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Daily Newsletter, Monday, 09/16/2002

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PremierInvestor.net Newsletter                 Monday 09-16-2002
                                                  section 1 of 2
Copyright ) 2002, All rights reserved.
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In section one:

Market Wrap:      What Didn't Happen
Watch List:       BRCM, CVC, HON, ITW, PENN, REY, TXN, and more...
Play of the Day:  Breakdown in Progress


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MARKET WRAP  (view in courier font for table alignment)
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09-16-2002                High    Low     Volume Advance/Decl
DJIA     8380.18 + 67.49 8389.26  8257.69  1183 mln   493/683
NASDAQ   1275.88 - 15.35 1292.73  1267.69  1089 mln   175/905
S&P 100   446.65 +  2.41  447.09  439.75   totals     668/1588
S&P 500   891.10 +  1.29  891.84  878.91
RUS 2000  386.13 -  3.86  389.99  385.91
DJ TRANS 2231.96 - 14.91 2246.58  2216.47
VIX        40.54 +  1.23   43.08  39.59
VIXN       57.73 +  1.88   59.60  56.59
Put/Call Ratio 1.09
******************************************************************


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

What Didn't Happen

A holiday session with low volume generally provides few clues as
to where the market is headed.   However, we had a couple of
significant moves, or in some cases, non-moves.

The day started out with a mixed bag of news.  On the positive
side, Business Inventories and sales for July were both up.
Inventories rose 0.4 percent at merchant wholesalers, 0.9 percent
at retailers and were down 0.1 percent at factories.  The
inventory to sales ratio, however, dropped to 1.35 from 1.43 a
year ago.  This is bullish, as a lower number indicates that
businesses are able to move the inventory they have accumulated.
With higher inventories and a lower ratio, business appears to be
better than last year, when we were in a recession.  Sales were
up 2.2 percent, while inventories were down 3.7 percent from a
year ago.

On the negative side, we saw a host of lowered expectations for
the semiconductor stocks.  Bank of America cut its 2002 and 2003
estimates for Taiwan Semiconductor (TSM) and United
Microelectronics (UMC), citing weakness in the consumer segment.
Prudential lowered earnings estimates for the fourth quarter and
2003 for the following semiconductor stocks:


Anadigics (ANAD)
Broadcom (BRCM)
Emcore (EMKR)
LSI Logic (LSI)
Microchip Technology (MCHP)
Pericom Semiconductor (PSEM)
STMicroelectronics (STM)
Microtune (TUNE)
Texas Instruments (TXN)
Atmel (ATML)
Exar (EXAR)
Nvidia (NVDA)
PMC-Sierra (PMCS)
Vitesse (VTSS)

This development is very bearish for the sector, as the
Semiconductor Index has now reached a new 52-week low for the 3rd
time in six weeks.  The support level of 275, from the September
6 low, appeared as though it would hold for a while, as the index
ventured back over 300 as recently as last Wednesday.  Today's
downgrades, however, showed renewed weakness and could lead to a
new wave of selling. After the bell, however, Microchip
Technology (MCHP), one of this morning's downgrades, announced
that higher gross margins would help the company beat second
quarter earnings targets. This may give the sector a lift
tomorrow, however there has been damage done which news from a
single company will be hard pressed to reverse. As the tech
sector has been leading the market for several years, the
breakdown in the SOX could be the first domino toward re-testing
July's lows.  I realize this may seem like a leap of faith, but
the scenario is developing in the following manner.

The Dow, S&P 500, NDX and Nasdaq Composite have all formed a
classic head and shoulders reversal pattern beginning with the
rally from July 24 to August 22.  Since then, the Dow and S&P 500
collapsed, but found support at the 50% retracement of that
rally.  The Nasdaq Composite and NDX gave back a larger
percentage of the gains during the rally from July 24 to August
22, but both found support above the July lows.  This recent
support is the basis for the right shoulder of the formation in
all three indices.  The charts of the Dow and Nasdaq Composite
are below, and look very similar to their counterparts.

Chart of the Dow


Chart of the Nasdaq Composite (COMPX)


The last time the markets crossed significant resistance to the
upside on the same day, was August 19, when all of the broad
market indices crossed over their 50-dmas for the first time
since spring.  The Semiconductor Index (SOX.X) failed at its 50-
dma, however.  This signaled a drop in the semis, which led the
Nasdaq lower. It can be argued that the Nasdaq, heavily weighted
with technology stocks, led the Dow lower as well, as technology
has done throughout the late 1990s and early 2000s.

With the Semiconductor Index (SOX.X) now breaking support once
again, the whole scenario may be re-starting.  If we experience
another sell-off in the techs, led by the SOX, it will most
certainly lead the Nasdaq through its neckline.  A neckline break
will be a very bearish sign, and the weight of the techs falling
would most likely drag the Dow down, as well.

Chart of the Semiconductor Index  (SOX.X)


So where's the good news?  Well, both the Dow and Nasdaq
Composite have both managed to avoid a neckline break.  Both
averages have diverged in their direction for the last two days.
The Nasdaq rallied, while the Dow fell on Friday.  Today was the
opposite.  However, both appear to be consolidating just above
their respective necklines and finished the day right around
where they finished on Thursday.  The Dow finished the day on
Thursday at 8379.41 and closed today within a point at 8380.18.
The Nasdaq finished Thursday at 1279.68 and closed today within
four points at 1275.88.  The Nasdaq closed slightly further away
to the downside, but has just a pinch more breathing room before
a breakdown than the Dow does.

Chart of the Dow and Nasdaq H&S Patterns


On a day when the both the NYSE and Nasdaq traded just barely
over a billion shares, there was hardly enough trading to push
these averages through significant levels.  However, there was
enough trading to take out the previous lows in the SOX, so the
technical developments, or in the case of the Dow and Nasdaq,
non-developments, can still be viewed with significance.  These
holds above the neckline are bullish signs, and although they are
not so bullish as to attract my dollars to the upside, I have put
the hammer back in the toolbox for the time being.

One of the reasons cited for the economy not slipping into a
double-dip recession is the strength of the housing market. Last
week we received data showing that foreclosure rates have reached
record highs.  This level of 1.23% pales when compared to this
morning's numbers released by the Federal Housing Administration.
The FHA said that 4.7% of FHA borrowers are at least 90 days late
on their loan payments.  This is almost twice the rate of 1995.
It appears that low mortgage rates have resulted in a housing
boom that may be sitting on a time bomb.  While the FHA takes on
borrowers that may have more risk, a trend is still a trend.
With lay-offs increasing, consumer debt growing, and foreclosures
at an all-time high, this delinquency rate looks like another
foot on the wrong side of the seesaw.

A look at the Dow Jones U.S. Home Construction Index (DJUSHB)
shows that after reaching all time highs earlier this year, the
homebuilders experienced a sell-off and are once again
experiencing resistance to the upside as the try to recover.
With numbers like foreclosures and delinquent mortgages
increasing, the group has a lot to overcome.  What had acted as
support as the index rallied to all time highs earlier this year,
is now acting as resistance.  Traders may want to keep an eye on
increases in the above rates as indicators of short opportunities
in the sector.

Chart of the Dow Jones U.S. Home Construction Index (DJUSHB)


After Iraq today said they would allow the unconditional return
of weapons inspectors, Thursday's OPEC meeting will take on added
significance.  With the price of oil already high, and the
October Crude Oil Futures trading over $29 a barrel, the decision
on whether to raise production quotas could have a pronounced
effect on the stock market.   If we do go to war with Iraq, oil
prices are likely to skyrocket.  This is a sure way to raise
costs for many industries.  If OPEC shows that they are willing
to help out by increasing production to keep prices in check,
this will help alleviate some of the anxiety over the likely
increase.  Even if OPEC does increase production, a war in the
Middle East can interrupt shipment out of the region.  While the
largest oil producer, Saudi Arabia, has said it supports
increased production, other members, such as Venezuela, Iran and
Kuwait have come out against the measure.  The OPEC members
actually exceeded their current quotas by 1.7 million barrels per
day in the month of August, according to the International Energy
Agency.  Therefore, any increase would have to exceed this extra
output before lowering costs.  Iraq produces about 2.7 million
barrels per day, however it could affect prices by an even
greater amount if it acted against neighboring Arab countries as
a war escalated in the region.  With the return of inspectors,
OPEC may not feel as compelled to increase quotas, as the threat
of war may be lower.  While crude oil may drop slightly in the
short-term, the specter of war still hangs over the region. There
is no guarantee the U.S. will accept the return of inspectors as
a solution to the problem and if President Bush does back off
from threats of military action for the time being, we do not
know what these inspectors will find, although it is likely that
Iraq will clean up any evidence of a nuclear threat.

Dow Jones and Company warned that third quarter earnings would
come in below forecasts, due to a drop-off in advertising sales
during the month of September at the Wall Street Journal.

In an interesting development that turned into good news for
Boeing, the machinists union was unable to muster enough votes
for a strike in response to the airline's final contract offer.
Although 62% of the 25,000 union workers voted against the
contract, they fell just shy of the 2/3 needed for a strike.
According to the union's bylaws, they are required to adopt the
contract if the strike vote fails.  Therefore, they will now
spend the next three years working under a contract that was
rejected by a significant majority of its members. Both parties
are still waiting for an arbitrator's ruling on whether Boeing
subcontracting of work to outside companies, at the same time it
issued layoffs, was a violation of the union's 1999 contract.
Next up for Being is the contract of its second largest union,
the Society of Professional Engineering Employees in Aerospace,
representing technical workers and engineers, which expires in
December.

Northrop Grumman (NOC) and General Dynamics (GD) each enjoyed
banner days after the Pentagon announced late Friday that it had
awarded the companies a $5 billion contract to build 10 Aegis
destroyers.   NOC finished up $2.00 to $129.39 and GD tacked on
$3.58 to close at $87.32.

The markets will likely react positively tomorrow to the news of
Iraq's cooperation, although the President may say something
between the time of publication and tomorrow morning that
interferes with this theory.  I would expect a rally on the news,
however in order to prevent a long term breakdown of the crucial
levels described above, we will need to see a return of business
spending to the tech sector.  MCHP's comments will help, but the
news from one company in the face of the additional downgrade of
thirteen companies in the sector is only a drop in the bucket.
Look for a gap up in the morning and then a pause for Oracle's
earning's after the bell.  Oracle is expected to meet
expectations, but that is not always a catalyst to upward
movement, as accompanying comments can send an industry reeling.
Apparently, someone is expecting a fallout, as the Put/Call ratio
has reached 1.09, reflecting the trading of more puts than calls.
This reflects today's trading, however, which closed before the
Iraq news broke.  Tomorrow should see some incredible volatility
with the Iraqi news and Oracle announcement, so watch your stops
and hang onto a few extra puts on a big rally, in case of
negative statements after the bell.

Steve Price


==================================================================
WATCH LIST
==================================================================

The PremierInvestor.net watch list is not designed to be read
as full fledged stock picks.  Rather we would prefer to offer
it as an extra tool in today's investor toolbox.  Think of it
as a radar screen with your own radar operator pointing out
interesting developments, technical patterns or potential plays
that you may or may not have seen on your own.  Due to time
constraints we do glance at the news but rarely do we have
time to fully read pertinent news stories, due background
research and other necessary screens that investors should do
before making a decision.  A common exercise is to read the
entry, glance at the sector and other stocks in that industry
and then compare what's happening in the stock to what's
happening in the broader market indices.  We hope you enjoy
the Watch List and that it proves to be a useful tool for your
own trading success.

STOCKS WORTH WATCHING
---------------------------------

Broadcom Corp - BRCM - close: 14.40 change: -0.85

WHAT TO WATCH: The semiconductor index hit new multi-year lows
today amid bearish sector news and negative brokerage comments.
How low can the SOX.X go?  A glance at the weekly chart shows
that the index is in the process of retracing its explosive rally
from late-1998.  A complete retracement would put it near the
all-time lows near 200...That's a 25% drop from current levels!
Although we wouldn't expect this to happen in the near future,
the immediate future looks pretty bleak for the bulls.  The
index's weekly and daily stochastics are both pointing lower, and
the p-n-f chart is showing a fresh double-bottom sell signal.
Insofar as specific stocks to short within the group, it's
getting hard to find one that isn't already oversold.  BRCM,
however, has just suffered a breakdown and looks like it has
ample downside remaining.  Shares fell to a multi-year low on
Monday after abandoning support at $15.00.  Given the sector
negativity and triple-bottom p-n-f sell signal, a short-term
decline to the next level of historical support near $12.00 is
not out of the question.  Bearish positions can be evaluated on a
move below today's low of $14.35 or a failed rally to $15.00.




---

Coca-cola Enterprises - CCE - close: 21.78 change: +0.68

WHAT TO WATCH:  It's not the fastest mover, but shares of CCE
(the bottling division of Coca-cola) might soon be offering a
bullish entry point.  Friday's upgrade from Goldman Sachs had the
stock breaking above short-term resistance at $21.00.  CCE
continued to move higher today, solidly outperforming the Dow
Jones en route to a 3.2% gain.  This was sufficient to take the
stock above the August highs near $21.60.  With the MACD curling
higher and no resistance levels directly overhead, a retest of
the 52-week highs at the $24.00 level seems likely.  Traders
could think about going long on a move above today's high
($21.84), but the most prudent strategy would be wait for shares
to clear whole-number resistance at $22.00.




---

Cablevision Systems - CVC - close: 11.70 change: +0.72

WHAT TO WATCH: CVC traded higher today on speculation that the
company may put its cable division up for sale.  This follows a
two-week uptrend that has seen shares bounce off the 50-dma
($8.47) and break above psychological resistance at $10.00.
Although the daily stochastics suggest CVC is already overbought,
the double-top p-n-f breakout and rising MACD are indications
that the stock may continue its recent ascent.  Additional
restructuring/buyout rumors could help the bulls.  With this in
mind, aggressive traders can evaluate long entries on a move
above today's high ($11.89).  Short-term traders could target a
move to the $14.00 region.




---

Danaher Corp - DHR - close: 55.60 change: -0.80

WHAT TO WATCH: Shares of this technical instruments company have
suffered heavy selling pressure over the past four sessions.  The
stock displayed relative weakness versus the Dow Jones on Monday
and fell below the August low of $55.59.  With the oscillators
pointing lower and the p-n-f chart on a double-bottom sell
signal, it would not be surprising to see the multi-month low
near $54.00 give way within the next few sessions.  Should this
occur, DHR could quickly retrace its steep ascent from October of
last year.  Longer-term bears can be encouraged by the
downtrending weekly stochastics and recent violation of the 200-
week moving average.




---

Honeywell Intl - HON - close: 24.65 change: +1.09

WHAT TO WATCH: Honeywell announced last Thursday night that it
had lowered earnings estimates for both the third quarter and
full-year 2002.  The company cited continued economic weakness as
the primary reason for the lowered guidance, particularly in the
aviation sector.  This news had HON gapping sharply lower the
following morning.  Shares bounced back on Monday but couldn't
quite begin filling in the gap.  If/when this does occur,
speculative traders could think about taking long positions.
Specifically, a break above $24.80 could clear the way for a move
back to the $28.00 level.  We saw a similar rebound with fellow
Dow Component JNJ in July when the stock gapped lower on
accounting concerns and then quickly recovered its losses over
the following week.




---

Illinois Tool Works - ITW - close: 61.05 change: -2.25

WHAT TO WATCH: Illinois Tool announced this morning that it
expects Q3 earnings in the $0.75-$0.80 range, which is less than
the consensus estimates of $0.82.  Shares tumbled 3.5% on this
news, on the strongest volume in nearly one year.  Technically,
the chart for ITW is looking awfully bearish.  Shares have fallen
below the 50-dma and the oscillators are downtrending.  The
point-and-figure chart is also looking ugly, with ITW freshly
breaking below bullish support and producing a double-bottom
breakdown.  Although the stock bottomed out at $59.77 today, this
may have only offered a temporary reprieve for the bulls.  A move
under today's low would provide bearish traders with a possible
action point.  The July low of $56.01 provides a clearly defined
profit-target for short-term traders.




---

Penn National Gaming - PENN - close: 20.14 change: +0.02

WHAT TO WATCH: PENN came within a mere four cents of setting an
all-time high on Monday.  The stock has nearly doubled from its
July lows and the recent gains have come on increasing volume.  A
breakout into uncharted territory could trigger another round of
short-covering that takes PENN to the next level of psychological
resistance at $25.00.  Long entries can be targeted on a move
above $21.00.  This would create a double-top buy signal on the
point-and-figure chart.  Casino bulls may also want to check out
BYD, which is likewise within range of 52-week highs.




---

Reynolds & Reynolds - REY - close: 26.05 change: -0.20

WHAT TO WATCH: Reynolds provides IT solutions for the automotive
retailing marketplace.  Given the fact that the majority of other
IT-related companies are trading at multi-month lows, it's
impressive to note that REY has been uptrending for the past two
months.  This relative strength bodes well for the bulls.
Although potential investors need to be aware of possible
resistance at the 200-dma ($27.29), aggressive traders could
think about going long on a move above $26.25.  This would put
REY in a fast-move region, the top of which lies near $30.00.




---

Texas Instruments - TXN - close: 18.27 change: -0.73

WHAT TO WATCH: Last week we featured TXN as a bearish Watch List
candidate, based on its rollover from overhead resistance.  The
stock has since weathered some heavy selling and is now in danger
of breaking to multi-year lows.  The SOX.X suffered that fate
today after CHTR announced an earnings warning and both Merrill
Lynch and Prudential reduced their estimates on several
chipmakers.  TXN was specifically targeted by PRU, as they cut
their 2002 outlook from 28 cents to 25 cents and reduced the 2003
estimate from 80 cents to 60 cents.  Technically, TXN looks like
a good short play on a move below $18.16.  You'd have to go all
the way back to 1998 to find the next level of historical
support, which lies at $16.00.  Further sector negativity could
push TXN down to the $15.00 region.  Point-and-figure chartists
will note that a trade at $18.00 would trigger a spread-triple
sell signal.





=========================
Play-of-the-Day (BEARISH tech play)
=========================

Maxim Integrated - MXIM - cls: 26.37 chg: -1.53 stop: 29.26 *new*

Company Description:
Maxim Integrated Products is a leading international supplier of
quality analog and mixed-signal products for applications that
require real world signal processing. (source: company press
release)


- ORIGINAL WRITE UP: September 12th, 2002 -

Why We Like It:
Hope springs eternal, and semiconductor bulls had theirs' lifted
by the recent action in the SOX.X.  The index rebounded from its
multi-year lows, despite more evidence of weakness from the likes
of INTC, NVLS, and others.  The lack of a "sell the bad news"
reaction seemed to indicate that the SOX's extended decline had
outpaced the fundamental (albeit very hazy) outlook for future
growth.  From a technical perspective, most chip stocks had
suffered intense selling and were overdue for a relief rally.
Unfortunately for the bulls, today's action dashed nearly all
hopes that the semiconductor group had put in a bottom.  Lehman
Brothers said this morning that its 2003 growth forecast for the
semiconductor equipment sector had been reduced from 27% to 10%.
LEH cited data points that indicate continued fundamental
weakness.  Piper Jaffray added fuel to the bearish fire by
cutting estimates on several semi equipment stocks, including
sector leader AMAT.  The firm believes a continued tepid capital
spending environment will weigh heavily on the group.

Of course, this is not stunning news.  We've known for some time
that the prospects for a pickup in IT spending remain highly
tentative.  A week ago, when chip bulls were out in full force,
negative brokerage comments would not have led to a widespread
sell-off.  Today's sizeable 6.0% decline in the SOX.X indicates
that the longer-term bearish trend is still in place.  The index
has rolled over from psychological resistance at 300 and looks to
be on a crash course with support at 275.  The faltering daily
stochastics (5,3,3) suggest that this level may eventually fail.

MXIM is also threatening a breakdown to multi-year lows.  The
company wasn't directly implicated in today's downgrades, but its
analog products have seen a similar reduction in demand.
Although shares experienced heavy selling today, the daily
stochastics (5,3,3) are just beginning to reverse near the
midlevel.  This is an indication that the bears are not yet
finished with MXIM.  With no underlying support levels, shares
could experience a rapid decline if the sector remains weak.
We'll enter this short play on a move below the multi-year low of
$27.45.  If all goes as planned we'll see MXIM fall below $27.00
(thus creating a triple-bottom p-n-f sell signal) and make its
way toward psychological support at $25.00.  Shorter-term traders
could target a move to this level.  We're going to look for a
more severe sell-off that takes the stock all the way to the
$20.00 region.  If our play is triggered we'll use a stop at
$30.06, above both today's high and psychological resistance at
$30.00.  Those with a greater risk tolerance could use a stop
slightly above Wednesday's high of $31.62.

- Most Recent Update: September 13th, 2002 -

It was a "good news, bad news" day for the chip group.  GNSS
caught a bid on Friday after the company announced it would beat
revenue estimates for the current quarter.  However, this
positive sector development was countered by ESST, who slashed
its targets for the second half of 2002.  Shares of the DVD
chipmaker were ravaged for a 31% loss.  With no other major news
driving the group, the SOX.X continued to drift towards key
support at 275.  MXIM also witnessed light selling pressure on
Friday.  Our short play was activated when shares hit our entry
trigger at $27.44.  The stock traded mostly flat in afternoon
trading and finished with a small loss.  Going forward, we'll be
watching for shares to break under today's low ($27.34) and move
towards the $25.00 region.  New short entries can be targeted on
a move under $27.00, which would create a triple-bottom p-n-f
breakdown.

- Play-of-the-Day Comments: September 16th, 2002 -

The chip sector was pressured on Monday by an earnings warning
from CHTR and a slew of negative brokerage comments.  Several
stocks joined the SOX.X semiconductor index in setting new 52-
week lows.  Such was the case with MXIM, which fell to a 5.4%
loss.  This breakdown could bring more bears out of the woodwork.
If this is the case, new entries could be targeted on a move
below today's low ($26.20).  A rollover from the $28.00 level
might also provide a shorting opportunity.  The SOX looks
technically weak and may soon test the 250 level.  This sector
negativity could have MXIM breaching psychological support at
$25.00 in rapid fashion.  Based on the recent decline we've
elected to tighten our stop-loss to $29.26, just above Friday's
high.  More aggressive traders could maintain a stop above the
$30.00 mark.

Picked on September 13th at $27.44
Gain since picked:           +1.07
Earnings Date             11/05/02 (unconfirmed)







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Copyright ) 2002  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                  Monday 09-16-2002
                                                   section 2 of 2
Copyright ) 2002, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
=================================================================

In section two:

Net Bulls
  Stop Adjustments:      MXIM (bearish)

Stock Bottom / Active Trader
  Triggered Plays:       GM (bearish)

High Risk/Reward
  Triggered Plays:       INVN (bullish)

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

Stop Adjustments
----------------

Maxim Integrated - MXIM - cls: 26.37 chg: -1.53 stop: 29.26 *new*

The chip sector was pressured on Monday by an earnings warning
from CHTR and a slew of negative brokerage comments.  Several
stocks joined the SOX.X semiconductor index in setting new 52-
week lows.  Such was the case with MXIM, which fell to a 5.4%
loss.  This breakdown could bring more bears out of the woodwork.
If this is the case, new entries could be targeted on a move
below today's low ($26.20).  A rollover from the $28.00 level
might also provide a shorting opportunity.  Based on the recent
decline we've elected to tighten our stop-loss to $29.26, just
above Friday's high.  More aggressive traders could maintain a
stop above the $30.00 mark.






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

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

Triggered Plays
---------------

General Motors - GM - close: 44.61 change: +0.53 stop: 46.01

Shares of GM were met with further selling on Monday morning.
Our short play was triggered when the stock traded $43.89.  On
Tuesday we'll be looking for GM to break below the relative low
($43.70) and make its way towards the $40.00 level.  Note that
our stop is set at $46.01.






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

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

Triggered Plays
---------------

InVision Technologies - INVN - cls: 36.27 chg: +0.51 stop: 32.79

INVN extended its recent breakout on Monday.  This play was
triggered when shares hit $36.66 shortly after the opening bell.
The stock displayed good relative strength, outperforming the
NASDAQ and moving to a new multi-month high.  Although our stop
is set at $32.79, more conservative traders could use a stop
slightly under Friday's low $33.45.  Those looking for new
entries can watch for a move above today's high at $37.25.






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

KBH     KB Home                   52.24     +0.59
GMRK    Gulfmark Offshore Inc     17.40     +0.76

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

RINO    Blue Rhino Corp           15.84     +1.24

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

AG      Agco Corp                  22.10     +1.04
OVER    Overture Services Inc      24.34     +1.56
GTK     Gtech Holdings Corp        25.10     +1.08
EASI    Engineered Support Sys     61.25     +3.11
HRLY    Herley Industries Inc      21.30     +1.29
AGM     Federal Agricultural Mtg   29.56     +1.05
MTEC    Meridian Medical Tech      30.69     +5.18

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

FNM     Fannie Mae                 70.98     -1.72
WM      Washington Mutual Inc      33.44     -1.76
ITW     Illinois Tool Works Inc    61.05     -2.25
D       Dominion Resources Inc     52.33     -5.67
KB      Kookmin Bank               38.80     -2.70
GDW     Golden West Financial      62.02     -1.78

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

NONE.




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