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PremierInvestor.net Newsletter                 Tuesday 11-12-2002
                                                   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:      Mistaken Guidance
Market Sentiment: Out of Breath
Play-of-the-Day:  Getting Bold On Black Gold

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U.S. Market Numbers
-----------------------------------------------------------------
MARKET WRAP  (view in courier font for table alignment)
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      11-12-2002           High     Low     Volume Advance/Decline
DJIA     8386.00 + 27.10  8504.67  8356.73 1.63 bln   1919/1272
NASDAQ   1349.56 + 30.40  1367.97  1328.08 1.52 bln   2136/1245
S&P 100   450.50 +  2.87   456.82   447.63   Totals   4055/2517
S&P 500   882.95 +  6.76   894.30   876.19
RUS 2000  374.69 +  5.55   377.61   369.14
DJ TRANS 2280.69 +  9.63  2299.57  2270.07
VIX        35.39 -  0.72    35.71    33.63
VXN        55.25 -  0.46    56.63    53.02
Total Vol   3,353M
Total UpVol 2,625M
Total DnVol   693M
52wk Highs    74
52wk Lows    108
TRIN        0.79
PUT/CALL    0.85
-----------------------------------------------------------------

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

Mistaken Guidance

Flash! Cisco CEO John Chambers says order backlog is comfortably
above $1.4 billion! Quick buy tech stocks was the impression
many investors got. The Nasdaq rallied to 1367 and only four
Nasdaq 100 stocks were negative for the day. BUT, and you
knew there was a but, Salomon Smith Barney says that was a
misrepresentation.

Dow Chart - Daily


Nasdaq Chart - Daily


About 2:30PM SSB came out with their "where's the beef" comment
and the market burned off nearly all its gains and only short
covering and bargain hunting at the close kept the Dow from
going negative. SSB said people were taking Chamber's comments
out of context about the "improved" backlog. According to SSB
the backlog number is useless as quarters are always back-end
loaded and the backlog numbers were in the $2 billion range in
the past. SSB said the Sept and Oct order patterns were actually
below Cisco's targets. Chambers was speaking at the UBS Warburg
Global Teleconference in New York and he declined any financial
guidance other than to say that customers are remaining cautious.
Certainly not anything was said to justify a +50 point gain in
the Nasdaq intraday.

Yesterday Oracle continued to say that visibility remained
poor and they did not see the beginnings of a recovery until
the first half of 2003. That implies a minimum gain in the first
quarter. ORCL recovered what it lost yesterday on the Cisco
comments today.

Need proof things are not improving in consumer confidence?
Charles Schwab announced today the 4Q job cuts would hit 1,900.
They had previously said they would be forced to cut up to -10%
of their work force if things did not improve.

Phillip Morris went up in smoke today and lost nearly -$6
after saying it could no longer affirm guidance for the current
quarter. This is a major hit for a Dow stock and considering
only eight Dow stocks were negative, MO lost more than the other
seven combined.

There were so many conflicting stories in the market today it
was ridiculous. Retail sales for JCP were up and WMT said it
was back on track to hit same store estimates. Analysts however
said it appeared to be due to a sharp burst of winter clothes
buying due to a week of early winter weather. They feel this
buying will fade and could have actually subtracted from the
holiday sales due to limited consumer budgets.

Probably the biggest boost to the market today was a flood of
Fed heads out pounding the table on the economy. Reports put
six of the inner circle out on the social circuit today but
only four made official speeches. Ferguson spoke at two different
events in Pennsylvania, Olson in Ohio, Bies in Washington and
Greenspan in Mexico City. While the general made veiled comments
about Brazil his speech was more of a global history lesson.
The troops however were upholding the party line of a very
accommodative Fed, which had injected massive amounts of
stimulus into the economy, and that stimulus was working. They
stressed the fact that it is growing steadily and next year
the results would be seen. If you remember the past month
when Fed speak was zero you can see the major shift in policy
and a strong attempt to "talk up" the markets. This brings up
the question again of what do they know that we don't? Why the
sudden full court press when they were dormant for the prior
month. Tomorrow Greenspan will get the hot seat again as he
addresses the Joint Economic Committee and you can bet he will
try to spin the party line in his favor. The Richmond and
Kansas City Fed district both released positive reports
showing slight growth in their areas.

The Fed head will have his work cut out for him after the
Business Roundtable Survey was released today. 60% of the
top 150 CEOs surveyed expected more layoffs in 2003. Only
19% expected capital spending to increase in 2003. 65% of
the CEOs expect GDP growth less than 2%. 28% expect flat to
lower sales. These 150 CEOs represent a workforce of over
10 million and $3.7 trillion in revenues. These are the
business men who know what is happening in the real world.
Using a general average it would appear that two thirds of
the CEOs were looking for a continued weakness of some sort
in their business in 2003.

The news that the IRAQ parliament had unanimously voted to
reject the UN resolution fell on deaf ears since their vote
does not count. In a dictatorship like Iraq only one vote
counts and that is Saddam. A vote to accept the resolution
from a parliament member would have been a vote for personal
suicide. Saddam has until Friday to accept/reject the resolution
and it should be a given that he will accept in an effort to
buy time. IRAQ was caught trying to buy one million anti-nerve
gas injections on the open market today. Since it was of a
specific type of nerve gas that he is not supposed to posses
it is obvious that he has it and is planning on using it or
they were simply trying to scare the US into thinking they
would.

The biggest killer on the markets today was the release of a
new Osama Bin Laden tape on Arab TV. Unfortunately the tape
has been verified by multiple sources as being genuine and
recent. Osama spoke about the Russian theater attack and the
attack in Bali and warned the US about attacking Iraq. It
called on believers to continue the war. Just like Jason of
multiple horror movie fame, Osama came back from the dead and
cancelled everything the US government thought about his demise.
No longer is he a dead leader with a scattered and decimated
gang. He is alive, well and organizing attacks. Do you think
he just did not want Saddam getting all the attention? (grin)

Wednesday we have an IBM analyst meeting, which could create
significant market movement and the AMAT earnings after the
close. Add in the Greenspan comments and Osama tape ramifications
and the day could be exciting. It is going to be a tug of war
between Greenspan and everybody else. We know Greenspan is going
to be putting a positive spin on our economic future while the
talking heads on the news channels will be cautioning against
a much higher risk of terrorist strikes ahead. There is already
speculation that the tape was timed to trigger sleeper cells
into specific and immediate action. The Dow is poised on the
top of strong support between 8200-8350 and it is going to
take some specific and credible problems to break through
that support. The bulls are expecting an end of year rally
and Greenspan is going to try and give it to them.

Enter Very Passively, Exit Very Aggressively!

Jim Brown
Editor


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

Out of Breath

By Steven Price

The bulls tried their best to support a rising Dow, but in the
end it was just too heavy. The Dow has shown extreme volatility
in the current range.  The last time we were between 8200 and
8550, we tested the bounds of the range almost daily and today
was no different.  A slow growing rally lifted the blue chips
throughout most of the day, however 8500 proved too tough and
each time the average crossed that mark, the bears came out to
play.   The Dow eventually finished the day up 27.05, to close at
8386.00, however, it felt more like a down day after giving up
118 points from its high of the day.

Philip Morris' (MO) comments that it could not confirm its
previous 2003 growth target of 8-10% got the ball rolling
downhill in the Dow and the rest of the group quickly followed.
The company cited soft tobacco industry volume, blaming
counterfeit and lower priced imported brands.  MO finished the
day down $5.95, and was joined by RJ Reynolds (RJR), which gave
up $4.87 and U.S. Tobacco (UST), which lost $2.43.

The retail sector started the day on a high note, after J.C.
Penney (JCP) beat estimates and raised guidance.  However, as the
day wore on, so did the euphoria, and the rally in the sector
faded by the close.   Those investors who dumped the stocks got
out ahead of an after the bell warning from Nordstrom (JWN),
which lowered its third quarter guidance, blaming record-keeping
changes associated with the company's transition to a new
inventory management system and increased selling and
distribution center expenses.   Regardless of the spin, a warning
from a major retailer heading into the holiday shopping season is
certainly not good news. We will get earnings from Wal-Mart and
Federated in the morning, and the sector should live or die, at
least for the day, based on those numbers and the accompanying
statements.  Wal-Mart has already dialed down its monthly sales
expectations, so it will be interesting to watch whether we get a
rally if they manage to still match estimates.  My guess is that
they will match, but caution that consumer spending trends may
dampen the holiday season.

The chip stocks managed a healthy bounce today, ahead of Applied
Material's (AMAT) earnings on Wednesday. The sector has sold off
after its dramatic October run, and today's bounce still found
resistance around 300, trading to a high of 302, before falling
back to close at 294.43.  It is hard to imagine AMAT saying
anything positive, after announcing last week that it would lay
off 11% of its workforce.

Speaking of layoffs, Eastman Kodak said it would stop making
disposable cameras in the U.S., and transfer some of its
operations in New York and Mexico, as part of its plan to cut
1,700 jobs. The moves will help the company's cost cutting
efforts, which also involve transferring some production of
professional film to Europe.

In spite of the failed rally in the Dow, the Nasdaq held onto a
30.37-point gain, after trading up over 48 points intraday.  Part
of the sell-off was due to Salomon Smith Barney's statements late
in the day that investors may be misinterpreting Cisco CEO John
Chambers' comments about the improved outlook for the company's
backlog.  SSB said that the backlog number is useless and that
September and October order patterns were actually below target.

The end of day sell-off would indicate a negative opening
tomorrow.  However, if Wal-Mart pulls an earnings surprise and
indicates consumer spending patterns are improving, then all bets
are off. It seems unlikely, but with a Dow that hasn't moved less
than 100 points intraday since September 20, no
support/resistance levels seem safe. Right now we are back in
range between 8200 and 8550, so look for a break across those
lines as an indication of directional change. Support above 1360
in the COMP would certainly look bullish as well, with a drop
under 1300 an indication that we are looking at the 50-dma of
1266 next.
-----------------------------------------------------------------

Market Averages

DJIA ($INDU)

52-week High: 10673
52-week Low :  7286
Current     :  8386

Moving Averages:
(Simple)

 10-dma: 8523
 50-dma: 8168
200-dma: 9251

S&P 500 ($SPX)

52-week High: 1176
52-week Low :  775
Current     :  882

Moving Averages:
(Simple)

 10-dma:  898
 50-dma:  866
200-dma:  994

Nasdaq-100 ($NDX)

52-week High: 1734
52-week Low :  795
Current     : 1001

Moving Averages:
(Simple)

 10-dma: 1016
 50-dma:  923
200-dma: 1145
-----------------------------------------------------------------

The Semiconductor Index (SOX.X):  The chip stocks got a bounce
today, after the recent sell-off.  However, the rally ended at
302 and fell back to close at 294, indicating we may once again
be seeing resistance at the 300 level.  Those bears looking to
short need to be aware of the AMAT earnings release after the
bell on Wednesday.  After the company announced layoffs last
week, it is unlikely we will get good news, but anything better
than expected may give the sector another boost.  The point and
figure shows a three box reversal up on the latest rebound, and
even though 300 appears as a failure on the daily chart, it
registered another "X" in the column today. We won't see another
buy signal until 332, but anything over the breakdown level of
308 should throw up a red flag for shorts.

52-week High: 657
52-week Low : 214
Current     : 294

Moving Averages:
(Simple)

 10-dma: 306
 50-dma: 269
200-dma: 420

Market Volatility

The VIX has made its way back over 35 and is holding there for
the time being.  While the reading is toward the bottom of the
recent range, it is on the high end, historically speaking, and
will most likely remain high until we begin to see a less
schizophrenic market, or consistently improving internals. An OEX
put/call ratio over 1.00, which is currently 1.20, virtually
guarantees a VIX in at least the mid-30s.

CBOE Market Volatility Index (VIX) = 35.17 -0.94
Nasdaq-100 Volatility Index  (VXN) = 55.25 -0.46

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

          Put/Call Ratio  Call Volume   Put Volume


Total          0.85        544,184       464,772
Equity Only    0.72        395,693       284,899
OEX            1.20         33,903        40,989
QQQ            0.43         51,320        22,282

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

Bullish Percent Data

           Current   Change   Status
NYSE          40      - 1     Bull Confirmed
NASDAQ-100    66      - 1     Bull Confirmed
Dow Indust.   63      + 0     Bull Confirmed
S&P 500       53      - 2     Bull Alert
S&P 100       61      - 1     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   1.68
10-Day Arms Index  1.32
21-Day Arms Index  1.15
55-Day Arms Index  1.30


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       1710          1021
NASDAQ     2037          1167

        New Highs      New Lows
NYSE         18              60
NASDAQ       39              58

        Volume (in millions)
NYSE     1,620
NASDAQ   1,546

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

Commitments Of Traders Report: 11/05/02

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 added 4,000 contracts to the short side, while
increasing longs by 1,000.  Small trader added 1,000 to the long
side, while increasing short positions by only 500 contracts.


Commercials   Long      Short      Net     % Of OI
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%)
11/05/02      438,546   472,384   (33,838)   (3.7%)

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
10/15/02      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%
11/05/02      138,604    76,032    65,572     30.5%

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 added 2,000 long contracts while adding 1,000 to the
short side.  Small traders added 30%, or 3,000 contracts to the
long side, while increasing shorts by a similar amount.


Commercials   Long      Short      Net     % of OI
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%)
11/05/02       49,128     56,121    (6,993) ( 6.6%)

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
10/15/02       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%
11/05/02       13,355    12,903       452     1.7%

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 added to both sides, increasing longs by 700 and
shorts by 2,300.  Small traders reduced long positions slightly,
but dropped 2,300 from their short side, for a significant
reduction in the overall short position.


Commercials   Long      Short      Net     % of OI
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%
11/05/02       22,533    15,687    6,846      17.9%

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
10/15/02        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%)
11/05/02        5,089     8,735    (3,646)   (26.4%)

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

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


===============
PLAY-of-the-Day  ((new BULLISH high-risk/high-reward play))
===============

Amerada Hess - AHC - close: 52.41 change: +0.26 stop: 49.38

Company Description:
Amerada Hess, headquartered in New York, is a global integrated
energy company engaged in the exploration for and the production,
purchase, transportation and sale of crude oil and natural gas,
as well as the production and sale of refined petroleum products.
(source: press release)

Why We Like It:
Under normal circumstances we would not classify an oil stock as
a "high-risk/high-reward" play.  The sector is largely driven by
the price of crude, which tends to move in a gradual, incremental
fashion.  High volatility is typically not the name of the game
for oil stocks.  However, AHC has seen unusually large movements
in recent weeks.  Shares were hammered for a 25% loss in late-
October.  The catalyst for this sell-off was the company's third-
quarter earnings report, which included a net loss of $136
million.  Amerada Hess cited weak profit margins and lowered
reserve estimates as reasons for the decline.  These problems are
certainly not specific to AHC - COP, MRO, and SUN have also been
plagued by similar issues.  We're not expecting more bearish news
out of the AHC camp, but traders need to be aware of the
possibility.  The second (and primary) reason for placing AHC in
the high-risk/reward category is the headline risk associated
with the looming war in Iraq.  Sudden unexpected developments in
the region could lead to sharp movements in the oil sector.  Most
analysts believe there is a currently a $5-$7 "war premium"
priced into the price of crude.  Should the Iraqi conflict be
resolved peacefully, oil could quickly deflate to "non-war"
levels.  This would probably have an adverse impact on refining
companies.

So now that you know the risks associated with Amerada Hess,
let's talk about why we think the stock is going to rise.  What
initially drew our attention to AHC is the way shares have
started to retrace the aforementioned sell-off.  The stock has
broken out of a brief consolidation between the $50-$52 area and
has no significant overhead resistance until $60-$61.  The
oscillators are looking positive as well, with the MACD in the
early stages of a bullish crossover.  The three-box reversal on
the point-and-figure chart bolsters the positive technical
outlook.  Bringing oil back into the equation, we also think that
the price of crude has reached a short-term bottom.  Crude oil
futures (cl02z) have recently stabilized near $26/barrel after a
one-month downtrend.  This level coincides with both historical
support and the 200-dma.  Although the downtrend (most easily
visible on a 60-minute chart) has not yet been broken, we believe
the looming war clouds will help to put a floor under the
commodity.  On a similar note, the OIX.X oil index has support at
250.

We're entering this play at current levels.  Those looking for more
bullish confirmation may want to wait for shares to move above today's
high ($53.27).  Our stop is located at $49.38, two cents under the
multi-year low.  We'll start this play with an official profit-target
at $59.94, just below psychological resistance at $60.00.  More
aggressive traders could look for a rally to the 50-dma at $63.11.

Annotated Chart - AHC



Picked on November 12th at $52.41
Results since picked:       +0.00
Earnings Date            10/24/02 (confirmed)







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Copyright ) 2002  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                  Tuesday 11-12-2002
                                                    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
  Bearish Play Updates:  IBM

Stock Bottom / Active Trader
  Bearish Play Updates:  BZH, DIA, MO, SUP

High Risk/Reward
  New Bullish Plays:     AHC
  Bullish Play Updates:  T
  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 Play Updates
===============

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

Intl Business Machines - IBM - cls: 79.15 chg: +1.86 stop: 82.06

Shares of IBM showed signs of firming up yesterday while the
broader market sold off.  The stock reached a new relative low
but closed with a relatively small loss compared to the Dow
Jones.  This could've been expected, given the stock's previous
multi-session downtrend.  Shares continued to trade strong after
Big Blue took the wraps off some of its new software products
this morning.  Unlike the Dow Jones, IBM was able to hold on to
the lions share of its intraday gains.  Tech stocks in general
seemed to be immune to the afternoon bearishness that plagued
other sectors.  Although we're encouraged by today's late-session
rollover from $80.00, our technical analysis may be rendered
useless if IBM has some positive things to say at tomorrow's
analyst conference.  We have no reason to believe that the
company has any bullish surprises up their sleeves (given the
overall IT weakness, we think odds are in favor of *negative*
comments), but traders looking for new positions should strongly
consider waiting until Thursday to think about short entries.
Without any good news to prop up the stock, we believe IBM will
ultimately succumb to the weakening Dow and fall below the
relative low of $76.70.

Picked on November 7th at $78.95
Results since picked:      -0.20
Earnings Date           10/16/02 (confirmed)






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

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

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

Beazer Homes - BZH - close: 58.60 change: -2.02 stop: 64.06 *new*

Homebuilding stocks showed decent relative strength on Monday
while the broader market moved lower.  Today's action was exactly
the opposite, as the DJUSHB sank to a new relative low while the
Dow Jones moved higher.  Our short play in BZH was triggered
shortly after the opening bell when shares reached our entry
point at $59.94.  Shares were hit with heavy selling during the
final 90 minutes of trading and finished at the lows of the day.
That's a good indication that the stock will continue to move
lower on Wednesday.  On a technical basis we believe today's
violation of the $60.00 support level will lead to an eventual
retest of the $52.00 area.  New short positions can be targeted
on a continued decline from current levels or a failed rally at
$60.00.  Our stop is set at $64.06, slightly above the 50-dma.
Those willing to give BZH more breathing room could use a stop
just above $65.00.

Picked on November 12th at $59.94
Results since picked:       +1.34
Earnings Date            11/05/02 (confirmed)





---

Diamonds - DIA - close: 84.30 change: +0.34 stop: 87.06 *new*

The Dow Jones rebounded on Tuesday and put a halt to its three-
day losing streak.  Gains in tech components HPQ, INTC, and IBM
helped the index to an intraday gain of more than 140 points.
But just as it looked like the Dow might make a run to the 8550
area, negative news from the Phillip Morris camp shook the bears
out of hibernation.  In an analyst conference this afternoon MO
retreated from its previous full-year guidance for 2003, leading
to a 13.8% loss in the company's stock.  This alone was a heavy
weight on the Industrials.  The market also seemed to be
pressured by the release of an audiotape that was purported to
have Osama Bin Laden talking about recent terrorist attacks.
When all was said and done, the Dow finished with a paltry 27-
point gain...Not exactly a powerful relief rally.  Technically,
bulls can be pleased with the way 8500 acted as resistance today.
A move below $83.61 on the Diamonds could send the stock to the
$82.00 region.  Conservative traders may want to consider
covering half of their short positions if shares bounce from this
level.  We believe the Dow could eventually reach the 8000 area.
Note that our stop-loss has been inched down to $87.06.  Slightly
more aggressive traders could maintain a stop just above the
relative high of $88.15.

Picked on November 7th at $85.89
Results since picked:      +1.59
Earnings Date           xx/xx/xx




---

Phillip Morris - MO - cls: 37.03 chg: -5.95 stop: 38.06 *new*

Beautiful!  With MO rising above its 50-dma and repeatedly
butting its head against resistance at $44.00, we were starting
to get a little concerned about this short play.  Those worries
were vaporized this afternoon when Phillip Morris made some
bearish comments at Morgan Stanley's Global Consumer Conference.
The company said that although growth estimates for 2002 remain
intact, it was backing off from the full-year forecast for 2003.
MO's CFO cited a glut of imported and counterfeit cigarettes as
the primary reasons for the lack of forward-looking guidance.
The resulting sell-off was not pleasant for the bulls.  MO sliced
through $40.00 (without even pausing to catch its breath) and
finished in the red by 13.8%.  Looking at the daily chart, we
can't find a larger single-day loss within in past two years!
This play is now up 10.7% from our action point at $41.49.  With
MO approaching support at $36.00, traders would be perfectly
justified in taking profits at current levels.  We believe that
brokerage downgrades and overall negative sentiment resulting
from today's news could serve to push MO below support.  Thus,
we're going to keep this play active with a stop at $38.06.  If
shares trade at or below $36.06 we will close half of our
hypothetical short position.  The remaining half will remain
open, with the expectation that MO will reach the $33-$35 area.

Picked on October 29th at $41.49
Results since picked:      +4.46
Earnings Date           10/17/02 (confirmed)




---

Superior Ind. - SUP - cls: 40.52 chg: -0.21 stop: 43.83 *new*

Our apologies if these updates are starting to sound like a
broken record, but SUP just can't seem to break its pattern of
lower lows.  The stock looked like it might avoid that fate today
when shares held on to a solid gain with 90 minutes before the
closing bell.  Unfortunately for shareholders the stock sold off
sharply with the Dow Jones and finished with a small loss.  The
steady downtrend is a very good sign for this short play.  We're
also encouraged by the way investors ignored yesterday's
announcement that Superior would increase its annual
manufacturing capacity over the next two years.  New entries can
be gauged on a move below $40.00.  Our stop-loss has been lowered
to $43.83, just above the 50-dma.

Picked on October 28th at $42.97
Results since picked:      +2.45
Earnings Date           10/17/02 (confirmed)






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

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

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

Amerada Hess - AHC - close: 52.41 change: +0.26 stop: 49.38

Company Description:
Amerada Hess, headquartered in New York, is a global integrated
energy company engaged in the exploration for and the production,
purchase, transportation and sale of crude oil and natural gas,
as well as the production and sale of refined petroleum products.
(source: press release)

Why We Like It:
Under normal circumstances we would not classify an oil stock as
a "high-risk/high-reward" play.  The sector is largely driven by
the price of crude, which tends to move in a gradual, incremental
fashion.  High volatility is typically not the name of the game
for oil stocks.  However, AHC has seen unusually large movements
in recent weeks.  Shares were hammered for a 25% loss in late-
October.  The catalyst for this sell-off was the company's third-
quarter earnings report, which included a net loss of $136
million.  Amerada Hess cited weak profit margins and lowered
reserve estimates as reasons for the decline.  These problems are
certainly not specific to AHC - COP, MRO, and SUN have also been
plagued by similar issues.  We're not expecting more bearish news
out of the AHC camp, but traders need to be aware of the
possibility.  The second (and primary) reason for placing AHC in
the high-risk/reward category is the headline risk associated
with the looming war in Iraq.  Sudden unexpected developments in
the region could lead to sharp movements in the oil sector.  Most
analysts believe there is a currently a $5-$7 "war premium"
priced into the price of crude.  Should the Iraqi conflict be
resolved peacefully, oil could quickly deflate to "non-war"
levels.  This would probably have an adverse impact on refining
companies.

So now that you know the risks associated with Amerada Hess,
let's talk about why we think the stock is going to rise.  What
initially drew our attention to AHC is the way shares have
started to retrace the aforementioned sell-off.  The stock has
broken out of a brief consolidation between the $50-$52 area and
has no significant overhead resistance until $60-$61.  The
oscillators are looking positive as well, with the MACD in the
early stages of a bullish crossover.  The three-box reversal on
the point-and-figure chart bolsters the positive technical
outlook.  Bringing oil back into the equation, we also think that
the price of crude has reached a short-term bottom.  Crude oil
futures (cl02z) have recently stabilized near $26/barrel after a
one-month downtrend.  This level coincides with both historical
support and the 200-dma.  Although the downtrend (most easily
visible on a 60-minute chart) has not yet been broken, we believe
the looming war clouds will help to put a floor under the
commodity.  On a similar note, the OIX.X oil index has support at
250.

We're entering this play at current levels.  Those looking for more
bullish confirmation may want to wait for shares to move above today's
high ($53.27).  Our stop is located at $49.38, two cents under the
multi-year low.  We'll start this play with an official profit-target
at $59.94, just below psychological resistance at $60.00.  More
aggressive traders could look for a rally to the 50-dma at $63.11.

Annotated Chart - AHC



Picked on November 12th at $52.41
Results since picked:       +0.00
Earnings Date            10/24/02 (confirmed)





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

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

AT&T Corp. - T - close: 13.86 change: +0.34 stop: 12.83

Is this the sign of true strength?  The telecom industry has been
buzzing with word that not only will the bankrupt WCOM
potentially get a new CEO but the government might actually let
them re-emerge out of bankruptcy debt-free.  This would be a HUGE
competitive advantage to start fresh and competitors like AT&T
should see a reaction in their share price.  So why aren't we
seeing any selling pressure in T?  Does Wall Street not believe
the hype that WCOM might be a new contender for the telecom
title... or do they just not care?  Looking at the stock it would
appear that shares of T have been able to continue their rising
channel.  Shares have bounced twice at the 30-dma and the stock
looks poised for a new short-term leg up after today's bounce.
Many of the oscillators are indicating a potential bullish bounce
higher except the MACD.  The MACD is actually looking rather
bearish and it could produce a bearish crossover any day now.
Technical traders shouldn't base their strategy on any one
indicator but it is something to watch out for.  Also keep in
mind that despite T's strength if the Industrials continue to
slip it will be a heavy weight that could drag the stock lower.
Our stop at 12.83 looks good but more conservative traders could
bump theirs just under $13.40 and the same goes for anyone
considering a new position.  A stop under $13.40 would be a
relatively low risk endeavor, just be sure to confirm market and
stock direction are bullish before committing any capital.

Picked on October 23rd at $13.40
Results since picked:      +0.46
Earnings Date           10/22/02 (unconfirmed)

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

Human Genome Sciences - HGSI - cls: 9.09 chg: +0.13 stop: 10.61*new*

Shucks!  Monday was looking rather sweet for the biotech bears.
Shares of HGSI slipped to a new low of $8.83 before closing at
8.87.  The follow through on the close under $9.00 looked very
encouraging for shorts.  We think the bounce today in HGSI was
just that - a bounce.  The 1.45% gain on Tuesday's session could
have been worse.  The broader markets were in rally mode for most
of the day but stocks couldn't seem to hang on to those gains.
Despite the afternoon pull back several technology groups out
performed the S&P 500.  The biotechs were one of them.  The BTK.X
bounced and traded as high as 353 (almost 354) before slipping
again.  This is probably attributed to an upgrade for Amgen.
CIBC World Markets upgraded shares of AMGN from a sector perform
to a sector outperform.  Not too bullish but enough to give AMGN
a bounce off its 100-dma and the $44 level.  Keep an eye on AMGN
as it leads the biotechs.  Closer to home there was positive news
from the HGSI PR machine.  The report on Monday out of HGSI on
their Albuleukin drug may have slowed the stock's descent.  The
report stated that scientists had achieved positive results in a
mouse model on a malignant human melanoma tumor.  HGSI plans to
file for a New Drug application with the FDA sometime next year
but it's too early to tell.  Unfortunately for shareholders there
didn't seem to be much excitement over the news.  Our strategy at
this point is to tighten our stop to $10.61.  HGSI, AMGN and the
BTK.X could bounce yet again.  We're going to reduce our
exposure.  However, those traders looking for a new entry might
want to watch for a failed rally anywhere between $9.50 and
$10.00.  It could be a new entry point.

Picked on November 1st at $ 9.49
Results since picked:      +0.40
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

TSN     Tyson Foods                11.79     +0.58
FO      Fortune Brands             48.52     +0.72
GRTS    Gart Sports                20.75     +1.51
BF      BASF Ads                   38.33     +0.87
CMA     Comerica Inc               43.76     +1.14
KIND    Kindred Healthcare         17.39     +0.52

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

EAGL    EGL Inc                    14.50     +1.04
VOD     Vodafone Group             17.64     +2.19
MSM     MSC Industrial Direct      15.40     +1.58

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

SCHL    Scholastic Corp            46.71     +2.78
ZOLL    Zoll Medical Corp          37.24     +1.52
CPG     Chelsea Property           35.35     +1.10
JCP     JC Penny                   20.96     +2.45
KOSP    KOS Pharma.                20.31     +1.16
MBT     Mobile Telesys             35.90     +1.45
TWP     Trex Co                    29.88     +1.83

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

NX      Quanex Corp                31.81     -1.07
MGAM    Multimedia Games           20.49     -1.81
CTCO    Commonwealth Tel.          36.22     -1.80
VLO     Valero Energy              32.94     -1.56
PNR     Pentair Inc                30.90     -1.45

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

SCSC    Scansource Inc             63.50     -1.54
GUC     Gucci Group                89.91     -0.74
UVV     Universal Corp             34.91     -1.89
CSB     Ciba Specialty Chem.       35.19     -0.74
FFKT    Farmers Capital Bank       33.99     -0.05




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