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Daily Newsletter, Tuesday, 12/24/2002

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PremierInvestor.net Newsletter                 Tuesday 12-24-2002
                                                   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:      Lump of Coal For Markets

-----------------------------------------------------------------
U.S. Market Numbers
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MARKET WRAP  (view in courier font for table alignment)
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      12-24-2002           High     Low     Volume   Adv/Dcl
DJIA     8448.11 - 45.20  8491.99  8443.65  .57 bln 1441/1593
NASDAQ   1372.47 -  9.20  2382.93  1372.38  .52 bln 1345/1781
S&P 100   453.27 -  2.79   456.06   453.12   Totals 2786/3374
S&P 500   892.47 -  4.91   897.38   889.48
RUS 2000  388.12 -  1.61   389.73   387.95
DJ TRANS 2307.99 - 13.70  2321.86  2307.13
VIX        30.01 +  0.68    30.35    29.49
VXN        45.13 -  0.76    46.50    45.03
Total Vol   1,161M
Total UpVol   388M
Total DnVol   785M
52wk Highs   143
52wk Lows    149
TRIN        2.23
PUT/CALL    0.55
-----------------------------------------------------------------

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

Lump of Coal For Markets

Santa delivered a lump of coal to the markets on Tuesday in
the form of the Durable Goods Orders. He was not alone as the
North Korean grinch helped steal Christmas spirit as well.
Despite the negative news the Dow managed to close right on
support one more time.

Dow Chart - Daily


Nasdaq Chart - Daily


The biggest hurdle for the markets at the open was a huge
drop in Durable Goods by -1.4%. Analysts had been expecting
a +0.5% gain. New orders fell by -1.3%. This wiped out almost
the entire increase for October and prompted worries that the
weak recovery bounce was failing. Orders for computers fell
by -3.7% which calls into question any future semiconductor
sales numbers. Despite this very negative economic news the
Dow managed to rebound off the opening lows and was showing
some growing strength until the grinch showed up.

Even weak retail sales numbers, which showed only +0.1% growth
for the week failed to make a significant impact on traders.
Most have been hearing the bad news about the holiday sales
for weeks now and the bad news should already be priced into
the market. However, the news is going from bad to worse. The
analyst community is now beginning to claim that this is the
worst year for retailers since 1991. Profits are expected to
be dismal and all eyes will be on next weeks reports to see
if the last minute shoppers helped pull the sector back from
the brink.

Adding to the negativity was the Monthly Mass Layoff report
which showed an increase to -240,028 jobs lost in November
from -171,088 lost in October. There were 2,150 mass layoffs
announced in November, which was significantly above the
1,497 in October. The continuing rise in the rate of
unemployment and the drop in durable goods bodes ill for
the 4Q GDP and any early recovery in 2003.

One additional indicator of overall weakness is a rash of
earnings warnings from video game manufacturers. This sector
is typically the last to be hit since teenage boys are the
predominate buyers and are relatively loose with their money.
The lack of sales across this sector should have the same
impact as the earnings warnings from Lance snacks. The snack
giant who depends on vending machines for a large majority
of their sales warned that they would miss 4Q earnings a
couple weeks ago. These extreme low-level indications of
weakness are even more troubling when added to unemployment
and the larger trends.

The final straw for the markets was the arrival of the grinch
in the form of North Korea, which warned on Friday of an
"uncontrollable catastrophe" if Washington failed to back
off the current hostile policy towards them. They said the
confrontation between the US and NK was escalating into an
extremely dangerous phase. NK has intercontinental missiles
and scientists have said they could have a nuclear bomb ready
for delivery in as little as three months. It appears NK is
taking advantage of the worlds distraction with Iraq and using
the opportunity to engage in some brinkmanship in an effort
to improve their global stature. Rumsfield raised the ante
on Tuesday by saying the US could fight two wars at once if
pressed and could win them both. The implied threat was
directed at NK and was warning them not to pull on Superman's
cape. He said they could swiftly defeat NK if pressed into
a second conflict. This may be wishful thinking as NK is not
as weak as Iraq.

The lack of positive movement in the markets during the holiday
week are distressing for the bulls. This typically bullish
period is slowly sinking in the quicksand of economic weakness
and global events. If traders cannot pull a rabbit out of the
hat on Thursday the outlook for an end of year rally will grow
noticeably dimmer. The normal influx of end of year cash may
be derailed into money markets instead of stocks. The markets
are poised to close with losses for the third consecutive year,
which has not happened since the depression. The Dow closed
right on the top of current support at 8450. With only a 150
point cushion between today's close and disaster (a drop under
8300) the stage is set for the end of the year. If the bulls
don't show up on schedule on Thursday we could easily see a
serious trend change.

I would like to wish all our readers a very happy holiday.
The newsletter will operate a reduced content schedule today
and Thursday with no newsletter on Wednesday.

Jim Brown
Editor



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DISCLAIMER
=================================================================

This newsletter is a publication dedicated to the education
of stock traders. The newsletter is an information service
only. The information provided herein is not to be construed
as an offer to buy or sell securities of any kind. The
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
is possible at this or some subsequent date, the editors and
staff of PremierInvestor.net may own, buy or sell securities
presented. All investors should consult a qualified professional
before trading in any security. The information provided has
been obtained from sources deemed reliable but is not
guaranteed as to accuracy or completeness. PremierInvestor.net
staff makes every effort to provide timely information to its
subscribers but cannot guarantee specific delivery times due to
factors beyond our control.

Please read our disclaimer at:
http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html

*****************************************************************
ADVERTISING INFORMATION

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Newsletter, or any Premier Investor Network newsletter please
contact Contact Support.

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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 12-24-2002
                                                    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:

Split Trader / Stock Splits
  Triggered Plays:   FRX (bullish)

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


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

===============
ST Play Updates
===============

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

Forest Labs - FRX - close: 100.13 change: +0.57 stop: 95.98

Shares of FRX shook off the broader market's directionless
trading on Tuesday and plowed through psychological resistance at
$100.  Our long play was triggered at $100.26.  Shares maxed out
just six cents below the ascending 50-dma ($100.81) before
selling off during the final half-hour of the abbreviated
session.  Now that shares are beginning to fill in the December
6th gap, we think odds are good that FRX will rally up to the
$108-$110 area.  New long entries can be targeted on a move above
the 50-dma.  Point-and-figure chartists will note that a double-
top buy signal was created today.





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

USG     USG Corp                    8.60     +0.65

---------------------------------------
Breakout to Upside (Stocks $5 to $20)
---------------------------------------
Ticker  Company Name               Close     Change
ISPH    Inspire Pharmaceuticals     9.79     +1.80
CTEC    Cholestech Corp             6.30     +1.02

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

AGN     Allergan Inc               58.17     +5.43

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

                             

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

                             




=================================================================
To stop receiving this PremierInvestor.net Newsletter,
send email to Contact Support
=================================================================
DISCLAIMER
=================================================================

This newsletter is a publication dedicated to the education
of stock traders. The newsletter is an information service
only. The information provided herein is not to be construed
as an offer to buy or sell securities of any kind. The
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
is possible at this or some subsequent date, the editors and
staff of PremierInvestor.net may own, buy or sell securities
presented. All investors should consult a qualified professional
before trading in any security. The information provided has
been obtained from sources deemed reliable but is not
guaranteed as to accuracy or completeness. PremierInvestor.net
staff makes every effort to provide timely information to its
subscribers but cannot guarantee specific delivery times due to
factors beyond our control.

Please read our disclaimer at:
http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html

*****************************************************************
ADVERTISING INFORMATION

For more information on advertising in PremierInvestor.net
Newsletter, or any Premier Investor Network newsletter please
contact Contact Support.

*****************************************************************


Copyright ) 2002  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.

DISCLAIMER

Option Investor Inc is neither a registered Investment Advisor nor a Broker/Dealer. Readers are advised that all information is issued solely for informational purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy, nor is it to be construed as a recommendation to buy, hold or sell (short or otherwise) any security. All opinions, analyses and information included herein are based on sources believed to be reliable and written in good faith, but no representation or warranty of any kind, expressed or implied, is made including but not limited to any representation or warranty concerning accuracy, completeness, correctness, timeliness or appropriateness. In addition, we do not necessarily update such opinions, analysis or information. Owners, employees and writers may have long or short positions in the securities that are discussed.

Readers are urged to consult with their own independent financial advisors with respect to any investment. All information contained in this report and website should be independently verified.

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