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Daily Newsletter, Tuesday, 11/19/2002

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PremierInvestor.net Newsletter                 Tuesday 11-19-2002
                                                   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:      All Hope, No Action
Market Sentiment: Patience, Patience
Play-of-the-Day:  Calling A Top

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U.S. Market Numbers
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MARKET WRAP  (view in courier font for table alignment)
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      11-19-2002           High     Low     Volume Advance/Decline
DJIA     8477.73 - 11.65  8546.84  8405.12 1.61 bln   1406/1777
NASDAQ   1374.35 - 19.30  1394.93  1367.76 1.57 bln   1413/1398
S&P 100   457.69 -  1.30   462.34   455.14   Totals   2819/3175
S&P 500   896.79 -  3.61   905.32   893.09
RUS 2000  379.57 -  3.01   383.27   379.16
DJ TRANS 2269.82 - 20.82  2294.14  2266.23
VIX        31.36 +  0.25    32.70    30.73
VXN        45.52 -  2.57    50.28    45.18
TRIN        1.20
PUT/CALL    0.81
-----------------------------------------------------------------

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

All Hope, No Action

The morning market action was worse than watching paint dry. They
recovered from the initial drop in very small increments and had
to fight for every point. The 12:30 rebound buoyed hopes while
Greenspan spoke but once the speech was over sellers ruled the
day.

Dow Chart - Daily


Nasdaq Chart - Daily



A warning by Dow component Home Depot set the tone for the day
as retailers continue to complain that the consumer is not coming
to their rescue. HD said sales were down -2% and could be down
another -3% to -5% in the fourth quarter. They missed earnings
by a penny and dropped -3.55 on the news.

BJ's Wholesale also warned that year end sales were less than
expected and was downgraded by one analyst to a "sell". The
company said it was going to try and prop up sales revenue by
offering more big ticket items like 42-inch plasma monitors.
Obviously if consumers can't afford the smaller conventional
TVs they will rush out and get a loan to spend thousands on
a flat screen. Did I miss something in supply and demand class?
The company said it was targeting $1.90 per share for 2004 and
analysts were expecting $2.21. Basically they just warned for
all of next year in advance to get it out of the way. AG Edwards
cut them to a sell from hold. BJ dropped -3.75 on the news.
WMT who competes with BJ's with its SAMS Wholesale unit has
already said sales would be flat in the fourth quarter. There
have been numerous analysts saying that this will be the most
heavily discounted selling season in over a decade just to
attempt to get rid of excess holiday inventory.

Dow component Deere offset some of the HD loss after hitting
raised estimates by cutting costs and introducing new products.
They affirmed 2003 earnings estimates and gained +1.84 on
the news.

Amazon bragged about being the retailer for the Segway Personal
Transporter but Bear Stearns downgraded them based on valuation
and lack of a pressing argument to achieve higher sales. They
said the retailer has already entered all the markets it could
without significant additional expense and achieving additional
market share would be difficult.

Amazon was not the only tech stock downgraded on valuation
with Microsoft in the same category. Raymond James downgraded
MSFT based on a lack of economic recovery. They said the
software companies revenue going forward would be directly
impacted by a lack of recovery and no IT spending. While there
will be an eventual PC replacement cycle nobody sees it coming
anytime soon according to Raymond James analyst Rich Scocozza.

EMC echoed those views when it's CEO said in Tokyo today that
he saw no signs of a pickup in corporate IT spending and was
wary of predictions of a rebound in 2003. EMC is the worlds
largest data storage company. The Unisys CEO said the same
think in a speech on Tuesday. He said that global spending
will not improve until profits improve and free cash flow
becomes available. It appears everyone is waiting on the
recovery to appear but it will not appear until everyone
starts spending again.

Greenspan echoed the same sentiments in his speech this
afternoon. He said "nobody was currently spending anything"
but then quickly corrected himself to say "very few" instead.
He dwelled on very slow and unsteady current growth but went
out of his way to say that the Fed was not running out of
stimulus ammo. In an effort to calm fears about a Japanese
style Fed with no bullets left he emphasized that they could
set/support interest rates on all maturities of treasuries
to infuse liquidity into the system. The markets rose as the
text of his speech was made available but fell after question
and answer session where comments were unscripted.

After the bell there were more earnings warnings from retailers
and more rumors regarding a coming profit warning from GE. On
Thursday GE is expected to warn and announce a restructuring
with a $2 billion charge to earnings. Rumors are for a -15 to
-20 cent drop in estimates. The stock has sold off significantly
over the last several weeks as these rumors have grown. Some
traders think a moderate warning could actually produce a bounce
since there is so much bad news already in the stock. Others
think the reinsurance, airline, capital equipment and financing
divisions could be in serious trouble and this could be the
final straw for the markets. Either way the bad news will be
out on Thursday.

The markets struggled to trade higher today and did so on
sentiment alone as there was no really positive news to power
stocks. The economic news was weak with Chain Store Sales down
-1.2% but we already knew there was trouble in the mall from
various warnings from retailers. The excuse of the day was a
late month Thanksgiving weekend which would cut several days
off the holiday season. There are only two post Thanksgiving
shopping days this November and there were nine last year. The
Bank of Tokyo estimated 2% of sales would be transferred from
November to December due to the short calendar. It appears
the strong two weeks of fall sales in early November did not
continue as analysts had hoped.

CPI showed that inflation was trending upward only slightly
with energy, medical and housing prices the main reason for
the increase. At the 2.2% annual rate inflation is not a
factor for the Fed and should not be a concern for traders.
Those rising home prices and the NAHB Housing Index today
showed that builders are still optimistic about the future.
The present conditions index is at the highest point in two
years. The 50 point rate cut has builders drooling at the
thought of another 90 days of bargain rates to fuel their
sales. Despite the enthusiasm it does appear that luxury
homes are slowing drastically while average houses are still
in demand. DHI said they had $2.8 billion in delivery backlog
on signed contracts. Their biggest problem was finding lots
to expand with. Even without any further gains in housing
2002 will go out as the strongest year in the last two decades.
Wednesday will have further info on this sector with the MBA
Mortgage Application Survey and New Residential Construction.

Tomorrow could be another struggle. We are slowly putting in
a series of lower highs and the Dow is steadily completing a
head and shoulders pattern with potentially disastrous results.
This week is typically bullish for the markets with the S&P
posting gains for nine consecutive years. Considering the last
two days it will be starting from a deficit if it is going to
stretch this streak to ten. The Nasdaq was the weakest index
for two consecutive days and closed today at a four day low
after failing at a quadruple top on Monday. The Nasdaq has
risk to 1320 and with continuing comments about no IT recovery
in sight it could reach it.

The Dow dipped to 8400 at the open and rebounded to resistance
at 8550 before slipping back to 8450 just before the close.
This is decent support but fear of GE and economic risks could
continue to weigh on the Dow to near 8300. That would also
complete the right shoulder and set up a potential disaster.
However, not all H&S patterns collapse and some rebound upon
completion. Regardless of the eventual outcome the immediate
outlook is not bright. There is significant overhead resistance
and every bounce is met with selling. Unless conditions change
the risks remain weighted to the downside with no positive stock
news to energize investors. The longest bear market in history
1039 days during the great depression. Today was the 1040th day
for the current bear market. Because of the +18% Dow gain off
the October lows some say this bear market was over then but
without some confirmation soon this could eventually go down
as the longest in history.

Enter Very Passively, Exit Aggressively!

Jim Brown
Editor


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

Patience, Patience

by Steven Price

On a day when the Dow lost fewer than 12 points, there was an
awful lot of red on my screen.  Of course the Nasdaq lost 19
points, contributing to the crimson tide, but as I see it, the
most ominous signs came from outside the tech sector.   Home
Depot reported earnings that matched expectations, but said same
store sales were down 2%, which was a stark contrast to its
previous forecast of 2-4% growth.  The company also said it is
"cautious on the economy into next year."   This would seem
consistent with The National Association of Home Builders
Remodeling Market Index, which was released today, and fell three
points to 49.8. Anything below 50 means remodelers view the
market as unfavorable and suggests to me that the recent wave of
home refinancing may be slowing down, in spite of rates being
lowered again earlier this month. One of the biggest sources of
consumer spending has been dollars taken from home sales and
refinancing.  Alan Greenspan's testimony of November 13 stated,
"(R)oughly half of equity extractions are allocated to the
combination of personal consumption expenditures and outlays on
home modernization." If we see a slowdown in that area, then I'm
not sure where else we'll get dollars to support current spending
levels.

While Home Depot is not the traditional retailer that relies on
the holiday shopping season for an enormous chunk of its
business, we continue to get warnings from retailers that do rely
heavily on the season. Wal-Mart and Federated both made cautious
statements on Monday about November same store sales being lower
than expected and today that sentiment was echoed by BJ's
Wholesale Club, which said November sales were below plan and
made cautious comments about 2003.  A.G. Edwards analyst Robert
Buchanan lowered the stock to a sell, saying the company had
already thrown in the towel for next year. The Bank of Tokyo's
weekly chain store sales report also showed a 1.2% decline last
week. As we head into the holiday season, which is already six
official shopping days shorter than last year (due to a later
Thanksgiving), a reluctance to spend could foreshadow another
weak year for consumer spending.

Economic data released this morning showed a 0.3% rise in the
Consumer Price Index for October, fueled mostly by a 1.9% rise in
energy prices. The core rate jumped 0.2%, which was in line with
expectations.  Prices are up 2% over the last year. The trade
deficit also narrowed slightly, dropping $300 million to $38
billion. The small increase in CPI keeps the Fed in the clear,
after lowering the overnight rate by 50 basis points on November
6.  A jump in CPI would indicate inflationary pressure, which is
combated by raising rates.  The slight rise was nothing severe
and indicates inflation is not currently an issue.

The head and shoulders pattern in the Dow and SPX, talked about
several times in this space, appears to be taking shape, with the
recent high of Dow 8636 and SPX 915 looking like the possible top
of a right shoulder. The fact that the Dow is now back under 8500
and the SPX is below support at 900 have me leaning to the
bearish side of the market, after donning bulls horns briefly
last week.  I'm not particularly concerned about what "should" be
happening and I am more than happy to change hats as often as the
market dictates.  Traders need to remember that there should be
no loyalty to a direction.  We simply jump on for the ride, no
matter how short or long it may be.  Long-term opinions are for
the 401k, not for short-term opportunities.

While I am leaning bearish, we must realize that the Nasdaq
Composite is still in a pattern of higher lows for the moment.
It has not been able to set a higher high above the August top of
1426, but the last two pullbacks stopped at 1279 and 1319.  The
current pullback to 1374 keeps that trend alive, so look for a
break below 1319 as the more decisive breakdown.

Part of the reason the Nasdaq has been slightly schizophrenic and
difficult to protect is the fact that the chip sector is bouncing
around without a defined trend.  It pulled back today, dropping
7.40 to 312, but bounced off 310, which had been previous
resistance back in September.  The group has mirrored the higher
low - lower high pattern of the COMP and right now is not giving
us much to work with. The news out of the sector has certainly
been negative, but it was negative for the last two months,
during a 50% gain, as well.

Traders can lean short here, but the trend is not terribly
strong.  A breakdown of the H&S neckline in the Dow between 8350-
8400 would show a stronger downtrend, but until we get that I
would be playing with smaller positions than usual. The same goes
for the Nasdaq.  Sometimes it's frustrating to sit on the
sidelines, but we must remember two rules: 1) There will always
be opportunities that present themselves and if you must force
it, play small; and 2) Always make sure you can come back and
play tomorrow.

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

Market Averages

DJIA ($INDU)

52-week High: 10673
52-week Low :  7197
Current     :  8474

Moving Averages:
(Simple)

 10-dma: 8512
 50-dma: 8172
200-dma: 9218

S&P 500 ($SPX)

52-week High: 1176
52-week Low :  768
Current     :  896

Moving Averages:
(Simple)

 10-dma:  897
 50-dma:  867
200-dma:  989

Nasdaq-100 ($NDX)

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

Moving Averages:
(Simple)

 10-dma: 1027
 50-dma:  935
200-dma: 1133

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

The Retail Index (RLX.X):  We are starting to see the cracks in
the dike after last week's bullish earnings releases.  Wal-Mart
started the week by warning that November sales were coming in
under target.  That was followed by similar warnings from
Federated and BJ's Wholesale club, which went so far as to give
cautious statements for all of 2003.  Even Home Depot got into
the act, by giving notice that same store sales for the month
were not only not showing the previously forecast 2% growth, but
would be down 2-4%.  The RLX has sold off the last two days, and
may test the recent low of 273 before the week is over.

52-week High: n/a (recalculated in June)
52-week Low : 253
Current     : 319

Moving Averages:
(Simple)

 10-dma: 282
 50-dma: 283
200-dma: 317
-----------------------------------------------------------------

Market Volatility

The VIX barely broke through its 200-dma at 31.25, before
bouncing off 30.  It is hovering over that level for the moment,
and has not closed under 30 since June 28. If the current
sideways movement in the market continues we may actually see the
20s in the near future.  However, the head and shoulders pattern
that appears to be forming in the Dow and SPX is likely raising a
few eyebrows and until we get a decisive move up, we may see the
VIX also holding this level.   In the case of an H&S breakdown,
look for the VIX to trade 35-40.


CBOE Market Volatility Index (VIX) = 31.36 +0.25
Nasdaq-100 Volatility Index  (VXN) = 45.52 -2.57

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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.81        461,795       371,788
Equity Only    0.72        377,520       273,281
OEX            1.04         10,790        11,258
QQQ            1.07         44,696        48,007

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

Bullish Percent Data

           Current   Change   Status
NYSE          42      + 2     Bull Confirmed
NASDAQ-100    69      + 1     Bull Confirmed
Dow Indust.   67      + 0     Bull Confirmed
S&P 500       56      + 0     Bull Alert
S&P 100       64      - 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   0.85
10-Day Arms Index  1.26
21-Day Arms Index  1.15
55-Day Arms Index  1.20


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       1174          1554
NASDAQ     1316          1820

        New Highs      New Lows
NYSE         21              34
NASDAQ       50              50

        Volume (in millions)
NYSE     1,619
NASDAQ   1,615

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

Commitments Of Traders Report: 11/12/02

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 increased short positions by 4,000 contracts, while
slightly reducing the long side.  Small traders increased long
positions by 3,000 contracts, while reducing the short side by
6,000.

Commercials   Long      Short      Net     % Of OI
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%)
11/12/02      437,683   476,540   (38,857)   (4.3%)

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
10/22/02      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%
11/12/02      141,389    70,624    70,765     33.4%

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 reduced the long side by 3,500 contracts while
leaving the short side virtually unchanged.  Small traders, on
the other hand, reduced short positions by 4,000 contracts and
longs by just 700.


Commercials   Long      Short      Net     % of OI
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%)
11/12/02       45,647     55,892   (10,245) (10.1%)

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
10/22/02       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%
11/12/02       12,698     8,801     3,897    18.1%

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 left positions relatively unchanged, with a slight
reduction in both longs and shorts.  Small traders increased the
long side slightly and left shorts around the same level.

Commercials   Long      Short      Net     % of OI
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%
11/12/02       22,283    14,953    7,330      19.6%

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
10/22/02        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%)
11/12/02        5,736     8,513    (2,777)   (19.5)

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 BEARISH high-risk/high-reward play))
===============

Netease.com - NTES - close: 9.17 change: -0.97 stop: *text*

Company Description:
NetEase.com, Inc. is a leading China-based Internet technology
company that pioneered the development of applications, services
and other technologies for the Internet in China. The NetEase Web
sites, operated by a company affiliate, organize and provide
access to 18 content channels through distribution arrangements
with more than one hundred international and domestic content
providers. (source: company press release)

Why We Like It:
It's amazing how history can repeat itself.  Over the past month
a handful of internet portal stocks have doubled or even tripled
in value.  Sounds like 1999 all over again, doesn't it?!  Back in
the day, stocks like Yahoo, Infoseek, and Lycos helped to inflate
the internet bubble.  The latter two companies were eventually
bought out, while YHOO remained as the lone survivor of the
portal business.  Fast-forward three years, and the same thing is
happening (albeit on a smaller scale) in the Far East.  Chinese
internet stocks NTES, SINA, and SOHU have recently exploded to
the upside on speculation that one of the companies will emerge
as the premier portal providers in the world's most populous
nation.  The Chinese economy is currently enjoying an 8% growth
rate, thanks to capitalist reforms by the government.  It's not
too hard to see why speculative traders have been moving into
these stocks.  What seems to have ignited the recent rally is the
latest earnings reports, in which SINA and NTES both posted
narrower losses on a year-over-year basis.  This is enough to
have speculative bulls drooling at the prospect of profitability
and Chinese internet domination.

While the growth possibilities for China are admittedly
tantalizing, we think NTES is extremely overextended.  The stock
has more than quadrupled in value since the relative low of $2.05
in early-October.  NTES finally saw some consolidation today
after the stock ran into psychological resistance at $10.00.
There was no news to explain the previous three days of steep
gains.  As a matter of fact, U.S. regulators are currently
delving into the company's restatement of financial results from
2000.  Further revelations of government inquiries could send
NTES into a freefall.  Technically, the stock looks overdue for
some consolidation and we think now is the time to consider short
positions.  It looks like shares could eventually pull back to
the $6.00 region, where shares briefly consolidated before the
latest upward move.  This would also be a 50% retracement from
the October lows to November highs.  By using a stop at $10.42
(two cents above the relative high), we've created a favorable
risk/reward ratio.  We'll hold off on actually entering this play
until NTES moves below $9.00.  This level acted as support on
Tuesday.  However, the play will NOT be activated if shares gap
below $8.50 tomorrow morning.

Needless to say, this is a very speculative strategy - we're
attempting to call a short-term top on a stock that has been
moving explosively higher.  Only risk capital should be used for
this play.  On a logistical note, the recent gains might make it
more difficult to find stock to short.  Contact your broker if
there is any question as to the availability of shares to borrow.

Picked on November xxth at $xx.xx <- see text
Results since picked:       +0.00
Earnings Date            11/05/02 (confirmed)







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newsletter picks are not to be considered a recommendation
of any stock but an information resource to aid the investor
in making an informed decision regarding trading in stocks. It
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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 11-19-2002
                                                    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
  Bullish Play Updates:  KRON
  Bearish Play Updates:  IBM

Stock Bottom / Active Trader
  Bullish Play Updates:  SPC
  Bearish Play Updates:  DIA

High Risk/Reward
  New Bearish Plays:     NTES
  Bullish Play Updates:  AHC
  Bearish Play Updates:  CW, HGSI

Split Trader Stock Splits
  Split Announcement:
                         IBCP: 3-for-2 Split Announcement

Trading Ideas
  Value Plays With Bullish Signals
  Breakout to Upside (Stocks $5 to $20)
  Breakout to Upside (Stocks over $20)
  Breakout to Downside (Stocks over $20)
  Recently Overbought With Bearish Signals (Stocks over $20)


==================================================================
Net Bulls (NB) Tech Stock section
==================================================================

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

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

Kronos Inc. - KRON - close: 39.25 change: +0.44 stop: *text*

Still waiting for a breakout.  KRON has done a decent job of
holding near its multi-month highs over the past two days, but
shares just can't seem to move back above resistance at $40.00.
The stock showed good relative strength on Tuesday and
outperformed the GSO.X software index, which finished with a loss
of more than 1.0%.  That's an indication to us that the stock
should still be able to move to new relative highs, despite the
recent trend of lower lows and lower highs.  We're maintaining
our entry trigger at $40.51, with a stop at $37.98.  There have
been no fresh news developments for Kronos.

Picked on November xxth at $xx.xx <- see text
Results since picked:       +0.00
Earnings Date            10/29/02 (confirmed)




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

Intl Business Mach. - IBM - cls: 78.37 chg: -0.81 stop: 81.06*new

We certainly can't complain about the recent trading in IBM.  On
Monday the bulls were once again frustrated by resistance at the
200-dma ($80.83).  Shares sold off from this moving average early
in the session and have since trended lower.  Today's action saw
Big Blue gap under short-term support at $79.00 before finishing
with a 1.0% loss.  Not too shabby, considering the Dow was only
down 11 points.  News that IBM had inked a $290 million
supercomputer deal with the federal government seemed to fall on
deaf ears.  This paper trade's return to profitability coincides
nicely with rolling action on the oscillators.  Factor in a
weakening Dow Jones into the equation, and we think odds are good
that shares will soon be testing the November low of $76.70.  New
short positions can be targeted on a move under this level. The
Dow has more or sell been trading sideways, but this could change
if the index completes a head-and-shoulders formation on the
daily chart.  The NASDAQ is beginning to move lower from 1400 and
this should also benefit our short play.  Our stop has been
lowered to $81.06, slightly above Monday's high and the 200-dma.

Picked on November 7th at $78.95
Results since picked:      +0.58
Earnings Date           10/16/02 (confirmed)






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

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

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

St. Paul Co. - SPC - close: 34.23 change: -0.07 stop: 33.18

This long play was triggered on Monday morning when SPC wiggled
its way above $35.10.  Although we were looking for a breakout
over this level to trigger another round of buying, the weakening
broader market threw wrench in our bullish plans.  For now we'll
have to be content with the fact that SPC found support at $34.00
on Tuesday.  This area previously served as resistance.  Shares
mirrored the Dow and finished with a fractional loss.  The IUX.X
insurance index showed a similar lack of direction and finished
with a small gain.  SPC still looks like a good bullish trade on
a move above the relative high ($35.14), but we'd be wary of a
breakout that was not accompanied by strength in the IUX.X.  The
recent spike above $35.00 may turn out to be nothing but a head
fake if the sector heads lower with the market.  On a more
positive note, the speed with which the U.S. Senate pushed
through President Bush's Homeland Security bill is a sign that a
Terrorism Insurance initiative may not be far behind.  We believe
SPC would benefit from the passing of such a bill.

Picked on November 18th at $35.11
Results since picked:       -0.88
Earnings Date            10/23/02 (confirmed)

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

Diamonds - DIA - close: 85.06 change: +0.15 stop: 87.06

The Dow usually has a pretty tough time posting a gain when one
of its components gets whacked for a double-digit loss.  The
primary laggard on the index today was HD, which was hit for a
loss of nearly 13% after the company said that same-store sales
could decline by as much 5% in the fourth quarter.  The world's
largest home-improvement retailer also said that it would not
achieve its longer-term growth objectives.  Tech-related
components INTC, MSFT, and IBM also helped to drag the Dow lower
after Mr. Softee was hit with a brokerage downgrade.  Given these
negative developments, the bulls can be somewhat pleased that the
Dow finished with a loss of just 11 points.  Less encouraging is
the trend of lower highs since the Industrials topped out at 8800
on November 6th.  There's also been a lot of conjecture about
whether a head-and-shoulders pattern is forming on the daily
chart.  We see a left shoulder in mid-October and a head created
by the early-November highs.  All it would take to complete the
right shoulder is a decline to the 8300 area.  A similar head-
and-shoulders formation was seen in July/August/September before
Dow sold off to the 7200 region.  Chart pattern speculation
aside, the reversing daily stochastics (5,3,3) indicate that the
bulls will have a difficult time pushing the Dow back above 8600.
New positions in the Diamonds can be targeted on a move below
$84.00, but remember that possible support lurks at $83.00.

Picked on November 7th at $85.89
Results since picked:      +0.83
Earnings Date           xx/xx/xx






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

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

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

Netease.com - NTES - close: 9.17 change: -0.97 stop: *text*

Company Description:
NetEase.com, Inc. is a leading China-based Internet technology
company that pioneered the development of applications, services
and other technologies for the Internet in China. The NetEase Web
sites, operated by a company affiliate, organize and provide
access to 18 content channels through distribution arrangements
with more than one hundred international and domestic content
providers. (source: company press release)

Why We Like It:
It's amazing how history can repeat itself.  Over the past month
a handful of internet portal stocks have doubled or even tripled
in value.  Sounds like 1999 all over again, doesn't it?!  Back in
the day, stocks like Yahoo, Infoseek, and Lycos helped to inflate
the internet bubble.  The latter two companies were eventually
bought out, while YHOO remained as the lone survivor of the
portal business.  Fast-forward three years, and the same thing is
happening (albeit on a smaller scale) in the Far East.  Chinese
internet stocks NTES, SINA, and SOHU have recently exploded to
the upside on speculation that one of the companies will emerge
as the premier portal providers in the world's most populous
nation.  The Chinese economy is currently enjoying an 8% growth
rate, thanks to capitalist reforms by the government.  It's not
too hard to see why speculative traders have been moving into
these stocks.  What seems to have ignited the recent rally is the
latest earnings reports, in which SINA and NTES both posted
narrower losses on a year-over-year basis.  This is enough to
have speculative bulls drooling at the prospect of profitability
and Chinese internet domination.

While the growth possibilities for China are admittedly
tantalizing, we think NTES is extremely overextended.  The stock
has more than quadrupled in value since the relative low of $2.05
in early-October.  NTES finally saw some consolidation today
after the stock ran into psychological resistance at $10.00.
There was no news to explain the previous three days of steep
gains.  As a matter of fact, U.S. regulators are currently
delving into the company's restatement of financial results from
2000.  Further revelations of government inquiries could send
NTES into a freefall.  Technically, the stock looks overdue for
some consolidation and we think now is the time to consider short
positions.  It looks like shares could eventually pull back to
the $6.00 region, where shares briefly consolidated before the
latest upward move.  This would also be a 50% retracement from
the October lows to November highs.  By using a stop at $10.42
(two cents above the relative high), we've created a favorable
risk/reward ratio.  We'll hold off on actually entering this play
until NTES moves below $9.00.  This level acted as support on
Tuesday.  However, the play will NOT be activated if shares gap
below $8.50 tomorrow morning.

Needless to say, this is a very speculative strategy - we're
attempting to call a short-term top on a stock that has been
moving explosively higher.  Only risk capital should be used for
this play.  On a logistical note, the recent gains might make it
more difficult to find stock to short.  Contact your broker if
there is any question as to the availability of shares to borrow.

Picked on November xxth at $xx.xx <- see text
Results since picked:       +0.00
Earnings Date            11/05/02 (confirmed)





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

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

Amerada Hess - AHC - close: 53.63 change: +0.58 stop: 49.94*new*

Shares of AHC are still trudging along.  There was some
excitement earlier this week with the oil-tanker spill off the
coast of Spain.  Excitement is probably the wrong word as the
single-hulled tanker has sunk with more than twice as much fuel
as the infamous Valdez spill off the coast of Alaska.  This will
be a serious disaster for the Spanish fishing industry but we
doubt it has any affect on the oil industry as a whole - other
than a renewed push to phase out the use of single-hulled tankers
already due to be moth-balled between 2010 and 2015.  The price
per barrel spiked higher a couple of days ago but has seen just a
little bit of profit taking (cl02z, light crude December
contracts).  This has produced a bullish crossover in the MACD
but it's not showing much strength.  Shares of AHC are seeing
potential resistance at $55.  The short-term trend for AHC has
been a slowly rising oscillating channel.  Thus, new entries are
probably best made at a pull back to the $53.00 level.
Conservative traders could even bump their stop up a couple of
points to reduce exposure.  At the moment, we're going to inch
our stop higher from $49.38 to $49.94.

Picked on November 12th at $52.41
Results since picked:       +1.22
Earnings Date            10/24/02 (confirmed)




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

Curtiss Wright - CW - close: 64.29 change: -0.82 stop: 67.82

It's hard to get too excited about a 1.2% decline, but we're
pretty darn pleased with how CW traded today.  The overall
defense sector (as gauged by the DFX.X defense index) rebounded
after several consecutive days of losses.  However, this did not
translate to a gain for Curtiss Wright.  Shares instead continued
to drift lower with little regard to what the rest of the market
was doing.  The company's announcement of a 15-cent divided this
afternoon did not appear to impact trading.  (The dividend will
be payable on December 16th to shareholders of record on December
2nd).  Our short play was activated at $64.94 after shares fell
under the 200-dma ($65.06).  This breakdown, along with the fresh
bearish MACD crossover, suggests that CW will continue to retrace
its October/November rally.  The DFX.X is also teetering above
support at 152 and looks prone to another downward leg.
Meanwhile, the DFI.X index (both the DFI and DFX measure the
performance of the defense group) looks like it could either
bounce back to the 500-510 area after setting an all-time low on
Tuesday morning...Or suffer another breakdown.  Either way, CW's
relative weakness isn't a good sign for the bulls.  New short
positions can be targeted on a move below $64.00, but remember
that shares may find support in the $62.50 area.  Our stop is
located at $67.82.

Picked on November 19th at $64.94
Results since picked:       +0.65
Earnings Date            10/29/02 (confirmed)




---

Human Genome Sciences - HGSI - cls: 8.61 chg: -0.05 stop: 9.51

The Biotech Index (BTK.X) is continuing to trade sideways as the
giant of the group, AMGN, has rolled over at the 200-dma as
expected (and outlined in our previous updates).  As shares of
AMGN failed near $49.00 and currently trading $45.80, we're
surprised that the BTK isn't looking weaker.  If AMGN can break
below the 100-dma near 44.17 and the $44 level it could lead the
group lower.  Readers may or may not remember that AMGN is the
biggest component in the BTK index so where AMGN goes the stocks
in the sector tend to follow.  Looking significantly weaker than
AMGN is HGSI.  The stock has continued to slip lower albeit at a
slower pace.  Those traders who might be feeling impatient with
the pace of the trade might want to consider taking profits now
or closing out half their position.  Shares of HGSI did rally
higher yesterday (as did AMGN) but they rolled over as well.  The
new lower high for HGSI is in the $9.15 area.  Conservative
traders could lower their stop to just above this mark.  The
$9.30 level also looks tempting as a stop to reduce current risk.
The MACD is starting to flatten out for HGSI and considering its
oversold condition could give us a false bullish crossover soon.
It is something to consider when evaluating risk.  Stochastics
with a 5,3,3 setting are already indicating a reversal in
momentum but it has not yet played out in the stock price.  We
would be cautious in adding to or initiating new positions unless
one did so with a tight stop to reduce risk (tighter than our
current listed stop of $9.51).  We will reiterate that our
current profit target is $7.51 but less aggressive traders might
consider the $8.00 area as a good place to cover for a profit.

Picked on November 1st at $ 9.49
Results since picked:      +0.88
Earnings Date           10/29/02 (confirmed)






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

Split Announcements
-------------------

Independent Bank Sets 3-for-2 Stock Split, Raises Dividend

After the market opened this morning, Independent Bank Corporation
(NASDAQ:IBCP) announced a 3-for-2 stock split.

The split will be payable on December 31, 2002 to shareholders of
record on December 5, 2002.  The company also announced a cash
dividend of $0.14/share, payable on January 31, 2002 to
shareholders of record on January 6, 2002.  This represents a
22.5% increase over the previous dividend, when also factoring in
the October 2002 5% stock dividend and the upcoming stock split.

A weekly chart for IBCP shows that the stock is in the midst of an
impressive uptrend that began in March of 2000.  That slow mover
recently broke down below support at $32.00, but has thus far
remained above its 200-dma at $30.90.  This moving average acted
as support during a pullback in early October.

Shares closed at $31.30 on Monday.  For a current quote, click here:

http://user.financialcontent.com/pin1/quote.cgi?account=pin1&ticker=IBCP

About the company
Independent Bank Corporation and its subsidiaries operate 97 offices
across Michigan's Lower Peninsula (source: company press release)


=================
  Trading Ideas
=================

This section contains stocks that meet criteria which may make
them of interest to long and short side traders.  These are not
recommendations, nor have they been reviewed by PremierInvestor
editors for investment potential.  However, each of them has
technical and fundamental characteristics that make them worthy
of further review by traders and investors looking for fresh ideas.
New stocks will appear daily following the market close.


Value Plays With Bullish Signals
---------------------------------
Ticker  Company Name               Close     Change

BBY     Best Buy                   23.09     +0.78
UHAL    Amerco                      5.20     +0.90
USNA    Usana Health Science       10.79     +0.89
AYE     Allegheny Energy            6.35     +0.60

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

SPLS    Staples Inc                18.39     +2.16
CLHB    Clean Harbors              12.59     +4.69
A       Agilent Tech.              16.60     +3.00
ATRS    Altiris Inc                12.87     +1.27

---------------------------------------
Breakout to Upside (Stocks over $20)
---------------------------------------
Ticker  Company Name               Close     Change
MDT     Medtronic Inc              47.83     +1.28
BOW     Bowater Inc                35.25     +1.50
DE      Deere & Co                 49.90     +1.84

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

ABC     Amerisourcebergen          59.00     -4.40
SRDX    Surmodics Inc              33.36     -1.41
ESRX    Express Scripts            51.29     -2.21
PHSY    Pacificare                 28.95     -1.56
BSTE    Biosite Inc                27.54     -1.22
MCK     Mckesson Corp              26.87     -1.40
BDK     Black & Decker             43.63     -2.25
DGX     Quest Diagnostics          56.83     -3.97

-----------------------------------------
Recently Overbought With Bearish Signals (Stocks over $20)
-------------------------------------------
Ticker  Company Name               Close     Change
WMI     Waste Management           23.28     -1.41
REY     Reynolds & Reynolds        25.45     -0.64
PKY     Parkway Properties         35.05     -0.21
CXP     Centex Construction        35.55     -0.76
B       Barnes Group               22.29     -0.23




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