Ltd                   11.16     +1.28
TZIX    Trizetto Group Inc         14.33     +1.22
NETE    Netegrity Inc              15.65     +2.48
STAR    Lone Star Steakhouse       19.50     +1.08
STOR    StorageNetworks Inc         5.14     +1.06

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

PG      Procter & Gamble Co        81.68     +3.39
KFT     Kraft Foods Inc            37.06     +1.56
BAX     Baxter Intl. Inc           55.83     +2.08
LMT     Lockheed Martin Corp       52.97     +2.51
ITW     Illinois Tool Works        71.38     +1.39
GD      General Dynamics           89.56     +4.21
UNP     Union Pacific Corp         62.05     +1.82

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

V       Vivendi Universal          42.63     -2.27
CSR     Credit Suisse Group        38.47     -1.10
KG      King Pharmaceutical        36.40     -1.45
EL      Estee Lauder Co            32.30     -1.30
ERTS    Electronic Arts Inc        53.07     -3.83
PSD     Puget Sound Energy         20.74     -1.74

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

... none ...	



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