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Daily Newsletter, Tuesday, 03/04/2003

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PremierInvestor.net Newsletter                 Tuesday 03-04-2003
                                                   section 1 of 2
Copyright ) 2003, 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:      House Fires and Car Bombs
Market Sentiment: And the Walls Came Tumbling Down
Play-of-the-Day:  Not Looking Healthy

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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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      03-04-2003           High     Low     Volume Advance/Decline
DJIA     7704.87 -133.00  7845.71  7704.31 1.42 bln   1136/2064
NASDAQ   1307.77 - 12.50  1321.34  1307.27 1.19 bln   1254/2024
S&P 100   415.36 -  6.82   422.64   415.32   Totals   2390/4088
S&P 500   821.99 - 12.82   835.43   821.96
W5000    7807.01 -113.40  7924.51  7806.26
RUS 2000  356.51 -  2.80   359.31   356.04
DJ TRANS 2034.36 - 31.70  2067.46  2033.98
VIX        36.58 +  2.49    36.58    35.19
VXN        44.97 -  0.86    46.59    44.84
Total Volume 2,756M
Total UpVol    489M
Total DnVol  2,211M
52wk Highs  186
52wk Lows   256
TRIN       3.37
PUT/CALL    .90
-----------------------------------------------------------------

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

House Fires and Car Bombs

It was not a pretty day for the markets. Housing sales went
down in flames, auto sales crashed and Greenspan bombed the
markets with words of caution about slower times ahead and
the possibility of a slow down in consumer spending. Terrorists
set off a bomb in the Philippines and the US said it may forget
trying to get a UN resolution and proceed on its own. The
markets did not react well to this attack from all sides.

Dow Chart - Daily


Nasdaq Chart - Daily


Leading the batting order today was the Challenger Layoff
report which showed a +5% rise in layoffs in February to
138,177. This is the second monthly gain and shows that
corporations are still cutting employees due the weak outlook.
The largest number of layoffs were in computer manufacturing,
computer services and non-profit organizations. Rising energy
prices are causing corporations to cut back even further to
protect already skinny bottom lines.

Chain Store sales rose slightly for the week at +2.0% but
fell -1.0% compared to last year. There was no big rebound
in the week after the blizzard in the Northeast and analysts
are concerned that war worries are causing an increase in
the cocooning process.

Disney said today that business at their attractions dropped
measurably and immediately when the orange alert was issued
and has not come back. Airlines are seeing less traffic and
restaurants are warning about slowing sales. The quadruple
threat of war, terror, economy and gas prices are combining
to squash consumer interest and being home alone has taken
on a positive context.

Lenar Homes announced a weaker than expected forecast for
orders in the first quarter and JPM said the stock could
fall -25% from its present level. Needless to say that began
a massive haircut for the entire sector.

Not to have his thunder stolen by JPM, Greenspan dropped a
bomb this morning when he said he saw home sales slowing as
well. This double whammy tanked builders, home improvement
companies, appliance manufacturers and any other related
industry. He was not done. He said consumers withdrew a
record $700 billion in equity from homes in 2002 or 10%
of all home equity available. He said this bubble brought
about by the very low mortgage rates could not continue and
could slow dramatically going forward. This would lead in
his opinion to a slowing of consumer spending and weaker
times ahead. Sounds like he had a bad nights sleep and
got up on the wrong side of the bed. The markets really
took this news badly and saw it as evidence that the
current soft patch may be turning into quicksand.

After posting disappointing sales numbers yesterday DB
Securities cut GM and Ford to a sell. They said recent
developments have led them to be increasingly pessimistic
about the downside risk for automakers over the next few
years. The firm said the annual pace of deflation could
get worse and the lower demand and increased capacity by
foreign automakers was going to provide a rocky road for
automakers. They also said the risk of a prolonged
economic downturn through 2005 is much greater than is
commonly perceived. Oops! Anything related to autos and
auto parts dropped significantly.

Adding to the overall investor anguish was comments from
Warren Buffet that stocks were over valued and the market
would probably see some rough times ahead. Buffet said
that sometimes the best action is no action and said he
was on the sidelines until the circumstances played out
and a better investing environment appeared. The Oracle
of Omaha is followed by many investors as a successful
predictor of market action. This prompted another round
of selling by the retail crowd.

On the war/terror front things are heating up fast. The
US is "reportedly" preparing a 72 hour warning of imminent
hostile action to allow people like diplomats, UN inspectors,
humanitarian workers, etc, to evacuate the country. This
warning could be issued according to undisclosed sources
any time over the next ten days. Must be a pre-warning
warning by leaking it early.

The US is reportedly ready to withdraw the UN resolution
instead of face a potential veto. According to analysts
and commentators the US has decided to go it alone and
go soon to avoid any other resolution prohibiting hostile
action from coming to the floor. This is producing a
speeded up time frame for the attack. 60,000 more troops
were ordered to deploy from the US this week including
the 1st Cavalry which was thought to be the confirming
signal. There was not going to be a war until they were
called up. There were multiple ships ordered deployed
from Norfolk VA today with 8,000 marines and personnel.
Get this, it was to an undisclosed location. Marines to
an undisclosed location on assault ships? Something else
heating up somewhere?

The North Korea incident where fighters intercepted a
US spy plane in international waters could be the last
straw in the bluffing match. The US said it was using
all diplomatic channels in dealing with the NK threats
but, and this is a first, "we are not ruling out military
action." With that one line the threat level for a real
conflict with NK just went to critical status. NK has
real weapons and an army 15 time the size of Iraq's.
Unfortunately for NK there is water on two sides and
no need to beg other countries for passage. In reality
I do not expect a conflict and I think the US put the
force card on the table to warn NK they had taken just
about as much BS as they were going to take and the next
time a fighter approached a US plane it might not come
home. The US ordered some bombers deployed to Guam in
order to "deter aggression by NK". Needless to say this
was another straw on the markets back.

This week is rushing full speed into a potential train
wreck. With the news events mentioned above we are already
on a down hill slide and with the Dow finishing at a five
month low. The potholes in out immediate future are the
Fed Beige Book on Wednesday, Factory Orders and the Intel
mid-quarter update on Thursday and the Nonfarm Payrolls
on Friday. Also on Friday is the UN inspector report to
the UN Security Council. With planes, ships and troops
leaving in huge numbers and at an increased pace it does
not appear the US cares about the UN decision. This ramping
up of the attack force could mean it has given up on help
from Tony Blair and others and once that decision is made
there is no reason to wait.

I think we are approaching a critical timeframe. It appears
the attack is imminent with the "72 hour" warning in the
works. It appears the US will go alone. It appears the
economy is tanking fast. It appears the war may only
provide a brief bounce and once that excuse is gone the
economy will take center stage and be exposed to the
searchlight of truth. Based on today's auto and housing
disasters that searchlight may find more imperfections
than the laser fault finder on the "Are You Hot" reality
show. As all of these events are fully considered by
investors the end result may not be pretty.

With the Dow closing at 7700 I think it is safe to assume
a retest of the October low around 7200 is in our future.
There is only one more speed bump ahead of us and that is
the 7630 low from Feb-13th. Once that low is passed we will
have wiped out any technical reason to justify disclaiming
a retest of 7200. Bulls are slowly waking up to this fact
an there was a distinct lack of buyers today. The volume
was VERY light at only 1.4B for the NYSE and 1.2B for the
Nasdaq. This may be total lack of conviction but ships
can sink in calm seas. The lack of buy programs over the
last two days has been very evident. There may not be a
lot of sellers but they are winning the battle.

The Nasdaq struggled to hold on to gains from last week
and failed. It closed at 1307 and barely above the critical
1295-1305 low range. Intel will be the key on Thursday but
it is unclear what a guidance affirmation would do. Just
saying the times are tough but we are holding to our
lowered estimates probably will not give investors much
confidence.

I had one reader ask me what SPX level was represented by
Dow 7200. That equates to about 770 and the SPX closed at
822 today. Obviously we know what that trader is thinking
and I would bet there are quite a few institutions that
are thinking the same thing. The bets have been made and
everybody is just waiting for time to expire on the clock.
Cash is on the sidelines waiting for the next game to begin.
That game could begin with a bang but it may end with a
whimper as the April earnings season arrives. We are
approaching earnings warning season already but it may be
over shadowed by the start of the war leaving investors
holding the bag when the actual earnings are announced in
April.

Enter Very Passively, Exit Very Aggressively!

Jim Brown
Editor


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

And the Walls Came Tumbling Down
by Steven Price

The breakdown from recent highs continued today - right down to
another significant level of support.  The bears, however, were
not to be denied. The recent closing low in the Dow was 7749 on
February 13.  That day we dropped all the way down to 7628
intraday, but rallied over 100 points into the close. Today's
morning low was 7750.81, where we found support and then traded
sideways for a couple of hours, before rounding higher and making
up some of the day's losses. The rally was short lived, however,
eventually failing at 7800 and breaking down below the 7749
support level. The fact that we first found support and then took
out the level underscores the bearishness of today's move.

With bullish percents now reaching down into areas we last saw in
October, the risk has shifted to the point where bears need to be
aware that oversold conditions could lead to a rebound. That
being said, we still have not been able to crack the Dow 8000
barrier on the last couple attempts and we also got bearish
reversals on the point and figure charts into columns of "O" in
the SPX and OEX, following that of the Dow.  While those signals
give us little reason to make the case for going long, we should
be aware that the Dow bullish percent now sits on an ascending
trend line from its recent lows in July and October.

The other factor that seems to create problems for bears here is
in the techs.  While the Dow has sought out new daily lows, the
Nasdaq Composite has refused to really give in. In fact, with the
Dow, SPX and OEX all in negative territory most of the morning,
the COMP made its way all the way back into positive territory
mid-day.  I have highlighted the support level at 1319, which was
the November left shoulder pullback low of the head and shoulders
pattern formed from October through January.  That level remained
tough today, with an intraday drop below it once again being
bought and brought back to just above. In the end, it eventually
failed and that could be a domino to a break below 1300. We could
be seeing a similar support to resistance transformation to the
one at Dow 7800. However, 1300 should again provide support, as
it did on the last drop and the techs are still holding up
relatively well compared to the industrials.  The COMP closed on
Monday at 1320, after a similar trip below that support.

The news events that sent us lower this morning were the bombings
in the Philippines. A bomb exploded at Davao City airport on
Mindanao Island, killing 21 people and injuring 148.  An hour
later, a second bomb went off at a health center 30 miles away.
Those events, as well as comments from Warren Buffet that his
Berkshire Hathaway was doing little in equities and instead
increasing investment in junk bonds, also sent investors to the
sidelines. If Buffet now considers junk bonds less risky than
stocks, it is hard to imagine the average retail trader looking
to move back into equities.  That was precisely what we saw
today, but even those comments and the bombings were not enough
to break that February 13 support.

The Dow 7800 level had provided several bounces on the way back
from those February 13 lows and today's drop below that level
gives bears hope, as it did not provide the same bounce it did on
February 26 and 27.  It also showed some intraday resistance
after the 7750 test, as the Dow moved sideways in a 50-point
range for much of the afternoon. We can focus on 7800 now as the
next resistance level, since it was previous support and now
appears to have bears waiting with plenty of supply - at least
enough to have overwhelmed the bulls.

While we appear to be stair stepping our way down to successively
lower levels, none of the recent moves have seen very high
volume, which suggests traders are turned off from the market
until we get some resolution on the international front.  Russia
threatened to use a veto on any U.S. proposal calling for
military action in Iraq and the U.S. basically said it might not
call for a vote unless it thinks it will get a favorable ruling.
That doesn't mean it won't invade, it just means it will have to
forgo a U.N. coalition and go in on its own, or at least with
Britain. The Turkish Parliament's rejection of the U.S. plan to
use its bases further complicates the matter.

The theory goes that if the U.S. invades without global support,
we may see an outflow of assets from foreign investors, further
sinking the stock market.  If we at least get a coalition, it
reduces that effect and the market may see a relief rally once
the invasion begins. For now, we should trade what we see and
that direction remains down.  I have a bearish position, but have
tightened up my stop to chase the market in case we do get
another bounce from these levels.  The new relative closing low
in the Dow is certainly a bearish sign and cannot be discounted.
However, as bullish percents become more extended to the
downside, be alert that any bounce can be significant and keep
your stops nice and tight.
-----------------------------------------------------------------

Market Averages

DJIA ($INDU)

52-week High: 10673
52-week Low :  7197
Current     :  7704

Moving Averages:
(Simple)

 10-dma: 7882
 50-dma: 8222
200-dma: 8576

S&P 500 ($SPX)

52-week High: 1176
52-week Low :  768
Current     :  822

Moving Averages:
(Simple)

 10-dma:  836
 50-dma:  869
200-dma:  907

Nasdaq-100 ($NDX)

52-week High: 1734
52-week Low :  795
Current     :  982

Moving Averages:
(Simple)

 10-dma:  997
 50-dma: 1010
200-dma: 1007
-----------------------------------------------------------------



Dow Jones Home Construction Index (DJUSHB): Alan Greenspan said
this morning that there is little risk of a housing bubble. Then
it popped.  Or at least that's the way it felt for anyone long
the sector, following a speech in which the Chairman said,
"Refinance and home-purchase originations peaked in the fourth
quarter of last year. It is difficult to imagine that pace being
maintained in the current quarter."  He indicated that the
economy would not be able to rely as much on consumer spending
derived from this area and the housing stocks took it on the
chin. The DJUSHB dropped 20 points, or 6%, following the comments
and also news from Lennar (LEN - $3.91).  LEN released its first
quarter orders report that showed 7% year over year growth. JP
Morgan came out and said it was well below their 23% estimate and
a substantial deceleration from the fourth quarter's 38% growth.
Morgan said the stock could lose 25% and the entire sector
followed it down hill.

52-week High: 397
52-week Low : 260
Current:      298

Moving Averages:
(Simple)

 21-dma: 316
 50-dma: 317
 200-dma: 324

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


The VIX bounced from 34% for the third time, as the Dow slid to
its lowest closing level since last October.  The VIX is derived
from the OEX, which along with the SPX, has yet to break its
February low, but is nonetheless testing the downside once again.
With the move back over 35%, it appears there is plenty of
downside room in the equities before the VIX reaches 40%, which
has signaled at least a short term equity rally over the past few
months.  It finished the day at 36.58.


CBOE Market Volatility Index (VIX) = 36.58 +2.49
Nasdaq-100 Volatility Index  (VXN) = 44.97 -0.86

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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.90        415,703       375,782
Equity Only    0.80        290,770       233,771
OEX            0.84         25,907        21,825
QQQ            0.83         23,907        19,810


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

Bullish Percent Data

           Current   Change   Status
NYSE          39.2    - 0     Bull Correction
NASDAQ-100    34.0    - 0     Bear Confirmed
Dow Indust.   13.3    - 0     Bear Confirmed
S&P 500       33.4    - 0     Bull Correction
S&P 100       27.0    - 1     Bear 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  1.64
10-Day Arms Index  1.53
21-Day Arms Index  1.40
55-Day Arms Index  1.36

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        901          1908
NASDAQ     1172          1948

        New Highs      New Lows
NYSE        90              120
NASDAQ      86              113

        Volume (in millions)
NYSE       1,412
NASDAQ     1,192
-----------------------------------------------------------------

Commitments Of Traders Report: 02/25/02

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 made few changes to either side of the equation,
resulting in a net change of 200 short contracts.  Small traders
added 2300 contracts to the long side.

Commercials   Long      Short      Net     % Of OI
02/04/03      414,543   465,678   (51,135)   (5.8%)
02/11/03      412,333   472,156   (59,823)   (6.8%)
02/18/03      423,871   481,871   (58,000)   (6.4%)
02/25/03      424,276   482,476   (58,200)   (6.4%)

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
02/04/03      151,174    93,439    57,735     23.5%
02/11/03      161,126    95,618    65,508     25.5%
02/18/03      155,475    91,102    64,373     26.1%
02/25/03      157,790    91,083    66,707     26.8%

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 slightly to the long side and added 1,200 short
contracts.  Small traders left the long side alone and reduced
shorts by 2,000 contracts.

Commercials   Long      Short      Net     % of OI
02/04/03       40,934     50,992   (10,058) (10.9%)
02/11/03       39,412     53,818   (14,406) (15.5%)
02/18/03       38,486     50,501   (12,015) (13.5%)
02/25/03       38,787     51,745   (12,958) (14.3%)

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
02/04/03       25,573     8,648    16,925    49.5%
02/11/03       29,667     8,915    20,752    53.8%
02/18/03       25,482     9,425    16,057    46.0%
02/25/03       25,378     7,431    17,947    54.7%

Most bearish reading of the year: (10,769) - 06/11/02
Most bullish reading of the year:  19,088  - 01/21/02

DOW JONES INDUSTRIAL

Commercials increased the long side by 1,000 contracts and left
shorts relatively unchanged.  Small Traders reduced the long side
by 700 contracts and left the short side alone.

Commercials   Long      Short      Net     % of OI
02/04/03       17,596    11,232    6,364      22.1%
02/11/03       19,826    11,800    8,026      25.4%
02/18/03       18,812    11,939    6,873      22.4%
02/25/03       19,985    11,866    8,119      25.5%

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
02/04/03        4,583     9,424    (4,841)   (34.6%)
02/11/03        5,390     9,300    (3,910)   (26.6%)
02/18/03        5,561     8,973    (3,412)   (23.5%)
02/25/03        4,872     8,723    (3,851)   (28.3%

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))
===============

Universal Health Svcs. - UHS - cls: 38.04 chg: -0.56 stop: *text*

Company Description:
Universal Health Services, Inc. is one of the nation's largest
hospital companies, operating acute care and behavioral health
hospitals and ambulatory surgery and radiation centers
nationwide, in Puerto Rico and in France. It acts as the advisor
to Universal Health Realty Income Trust, a real estate investment
trust. (source: company press release)

Why We Like It:
One glance at the daily chart for UHS lets you know that
something went dreadfully wrong on Valentine's Day, when the
stock gapped sharply lower and lost roughly one fifth of its
value on monstrous volume of 17.5 million shares.  The catalyst
for this sell-off was the unexpected firing of Universal Health
CFO Kirk Gorman.  In a conference call, company officials said
the split was due to "philosophical" differences but refused to
give many specific details.  Later on it became apparent that Mr.
Gorman's termination stemmed from a dispute with UHS auditor
KPMG.  Letters released by Universal Health reveal that Gorman
was reluctant to sign off on the company's financial reports,
saying that he was "...personally unable to verify that all of
our according is in accordance with General Accepted Accounting
Procedures."  Some Wall Street analysts speculated that Gorman's
refusal might be an indication of accounting irregularities at
UHS.  If there are two words that investors hate to hear, it's
"accounting irregularities."  A slew of brokerage downgrades
reflected the uncertainty and contributed to the overwhelmingly
bearish reaction to Gorman's departure.

In the days that followed, UHS managed to recoup some of its
losses and fill in a large chunk of the February 14th gap.  News
of an informal SEC inquiry into the recent management shakeup did
not have a substantial impact on the stock's price, which hovered
in the $38-$40 range during the latter part of February.  But
after failing to push UHS through psychological resistance at
$40.00, it looks like the bulls are growing increasingly
impatient.  Shares have drifted steadily lower over the past two
sessions and are now threatening a violation near-term support at
$38.00.  If the weakening Dow Jones is any indication, that level
could be taken out on Wednesday morning.  Our trigger to enter
this play is at $37.98.  Our objective is to ride UHS back
towards the mid-February lows.  Other than possible support at
the February 21st lows near $36.00 (which were formed when UHS
gapped lower in reaction to news of the SEC inquiry), we don't
see any substantial underlying support.  In terms of specific
downside targets, we'll exit the hypothetical trade if shares
trade at or below $33.06.  Once the play is activated we'll use a
stop at $40.16, two cents above the relative high.  Traders
willing to give UHS a bit more breathing room could use a stop
slightly above the descending 21-dma at $40.61.

Annotated daily chart - UHS:



Picked on March xth at xx.xx <- see text
Results since picked   +0.00
Earnings Date       02/13/03 (confirmed)







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Copyright ) 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                  Tuesday 03-04-2003
                                                    section 2 of 2
Copyright ) 2003, 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:  CMVT, SLAB
  Bearish Play Updates:  INFY
  Closed Bullish Plays:  IBM

Stock Bottom / Active Trader
  New Bearish Plays:     UHS
  Bullish Play Updates:  DHR, TOO
  Bearish Play Updates:  APD

High Risk/Reward
  Bullish Play Updates:  AMGN, GLW
  Bearish Play Updates:  AW, CTAC, IDPH
  Closed Bullish Plays:  TECD

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

Comverse Technology - CMVT - cls: 9.62 chg: -0.08 stop: 9.39

Ouch!  The last two days of broader market declines have come
home to roost in shares of CMVT.  After Friday's heavy volume
breakout to the upside through resistance one would have expected
a bit more tenacity from CMVT.  Shares have pulled back to short-
term support near $9.50.  The short-term up trend remains in tact
but we came very close to being stopped out when the stock dipped
to $9.47 this morning.  If you're an optimist, this is an entry
point to leg into a position on the pull back.  However, we would
prefer to wait for some show of strength and hopefully see CMVT
back over the $10.00 mark before committing any cash.  If the
Nasdaq composite breaks below the 1300 mark it probably won't
matter as investors will be tempted to sell again to avoid the
next big leg down.  Meanwhile in the news, CMVT issued a press
release stating that the company will be holding a conference
call to review its fiscal 2002 Q4 results on Wednesday, March
12th.

Picked on February 28th at $10.20
Gain since picked:          -0.58
Earnings Date            11/26/02 (confirmed)




---

Silicon Labs - SLAB - close: 26.52 change: +0.02 stop: 23.99

Last week as we watched the unfolding drama taking place in the
tech world's daily soap opera "All My Chips", the $SOX chip index
had made a valiant effort to breech the 300 level of resistance.
In a cliffhanger episode last Friday (hey, it's not sweeps week)
the SOX closed just points away from a new relative high above
resistance.  Alas, a bullish breakout was not to be.  The SOX did
trade higher on Monday morning, piercing the 300 level before
being brutally shoved back into the rangebound trading that has
bored us all but the day traders.  From Monday's open the SOX has
retreated all the way back to recent support near 280 and remains
there, heavy hearted and listless.  Meanwhile, our star of the
show, SLAB has been hit hard by the weakness in the SOX.  After
trading as high as $28.00 in Monday's session the stock is back
to bouncing off support near $26.  Traders should keep an eye on
both SLAB and the $SOX.  The PnF chart of the SOX is currently on
a buy signal but if it breaks the 280 level, not only will it be
a technical breakdown on the daily chart but it will also show a
technical sell signal on the PnF chart.  SLAB is certainly much
stronger but without support from the group it's going to have a
hard time busting through its own PnF resistance just overhead.
More conservative traders may want to start thinking about
raising their stops to protect any gains and or limit exposure.
In the news, SLAB's CFO is slated to present at the Deutsche Bank
2003 Information and Technology Hardware Conference in
Scottsdale, AZ on March 11, 2003.

Picked on February 20th at $25.74
Results since picked:       +0.78
Earnings Date            01/22/03 (confirmed)




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

Infosys Technologies - INFY - cls: 60.05 chg: -0.95 stop: *text*

News of a large explosion at an airport in the Philippines
rattled the Eastern markets on Tuesday, including the Indian BSE
30, which finished with a loss of nearly 1%.  This resulted in a
small downward gap for shares of the U.S. ADR this morning.  The
stock drifted lower throughout the session and gave back 1.5%.
On the daily chart, we see that the upward momentum from Friday's
rebound quickly faded at the 200-dma ($62.42).  That level
continued to act as resistance on Monday.  With INFY already
retracing most of Friday's gains, it looks like shares could soon
be trading at fresh multi-month lows.  We're maintaining our
action trigger for this paper trade at $59.49.   If the play is
activated we'll use a stop at $63.01, although a stop slightly
above the 200-dma would be perfectly acceptable from a technical
standpoint.

Picked on February xxth at $xx.xx <- see text
Results since picked:       +0.00
Earnings Date            04/11/03 (unconfirmed)





===============
NB Closed Plays
===============

  --------------------
  Closed Bullish Plays
  --------------------

Intl Business Mach. - IBM - cls: 76.70 chg: -0.63 stop: *text*

The growing threat of war with Iraq has put the kibosh on any
successful rally attempts for the markets and IBM is not showing
any leadership to the upside.  The Premier Investor Newsletter
has not yet been triggered on this play and thus we drop it
unopened.  More aggressive traders might want to watch it for a
bounce at support near $76.00 but we would encourage a pretty
tight stop as the Dow Industrials looks close to breaking down
into another leg lower.  Meanwhile in the news, IBM announced it
was recalling some 56,000 monitors that had a tendency to
overheat and smoke, thus creating a fire hazard.  We doubt this
will have any affect on the stock price.

Picked on February Xth at $xx.xx
Results since picked:      +0.00
Earnings Date           01/16/03 (confirmed)






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

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

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

Universal Health Svcs. - UHS - cls: 38.04 chg: -0.56 stop: *text*

Company Description:
Universal Health Services, Inc. is one of the nation's largest
hospital companies, operating acute care and behavioral health
hospitals and ambulatory surgery and radiation centers
nationwide, in Puerto Rico and in France. It acts as the advisor
to Universal Health Realty Income Trust, a real estate investment
trust. (source: company press release)

Why We Like It:
One glance at the daily chart for UHS lets you know that
something went dreadfully wrong on Valentine's Day, when the
stock gapped sharply lower and lost roughly one fifth of its
value on monstrous volume of 17.5 million shares.  The catalyst
for this sell-off was the unexpected firing of Universal Health
CFO Kirk Gorman.  In a conference call, company officials said
the split was due to "philosophical" differences but refused to
give many specific details.  Later on it became apparent that Mr.
Gorman's termination stemmed from a dispute with UHS auditor
KPMG.  Letters released by Universal Health reveal that Gorman
was reluctant to sign off on the company's financial reports,
saying that he was "...personally unable to verify that all of
our according is in accordance with General Accepted Accounting
Procedures."  Some Wall Street analysts speculated that Gorman's
refusal might be an indication of accounting irregularities at
UHS.  If there are two words that investors hate to hear, it's
"accounting irregularities."  A slew of brokerage downgrades
reflected the uncertainty and contributed to the overwhelmingly
bearish reaction to Gorman's departure.

In the days that followed, UHS managed to recoup some of its
losses and fill in a large chunk of the February 14th gap.  News
of an informal SEC inquiry into the recent management shakeup did
not have a substantial impact on the stock's price, which hovered
in the $38-$40 range during the latter part of February.  But
after failing to push UHS through psychological resistance at
$40.00, it looks like the bulls are growing increasingly
impatient.  Shares have drifted steadily lower over the past two
sessions and are now threatening a violation near-term support at
$38.00.  If the weakening Dow Jones is any indication, that level
could be taken out on Wednesday morning.  Our trigger to enter
this play is at $37.98.  Our objective is to ride UHS back
towards the mid-February lows.  Other than possible support at
the February 21st lows near $36.00 (which were formed when UHS
gapped lower in reaction to news of the SEC inquiry), we don't
see any substantial underlying support.  In terms of specific
downside targets, we'll exit the hypothetical trade if shares
trade at or below $33.06.  Once the play is activated we'll use a
stop at $40.16, two cents above the relative high.  Traders
willing to give UHS a bit more breathing room could use a stop
slightly above the descending 21-dma at $40.61.

Annotated daily chart - UHS:



Picked on March xth at xx.xx <- see text
Results since picked   +0.00
Earnings Date       02/13/03 (confirmed)





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

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

Danaher Corp. - DHR - close: 63.75 change: -1.79 stop: 61.98

Hmm... previously we were pretty encouraged by DHR's ability to
seemingly ignore the broader markets and climb higher with out
them.  Or so it seemed Thursday-Friday-Monday.  Shares of DHR
pulled back 2.7% today as the Dow Industrials lost 133 points.
Is this market related profit taking?  Or is this some how
related to the hammering felt in the automotive group today?  We
doubt the latter as DHR doesn't seem to have too much exposure in
the auto sector.  We did note that shares of Sears (S) were down
big today (-5.88%).  Sears is DHR's biggest single customer.
There didn't seem to be any significant news about Sears today,
but the retail giant did have its credit downgraded on Friday.
Back to DHR, the short-term trend remains intact despite the big
drop today.  Shares stalled near the 50-dma, but we would not be
surprised to see the drop continue until the shares hit the
$63.00 mark.  If you're looking for new positions, sit back and
wait for a bounce at $63.00.  This should significantly reduce
any exposure with a stop loss just under $62.  Of course, if the
broader markets continue to trade lower, we'd suggest avoiding
any bullish trades period.

Picked on February 26th at $64.36
Results since picked:       -0.61
Earnings Date            01/30/02 (confirmed)




---

TOO Inc - TOO - close: 14.86 change: -0.74 stop: 14.39 *new*

Danger, Will Robinson, Danger!  The Retail Index ($RLX) and
shares of WMT took some big hits today as investors appear to be
fleeing the retail group based on weak economic numbers and war
jitters.  It didn't help having Victoria's Secret lose their
court battle (whether you believe they were right or not).
Shares of TOO, which had been holding up on Monday gave in to the
selling pressure today and lost 4.7%.  The short-term uptrend
appears to be compromised and despite our feelings that TOO still
looks like a decent longer-term investment we're going to raise
our stop loss.  The new stop will be $14.39.  More conservative
traders may want to use $14.49, as the recent low was near the
14.50 mark.  If the markets/retail sector don't bounce soon (like
tomorrow) we'll plan on being stopped out.  No new positions are
recommended at this time.

Picked on February 27th at $15.66
Gain since picked:          -0.41
Earnings Date            02/19/03 (confirmed)




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

Air Products - APD - close: 38.14 change: -0.77 stop: 40.06

APD tried its best to break out of its multi-week descending
trend.  The stock staged a strong reversal from last Tuesday's
multi-year low of $36.97 and by Monday morning shares had marched
up to a short-term high of $39.52.  However, Air Products was not
able to power above its descending 21-dma at $39.67.  Shares have
distanced themselves from that moving average as the Dow Jones
moved lower over the past two sessions.  On Tuesday APD
underperformed the Industrials and posted a 2.0% loss, settling
just above $38.00.  That level acted as support last week after
the stock rebounded from its relative lows.  A breakdown below
$38.00 might present an opportunity to open new short positions,
but remember that possible support lurks at $37.00.  By the way,
remember those bullish oscillators?  The past two days of losses
have led to a flattening of the daily stochastics (5,3,3) while
also preventing a bullish MACD crossover.  That's an encouraging
technical development for the bears.  Our stop-loss is set at
$40.06.  Traders looking to protect a small gain could use a stop
just above the 21-dma.

Picked on January 29th at $39.84
Results since picked:      +1.70
Earnings Date:          01/22/02 (confirmed)






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

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

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

Amgen Inc. - AMGN - close: 54.12 change: +0.27 stop: 51.54

As much as we would have liked to see AMGN finally break through
the $55 level, it is somewhat reassuring to know that the pattern
of the past few weeks hasn't changed.  Each time AMGN tags a new
intraday high, it pulls back to confirm support at a higher
level.  Yesterday's push up to the $54.95 level brought about
some selling and the stock proceeded to fall back before a slight
rebound from the $53.50 level.  That rebound just wasn't
sustainable in the face of the broad market weakness on Tuesday
and after finding resistance at a slightly lower high $54.76,
AMGN pulled back to just above the $54 level.  That's the long
way of saying that AMGN is in the process of dipping back to test
support again after another failure to break above $55.  But it
sill looks pretty strong in light of the broad market weakness
and even the BTK index ending the day in the red.  The ascending
trendline we've been following has now risen to $52.70, so a dip
and rebound from around $53 is likely to be our next solid entry
into the play while we wait and watch for the stock to finally
crack the $55 level.  Conservative traders may want to place
stops close to breakeven, just below $52.50.

Picked on February 14th at $52.51
Results since picked:       +1.61
Earnings Date            04/24/03 (unconfirmed)




---

Corning Inc. - GLW - close: 5.02 change: -0.08 stop: 4.53

This long play was activated on Monday morning when GLW sliced
through resistance at $5.00.  The stock set a relative high of
$5.21 before drifting lower with the NASDAQ.  Today's action saw
GLW give back another 8 cents while the Composite once again
suffered from a lack of buyers.  The 5-minute chart shows a
bearish, albeit very orderly downtrend over the past two
sessions.  That's not too surprising, given the lack of broader
market leadership.  What's technically encouraging is the fact
that GLW has attracting buying interest at $5.00, which now
appears to be acting as support.  Further sideways trading at
this level would provide a good base from which the stock might
be able rally.  In after-hours news, Corning CFO James Flaws,
speaking at a Morgan Stanley conference, reiterated the company's
forward-looking expectations.  Specifically, GLW is forecasting a
return to profitability in the third quarter and a first quarter
loss of $0.01-$0.04 per share.  Flaws also said that the
company's telecom segment expects to grow $300 million to $330
million of earnings improvement this year.  This news had GLW
ticking slightly higher in the extended trading session.  Barring
a strong market sell-off tomorrow, the stock looks like it could
soon be trading at new relative highs.  New entries can be
targeted on a move above $5.21.  However, we would not recommend
chasing the stock if shares gap sharply higher tomorrow morning.

Picked on March 3rd at $5.01
Results since picked:  +0.01
Earnings Date       04/24/03 (unconfirmed)




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

Allied Waste - AW - close: 8.03 change: -0.09 stop: 9.03

The recent broader market weakness has made it awfully difficult
for AW to retrace more than a small portion of its late-February
losses.  The stock ticked lower on Monday after failing to move
above short-term resistance ($8.25) in the opening minutes of
trading.  Shares continued lower this morning and tagged a
session low of $7.88 before gravitating back to the $8.00 region,
where they traded for the rest of the day.  Technically, it's
hard to make much of this rangebound action.  Volume continues to
the significantly less than the volume that accompanied the rapid
decline from $10.00.  However, bears will be pleased to see that
AW has traced a series of lower highs and lower lows over the
past three sessions.  It's also encouraging to see that the daily
stochastics (5,3,3) are on the verge of producing a crossover to
the downside.  With Allied Waste having a tough time finding
buyers, more weakness in the major equity indexes could be just
the catalyst the bears need to push shares under the relative low
of $7.65.  Short-term traders might want to think about scaling
out of positions if AW rebounds near that level.  Our downside
profit-target is still located at $7.06.  Aggressive traders
looking for new entries can watch for another failed rally near
$8.25.

Picked on February 20th at $8.54
Results since picked:      +0.51
Earnings Date           02/13/03 (confirmed)




---

1-800 Contacts - CTAC - cls: 17.63 chg: -0.78 stop: 20.01

This wasn't the follow-through day that the bulls were hoping
for.  On Monday CTAC shrugged off late-session weakness in the
major indexes and closed above the 100-dma.  You'll recall that
that moving average has given the bulls fits over the past week.
However, any hopes for a continuation of those gains were crushed
when CTAC moved sharply lower on Tuesday morning.  The stock
retraced a majority of Monday's intraday rally and traded to a
low of $17.45.  Shares then moved in the $17.50-$17.80 range for
the remainder of the session before finishing with a loss of
4.2%.  Looking at the daily chart, we see that CTAC traced an
Inside Day.  Tomorrow we'll be watching for the stock to fall out
of this consolidation pattern and move towards support in the
$17.00-$17.15 region.  A move below $17.00 would clear the way
for a possible decline to our downside target at $16.06.  As for
new entries, the recent sideways action (up one day, down the
next) has made it more difficult to find action points.
Speculative traders might be able to target entries on another
failed rally near the rising 100-dma at $18.26.  The PI
newsletter currently has a gain of 6.2% in this paper trade, with
a stop at $20.01.  Those looking for a little less upside risk
could use a stop just above last week's high of $19.25.

Picked on February 20th at $18.80
Results since picked:       +1.17
Earnings Date            02/18/03 (confirmed)




---

IDEC Pharma. - IDPH - cls: 28.72 chg: -0.38 stop: 30.16 *new*

Descending resistance at the 21-dma was put to the test on Monday
afternoon when IDPH broke its recent trend of lower lows and
moved through $30.00.  But unfortunately for shareholders, the
stock topped out mere cents below that moving average.  The
subsequent steep afternoon sell-off renewed the bears' resolve.
IDPH gave back most of its morning gains and closed under the
long-term descending trendline.  Today's action saw relatively
sedate trading until the final 10 minutes, when shares moved
sharply lower with the BTK.X biotech index.  A 15-minute chart
reveals that IDPH has traced a series of higher lows ever since
it bottomed out on February 25th.  Bears will be watching for
shares to violate that uptrend and fall towards the multi-month
low of $28.26.  A move under that level would present a possible
shorting opportunity.  Our stop has been bumped down to $30.16,
slightly above yesterday's high and the 21-dma at $30.01.

Picked on February 13th at $29.99
Results since picked:       +1.27
Earnings Date            01/30/03 (confirmed)





===============
HR Closed Plays
===============

  --------------------
  Closed Bullish Plays
  --------------------

Tech Data - TECD - close: 21.75 change: -0.71 stop: 20.94

Tech Data announced this morning that it had acquired Soft Europe
SA, a privately-held graphics software distributor.  Although
terms of the deal were not disclosed, investors seemed to react
to the news with a clearly bearish bias.  TECD suffered from
selling pressure throughout the session and finished with a 3.1%
loss.  Meanwhile, the NASDAQ didn't even give back a full
percentage point.  Technically, we are not encouraged by the
potential reversal pattern on the daily chart.  TECD topped out
at $23.21 (78 cents below our profit-target) on Monday morning
and has since trended steadily lower.  Coincidentally, the stock
closed at $21.75 - exactly where we picked TECD two weeks ago.
Bulls will point out that the stock is still holding above short-
term support at $21.60 and hasn't yet broken the recent uptrend.
But in light of the recent reversal, bearish daily stochastics
(5,3,3), and weakening broader market, it looks like odds are
stacked against a rally back to the relative highs in the near
future.  We've elected to close this paper trade at current
levels.  Traders willing to take some heat could maintain long
positions with a stop slightly under last week's low of $20.95.

Picked on February 18th at $21.75
Results since picked:       +0.00
Earnings Date            03/17/03 (unconfirmed)





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

                             

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

                             

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

HRS     Harris Corp                30.94     +1.20
DISH    Echostar Comm              27.65     +1.70
HSIC    Henry Schein               41.99     +1.29

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

PHM     Pulte Homes                46.80     -3.90
LOW     Lowes Companies            37.55     -1.72
CDWC    CDW Computer Centers       40.45     -2.33
S       Sears Roebuck              20.14     -1.26
MERQ    Mercury Interactive        30.36     -1.15
MATK    Martek Biosciences         22.07     -1.16
MTG     MGIC Investments           37.55     -1.79
WHR     Whirlpool Corp             46.44     -2.20
JCI     Johnson Controls           74.91     -2.50
BZH     Beazer Homes               54.90     -3.18
BWA     Borg Warner                47.67     -2.9

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

IRF     International Rectifier    20.60     -0.80
ASN     Archstone-Smith            21.59     -0.44
WLS     William Lyon Homes         21.60     -1.65
CATY    Cathay Bancrop             37.82     -0.13




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newsletter picks are not to be considered a recommendation
of any stock but an information resource to aid the investor
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staff of PremierInvestor.net may own, buy or sell securities
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