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Daily Newsletter, Tuesday, 12/03/2002

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PremierInvestor.net Newsletter                 Tuesday 12-03-2002
                                                   section 1 of 2
Copyright ) 2002, All rights reserved.
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In section one:

Market Wrap:      Let The Warnings Begin
Market Sentiment: Time to Reconsider
Play-of-the-Day:  Breaking It Down

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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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      12-03-2002           High     Low     Volume   Adv/Dcl
DJIA     8742.93 -119.60  8861.13  8721.88 1.79 bln 1234/1978
NASDAQ   1448.96 - 35.80  1474.69  1445.23 1.61 bln 1094/2300
S&P 100   469.62 -  7.57   477.19   468.57   Totals 2328/4278
S&P 500   920.75 - 13.78   934.53   918.73
RUS 2000  400.83 -  7.71   408.54   400.83
DJ TRANS 2337.04 - 44.40  2381.82  2334.27
VIX        31.76 +  1.70    32.32    30.88
VXN        51.99 +  1.82    52.69    51.62
Total Vol   3,612M
Total UpVol   677M
Total DnVol 2,905M
52wk Highs   126
52wk Lows     73
TRIN        1.96
PUT/CALL    0.89
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===========
Market Wrap
===========

Let The Warnings Begin

It is that time of the month, again. The first three weeks of
last month of each quarter is chock full of earnings warnings,
analyst meetings, mid-quarter updates and news events worded
to cause investor guidance to drop. The is commonly know as
the smoke and mirrors period. There is the official announcement,
the official spin about the announcement and the analyst
interpretation of the announcement. An example would be an
analyst comment that HPQ was doing well because their printer
business was healthy and they saved $2.4 billion from the merger.

Dow Chart - Daily

Nasdaq Chart - Daily


On the surface that HPQ comment sound great. The company is a
year ahead of schedule to trim $3 billion in costs by merging
CPQ/HWP into one company. HPQ has already cut -$2.4 billion
in expenses or the translated version, "they merged two
companies together and then cut half the employees." To say
HPQ is doing great because the printer business is up +15%
is also an error. The other five divisions lost ground. The
leading losers were storage -13%, hardware -20%, Personal
Computers -18%. Carly was positive in her spin but the
company said technology spending was still tepid and they
could not raise guidance due to the current uncertain
economy. Translation, "the earnings gains have come from
slashing employees and writing off merger assets and are
not repeatable."

Just before the bell UAL announced that they were cutting more
pilots in two more waves of cuts in Jan/Feb. There is just no
pickup in airline traffic and the warning to American airports
that Al Queda may have smuggled shoulder fired antiaircraft
missiles into the U.S. will make even more travelers reconsider
their trips.

Based on auto sales for the month they are not buying new cars
for those trips either. Sales were up slightly from the terrible
October levels but were significantly below levels from last
November. This should not surprise anyone since November-2001
was a banner month with new incentives prompting many to go into
debt for a new car since they were going to be spending more
time closer to home. The greatly increased incentives this year
barely increased November sales over the October drought period.
This was likely a dead cat bounce as dealers reacting to the
serious October drop pulled out all the stops to lure buyers
back into the showrooms. The buy one get one free program by
Ford did little to help with sales falling -20% in November.
Ford said it would cut production by 25,000 units. The technical
drop in November sales was the topic of many news stories today
but the main point should have been "actual sales" did not drop
from the October levels. If they can hold the current 16 million
pace it will prevent a further decline in the sector.

Retail Sales rose for the second consecutive week but only
enough to erase the -1.2% dip from the week of Nov-16th.
While the sales were up they were only up +0.3% and this
was supposed to be a huge shopping week. Reports generally
indicated a strong Friday but weaker Saturday. This is not
an exciting prospect for the seasonal trend. If shoppers
have only four weeks instead of the normal five to complete
the task then sales should have escalated more than +0.3%.

In the local parking lot indicator update, I visited a new
one million square foot shopping mall here in Denver on Monday.
At 6:PM there were less than 30 people in a food court that
holds over 500. Most stores had less than 10 customers, many
zero customers. I counted customers as we walked through
Neiman Marcus. There were 12 in the entire store. The only
stores with traffic were the toy stores and Target. I went
into a video game store to look for a title on my list and
I was the only customer in the store for the entire 10 min
I was there. They claim there are 3500 employees in the mall
and I would have bet that was twice the number of shoppers.

I dropped by Best Buy to get a DVD player and had five
employees ask if they could help me before I made it 150 ft
into the store and one was the manager. When I went to check
out there were three registers open and no customers at two
of them. However, as I drove by Wal-Mart two blocks away the
parking lot was packed. It appears to me that sales are only
good at the super discount general merchandise stores like
WMT and TGT and bearish for everyone else. This may only mean
that Denver is a depressed economic center and not a national
trend. It does make me more wary about reading between the
lines on future retail news.

I have had several emails tell me to stick to stock reporting
and spare them the personal retail stories. If you feel that
way I am sorry. I think as investors we should keep our eyes
open to everything we can observe in the world around us. We
should not depend on CNBC to deliver our economic outlook in
a tidy package. I personally would rather have an opinion
about what the next retail sales report might say BEFORE it
is released. I want to know as far in advance as possible if
we are going to fall back into another recession. I do not
want to be led down the path with the rest of the sheep only
to find out the yellow brick road led into a slaughter house.
If my economic expectations are low then an upward revision
is a pleasant surprise.

The Challenger Layoff report showed that mass layoffs had
dropped slightly from the October high of 176,000 to 157,000.
This was still the second highest month in the last ten and
well above the average of 93,580. More than one third of the
cuts were in the high tech industries with the computer
sector leading the report with -25,000 layoffs. These job
cuts are helping companies cut costs and post higher profits
but are doing nothing to help consumers weather the storm.
With higher productivity allowing companies to do more with
fewer workers it means the eventual rebound may not produce
more jobs. Technology improvements are increasing output but
fewer consumers will have paychecks to spend. Since Congress
failed to extend unemployment benefits for a second time there
are more people dropping off the continuing jobless claims
each month even though more people are unemployed. This makes
the headline numbers even more deceiving. Friday we will get
the nonfarm payroll report for November and there is a good
chance that we will see a negative jobs number. This is not
a sign of a recovery.

Nokia dampened hopes for a rebound in the cell phone market
saying global phone sales could rise only +10% in 2003 and
equipment for cellular communications would drop by -10% on
fears of an uncertain market, war and the global economy.
Nokia makes 40% of all cell phones and their forecast carries
weight in the sector. This outlook was opposite the bullish
forecast by Merrill on Monday, which estimated 474 million
units compared to only 440 million by Nokia. TXN also said
business in the mobile digital signal processors was on track
to exceed expectations for the quarter while the analog
competitors were seeing slowing of their business. This
shows that only high end phones are in demand while the
cheaper mass market models are slowing.

AOL shocked the markets this morning with estimates of revenue
for 2003 well below their prior forecast. They put forth a
get tough strategy going forward and began promoting their
"AOL for life" campaign. Hopefully that does not refer to the
time it takes to get connected and download email. They said
they were going to concentrate on making a profit on their
dialup customers, which translates to higher prices in my view.
They are going to try and convert 10% of their 30 million
customers to broadband at $15 a month for service plus the
cost of the broadband. They are not expecting any sales growth
in 2003 and sees earnings in the low end of the prior range.
AOL dropped nearly -15% on the news to $14.

Cisco began it's analyst meeting by saying it had no plans
to discuss guidance. Chambers said it was not company policy
to discuss guidance unless it had changed materially. The
analysts in attendance griped visibly that the speech by
Chambers was the same speech he gave at the USB conference
last month. The general opinion was that nothing positive
had changed or Cisco would have tried to spin it to their
benefit. Without any new information they theorized that the
outlook was negative and the low end of estimates currently
apply. CSCO fell to $14.40 on the news and traders were
expecting further profit taking on the two month rally from
the $8 October low.

We have had comments from HPQ, AOL and CSCO, all of which
left us with a sour taste in our mouth and red candles on
the charts. The next challenge is Intel, which holds it's
update on Thursday. INTC fell to support just above $20.00
on worries that the Thursday meeting could show a lack of
pickup in the PC sector. With HPQ showing strong drops in
sales of computers and retailers for big ticket items not
reporting any gains the outlook is grim. There is a very
large replacement cycle looming in our future with software
on 180 million computers going off maintenance by June 2003.
That is when Windows-98, the Y2K upgrade product, will no
longer be supported. This is not a big problem because 98
is very stable (all things considered) and companies with
thousands of Win98 computers should have tripped over any
problems long ago. The bigger problem is the upgrade path.

A new computer will be much faster but the software will be
more expensive due to the new MSFT license program. Companies
will hold off changing until the last minute due to cost
and complexity and some analysts think they may try to
generation skip the Windows-XP release and jump to the
successor. If so then the brunt of the next upgrade cycle
could be 2004 instead of 2003. The squeeze point is
processor speed. Faster servers are being held back by
slower workstations and companies may be forced to upgrade
due to data constraints. There are as many opinions as
there are analysts and all eyes will be on Intel on Thursday.

The markets cratered on the AOL warning this morning and
never recovered. The futures after the HPQ announcement
and Disney earnings warning after the close are hovering
at -4.00 for the S&P and -7.50 for the Nasdaq. This is not
painting a bullish picture for Wednesday. There is another
flurry of economic reports on Wednesday. Factory Orders,
ISM non-mfg, Mortgage Applications and Productivity. Not
much in that list to hope for. Support for the Dow is now
8670 and 1440 for the Nasdaq. Both of these levels do not
leave us much room to breathe before dropping into critical
territory. The challenge is also strong overhead resistance
which begins around 8800 on the Dow and 1460 on the Nasdaq.
As you can see this is not a very big range and it will
require much more effort to go up than drift down. Volume
is the weapon of the bulls and it was absent today and
will likely be absent until we hear from Intel.

Enter Very Passively, Exit Aggressively!

Jim Brown
Editor


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

Time to Reconsider
by Steven Price

We finally got a pattern that could give the bears some fuel
heading into tomorrow's trading session.  Since November12, the
Dow took off in an ascending channel that has given it a boost on
each pullback.  However, today's close under 8750 appears to be a
breakdown underneath that channel, although just barely, with a
close of 8742.  What was possibly just as important was the
resistance below the 8000 we saw this afternoon, with a high of
8799.  If we are seeing resistance at that level, following
rejection just over 9000, then we may have our first lower high
and a possible trend reversal.  The next step for the bears is a
trade under 8670, which would also be a lower low and possibly
the start of a new descending channel.

It was news from several sources that sent the market tumbling
this morning.  AOL said that 2003 revenues will be essentially
flat, as growth in worldwide subscription revenue will be offset
by declines in advertising and commerce revenues of 40% to 50%.
Merrill Lynch added that they were shifting assets back out of
stocks and into bonds and cash, citing concerns about corporate
earnings and war.  The Wall Street Journal reported that home
prices rose at a significantly slower pace in the third quarter
and that the market may be cooling.  Considering how steep the
recent rally has been, and the looming resistance of the August
high and 200-dma for the Dow, it only took one domino to set the
wheels in motion and we got a few of them.

I don't want to get ahead of myself here, and it is true that my
inner bear has been wondering all along just how the current
rally can be sustained without some evidence of an across the
board increase in business spending.  We have gotten some
evidence of increases here and there and I have mentioned in
previous articles that a turnaround will come gradually, with
good mews mixed in with the bad.   Any trader can find a trend to
support the view they want to see, if they look hard enough.
However, the proof is in the bottom line and if we begin to see
lower highs and lower lows, then the bottom line should favor the
shorts.

The Semiconductor Sector Index (SOX.X) has been leading the tech
indices around recently and if today's action is an indication of
things to come, then we should be seeing more red in the near
future.  The SOX gave up 5% today, which took the index back
below the August highs, and also below the last pullback,
establishing a lower low after a blow-off top that failed
resistance at 400. The SOX finished the day down -19.62 at
355.62.  That actually came in spite of some good news from the
tech sector overnight, with increased guidance from Citrix (CTXS)
and comments from Siebel Systems (SEBL) that the IT market is
firming and demand looked better in the fourth quarter than the
third. After the bell, it was reported that the CEO of Hewlett
Packard said in an analyst meeting that IT spending remains
tepid, contradicting those statements by SEBL and CTXS, but the
sell-off came before the HP statement, so apparently investors
have already decided that the chip stocks are overbought. That's
not a stretch, considering they saw almost an 80% gain in seven
weeks.

Disney didn't do the market any favors after the bell when it
announced it had overstated its 2002 profits by $74 million, due
to overestimating the box office revenue from "Treasure Planet."
The movie took in about half of what Disney movies usually gross
in the first weekend and resulted in the company lowering its
first quarter earnings estimate by a penny per share.  Some
"Treasure."

I'll be looking for those lower lows tomorrow as a signal to go
short the broader markets.  If we get a bounce instead, then
traders need to realize there is a short ceiling above at Dow
9077, as well as the 200-dmas in the Dow, COMPX and NDX. We'll be
getting a look at the ISM index, Factory Orders and Productivity
tomorrow, so we could see a bounce in the morning.  However, if
the Dow fails again at 8800, I'll be looking to enter short on
the failure.
-----------------------------------------------------------------

Market Averages

DJIA ($INDU)

52-week High: 10673
52-week Low :  7197
Current     :  8742

Moving Averages:
(Simple)

 10-dma: 8770
 50-dma: 8280
200-dma: 9172

S&P 500 ($SPX)

52-week High: 1176
52-week Low :  768
Current     :  920

Moving Averages:
(Simple)

 10-dma:  925
 50-dma:  877
200-dma:  981

Nasdaq-100 ($NDX)

52-week High: 1734
52-week Low :  795
Current     : 1088

Moving Averages:
(Simple)

 10-dma: 1099
 50-dma:  973
200-dma: 1118
-----------------------------------------------------------------

The Semiconductor Index (SOX.X): It is beginning to appear as
though the run for the chip stocks has come to a halt.  After
finding rejection at 400, where the index failed in June and
July, it has retreated below the August highs, as well.  After
losing 5% today, the SOX set its first lower low, since the
incredible run from a low of 209 on October 8.  It saw an 80%
gain in seven weeks, but has now given up 38 points since
Monday's high of 393.80.  After such an amazing run, some
pullback can be expected, but the lower low may signal a trend
reversal.  If you are still long stocks in the sector, you may
want to start collecting some protective puts.

52-week High: 657
52-week Low : 275
Current     : 355

Moving Averages:
(Simple)

 10-dma: 359
 50-dma: 290
200-dma: 406
-----------------------------------------------------------------

Market Volatility Index (VIX):  You mean there's still a
downside?  Interesting that the VIX actually headed higher last
week on a market increase, just before this week's drop. It
usually takes some institutional trading to move the VIX against
the grain. Do you suppose Merrill Lynch may have been buying a
few puts ahead of this morning's announcement that they were
shifting assets from stocks back into bonds and cash?  Do you
suppose other firms are planning the same strategy after the
recent rally?  I don't mean to sound like a conspiracy theorist
(well maybe just a little), but I find it interesting that the
VIX just wouldn't go down last week as the market rallied.


CBOE Market Volatility Index (VIX) = 31.85 +1.80
Nasdaq-100 Volatility Index  (VXN) = 51.99 +1.83

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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.89        482,329       428,133
Equity Only    0.83        388,073       320,816
OEX            0.89         17,973        15,980
QQQ            2.80         35,052        98,256

-----------------------------------------------------------------
$bpnya
Bullish Percent Data

           Current   Change   Status
NYSE          51      + 2     Bull Confirmed
NASDAQ-100    82      + 1     Bull Confirmed
Dow Indust.   70      - 3     Bull Confirmed
S&P 500       68      + 1     Bull Confirmed
S&P 100       75      + 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   1.40
10-Day Arms Index  1.15
21-Day Arms Index  1.16
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       1007          1788
NASDAQ     1013          2194

        New Highs      New Lows
NYSE         35              62
NASDAQ       27              26

        Volume (in millions)
NYSE       1784
NASDAQ     1616

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

Commitments Of Traders Report: 11/26/02

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 8,000 contracts to the short side, while adding
fewer than 1,000 to the long side.  Small traders added almost
9,000 long contracts, while increasing short positions by only
4,000.

Commercials   Long      Short      Net     % Of OI
11/05/02      438,546   472,384   (33,838)   (3.7%)
11/12/02      437,683   476,540   (38,857)   (4.3%)
11/19/02      446,668   480,270   (33,602)   (3.6%)
11/26/02      447,024   488,250   (41,226)   (4.4%)

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
11/05/02      138,604    76,032    65,572     30.5%
11/12/02      141,389    70,624    70,765     33.4%
11/19/02      143,070    77,332    65,738     29.8%
11/26/02      155,975    81,962    74,013     31.1%

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 added 1,000 long contracts and left shorts relatively
unchanged.  Small traders added 1,300 long contracts and 1,800
shorts.

Commercials   Long      Short      Net     % of OI
11/05/02       49,128     56,121    (6,993) ( 6.6%)
11/12/02       45,647     55,892   (10,245) (10.1%)
11/19/02       42,074     52,302   (10,228) (10.7%)
11/26/02       43,231     52,425   ( 9,194) ( 9.6%)

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
11/05/02       13,355    12,903       452     1.7%
11/12/02       12,698     8,801     3,897    18.1%
11/19/02       16,292    10,540     5,752    21.4%
11/26/02       17,574    12,329     5,245    17.5%

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 reduced long positions by 3,000 contracts, while
reducing shorts by only 700.  Small traders increased both
positions by approximately 2,000 contracts.

Commercials   Long      Short      Net     % of OI
11/05/02       22,533    15,687    6,846      17.9%
11/12/02       22,283    14,953    7,330      19.6%
11/19/02       23,535    15,741    7,794      19.8%
11/26/02       20,499    15,015    5,484      15.4%

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
11/05/02        5,089     8,735    (3,646)   (26.4%)
11/12/02        5,736     8,513    (2,777)   (19.5%)
11/19/02        4,428     8,203    (3,775)   (29.9%)
11/26/02        6,544    10,350    (3,806)   (22.5%)

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 Active Trader/non-tech play))
===============

Deluxe Corp. - DLX - close: 41.40 change: -1.44 stop: *text*

Company Description:
Deluxe Corporation's business units provide personal and business
checks, business forms, labels, self-inking stamps, fraud
prevention services and customer retention programs to banks,
credit unions, financial services companies, consumers and small
businesses. The Deluxe group of businesses reaches clients and
customers through a number of distribution channels: the
Internet, direct mail, the telephone and a nationwide sales
force. (source: company press release)

Why We Like It:
While Deluxe isn't exactly a household name, the company's
products (ranging from stamps to personal checks) have probably
played a role in your everyday life.  Their stock also boasts the
largest market capitalization in the office supplies sector,
ahead of both USTR, and MCL.  What drew our attention to DLX was
the way shares have broken down to multi-month lows.
Fundamentally, we can't find a whole lot to explain this
weakness.  The stock has been trending lower since mid-October,
despite a lack of noteworthy news developments.  The latest
quarterly report actually included an EPS result that was 9 cents
better than consensus estimates.  Not bad, but Wall Street didn't
seen to be very impressed - DLX has given back more than 10%
since the earnings announcement on October 17th.  Meanwhile, the
Dow Jones has clawed its way to a gain of 5.6% over the same time
period.

That pattern of relative weakness was on display during today's
session, as DLX underperformed the broader market and fell below
support at $42.00.  Shares also closed below the 50% retracement
level from July lows to October highs.  This breakdown was
accompanied by the largest volume in over a month.  With the p-n-
f chart showing a spread-triple sell signal and the daily
stochastics (5,3,3) heading lower, it looks like the stock could
continue to retrace its rapid late-summer gains and reach the
August lows near $37.00.  Given enough time (and some cooperation
from the broader market), a retest of the July lows ($33-$34)
wouldn't be out of the question.  Possible support lies in the
$39.50-$40.00 region.  This play will be activated if DLX moves
under today's low of $41.29.  If we're triggered our stop-loss
will be located at $44.09, one cent above the 200-dma.  Slightly
more conservative traders could use a stop just above Monday's
high of $43.65.

Annotated Chart - DLX:



Picked on December xth at $xx.xx <- see text
Results since picked:      +0.00
Earnings Date           10/17/02 (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 12-03-2002
                                                    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:

Stock Bottom / Active Trader
  New Bearish Plays:     DLX
  Bullish Play Updates:  SPC, TSCO
  Bearish Play Updates:  PG

High Risk/Reward
  Bullish Play Updates:  AHC, GLW, ICOS

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


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

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

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

Deluxe Corp. - DLX - close: 41.40 change: -1.44 stop: *text*

Company Description:
Deluxe Corporation's business units provide personal and business
checks, business forms, labels, self-inking stamps, fraud
prevention services and customer retention programs to banks,
credit unions, financial services companies, consumers and small
businesses. The Deluxe group of businesses reaches clients and
customers through a number of distribution channels: the
Internet, direct mail, the telephone and a nationwide sales
force. (source: company press release)

Why We Like It:
While Deluxe isn't exactly a household name, the company's
products (ranging from stamps to personal checks) have probably
played a role in your everyday life.  Their stock also boasts the
largest market capitalization in the office supplies sector,
ahead of both USTR, and MCL.  What drew our attention to DLX was
the way shares have broken down to multi-month lows.
Fundamentally, we can't find a whole lot to explain this
weakness.  The stock has been trending lower since mid-October,
despite a lack of noteworthy news developments.  The latest
quarterly report actually included an EPS result that was 9 cents
better than consensus estimates.  Not bad, but Wall Street didn't
seen to be very impressed - DLX has given back more than 10%
since the earnings announcement on October 17th.  Meanwhile, the
Dow Jones has clawed its way to a gain of 5.6% over the same time
period.

That pattern of relative weakness was on display during today's
session, as DLX underperformed the broader market and fell below
support at $42.00.  Shares also closed below the 50% retracement
level from July lows to October highs.  This breakdown was
accompanied by the largest volume in over a month.  With the p-n-
f chart showing a spread-triple sell signal and the daily
stochastics (5,3,3) heading lower, it looks like the stock could
continue to retrace its rapid late-summer gains and reach the
August lows near $37.00.  Given enough time (and some cooperation
from the broader market), a retest of the July lows ($33-$34)
wouldn't be out of the question.  Possible support lies in the
$39.50-$40.00 region.  This play will be activated if DLX moves
under today's low of $41.29.  If we're triggered our stop-loss
will be located at $44.09, one cent above the 200-dma.  Slightly
more conservative traders could use a stop just above Monday's
high of $43.65.

Annotated Chart - DLX:



Picked on December xth at $xx.xx <- see text
Results since picked:      +0.00
Earnings Date           10/17/02 (confirmed)





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

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

St. Paul Co. - SPC - close: 35.93 change: -0.07 stop: 35.11

Although Friday's bullish momentum carried over into the start of
Monday's session, SPC was dragged lower by the broader market
within minutes of the opening bell.  The stock rapidly sold off
and gave back all of the previous session's gains.  Buyers
finally moved in near the $35.65 area, which also acted as
support on Tuesday.  Looking at a 5-minute chart, we see that
shares traced a pattern of lower highs during today's session.
That's not a good sign for the bulls.  On the other hand, the
consistent intraday support is somewhat encouraging.  We also
like how SPC outperformed both the Dow Jones and the IUX.X
insurance index.  Basically it looks like the fate of this play
will rest largely on which direction the broader market takes
next.  Of course that could apply to any stock, but it seems
particularly true of SPC, which was trading strong before the Dow
sold off from Monday's highs.  We're going to move our profit-
target down to $37.94, which reflects the descending action of
the 200-dma.  Traders looking to harvest a small gain could
consider moving their stops up to $35.49, slightly under today's
low.

Picked on November 18th at $35.11
Results since picked:       +0.82
Earnings Date            10/23/02 (confirmed)




---

Tractor Supply Co. - TSCO - cls: 44.53 chg: +0.96 stop: *text*

This morning it looked like we'd have to bring the axe down on
this inactive long play.  TSCO opened weak and traded to an
intraday low of $41.75.  The sell-off resulted in a three-box
reversal on the p-n-f chart.  Because the stock had previously
given a triple-top buy signal, this created a "bull trap" alert.
Things were looking awfully bleak for shareholders, but that was
before an impressive intraday bounce sent TSCO back into positive
territory.  Shares finished with a gain of 2.2% easily outpacing
the RLX.X retail index, which fell by 1.6%.  In light of this
reversal, we're going to maintain our entry trigger at $45.51.
Remember that our stop will be set at $42.49 if the play is
triggered.

Picked on November xxth at $xx.xx <-- see text
Results since picked:       +0.00
Earnings Date            10/14/02 (confirmed)




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

Procter & Gamble - PG - close: 84.49 change: +1.69 stop: 86.06

PG led the Dow Jones lower on Monday, so it would've made perfect
sense for the stock to see heavier selling on a day when the
index gave back nearly 120 points...Especially given the previous
session's breakdown to multi-month lows.  Thus, we weren't too
thrilled to see the stock tack on 2.0% today.  Shares of other
personal and household products companies, such as G, CL, and ACV
also showed relative strength.  Perhaps this was a result of
sector rotation from tech stocks into the "safer" realm of
consumer non-cyclicals.  Bears may also have simply decided to
take some profits after pushing PG to an intraday low of $82.00.
This level offers whole-number support and also coincides with
bottom of the short-term descending channel on the 30-minute
chart.  PG closed slightly above the top of the channel but still
faces substantial overhead congestion in the $85-$86 region.
Going forward, we'll be looking for shares to roll over and fall
back towards $82.00.  New short positions can be targeted on a
break under this level.  Aggressive traders might also want to
think about shorting a failed rally near $85.00.

Picked on November 27th at $84.00
Results since picked:       -0.49
Earnings Date            10/29/02 (confirmed)






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

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

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

Amerada Hess - AHC - close: 56.85 change: +1.21 stop: 54.45*new*

It has been a long slow road since we picked AHC five weeks ago
but so far the PI newsletter is up almost 8.5%.  Driving many oil
patch stocks higher is the slowly rising price of oil.  Looking
at the January 03 light crude futures we see that it traded as
high as $27.65 before falling back to close under its 50-dma near
27.50.  This could be forecasting a consolidation as bulls and
bears battle for control at the 50-dma.  However, given the
political climate around the world, until the Iraq situation is
resolved, oil could continue to creep higher.  Checking the major
oil indices we noticed that the OIX.X is once again trying to
breakout over major resistance.  The index failed recently at the
260 resistance level and it has continued to fail at its 50-dma
for weeks.  This time it looks like the bulls are trying harder
as currently the OIX is actually resting on its 50-dma near 258,
which isn't very far from 260.  A breakout could be around the
corner.  What could be giving buyers some courage is the breakout
the market witnessed in the Oil Services sector yesterday.  The
OSX index has failed multiple times at the 90 level but bulls
were able to push through both the 200-dma and the 90 level in
Monday's session.  As far as shares of AHC are concerned we're
very encouraged by its relative strength.  The stock has managed
to build upon some short-term support at $55 and the two percent
gain today is certainly a sign of strength with the Industrials
down 120 points.  We are going to raise our stop and lower our
target.  Our new stop will be $54.45.  More conservative traders
might want to consider upping their stop to just under the $55
level.  Those same traders may also want to consider taking some
profits off the table.  Closing half the position is a smart move
to protecting capital and profits.  Considering that the 50-dma
for AHC has continued to slip closer to the share price we are
going to readjust our exit price to $58.50.  This is 50 cents
below the 50-dma currently at $59.00.  If shares of AHC trade
there intraday we will close the entire play.  New positions
would not be encouraged unless we witnessed a bounce at the $55
level.

Picked on November 12th at $52.41
Results since picked:       +4.44
Earnings Date            10/24/02 (confirmed)




---

Corning Inc - GLW - close: 4.50 change: -0.49 stop: 3.94

Today's trading in GLW exemplifies why we classified this stock
as a "high-risk/high-reward" play.  Shares were whacked for a
9.8% loss after failing to move above psychological resistance at
$5.00.  With the overall tech sector heading lower, GLW gave back
nearly all of yesterday's gains and filled in most of the Monday
morning gap.  Shares had seen some large gains recently, so it
wasn't a big surprise to see some profit-taking with the market.
The stock's single-digit stock price also adds to the volatility.
This play has plenty of breathing room with a stop at $3.94.  If
shares continue lower, we'd expect to see some support at $4.25,
location of the 19% retracement from the October lows to November
highs.  The key action point for the bulls is $5.00.  A move
above this level would pave the way for a possible rally to the
$6.00-$7.00 region.

Picked on December 3rd at  $4.72
Results since picked:      -0.22
Earnings Date           10/30/02 (confirmed)




---

ICOS Corp. - ICOS - close: 32.03 change: -0.51 stop: 28.72

It is a $4 billion battlefield.  Analysts are estimating that the
anti-impotence market will reach nearly $4 billion annually by
2006.  Pfizer's (PFE) little blue pill, Viagra, has been the drug
to beat and anyone who wants a slice of the pie is going to try
all they can to show that their solution is bigger, better and
faster than Pfizer's.  Eli Lilly (LLY), one of the bigger drug
companies on the market, has developed their own solution for the
anti-impotence market with their drug Cialis.  Cialis was co-
developed with Icos Corp (ICOS).  Recent reports say that Cialis
worked faster than Viagra.  Pfizer was quick to fire back with
their own "test" results showed that Viagra works just as fast.
Whatever the case, it shows that LLY and ICOS may have a winner
if PFE is so quick to defend their blue cash cow.  Shares of ICOS
didn't react very strongly but then the markets haven't done much
the last couple of sessions.  Thus, ICOS' sideways trading could
be viewed as a sign of strength.  We continue to feel that the
best entry point would be a pull back to the $30 area but more
aggressive traders may want to consider initiating a smaller
position if ICOS starts to bounce near $31.00 or 30.50.  A
convincing breakout over $32.50 would be encouraging for current
shareholders.  Currently, PI is up over 6.5% in the play.

Picked on November 22nd at $30.05
Results since picked:       +1.98
Earnings Date            11/05/02 (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

NCEN    New Century Financial      20.05     +1.10
DKWD    D&K Healthcare              9.81     +0.51
THRE    Therasense Inc             10.64     +0.87
POG     Patina Oil & Gas           31.58     +0.81
CED     Canadian Natural Res.      27.58     +0.88
HMY     Harmony Gold               14.42     +1.29
CSGS    CSG Systems                14.80     +0.53

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

CRY     Cryolife Inc                7.41     +1.03
CTXS    Citrix Systems             12.69     +1.26
CELL    Brightpoint Inc             7.77     +1.02

---------------------------------------
Breakout to Upside (Stocks over $20)
---------------------------------------
Ticker  Company Name               Close     Change
GENZ    Genzyme Corp               35.24     +2.44
ZOLL    Zoll Medical               37.75     +2.06
UCL     Unocal Corp                30.92     +1.31
AU      Anglogold Ltd              28.80     +2.00

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

IDPH    Idec Pharmaceuticals       32.29     -1.16
HUG     Hughes Supply              29.75     -1.16
BCS     Barclays ADR               27.14     -1.26
DRS     DRS Technologies           30.00     -3.51
KBH     KB Home                    41.53     -3.31
PECS    PEC Solutions              31.32     -2.03
NAV     Navistar Intl.             26.00     -3.55
PNW     Pinnacle West              30.90     -1.35
POC     P&O Princess               29.45     -1.50
DCX     DaimlerChrysler            33.75     -1.82

-----------------------------------------
Recently Overbought With Bearish Signals (Stocks over $20)
-------------------------------------------
Ticker  Company Name               Close     Change
PCAR    Paccar Inc                 46.77     -2.09
WHR     Whirlpool Corp             50.95     -2.40
CCMP    Cabot Microelectronics     56.62     -3.31
UVN     Univision Communications   29.37     -2.76
KEY     Keycorp                    25.48     -0.36
DASTY   Dassault Systems           25.75     -1.84
CMA     Comerica Inc               45.80     -1.43




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