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Daily Newsletter, Thursday, 07/11/2002

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PremierInvestor.net Newsletter                  Thursday 07-11-2002
                                                    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:      Rotation?  A bottom?  Short Covering?
Play-of-the-Day:  Who's getting the other golden goose?
Market Sentiment: Rally Ho or Downward We Go?

************************************************************
MARKET WRAP  (view in courier font for table alignment)
************************************************************
      07-11-2002           High     Low     Volume Advance/Decline
DJIA     8801.53 - 11.97  8854.90  8605.34 2.06 bln   1131/1879
NASDAQ   1374.43 + 28.43  1375.58  1323.59 2.26 bln   1469/2017
S&P 100   462.92 +  4.23   464.06   448.92   Totals   2600/3896
S&P 500   928.44 +  6.90   929.16   900.94 
RUS 2000  416.68 -  3.10   419.78   408.19 
DJ TRANS 2504.58 - 42.58  2548.97  2546.44   
VIX        38.55 -  0.47    41.64    38.55   
VXN        68.60 +  3.38    70.47    66.31 
Total UpVol 2,709.1M
Total DnVol 1,683.1M
52wk Highs   97
52wk Lows   722
TRIN        0.51
PUT/CALL     .89
*************************************************************

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

Rotation?  A bottom?  Short Covering?

Over the next couple of days, expect to hear the three questions 
regarding today's action.  Is it Rotation? A bottom? Short 
Covering? as questions to be bantered around at water coolers 
when reviewing today's rather wild trading session.

What started out "bleak" got "worse" then got "better" to only 
finish near the highs for the major averages.  If I were to 
answer any of the three questions above, I'd have to day today's 
action was indicative of some rotation, but a lot of short-
covering, which may eventually lead to a bottom, but I think it's 
way to early to be looking for a bottom as there's one heck of a 
lot of work to be done.

At the end of the day, the Dow Industrials managed to recoup all 
but 12 points of its intra-day 208-point declines to finish at 
8801 (-0.13%).  One of the weaker Dow components Eastman Kodak 
(NYSE:EK) $29.58 +11.03% lead the Dow's gains after the company 
said it expects to post Q2 earnings of $0.85 a share (excluding 
items) versus previous guidance of $0.60-$0.70 and analysts' 
estimates (based on company guidance I'm sure) of $0.63 a share.  

The photo/film/chemical maker cited improvement in its 
manufacturing productivity and operational performance, as well 
as the earlier-than-anticipated realization of the cost benefits 
of a restructuring begun last year.  The company followed to say 
that it is maintaining 2nd-half earnings to be between $1.35 and 
$1.75 a share.

Eastman Kodak Chart - Daily Interval




Today's "good news" from Eastman Kodak (EK) really looks to have 
caught some bears off guard.  While it is bullish for EK to give 
some upside guidance, bears are going to believe that the upside 
guidance from earnings isn't coming from growth in its business, 
but some cutting of fat from cost-cutting measures.  This type of 
thinking most likely had some bears locking in gains, but will 
most likely have some bears looking to enter new short positions 
near the declining 200-day moving average and 61.8% retracement 
level near-term.  I'd like to see the stock pull back and test 
the $28-$28.63 level and get a feel for any type of true 
commitment from bulls.  If the stock does pullback and firm at 
that level (similar to January's pullback after a jump higher on 
similar volume) then look for a bullish entry point.  

As it relates to "short-covering" which could lead to a market 
bottom, think of a bunch of stocks that have similar technicals 
to EK.  Should EK break above its 50 and 200-day MA and just keep 
running, that is how a bottom in the market could be put in.

The second biggest gainer in the Dow Industrials had shares of 
Intel (NASDAQ:INTC) $18.24 +8.5% despite a 02:30 PM EST not from 
Lehman Brother's analyst Dan Niles reiterating his cautious 
stance on the stock, saying that although Q2 estimates look 
reasonable, future consensus expectations may need to come down 
due to pressure on gross margins and falling average selling 
prices for its chips and processors.

Intel Corporation chart - Daily Interval




Intel (INTC) had actually been trying to show some upside as this 
Dow component and technology bellwether at least had given a "buy 
signal" that is still intact on its point and figure chart at 
$19.50 and looks to be trying to put in a double bottom.  Bears 
may be a bit jittery in this one as the stock traded strong 
despite a "respected" industry analyst advising caution.  Every 
analyst can be "wrong" from time to time.  Lehman Bros. analyst 
Dan Niles was cautious on Intel (INTC) last year at similar 
levels and that didn't keep the stock from trading $36 by 
December.  A break much above today's high could have the stock 
trading the $20.18 level in no time and that would be just about 
a 10% gain.  With a bullish vertical count of $26 associated with 
its point and figure chart, bears could step up their short-
covering, especially with tonight's news from Dell Computer 
(NASDAQ:DELL) $23.91 +1.01%.

After the closing bell, Dell Computer (DELL) guided higher on its 
upcoming Q2 saying it sees earnings of $0.19 per share, which is 
a penny higher than consensus of $0.18 a share.  Once again, the 
higher guidance isn't necessarily coming from growth due to 
increased consumer demand, as the company cites "continued gains 
in market share" for its higher guidance.  In after-hours 
trading, shares of Dell jumped 6% to $25.40.

Treasuries did reverse earlier gains, but not enough

The benchmark 10-year YIELD ($TNX.X) 4.619% reached its spike 
lower best of 4.553% at around 12:05 PM EST and reversed higher 
(caused by selling) from there.  

That was about 10-minutes before the Dow Industrials reached 
their session low of 8,605 at 12:15 EST and the NASDAQ Composite 
(COMPX) 1,374 +2.11% reaching its 12:15 EST low of 1,323.  

Any guesses when the S&P 500 Index (SPX.X) reached its intraday 
low at 900?  If you guessed 12:15, then you be exactly right!

This intra-day timeline does hint that there is indeed a chance 
that we're seeing some rotation from Treasuries to stocks, but it 
would at least take a move above 4.635% or 4.65% (good round 
number) to have me believing that the rotation will last.

10-year YIELD Chart - Daily Interval




It's entirely possible that we saw some technical selling in the 
10-year YIELD today at the lower end of the regression channel, 
but is sure did seem to have an impact on stock prices intraday 
as the selling in Treasuries came about 10-minute prior to 
today's lows in the major market averages.

Even if this was simply technical selling in Treasuries, 
continuation of such selling could still have a bullish impact on 
the broader market averages.

Even if you're a bearish equity trader based on economic belief, 
at least understand the potential ramifications if Treasuries see 
some near-term selling.

I will argue that today's selling in Treasuries looks to be 
technical in nature, and perhaps did have a hand in getting some 
bearish equity traders to cover some short positions in stocks 
that were overextended to the downside.

When I look at my "economically" sensitive indexes like the Dow 
Jones US Home Construction Index (DJUSHB) 346.58 -2.63%, Dow 
Transports (TRAN) 2,505 -1.67%, Morgan Stanley Cyclical Index 
(CYC.X) -1.51%, Retail HOLDRS (AMEX:RTH) $83.67 -1.02% and 
Forest/Paper Products Index (FPP.X) 336 -0.77%, I can't sit here 
and write that today's bullishness in the broader market averages 
were any type of "vote" for economic confidence.

I don't know who I heard on CNBC today call for another "tech-
led" market recovery, but I think that person is as far off base 
as those that called for it over a year ago.

Some will say we could see some "rotation" out of the more 
economically rooted sectors like the deep cyclicals, but I think 
its way toooooooooo early to even think that.  

Morgan Stanley Cyclical Index Chart - Weekly Interval




One reason I think there was a lot of short covering taking place 
today that may have been triggered by Treasury action, is that 
this group, while trading off their intraday low of 506.70 at 
12:30 PM, closed in the red by session's end.  

My opinion has been that technology stocks would be weak and that 
bulls would look to the bigger cyclicals on any type of bullish 
economic thought.  

Let's face it, bears have been shorting the heck out of 
technology and having success.  Only until the past month or so 
have bears had much success in the cyclicals.

As such, I think "smart money" has indeed been shorting tech and 
much more that the deeper cyclicals.  Today's "lag" by the more 
economically sensitive groups hints to me that there was a lot of 
short-covering being done.

For a "bottom" to be called, I'd sure as heck want to see some 
type of bullish response from the cyclicals.  The cyclicals 
historically get sold when they're reporting blockbuster 
earnings, their coffers are overflowing with cash, and they begin 
spending on technology that will enhance productivity to meet 
building demand for their products.  We haven't seen anything 
close to that yet so I'm not thinking that money is rotating out 
of the cyclicals in force to go play a capex resurgence in 
technology.

Nope.  But I will say that technology shorts are keeping a 
watchful eye on Treasuries and may be covering on the slightest 
hint of any selling that might indicate debt markets are looking 
for some higher return possibilities than a measly 4.619% YIELD 
from the 10-year.

How's the consumer?

What's the consumer been doing?  Tomorrow at 08:30 AM EST we'll 
get a look at June's Retail Sales numbers.  Economists are 
looking for a 0.6% rise compared to May's -0.9% decline.  Retail 
sales excluding autos has economists looking for a 0.4% gain, 
versus may's -0.4% decline.

Then at 09:45 AM EST, we'll get the University of Michigan's 
preliminary July Consumer Confidence reading.  Economists are 
looking for a reading of 93.3, versus June's 92.4%.

US Dollar watch

By session's end, the US Dollar Index (dx00y) 106.23 +0.12% 
reversed earlier weakness and not unlike stocks, pegged a session 
high close.

Once again, gold stocks got whipped around at the Gold/Silver 
Index (XAU.X) -3.57% gave back an earlier session 1% gain after 
December Gold futures (gc02z) $319.90 +.81% failed to hold above 
the $320 level for more than 15-minutes.  Here again, I'll note 
today's session high in December Gold futures reached their peak 
at from 12:05 to 12:15 EST, then traded off when Treasuries saw 
selling.

As I close out here, December Gold Futures (gc02z) are edging 
down $-1.20 at $318.70.

Jeff Bailey

Senior Market Technician
PremierInvestor.net



=========================
Play-of-the-Day           (New active trader BEARISH play)
=========================

Newmont Mining Corp. - NEM - close: 28.05 change: -0.83 
Stop: 29.10 

Company Description:
Newmont Mining Corporation (NMC), along with its subsidiaries, is
worldwide company engaged in the production of gold, exploration 
for gold and acquisition of gold properties. The Company also has 
an interest in a copper/gold mine that commenced production in 
late 1999. In addition, the Company produces zinc, lead and 
copper concentrates at its property in Western Australia. On 
February 13, 2002, NMC approved the adoption of an Agreement and 
Plan of Merger that provides for a restructuring of the Company 
to facilitate the February 2002 acquisitions of Normandy Mining 
Limited and Franco-Nevada Mining Corporation Limited, and to 
create a flexible corporate structure. NMC merged with an 
indirect, wholly owned subsidiary that resulted in the Company 
becoming a direct wholly owned subsidiary of a newly formed 
holding company. (Source: Company press release)


Why We Like It:
In light of the sell off in the market over the last few days, we 
feel as though the market as a whole is due for a short-term 
bounce.  The bounce might not last long, however, if the markets 
attempt a slight relief rally, gold will feel some downward 
pressure.   Our thoughts here are only of pure technical merit, 
and include the Volatility Index $VIX.X.  The $VIX.X, is at the 
top of the channel it has been trading in for the last three 
months.  Given the rally of broader markets, the VIX.X looks like 
it could see some selling before it could potentially continue 
higher.  Thinking there might be a pullback in the VIX.X and a 
possible bounce in the Dow and Nasdaq, we are shorting Newmont 
Mining (NYSE:NEM).  Further, on the daily chart, NEM found 
resistance on the 50-Day MA during the last two trading sessions.  
Our entry is at today's close of 28.05, looking for a target of 
25.60, which is just above support.  With no questions asked, we 
will close ALL of this position immediately if our target is met.  
To protect our trade from a potential rally in gold and another 
decline in the overall market, we are putting a tight stop at 
29.10, just slightly above the 50-Day MA.  This would be a 3.7% 
loss, and constitutes a 2.3:1 risk to reward.  We have also 
decided that this trade is to be a short-term hold, and could be 
closed quickly if market sentiment turns increasingly bearish.  
If the overall market breaks lows, i.e. the Dow breaks September 
lows, we will exit this trade based on the looming potential 
rally in gold.  This is a technical rebound play, and could 
return as much as 8.7% if all things work out correctly.  


Picked on July 11th at $28.05 
Gain since picked:      +0.00
Earnings Date         07/30/02 (confirmed)
 




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

Rally Ho or Downward We Go?
By Eric Utley

The market shocked most with its recovery from the abyss during
the day’s session.  But maybe the signs were on the wall, at least
for the ramp in technology shares.

We’ve had the Nasdaq-100 Bullish Percent ($BPNDX) in bull alert
for quite a while now, and that position finally led to some
upside in today’s session on what was a mix of frantic short
covering with a little bargain buying mixed in.  As it often
does, the Nasdaq leads the market as it is the most volatile of
the major averages.  So the early signs of a rally in tech
shares may be a sign of things to come elsewhere in the market.

Elsewhere, the market is getting increasingly oversold.  The
bullish percent readings for the S&P 500 ($BPSPX) and the S&P
100 ($BPOEX) are quickly approaching last fall’s lows, but are
not quite there yet.  What I’m wondering is why the internals of
the market by way of the bullish percent figures have not yet
taken out their September lows, but several of the major market
averages already have, including the SPX, OEX, and NDX.  The
Dow Jones Industrial Average ($INDU) is the only one of the
majors that has not yet broken below its September lows.

Speaking of the Dow, its bullish percent reversed back into a
bear confirmed condition during today’s session after the
indicator shed two stocks.  I didn’t check to see which stocks
went on sell signal in the Dow in the last two days, but
judging by the way the financials, industrials, and health
care sectors have been trading, it wouldn’t be too hard to
spot the new sell signals among Dow components.

The sector scorecard was all about technology during today’s
session.  All eight of the major technology sectors that I
track finished well into positive territory.  The Disk Drive
Index (DDX.X) was the laggard of the group with its measly
0.39 percent gain, which was a blip compared to the 6.85
percent pop in the Semiconductor Index (SOX.X).

If this market is going to rally, it’s going to be led higher
by technology.  Not that I’m a cheerleader for the new
economy, or wishing that it was 1999 again.  Rather, the
indicators I follow are lined up for a run in tech shares,
possibly followed by upside movement in the other recently
beaten down segments of the market.

Finally, I leave you with a question:  Why did the Nasdaq-100
Volatility Index (VXN.X) finish 5.18 percent higher when the
NDX finished 4.06 higher?

Don’t know?  Fair enough.  The answer: skepticism.

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

Market Averages

DJIA ($INDU)

52-week High: 11350
52-week Low :  8062
Current     :  8801

Moving Averages:
(Simple)

 10-dma: 9105
 50-dma: 9683
200-dma: 9823

S&P 500 ($SPX)

52-week High: 1316
52-week Low :  901
Current     :  927

Moving Averages:
(Simple)

 10-dma:  962
 50-dma: 1033
200-dma: 1098

Nasdaq-100 ($NDX)

52-week High: 2071
52-week Low :  946
Current     :  998

Moving Averages:
(Simple)

 10-dma: 1008
 50-dma: 1151
200-dma: 1391


Semiconductor ($SOX)

The SOX was the best performing sector on the day, leading
technology higher throughout the session.  The SOX gained a
very impressive 6.85 percent on the day.

Leading the way to the upside included shares of Xilinx
(NASDAQ:XLNX), Cree (NASDAQ:CREE), NVIDIA (NASDAQ:NVDA),
Broadcom (NASDAQ:BRCM), and Applied Materials (NASDAQ:AMAT).

52-week High: 657
52-week Low : 344
Current     : 372

Moving Averages:
(Simple)

 10-dma: 371
 50-dma: 451
200-dma: 510


Gold ($XAU)

The correlation continues!  Stocks higher, gold lower.  The
XAU was the worst performing sector on the day with its
3.57 percent drop.

Leading the way to the downside included Gold Fields (NYSE:GFI),
Meridian Gold (NYSE:MDG), Harmony Gold (NASDAQ:HGMCY), Anglogold
(NYSE:AU), and Agnico Mines (NYSE:AEM). 

52-week High: 89
52-week Low : 49
Current     : 75

Moving Averages:
(Simple)

 10-dma: 74
 50-dma: 79
200-dma: 65

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

Market Volatility

The VIX traded above 40 today!  But get this, it only finished
the day fractionally lower.

Even better, the VXN finished the day higher.  There may be
something to this rally after all.

CBOE Market Volatility Index (VIX) - 38.55 -0.47
Nasdaq-100 Volatility Index  (VXN) - 68.60 +3.38

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

          Put/Call Ratio  Call Volume   Put Volume
Total          0.89        746,418       663,198
Equity Only    0.73        560,152       408,730
OEX            0.84         54,863        45,878
QQQ            0.58         78,078        45,479

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

Bullish Percent Data

           Current   Change   Status
NYSE          41      - 3     Bull Correction
NASDAQ-100    15      + 2     Bull Alert
DOW           23      - 7     Bear Confirmed
S&P 500       26      - 5     Bear Confirmed
S&P 100       23      - 5     Bear Confirmed

Bullish percent measures the number of stocks in an index 
currently trading on a buy signal on their point and figure 
chart.  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  1.31
10-Day Arms Index  1.42
21-Day Arms Index  1.43
55-Day Arms Index  1.40

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.

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

Market Internals

        Advancers     Decliners
NYSE       1293          1960
NASDAQ     1455          2001

        New Highs      New Lows
NYSE        39            326
NASDAQ      15            266

        Volume (in millions)
NYSE     2,083
NASDAQ   2,297

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

Commitments Of Traders Report: 06/25/02

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

Commercial interests added back about 10,000 contracts to their
net bearish position.  Small traders dropped a number of longs
and a smaller number of shorts for a reduction in their net
bullish position by more than 20,000 contracts.

Commercials   Long      Short      Net     % Of OI 
06/11/02      388,751   457,018   (68,267)   (8.1%)
06/18/02      437,530   487,956   (50,426)   (5.4%)
06/25/02      378,214   438,775   (60,561)   (7.4%)

Most bearish reading of the year: (111,956) -   3/6/02
Most bullish reading of the year: ( 36,481) - 10/16/01

Small Traders Long      Short      Net     % of OI
06/11/02      174,357    69,464   104,893     43.0%
06/18/02      181,178    88,517    92,661     34.3%
06/25/02      134,380    62,792    71,588     36.3%

Most bearish reading of the year:  36,513 - 5/01/01
Most bullish reading of the year: 114,510 - 3/26/02
 
NASDAQ-100

The roles reversed.  Commercials went decidedly short, while
Small Traders went decidedly long.

Commercials   Long      Short      Net     % of OI 
06/11/02       45,946     36,878     9,068   10.9%
06/18/02       54,816     49,169     5,647    5.4%
06/25/02       27,238     35,926    (8,688) (13.8%)

Most bearish reading of the year: (15,521) -  3/13/02
Most bullish reading of the year:   9,068  - 06/11/02

Small Traders  Long     Short      Net     % of OI
06/11/02       14,561    25,330   (10,769)   (27.0%)
06/18/02       20,883    29,153    (8,270)   (16.5%)
06/25/02       14,749     7,570     7,179     32.2% 

Most bearish reading of the year: (10,769) - 06/11/02
Most bullish reading of the year:   8,460  -  3/13/02

DOW JONES INDUSTRIAL

Dow commercials dropped about 2,000 of their net long
position.  Small traders eased into a bullish position.

Commercials   Long      Short      Net     % of OI
06/11/02       20,369    17,172    3,197      8.5%
06/18/02       25,995    19,115    6,880     15.1%
06/25/02       18,016    13,255    4,761     15.2% 

Most bearish reading of the year: (8,322) -  1/16/01
Most bullish reading of the year: 15,135  - 10/16/01

Small Traders  Long      Short     Net     % of OI
06/11/02        7,500     9,925    (2,425)   (13.9%)
06/18/02        5,379    11,813    (6,434)   (37.2%)
06/25/02        6,414     6,597       183     1.40% 

Most bearish reading of the year:  (8,777) - 10/12/01
Most bullish reading of the year:   1,909  -  1/16/01

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




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Do not duplicate or redistribute in any form.




PremierInvestor.net Newsletter                 Thursday 07-11-2002
                                                    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/g11b_2.asp
=================================================================

In section two:

Stock Bottom / Active Trader
  New Bearish Plays:     AU, NEM
  Bearish Play Updates:  FLR, RJR, XL

High Risk/Reward
  New Bullish Plays:     NVDA
  Bearish Play Updates:  ALO, CHKP, SEBL
  Closed Bullish Plays:  SNE
  Closed Bearish Plays:  QLGC

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)
                         


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

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

  -----------------
  New Bearish Plays
  ----------------- 

Anglogold - AU - close: 28.21 change: -1.16 stop: 29.50

Company Description:
Anglogold is a global gold producer with 21 operations, in 8 
countries, worldwide. The company is among the world's largest 
gold producers with production of approximately 6 million ounces 
of gold each year. The company also has extensive and focused 
exploration activities in 10 countries and is listed on the 
following securities exchanges: Johannesburg (ANG), New York (AU) 
and Australia (AGG) as well as the London Stock Exchange (79LK) 
and the Paris (VA FP) and Brussels (ANG BB) bourses. 
(Source: company press release)

Why We Like It:
In light of the sell off in the market over the last few days, we 
feel as though the market as a whole is due for a short-term 
bounce.  Although the bounce may be short-lived, gold will feel 
some downward pressure if the markets attempt to breathe a 
little.   Our thoughts are only of pure technical merit, and 
include the Volatility Index $VIX.X.  The VIX.X is an inverse 
measurement of volatility, and is at the top of the channel it 
has been trading in for the last three months. With the rally in
the broader markets, the VIX.X looks like it could see some 
selling before it can continue higher.  Given the potential 
pullback of the VIX.X and a possible bounce in the Dow and 
Nasdaq, we are shorting Anglogold Ltd. (NYSE:AU) for a quick 
drop.  Our entry is at today's close of 28.21, looking for a 
target of 25.75.  With no ifs, ands, or buts, we will close ALL 
of this position immediately if our target is met.  To protect 
our trade from a potential rally in gold and another decline in 
the overall market, we are putting a tight stop at 29.50.  This 
would be a 4.5% loss, and constitutes a 1.93:1 risk to reward.  
We have also decided that this trade is to be a shorter-term 
hold, and could be closed quickly if market sentiment turns 
increasingly bearish.  If the overall market breaks lows, i.e. if 
the Dow breaks recent lows, we will exit this trade based on the 
looming potential rally in gold.  This is a short-term technical 
pullback play.

Picked on July 11th at $28.21 
Gain since picked:      +0.00
Earnings Date        10/31/02 (confirmed)
 



---

Newmont Mining - NEM - close: 28.05 change: -0.83 stop: 29.10 

Company Description:
Newmont Mining Corporation (NMC), along with its subsidiaries, is
worldwide company engaged in the production of gold, exploration 
for gold and acquisition of gold properties. The Company also has 
an interest in a copper/gold mine that commenced production in 
late 1999. In addition, the Company produces zinc, lead and 
copper concentrates at its property in Western Australia. On 
February 13, 2002, NMC approved the adoption of an Agreement and 
Plan of Merger that provides for a restructuring of the Company 
to facilitate the February 2002 acquisitions of Normandy Mining 
Limited and Franco-Nevada Mining Corporation Limited, and to 
create a flexible corporate structure. NMC merged with an 
indirect, wholly owned subsidiary that resulted in the Company 
becoming a direct wholly owned subsidiary of a newly formed 
holding company. (Source: Company press release)

Why We Like It:
In light of the sell off in the market over the last few days, we 
feel as though the market as a whole is due for a short-term 
bounce.  The bounce might not last long, however, if the markets 
attempt a slight relief rally, gold will feel some downward 
pressure.   Our thoughts here are only of pure technical merit, 
and include the Volatility Index $VIX.X.  The $VIX.X, is at the 
top of the channel it has been trading in for the last three 
months.  Given the rally of broader markets, the VIX.X looks like 
it could see some selling before it could potentially continue 
higher.  Thinking there might be a pullback in the VIX.X and a 
possible bounce in the Dow and Nasdaq, we are shorting Newmont 
Mining (NYSE:NEM).  Further, on the daily chart, NEM found 
resistance on the 50-Day MA during the last two trading sessions.  
Our entry is at today's close of 28.05, looking for a target of 
25.60, which is just above support.  With no questions asked, we 
will close ALL of this position immediately if our target is met.  
To protect our trade from a potential rally in gold and another 
decline in the overall market, we are putting a tight stop at 
29.10, just slightly above the 50-Day MA.  This would be a 3.7% 
loss, and constitutes a 2.3:1 risk to reward.  We have also 
decided that this trade is to be a short-term hold, and could be 
closed quickly if market sentiment turns increasingly bearish.  
If the overall market breaks recent lows; i.e. the Dow breaks 
September lows, we will exit this trade based on the looming potential 
rally in gold.  This is a technical rebound play, and could 
return as much as 8.7% if all things work out correctly.  

Picked on July 11th at $28.05 
Gain since picked:      +0.00
Earnings Date         07/30/02 (confirmed)
 




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

Fluor Corp. - FLR - close: 34.10 change: -1.10 stop: 37.36

To protect some of our profits, we would like to tighten our stop 
on half of our trade, covering half if FLR trades above 35.50.  
Fluor is trading on the lower portion of the channel on the daily 
chart.  Although we think this is still a reliable short, we are 
wary of a short-term bounce in the broader market.  To avoid 
getting stopped out for a loss on a dead cat bounce, we are 
lowering our stop to 35.50, where we will cover half of our 
position.  Conservative investors may book all of their profits 
at the 35.50 stop level, making sure no loss is taken.  More 
aggressive investors could hold half of the position up into our 
original stop of 37.36, which is slightly above the 50-Day MA.  

Picked on July 3rd at $35.94
Change since picked:   +1.84
Earnings Date       07/30/02 (confirmed)
 



---  

RJR Reynolds - RJR - close: 53.91 change: -1.03 stop: 56.01 *new*

Following UST and MO, our short RJR is moving in our favor.  In 
the legal arena, a U.S. appeals court rejected the tobacco 
company's challenge to the anti-trust class action suit currently 
in play.  This recent legal decision allows the class action suit 
to move forward, going to trial in front of a jury.  The alleged 
anti-trust violations implicate Philip Morris, RJ Reynolds, and 
many others in rigging tobacco auctions.  More legal worries 
could help stall prospective buying by fund managers in the 
Tobacco sector.

In our favor, RJR is testing support at the 54 area, potentially 
setting up for a sell off which could test recent lows.  If the 
stock starts to crumble, 50 will be a large technical and 
psychological support number.  Our NEW STOP is at 56.01, with a 
target projected in the 50 area.  
   
Picked on July 10th at $54.94 
Gain since picked:      +1.03
Earnings Date         7/19/02 (confirmed)
 



---

XL Capital - XL - close: 78.20 change: +0.45 stop: 83.06

As we pointed out previously, you never go broke booking profits. 
 So far, XL has faired well as a profitable short trade.  The 
broader market weakness along with the overall lack of strength 
in the Insurance Index, has allowed XL to move closer to our 
profit target.  The $IUX.X dropped 12 points yesterday.  With no 
new news surfacing on XL, the stock is at the mercy of the 
broader market and Insurance Index.  

XL Capital looks to be trading exactly at the bottom of the very 
short-term channel.  A potential bounce could be on the horizon, 
allowing the stock a chance to breathe before any continued 
selling.  The most obvious psychological resistance is the whole 
number at 80.  Therefore, we would like to put a profit 
protection stop for half of our position at 80.01, covering the 
remaining half if the stock breaks above $83.06.  
As the stock moves in our favor, we would like to reiterate...
The stock might find support near the $75 level so short-term 
traders could book half their profits between $76 and $75 and 
keep the other half of the position as we aim for the $70 region.   

Picked on July 3rd at $80.89
Gain since picked:     +2.69
Earnings Date       04/29/02 (confirmed)






==================================================================
HIGH RISK/HIGH REWARD (HR) section
==================================================================

============
HR New Plays
============

  -----------------
  New Bullish Plays
  ----------------- 

NVIDIA Corp. - NVDA - close: 19.92 change: +1.83 stop: *text*

Company Description:
NVIDIA Corporation, located in Santa Clara, CA, is the global 
leader in advanced graphics and multimedia processing technology 
for the consumer and professional computing markets. Its 2D, 3D, 
video and multimedia capabilities make NVIDIA one of the premier 
semiconductor companies in the world. NVIDIA offers a wide range 
of products and services, delivering superior performance and 
crisp visual quality for PC-based applications such as 
manufacturing, science, e-business, entertainment and education. 
(source: company press release)

Why We Like It:
Maybe CNBC has been airing too much footage of the recent running 
of the bulls in Spain.  A fear of being gored had shorts covering 
positions en masse on Thursday.  The chip sector was particularly 
strong, as evidenced by the 6.8% gain in the semiconductor index 
(SOX.X).  The bounce was in part precipitated by a trading floor 
rumor that INTC would increase earnings estimates after the 
close.  Although this rumor turned out to be false, the mere 
possibility was enough to have shorts running for the exits.  
Technically, the SOX bounced from the September lows for the 
second time in as many weeks and appears to be headed for a test 
of stubborn resistance at 400.  Shares of graphics chip producer 
NVDA blasted higher by 10% today, setting up what we think is an 
attractive long play.  The stock is currently residing just under 
near-term and psychological resistance at $20.00.  We think a 
break above this level could take the stock to the top of its 
descending regression channel near $25.  Although shares have 
already bounced sharply from the relative low of $15.62, the 
recent bullish MACD crossover suggests more buying ahead.  
Additionally, a trade at $21.00 will create a double-top breakout 
on the point-and-figure chart.  That would be the first p-n-f buy 
signal since May.  We're going to target a quick move to our 
official profit target of $23.99, just under resistance from 
late-June.  

And dude, DELL's upside Q2 earnings guidance (outlined in more 
detail in tonight's Market Wrap) should give NVDA a nice boost 
tomorrow.  Shares were trading in the $20.70-$20.80 range in the 
after-hours session.  This pretty much eliminates the guesswork 
from our entry strategy.  We're placing an entry trigger at 
$20.06, just above today's high.  Barring any unforeseen events 
before tomorrow's opening bell, NVDA will gap above this level.  
However, we will NOT enter this play if the stock opens above 
$20.99.  If our play is triggered, our stop-loss will be placed 
$18.94.  We'll probably move our stop closer to the $20 level if 
we see some immediate gains.  The obvious fly in the ointment for 
this play is the 400 level of resistance on the SOX.  We won't 
hesitate to challenge NVDA with a very tight stop if the index 
falters near this level.

Picked on July xth at $xx.xx <- see text
Gain since picked:     +0.00
Earnings Date       08/21/02 (unconfirmed)
  

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

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

Alpharma, Inc - ALO - cls: 14.01 chg: -0.53 stop: 14.63 *new*

In the most recent update for ALO we discussed how the stock was 
trading in an increasingly tight range and looked poised to make 
a large move.  With a little help from Wednesday's sharp decline 
in the DRG.X pharmaceutical index, shares broke to the downside.

ALO is now resting just above the 52-week low of $13.75.  
Although a break below this level could lead to another round of 
heavy selling, we're going to challenge the stock with a very 
tight stop of $14.63, just above today's high.  We don't want to 
see our gains go up in smoke if ALO bounces from current levels.  
It was encouraging to see that other than a brief spike to 
$14.34, ALO didn't budge from the $14 level this afternoon while 
the broader market was rallying.  This leads us to believe that 
shares will continue lower over the next few sessions.  Short-
term traders may want to consider taking their gains off the 
table if ALO find support near $13.75.  Aggressive entries could 
be gauged on a move below this level.  Otherwise, we would not 
suggest new shorts at this time.  Currently, Premier is up 12% on 
this bearish play.

Picked on June 26th at $15.95 
Change since picked:    +1.94
Earnings Date        07/29/02 (unconfirmed)
 



---

Check Point - CHKP - close: 13.18 change: +0.14 stop: 14.06 *new*

The breakdown we had been anticipating in the GSO.X occurred on 
Wednesday afternoon when the index broke under 100.  This led to 
weakness in shares of CHKP during the first half of today's 
session.  The stock traded to an intraday low of $12.10 (just 
four cents above our profit-target) on what appears to have been 
a bad tick.  Bad data aside, the stock floundered near $12.50 
until the NASDAQ rally carried it into positive territory.  The 
sustainability of today's tech rebound is questionable.  The 
relative weakness displayed by CHKP today (it underperformed the 
NASDAQ by 1%) suggests that shares will quickly retest today's 
lows if the broader market bullishness subsides.  It's also worth 
noting that most of today's tech gains were concentrated in the 
chip sector, not software.  

In an effort to mitigate our upside risk, we're going to inch our 
stop-loss down to $14.06, slightly above yesterday's high.  More 
conservative traders could use a stop just above today's high at 
$13.24.  Tonight's positive news from DELL had most tech stocks 
trading higher in after-hours, including CHKP.  We would not be 
surprised to be stopped out on Friday.  If this is the case, we'd 
be interested in playing the stock again on a rollover from the 
$15.00 level.

Picked on July 8th at $13.99
Gain since picked:     +0.81
Earnings Date        7/22/02 (confirmed)




---

Siebel Sys. - SEBL - close: 12.16 change: +0.20 stop: 12.31 *new*

This short play was triggered near the end of Wednesday's session 
when SEBL hit our entry trigger at $11.94.  The breakdown in the 
GSO.X software index had us anticipating further weakness today, 
but those hopes were dashed by the powerful reversal in the 
NASDAQ.  Will this rally have any staying power?  It's difficult 
to say at this point, but one thing we do know with certainty is 
that taking large losses is not a pleasant experience.  In an 
effort to minimize our upside risk, we're going to move our stop 
to $12.31, just above today's high.  The strong volume backing 
the stock's 1.6% gain is somewhat bullish but direction still 
looks muddy.  Bears, however, can point to the fact that SEBL did 
not mirror the NASDAQ's steep ascent in afternoon trading while 
bulls will note that SEBL didn't crater this morning like the 
rest of the market.  If shares head lower on Friday, traders can 
consider new entries on a move below today's low of $11.77.  In 
terms of sector performance, the GSO.X software index rallied 
back to the 100 level.  A rollover in the index and subsequent 
move under today's low ($96.40) would be decidedly bearish for 
the group.  If we do get stopped out of SEBL due to a 
continuation of the rally in the Nasdaq, we'll consider shorting 
it again should shares stall at the $14.00 level.

Picked on July 10th at $11.94
Gain since picked:      -0.22
Earnings Date         7/17/02 (confirmed)





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

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

Sony - SNE - close: 51.20 change: +0.73 stop: 49.79

SNE gapped lower on Thursday morning following a weak session on 
the Japanese Nikkei.  Shares had already weathered heavy selling 
on Wednesday that erased last week's gains.  Our play was closed 
for a loss of 5.5% when shares slipped under the $50 level and 
violated our stop-loss at $49.79.  

In hindsight, it appears this play's undoing was due to broader 
market weakness.  Prior to Wednesday's steep decline on the Dow 
and NASDAQ, SNE was displaying bullish technicals and appeared to 
be headed for a test of the 50-dma.  Given the subsequent 
reversal and continued weakness in the U.S. Dollar (it set a new 
multi-year low today), we would not be looking to buy this dip.  
We may give SNE another look if it bounces again from the 200-dma 
($48.03) or moves above the 50-dma at $54.18.  Traders who were 
more liberal with their stop (and thus still have long positions) 
should be watching for shares to continue today's bounce and move 
above short-term resistance near $53.60.


Picked on June 28th at $52.70 
Gain since picked:      -2.91
Earnings Date        10/24/02 (unconfirmed)
 



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

QLogic Corp - QLGC - close: 39.07 change: +2.18 stop: 40.06

A delayed reaction to yesterday's Morgan Stanley upgrade of BRCD
had storage-related issues trading relatively strong today.  
QLGC rebounded after briefly approaching the $36 level and 
finished with 5.9% gain.  Helping to fuel the rebound was a 
similar move in the SOX.X, which once again bounced from its 
September lows near 345.  There was also a rumor floating around 
on the trading floor that INTC would raise earnings guidance 
after the close.  Unreliable as rumors might be, they can have a 
substantial impact when short-term bears are looking for an 
excuse to cover positions and lock in some of their gains.  
Technically, QLGC is giving mixed signals.  Today's strong volume 
should have bears on alert.  However, the daily stochastics 
(5,3,3) are beginning to fall from overbought levels.  A glance 
at the daily chart shows this has recently been a reliable 
indicator of near-term tops.  If shares do head higher, we expect 
$40.00 to continue to provide resistance.  Nonetheless, we're 
dropping this play as of today's closing price of 39.07.  QLGC 
closed near the highs of the day and looks poised to head higher 
on Friday.  Rather than risk being stopped out on a spike above 
$40.00, we're simply going to close the play at current levels.

Picked on July 2nd at $34.68
Gain since picked:     -4.39
Earnings Date       07/18/02 (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 

     .none.          

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

SNDK    Sandisk Corp               14.55     +1.39
MVK     Maverick Tube Corp         14.45     +1.68

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

HRB     H&R Block                  47.65     +1.65
TBH     Telecom Brazil             22.48     +1.38
JAH     Jarden Corp                20.08     +1.08

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

XOM     ExxonMobil                 37.10     -1.13
PG      Procter & Gamble           85.95     -2.00
PEP     Pepsico                    43.40     -1.21
KO      Coca-Cola                  53.11     -1.59
HD      Home Depot                 31.40     -1.85
CVX     ChevronTexaco              82.65     -2.22
BMY     Bristol Myers Squibb       22.11     -1.04
ABT     Abbott Labs                31.65     -2.25
WAG     Walgreen Co                34.32     -1.32
P       Phillips Petroleum         53.40     -2.52
GD      General Dynamics           98.60     -4.66
GCI     Gannett Co Inc             69.85     -1.15
SHR     Schering Ag Ads            52.60     -4.30
CLX     Clorox Co                  38.20     -1.71
FOC     Fortune Brands Inc         48.62     -3.15

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

PPG     PPG Industries Inc        58.52     -1.57
TRW     TRW Inc                   54.91     -1.10
LEN     Lennar Corp               56.82     -3.07
LSTR    Landstar System Inc      100.99     -6.01




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