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Daily Newsletter, Thursday, 11/07/2002

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PremierInvestor.net Newsletter                 Thursday 11-07-2002
                                                    section 1 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 one:

Market Wrap:      Rally Bulls Trip Over Cisco
Play-of-the-Day:  All Good Things...
Market Sentiment: Casey Strikes Out


************************************************************
MARKET WRAP  (view in courier font for table alignment)
************************************************************
      11-07-2002           High     Low     Volume Advance/Decline
DJIA     8586.24 -184.80  8766.22  8549.82 1.74 bln   1095/2106
NASDAQ   1376.72 - 42.30  1400.08  1371.47 1.70 bln   1125/2239
S&P 100   460.59 - 10.47   471.06   458.13   Totals   2220/4346
S&P 500   902.70 - 21.06   923.76   898.68
RUS 2000  383.15 -  9.58   392.73   382.82
DJ TRANS 2350.62 - 63.10  2410.55  2347.27
VIX        35.28 +  0.80    35.91    34.36
VXN        53.90 +  3.84    54.71    52.29
Total Vol   3,649M
Total UpVol   597M
Total DnVol 3,021M
52wk Highs    93
52wk Lows    106
TRIN        2.35
PUT/CALL    0.88
*************************************************************

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

Rally Bulls Trip Over Cisco

Just when bulls thought everything was coming together to launch
a year end rally the cautions from Cisco caused a face plant on
Thursday. The Cisco skid knocked the Dow back to 8550 intraday
and 1371 on the Nasdaq. The markets were tripping over century
marks left and right but in reality it was just a normal post
Fed event.

Dow chart - Daily


Nasdaq chart - daily


It was a small comment from John Chambers. "I am more worried
about the current quarter than I was the last quarter." With
that comment and guidance that 4Q revenue would be flat to down
as much as -4% instead of a +$100 million increase, he helped
take the markets back down to Friday's closing levels. They
did spin it well with much higher margins and promises of major
profits when the economy recovers. Still the markets were ripe
for a sell off and sell they did.

IBM did not help the Dow with news that they were going to issue
more stock, $1.5 billion worth, to prop up their ailing pension
plan. This follows UTX taking the same step recently. Pretty
good trick if you can get away with it. Let the investors take
the hit on stock dilution and the company gets to play it's
"get out of debt card" with no penalty. IBM dropped -2.59 on
the news.

Economically it was not a bad day. Chain Store sales rose +3.1%
in October which surprised analysts. This was double the expected
gain. Retailers blamed it on cooler weather finally appearing
and causing stronger sales in sweaters, jackets and coats. If
this trend continues when the holiday season starts in two weeks
investors will be thrilled. Consumers must have put in on a
charge card because Consumer Credit jumped +$9.9 billion from
an expected $5.5 billion. This is another sign that consumers
are not dead but they are running out of cash. Once the credit
lines are maxed out for the holidays the 1Q-2003 is going to be
tough. But paying that piper will not happen until the 2Q.

Jobless claims fell by -20,000 and -13,000 more than expected.
Continuing claims drifted up slightly but analysts were positive
that maybe the job loss cycle was easing. Nonfarm Productivity
came in at +4.0% and only slightly less than expected at 4.3%.
This was more than double the Q2 numbers at only +1.7%. Even
more surprising was the +5.9% growth in the manufacturing sector.
Productivity in the durable goods sector grew +8.8%. This does
not do any good for new jobs yet but it will grow profits as the
economy picks up steam. Workers are working more which increases
productivity. When they can't work any more hours employers
are forced to hire more workers and the cycle begins again.
Rapid increases in productivity tends to be a leading indicator
for coming economic gains. Wholesale sales increased again but
only by +0.1% while inventories increased slightly by +0.5%.
This was the fourth month of gains and it has not happened since
2000. The wholesale industry is poised for growth and with a
very low 1.22 inventory-to-sales ratio it is in great shape.

After the close today QCOM flaunted its success despite the
news that China would be developing its own CDMA technology.
QCOM beat street estimates by +4 cents on a +34% rise in
revenue. QCOM said it expected revenue to increase another
+15% to +22% for the current quarter with earnings in the 35
to 38 cent range. Their earnings this quarter were 31 cents.
QCOM jumped nearly $2 to 36.38 in after hours. This could
help the chip sector tomorrow.

The Fed surprised everyone yesterday with a unanimous 50 point
rate cut. I have to admit I was totally in denial that they
would take that giant step. They said geopolitical risk,
spending, employment and production trends were sufficient to
justify the cut. The risks were weighted to further economic
weakness but with the 50 point cut that risk had been eliminated
and the risks going forward were balanced. In short, take this
50 points and choke on it because there is not going to be any
more. The wording was blunt and while the U.S. markets were
appreciative the size and wording was actually for the rest
of the world. The Fed was saying we are committed to strong
growth and we are going to do it without you but we would love
for you to help. The timing was critical but the message fell
on deaf ears. The United Kingdom, Korea and ECB all met today
and none of them cut rates. Greenspan is probably spinning in
frustration tonight that everyone else ignored the clear
challenge. Don't spit on Superman's cape and don't thumb your
nose at Greenspan. When the U.S. is roaring back with +5%
growth and other countries look to Greenspan for help that
phone call may not be answered.

Despite the Cisco news, the IBM share issuance, earnings warnings
from COST and MIKE and a dumping of Yahoo stock, today was just
a bout of typical post Fed profit taking. The rate cut was
priced into the market and with no future cuts on the horizon
the markets had to relieve pressure. Helping the markets today
were raised guidance from FD, ANN, GPS and JCP when retailers
were supposed to be in the tank. There was a rumor about Taiwan
Semiconductor getting a 40,000 wafer order. This rumor was
dismissed as not likely but Goldman Sachs said there have been
several reports of rush orders for PC chipsets for better than
expected holiday order fills. Goldman believes TSM will raise
guidance for the 4Q from improving conditions. Surprise! Cisco
also said it was seeing stronger growth in switches and that
goes directly into the coffers of BRCM, MRVL, ALTR and XLNX.
Even John Deere raised guidance to 26 cents from the Multex
consensus of 2 cents. JPM actually came out and strongly denied
the gold derivative rumors that have been plaguing the bank for
months. They lost -1.46 on the news but the entire sector was
down and they should begin to see gains as shorts exit for
greener pastures.

Just another post Fed profit taking day. That view could change
in an instant if the days lows (Dow 8550, Compx 1371, OEX 458,
SPX 899) fail tomorrow. As long as the market can hold at the
open there is a good chance it will close higher. If those
levels fail then we could finish much lower and possibly in
the Dow 8350 level. The QCOM news should help the tech sector
and a positive report by Disney after the bell should help the
Dow. The bulls did not get slaughtered today. They just ran
out of news events to bet on.

Enter Very Passively, Exit Very Aggressively!

Jim Brown
Editor


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

Intl Business Machines - IBM - cls: 78.95 chg: -2.59 stop: 82.06

Company Description:
IBM is the world's largest information technology company, with
80 years of leadership in helping businesses to innovate. IBM is
a leading provider of e-business solutions and is dedicated to
helping customers, IBM Business Partners, and developers leverage
the potential of the Internet and network computing across a wide
range of businesses and industries. The company offers a host of
cross-industry and industry specific solutions designed to meet
the needs of growing companies. (source: company press release)

Why We Like It:
Shareholders of IBM have enjoyed an astonishing rebound in recent
weeks: The stock gained 55% from its multi-year low of $54.01
(set on October 10th) to Monday's high of $83.81.  This huge move
was largely a result of the company's October 16th earnings
report.  Although Wall Street observers had fretted over the
possibility of an Intel-esque earnings disaster, IBM soothed
investors fears by beating third-quarter expectations and
maintaining its guidance for Q4.  This was enough to launch the
stock through congestion in the $73-$75 area and (at least
temporarily) above the August highs near $83.00.  Given these
rapid gains, it didn't come as a surprise to see some profit-
taking take place over the past two days.  We think the technical
outlook is for more weakness in near-term.

The point-and-figure chart has reversed into a column of four
"O's."  The past two three-box reversals proved to be entry
points, so it's somewhat interesting to see that the current
decline has been more severe.  The daily chart shows that IBM is
rolling over from both the August highs and the 200-dma at
$81.94.  We'd view any pullback that wasn't accompanied by
bearish oscillators as suspect, so it's encouraging to see that
both the MACD and daily stochastics are looking weak.  The
rolling MACD in particular is a good sign for the bears.  This
indicator was uptrending during the October/November rally.
Placing a retracement bracket from October 10th low to November
4th high, we see that a 50% pullback would put IBM near its 50-
dma at $69.59.  This also shows that shares bounced from the 19%
retracement on Thursday.  Conservative traders may want to wait
for shares to fall below this level ($78.00) before taking any
positions; we're entering this play at current levels.  Our stop
is located at $82.06, just above the 200-dma and yesterday's
high.  Although possible support at $75.00 could thwart our
bearish plans, the bulls will have a tough time holding their
ground if the Dow Jones continues to weaken.  IBM has some
additional support at $72.00.

Annotated chart - IBM:



Picked on November 7th at $78.95
Results since picked:      +0.00
Earnings Date           10/16/02 (confirmed)





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

Casey Strikes Out

by Steven Price

So much for the Fed hitting a home run with yesterday's rate cut.
Who cares about 50 basis points when the world's largest
networking company talks about a possible revenue decline of 3-4%
next quarter?   That was the theme to today's trading, as the
Nasdaq fell back from its attempt to break through the August
high of 1426, losing 42.28 to close at 1376.71.  Was it really
just a day ago that we were surging to what appeared to be a new
relative high.  If we had broken through the August levels, then
maybe an extended bull run was in the cards.  Cisco not only
rained on the parade, it popped the giant balloons and stole the
band's instruments.

Sounds pretty nasty; however, there was some joy in Mudville, as
the Dow's drop of 184.77 actually found support above previous
resistance of 8550. We appear to be back into the 8550-8750 range
of the last few days.  After a gain of 1600 intraday points from
the low on October 9 of 7197, to yesterday's high of 8800, the
pullback is certainly not catastrophic.  However, if we do
breakdown from here, the next support level will most likely be
8200.  Those traders holding long positions may want to punt on a
Dow trade under 8500 and switch teams for the ride down for the
next 300 points. A trade of 8500 will constitute a point and
figure sell signal to go along with the one registered by the SPX
today, when it traded 900.

The Semiconductor Index (SOX.X) is showing signs that the bull
run of the last month may be over. The index had been contained
in a rising channel, bouncing from the bottom trend line on each
pullback since October 9.  The SOX had increased 53% in less than
a month, but has now dropped out of its channel and is re-testing
the 300 level as support, with a close today of 302.61.  A break
under 300 could be decisive and those traders waiting for a short
opportunity should keep an eye on that level. With Qualcomm
beating expectations after the close, that confirmation may not
come, but the trend break should make longs in the sector
nervous.

President Bush took to the airwaves again with his Iraq plans,
letting anyone who was listening know that he wanted "peace," as
long as Saddam disarmed himself completely.  He said this request
was different than the last 16 or so, since if he did not comply
this time there would be action to make sure he did.

Retail sales reports flooded the market this morning, with mixed
results.  Several retailers, including Kohl's (KSS), Gap Stores
(GPS) and J.C. Penney (JCP), posted impressive same store sales
gains over last year.   However, there were also plenty of
disappointments; Wal-Mart posted gains in the upper end of a
reduced range and Sears saw a 10% decrease and most analysts are
still cautious about the spending environment.  With Consumer
Confidence and personal spending on the decline, a shortened
holiday shopping season takes on greater significance.
Thanksgiving falls six days later this year than it did in 2001,
leaving fewer days in the official holiday shopping season
between Thanksgiving and Christmas.  The Retail Index reflected
these fears, dropping 1.5%, along with a similar drop in the
Retail holders (RTH).

The homebuilders received a CSFB downgrade this morning, lowering
its recommendation on the group from "overweight" to "market
weight."  It said that industry and economic trends support a
more cautious view and that  "we no longer feel comfortable
telling clients to put new capital in the group."  The Dow Jones
U.S. Home Construction Index (DJUSHB) fell almost 7% and cracked
support at 300, finishing the day at 298.82. It has now rolled
over from its fourth lower high since August.  The index has
bounced from this level several times, and traders looking for
shorts need to exercise caution.  Look for resistance at 300
before piling on stocks in the sector to the short side.

Tomorrow should bring a downside test in the Dow.  If we bounce
once again from 8550, then traders can feel somewhat safe with
long positions, as the pullback will constitute a higher low and
could signal further strength and a run to 9000.  The Nasdaq
still has a gap to fill from Monday, and a bounce off 1360 would
do the job.  Therefore another 16 points can be shaved off the
COMP before the bears can truly state their case for continued
weakness. Watch these levels closely and don't be afraid to
switch teams quickly.  There is no such thing as a traitor when
it comes to playing the market.

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

Market Averages

DJIA ($INDU)

52-week High: 10673
52-week Low :  7286
Current     :  8586

Moving Averages:
(Simple)

 10-dma: 8513
 50-dma: 8175
200-dma: 9271

S&P 500 ($SPX)

52-week High: 1176
52-week Low :  775
Current     :  902

Moving Averages:
(Simple)

 10-dma:  899
 50-dma:  867
200-dma:  998

Nasdaq-100 ($NDX)

52-week High: 1734
52-week Low :  795
Current     : 1025

Moving Averages:
(Simple)

 10-dma: 1011
 50-dma:  919
200-dma: 1153

-----------------------------------------------------------------
The Semiconductor Index (SOX.X): The SOX gave evidence today that
the boom of the last month may be coming to an end.  With its
breakdown out of the ascending channel on the 27-point pullback
and break in the trend of higher lows, the expected 4th quarter
slowdown may finally be catching up to these stocks.  Up until
Cisco's warning last night, the sector had been able to shake off
the bad news that seemed to keep dripping from each earnings
report in the group.  There were some notable exceptions, but the
overall tone has been extremely negative. Nevertheless, the chip
stocks continued to soar until today.  The drop registered a new
PnF sell signal for the first time since pulling back to 272 on
the way up.  That pullback was a trap for the shorts, but after a
gain of more than 50%, the new signal is something to watch.  A
break below 300 would be the next short signal to keep an eye on.
Qualcomm beat earnings expectations after the bell and traded up
over a dollar, so we may not get the confirmation with a trade
below 300. However, if we do, then watch out below.

52-week High: 657
52-week Low : 214
Current     : 302

Moving Averages:
(Simple)

 10-dma: 305
 50-dma: 270
200-dma: 424

Market Volatility

The VIX jumped back over 35 today, indicating the fear has crept
back into the market and the premium sellers are out of the way.
Even yesterday, when the Dow surged almost a hundred points
following the FOMC rate cut, the VIX crept higher, as traders
were apparently weary of the recent bull run. That reluctance to
sell premium was rewarded today, when the Dow dropped almost 200
points and the S&P 500 gave up 21. The S&P gave a point and
figure sell signal and the Dow came within 50 points of doing the
same.

CBOE Market Volatility Index (VIX) = 35.28 +0.80
Nasdaq-100 Volatility Index  (VXN) = 53.90 +3.84

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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.88        588,172       517,093
Equity Only    0.78        452,575       354,590
OEX            0.72         32,307        23,334
QQQ            0.93         68,861        63,921

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

Bullish Percent Data

           Current   Change   Status
NYSE          41      + 1     Bull Confirmed
NASDAQ-100    69      + 1     Bull Confirmed
Dow Indust.   63      + 0     Bull Confirmed
S&P 500       57      + 1     Bull Alert
S&P 100       62      + 2     Bull 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   1.06
10-Day Arms Index  1.13
21-Day Arms Index  0.96
55-Day Arms Index  1.28


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 they do, they can signal significant market turning
points.

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

Market Internals

        Advancers     Decliners
NYSE        855          1880
NASDAQ     1029          2139

        New Highs      New Lows
NYSE         18              29
NASDAQ       41              34

        Volume (in millions)
NYSE     1,740
NASDAQ   1,747

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

Commitments Of Traders Report: 10/29/02

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

Commercials loaded up slightly on both sides of their position, adding
5,000 long and short contracts.  Small traders treated their positions
similarly, adding 3,000 contracts to both sides.

Commercials   Long      Short      Net     % Of OI
10/08/02      427,070   445,135   (18,065)   (2.1%)
10/15/02      429,448   449,138   (19,690)   (2.2%)
10/22/02      432,775   463,827   (31,052)   (3.5%)
10/29/02      437,565   468,557   (30,992)   (3.4%)

Most bearish reading of the year: (111,956) -   3/6/02
Most bullish reading of the year: ( 16,472) - 10/01/02

Small Traders Long      Short      Net     % of OI
10/08/02      131,486    81,010    50,476     23.7%
10/15/02      134,507    83,714    50,793     23.3%
10/22/02      134,641    72,681    61,960     29.8%
10/29/02      137,740    75,587    62,153     29.1%

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

NASDAQ-100

Commercials left positions virtually the same, with a slight reduction
to the long side and a slight increase to the short side.  Small
traders added less than 1,000 contracts to both sides.


Commercials   Long      Short      Net     % of OI
10/08/02       45,384     55,504   (10,120) (10.0%)
10/15/02       45,578     51,969    (6,391) ( 6.6%)
10/22/02       48,954     54,088    (5,134) ( 4.9%)
10/29/02       47,837     55,261    (7,324) ( 7.1%)

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
10/08/02       10,735     5,721     5,014    30.4%
10/15/02       10,185    12,478     2,293    10.1%
10/22/02       10,202     8,892     1,310     6.6%
10/29/02       10,584     9,419     1,165     5.8%

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

Commercials kept the status quo here, as well, reducing the net long
position by 300 contracts, of 0.4% of open interest.  Small traders
increased longs by 1,200 and shorts by 2,000.


Commercials   Long      Short      Net     % of OI
10/08/02       19,550    11,823    7,727      24.6%
10/15/02       20,914     9,630   11,284      36.9%
10/22/02       22,189    13,448    8,741      24.5%
10/29/02       21,800    13,337    8,463      24.1%

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
10/08/02        7,890     9,645    (1,755)   (10.0%)
10/15/02        6,040    10,329    (4,289)   (26.2%)
10/22/02        4,445     9,270    (4,825)   (35.1%)
10/29/02        5,602    11,090    (5,488)   (32.9%)

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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Copyright ) 2002  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                 Thursday 11-07-2002
                                                    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
  New Bearish Plays:     IBM

Stock Bottom / Active Trader
  Bearish Play Updates:  DIA, MO, SUP
  Closed Bearish Plays:  BAX

High Risk/Reward
  Bullish Play Updates:  T, THC
  Bearish Play Updates:  HGSI

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 New Plays
=============

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

Intl Business Machines - IBM - cls: 78.95 chg: -2.59 stop: 82.06

Company Description:
IBM is the world's largest information technology company, with
80 years of leadership in helping businesses to innovate. IBM is
a leading provider of e-business solutions and is dedicated to
helping customers, IBM Business Partners, and developers leverage
the potential of the Internet and network computing across a wide
range of businesses and industries. The company offers a host of
cross-industry and industry specific solutions designed to meet
the needs of growing companies. (source: company press release)

Why We Like It:
Shareholders of IBM have enjoyed an astonishing rebound in recent
weeks: The stock gained 55% from its multi-year low of $54.01
(set on October 10th) to Monday's high of $83.81.  This huge move
was largely a result of the company's October 16th earnings
report.  Although Wall Street observers had fretted over the
possibility of an Intel-esque earnings disaster, IBM soothed
investors fears by beating third-quarter expectations and
maintaining its guidance for Q4.  This was enough to launch the
stock through congestion in the $73-$75 area and (at least
temporarily) above the August highs near $83.00.  Given these
rapid gains, it didn't come as a surprise to see some profit-
taking take place over the past two days.  We think the technical
outlook is for more weakness in near-term.

The point-and-figure chart has reversed into a column of four
"O's."  The past two three-box reversals proved to be entry
points, so it's somewhat interesting to see that the current
decline has been more severe.  The daily chart shows that IBM is
rolling over from both the August highs and the 200-dma at
$81.94.  We'd view any pullback that wasn't accompanied by
bearish oscillators as suspect, so it's encouraging to see that
both the MACD and daily stochastics are looking weak.  The
rolling MACD in particular is a good sign for the bears.  This
indicator was uptrending during the October/November rally.
Placing a retracement bracket from October 10th low to November
4th high, we see that a 50% pullback would put IBM near its 50-
dma at $69.59.  This also shows that shares bounced from the 19%
retracement on Thursday.  Conservative traders may want to wait
for shares to fall below this level ($78.00) before taking any
positions; we're entering this play at current levels.  Our stop
is located at $82.06, just above the 200-dma and yesterday's
high.  Although possible support at $75.00 could thwart our
bearish plans, the bulls will have a tough time holding their
ground if the Dow Jones continues to weaken.  IBM has some
additional support at $72.00.

Annotated chart - IBM:



Picked on November 7th at $78.95
Results since picked:      +0.00
Earnings Date           10/16/02 (confirmed)






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

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

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

Diamonds - DIA - close: 86.05 change: -2.00 stop: 88.26

Was a 50-point rate cut already priced into the Dow?  It sure
looks that way.  The first signs of trouble for the bulls
appeared immediately after the interest rate announcement, when
the broader market reacted with unexpected tentativeness.  The
typical post-Fed volatility saw the major indices bounce between
either side of break-even before finishing strong in late-
afternoon trading.  The Dow finished up nearly 100 points, but in
general we were unimpressed with the bounce.  Last night's
uninspiring CSCO earnings added more ammunition for the bears.
In light of these developments, we moved our entry trigger for
the Diamonds up to $85.89.  This level was reached shortly after
noon today.  The Industrials traded weak for most of the session
and finished near the lows of the day.  It took a small bounce
from 8550 to prevent a loss of more than 200 points.  Overall it
looks like the index will continue to retrace its gains from the
past week.  New short positions in the DIA can be targeted on a
move under $85.50.  Our stop is set at $88.26, while we continue
to target a move to the $82.00 area.

Picked on November 7th at $85.89
Results since picked:      -0.16
Earnings Date           xx/xx/xx




---

Phillip Morris - MO - close: 43.06 change: +0.32 stop: 44.11

The three Dow components to finish with gains on Thursday were
MO, PG, and MCD.  We suspect defensive buying helped to prop up
the first two stocks.  The tobacco sector in general traded
higher today, with RJR and UST also posting gains.  Technically,
we're concerned about the way MO has rallied above its 50-dma
($42.66).  Additional resistance lies overhead at $44.00.  The
daily stochastics are approaching overbought levels, suggesting
that the current uptrend may come to an end within the next few
sessions.  The p-n-f chart also remains in a column of "O's," but
at this point the bulls appear to have the advantage.  We would
not recommend taking new short positions at this time.

Picked on October 29th at $41.49
Results since picked:      -1.87
Earnings Date           10/17/02 (confirmed)




---

Superior Ind. - SUP - cls: 41.84 chg: -2.19 stop: 44.31 *new*

There certainly hasn't been a lack of action in SUP over the past
two sessions.  Wednesday's action saw the stock move sharply
higher on no apparent company news.  This appears to have been
fueled in part by the strong afternoon rebound in the broader
market.  Interestingly enough, the rally came to a dead halt at
the converging 50-day and 100-day moving averages ($44.26).
Shares then gapped lower this morning and retraced the majority
of yesterday's gains.  Dizzy yet?  Overall it's hard to draw many
technical conclusions from these gyrations.  The fact that shares
rolled over from moving average resistance is encouraging, but
the directionless oscillators are not giving us any indication of
where SUP is headed next.  For now we'll take a wait-and-see
approach.  If today's downward momentum carries over into
tomorrow's session we could quickly see SUP fall under the
relative low of $41.16.  Our stop is now set at $44.31, slightly
above yesterday's high.

Picked on October 28th at $42.97
Results since picked:      +1.13
Earnings Date           10/17/02 (confirmed)





===============
AT Closed Plays
===============

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

Baxter Intl. Inc. - BAX - cls: 25.75 chg: +0.06 stop: *text*

Healthcare and drug stocks traded higher on Wednesday in response
to the impressive Republican showing in the off-year elections.
BAX moved higher with the DRG.X pharmaceutical index and
continued to distance itself from our entry trigger at $23.99.
Today's trading was somewhat more sedate, as shares set a new
mid-term high before finishing with a small gain.  Shares are
currently resting just below the long-term trend of descending
resistance on the daily chart.  A rollover from this level would
be a logical action point to short the stock.  However, the
rising oscillators and short-term uptrend do not support a
bearish outlook.  So far BAX has done nothing but stair-step
higher in November.  We'd hate to adjust our entry trigger, only
to see the stock rebound and continue its ascent.  We're cutting
BAX loose for now, but will keep an eye out for a move below
$24.00.  This stock might still be worth shorting if shares break
to new lows.

Picked on November 1st at $xx.xx
Results since picked:      +0.00
Earnings Date           10/17/02 (confirmed)






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

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

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

AT&T Corp. - T - close: 13.65 change: -0.41 stop: 12.83

The Industrials fell almost 200 points in Thursday's session so
it's not surprising to see Dow component AT&T feeling the
pressure.  The stock slipped some 2.9% and bounced at the $13.50
level intraday.  There was some potentially good news for T last
night or better said it was potentially bad news avoided.  The
FCC has decided not to review a confidential pact between AOL and
the merging AT&T Broadband and Comcast.  Odds are there are some
provisions in there that competitors to AOL and CMCSK would like
to see out in the open and or as a reason to prevent the merger
from being approved, which would be bad that did not help the
bulls today was word from a U.S. for T.  As it stands now, the
FCC will not pursue it.  Additional news Bancorp Piper Jaffray
analyst.  The UBPJ analyst downgraded T from "buy" to "hold" due
to valuation.  Their analyst believed that the price appreciation
in the stock had brought AT&T Corporate bonds to fair value.  The
analyst went on to say that T's business will be "pressured by
the economy and competition" but AT&T is expected to be a
"survivor" (Reuters).  The markets could be due for some
additional profit taking so bulls on T looking for new entries
may want to take a step back and wait to see where the stock
bounces.  The support at $13.50 today was encouraging but we
don't expect it to hold if the Industrials continue to suffer
selling.  Shares of T should see stronger support at $13, thus
we're going to leave our stop at 12.83.  A bounce at the $13
level would be an attractive new entry point given the spread
between entry and stop loss.  Traders who choose to go long on a
bounce at $13 should keep the overall market tone in mind before
initiating a position.

Picked on October 23rd at $13.40
Results since picked:      +0.25
Earnings Date           10/22/02 (unconfirmed)




---

Tenet Healthcare - THC - close: 26.28 change: +0.06 stop: 23.69

So that's what it feels like to be roadkill.  Our aggressive
high-risk play (which was triggered at $27.48) started off
auspiciously enough today as THC moved above short-term
resistance and finished with a solid gain.  Investors shrugged
off the recent bad news and pushed the stock up by 6.3%, despite
weakening in the broader market.  Then came tonight's conference
call.  In last night's write-up for this play we made mention of
this call, where the company was supposed to talk about Medicare
outlier payment issues.  Tenet instead took the opportunity to
announce an extensive management restructuring, including the
departure of its CEO and COO.  This unexpected news did not sit
well with investors.  Shares were trading near $19.50 in the
after-hours session, down more than $8.00 from the closing price.
Assuming these numbers hold, this play will be stopped out
tomorrow morning for a very heavy loss.  We knew from the get-go
that bad news could put a quick halt to the stock's rebound.
THC's classification as a "high-risk/high-reward" play reflected
that.  Traders should remember that the loss of capital is always
a strong possibility with these sort of plays.  Nonetheless,
being broad-sided by executive resignations is not an enjoyable
experience.  For those that did take positions in THC, we would
strongly advise against "averaging down," or buying more stock
tomorrow morning.  Today's developments could portend yet another
round of disastrous news.

Picked on November 6th at $27.48
Results since picked:      +0.47
Earnings Date           10/02/02 (confirmed)




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

Human Genome Sciences - HGSI - cls: 9.40 chg: -0.53 stop: 10.81

Weighing in on the Nasdaq slide was a poor performance in the
Biotech index.  The BTK failed at the 370 level and now looks
like it could be heading for a retest of support near 340.
Dragging the sector lower is the biggest biotech stock of them
all, Amgen (AMGN).  A couple of days ago Amgen postponed a Nov.
21st analyst meeting where the company was to offer updates on
its outlook going forward.  The new analyst meeting is scheduled
for Feb. 25th, 2003.  Amgen management said they needed the time
to "tackle several near-term issues" as one report put it.  As
expected the brokerage community did not respond well but we've
have not noticed too many downgrades.  If shares of AMGN break
under the $45 level, as it appears to be headed, the stock could
retest the $40 level of support.  This will be a weight dragging
the entire sector with it and HGSI will be guilty by association.
Speaking of HGSI, the stock is back under the $10 level and looks
rather attractive for new short entries.  We're going to keep our
stop at $10.81 for now but more conservative traders looking to
reduce their risk might consider using Wednesday's high of $10.57
to eliminate some exposure.  We have noticed that volume has been
declining the last few days, which does not indicate a lot of
conviction either way.  Strangely, we did not see any reaction in
the stock or the news from HGSI's appearance in the investor
conference on Wednesday.

Picked on November 1st at $ 9.49
Results since picked:      +0.09
Earnings Date           10/29/02 (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

ICN     ICN Pharmaceuticals        11.99     +2.79
AEOS    American Eagle             16.88     +0.99
SFD     Smithfield Foods           16.64     +0.60
PLMD    Polymedica Corp            31.20     +1.05

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

KOSP    Kos Pharmaceuticals        18.79     +2.10
CYBX    Cyberonics Inc             19.55     +1.45
OSUR    Orasure Tech.               7.00     +1.22
WWCA    Western Wireless Corp       6.31     +1.68
ARO     Aeropostale Inc            13.97     +1.76

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

MEG     Media General              57.76     +1.06
ATV     Anthem Inc                 81.58     +1.83
KSS     Kohl's Corp                62.00     +2.06
DRS     DRS Tech.                  36.68     +1.23
APC     Anadarko Petroleum         47.32     +1.25
CEPH    Cephalon Inc               55.41     +5.16
ANF     Abercrombie & Fitch        20.79     +2.88
PLMD    Polymedica Corp            31.20     +1.05

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

TRMS    Trimeris Inc               50.77     -4.57
ED      Consolidated Edison        42.50     -1.41
WEN     Wendy's Intl.              28.11     -1.38
BZH     Beazer Homes               62.54     -5.26
BN      Banta Corp                 29.65     -1.08
HUG     Hughes Supply              31.98     -1.57
LEN     Lennar Corp                53.31     -3.07

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

JPM     JP Morgan                  20.60     -1.46
FED     Firstfed Financial         26.70     -2.20
PNC     PNC Financial              39.54     -1.48
LIFE    Lifeline Systems           21.32     -1.17
FPL     FPL Group                  57.32     -2.68




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