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Daily Newsletter, Thursday, 07/31/2003

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PremierInvestor.net Newsletter                Thursday 07-31-2003
                                                   section 1 of 2
Copyright (c) 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:      Oops
Watch List:       AVE, RIMM, ATH, CVS and more!
Market Sentiment: Reversal day on good news

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
      07-31-2003           High     Low     Volume Advance/Decline
DJIA     9233.80 + 33.80  9361.40  9199.28 1.92 bln   1531/1708
NASDAQ   1735.02 + 14.10  1757.37  1728.34 1.79 bln   1869/1362
S&P 100   499.27 +  1.98   506.65   497.29   Totals   3400/3070
S&P 500   990.31 +  2.82  1004.59   987.49
W5000    9555.05 + 28.50  9673.12  9526.57
RUS 2000  476.02 +  3.22   478.80   472.80
DJ TRANS 2623.92 + 17.70  2653.23  2606.31
VIX        21.24 +  0.52    21.44    20.40
VXN        31.22 +  0.36    31.67    30.23
Total Volume 3,999M
Total UpVol  2,628M
Total DnVol  1,321M
52wk Highs  553
52wk Lows    73
TRIN       0.62
PUT/CALL   0.68
=================================================================

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

Oops

The bulls were partying hard with a +160 point Dow gain and
a new 52-week high when somebody tripped. Tripped a breaker,
tripped over bags of money or tripped on a banana peel the
results were the same. The lights went out and the party was
quickly over. As if somebody yelled fire in a crowded theater
the rush for the exits was fast and furious. When the smoke
cleared the +160 point gain had turned into only +33 and the
tone of the market was significantly different.

Dow Chart


Nasdaq Chart


S&P Chart


How we went from 100% bullish at the open to the crash at the
close has probably got more than a few bulls scratching their
heads tonight. The morning began with another drop in Jobless
Claims to 388,000 and the second consecutive week under 400K.
A trend, a trend, (visions of Tatu pointing to the plane on
Fantasy Island) the bulls were shouting. Granted the first
number started with a 3 instead of a 4 but not by much. Still
the futures were spiking. The fact that the numbers were still
adjusted for the cyclical auto layoffs was lost on everyone.
Continuing claims increased to 3.65 million indicating that
jobs are still hard to find regardless of the adjustments.

The slam-dunk came in the form of the GDP at +2.4% for the 2Q.
This was a full +1.0% over the estimates and the crowd went
wild. Personal consumption rose +3.3% and non residential
investment rose +6.9%. Yee-Haw! Bulls began to party and
shorts began running for cover. The buying was sharp and quick
and futures were quickly +8 and climbing. Bulls pointed to
this report as signs of a real recovery in progress. Let's
not forget that this was for the 2Q which began with a war.
Remember the expected post war bounce in the economy? For
about six weeks we saw a light spurt in buying in anticipation
of a quick recovery. That recovery never came and we ended the
quarter with an unbroken string of Jobless Claims over 400K
for the entire quarter. Corporate earnings have already told
us there was a bounce in April that slowly died into June.
This is the evidence of that bounce. Much of the jump was
due to a +7.5% increase in government spending. One of the
best components was a decrease in inventories by $17.9 billion
which should indicate a bounce in manufacturing soon. This
assumes of course the goods were made in America and not
imported.

The Employment Cost Index came in slightly less than expected
at +0.9% and provided yet another warm fuzzy feeling for
traders. Costs are not rising and there is no inflation in
wages. With nearly 9 million workers currently unemployed it
would be tough to command a premium wage and signing bonuses
are a thing of the past. Wage growth actually slowed in the 2Q
which is detrimental to future consumer spending.

The Help Wanted Index rose to 38 in June from 35 in May and
was possibly the most bullish sign of an economic upturn.
Ads for workers rose in all regions except East South Central.
This was the first real improvement in months. 73% of the 51
newspapers surveyed showed ad traffic rising. While this is
a positive turn the headline number of 38 is still an indication
of a declining job market.

The most bullish report of the day was the PMI report which
came in at 55.9 compared to estimates of 53 and actual of 52.5
in June. While the GDP is seen as a lagging indicator the PMI
is seen as a current trend and an acceleration of three
consecutive positive months. May was the first positive month
at 52.2 and June barely squeaked higher at 52.5. The huge jump
in economic terms to nearly 56 was very positive. The market
immediately rocketed to higher levels. New orders jumped to
61.7 from 54.8, backlog rose to 49.4 from 45.8 and employment
rose to 46.0 from 43.8. Inventories showed a significant drop
to 39.4 from 48.8 indicating a replenishment cycle in our future.
The news orders at 61.7 was the highest reading since November
2002. This is the report for the Chicago region and traders
hope the National ISM report on Friday follows suit.

That hope suffered a setback with the NY-NAPM, which came in
at 224.9 and the sixth consecutive monthly decline. The
manufacturing conditions component dropped to 64.8 from 92.8
in June. This whopping decrease took the excitement out of the
previous reports and cast a shadow over the ISM for Friday.
Traders were left wondering if the ISM would follow the Chicago
PMI or the NY-NAPM. Since the ISM is actually the old NAPM on
a national basis it was a credible concern.

Part of the strong selling at the close had to be due to the
strong economic calendar for Friday. The previously mentioned
ISM plus Nonfarm Payrolls, Construction Spending, Personal
Income and Spending, Consumer Sentiment, Semiconductor Billings
and July Auto sales. It will be a busy day. The ISM has been
in negative territory since February and it is expected to jump
+2 full points from 49.8 to 51.9. Plenty of opportunity for
disappointment here. The Nonfarm Payrolls are expected to show
a jump of +13,000 jobs with a whisper number of +25,000 jobs.
Again, plenty of room for disappointment. Consumer Sentiment
is expected to rise to 90.8. Worries are that it could follow
the confidence earlier this week with a drop instead.

The market drop today on a full deck of strongly bullish
economic reports could be due to many reasons. Worry over the
reports on Friday may have helped but were not likely the
total reason. The best guess is interest rates. The 10-year
yield reached 4.56% today after being only 3.07% just six weeks
ago. This is a disaster in the bond market the likes of which
have not been seen since 1994. Back then the bounce was not as
bad but it had dire repercussions. Several major investment
houses folded and Orange County California went bankrupt due
to over leverage in the bond market. The rumor making the
rounds today is that there are one or more big investment
companies, maybe even FNM or FRE, in serious trouble. Major
insurers announced this week they were canceling bankruptcy
insurance for Merrill, Schwab and dozens of other institutions.
The insurance policies, which protect investors over the $500K
federal protection limit, have become too risky according to
Travelers, AIG and Radian Group. Sign of the future?

The rising rates, regardless of economic news, stock market
movement or Fed commentary has everybody baffled. Bonds
just keep going down and seldom pause for more than a few
minutes during the day. Confounding the constant selling is
a lack of money flowing into the stock market. Normally when
bonds sell off a large portion of the money moves into stocks.
It is not happening. Even given the large economic bounce at
the open today the volume was still only average and the market
breadth was terrible. On the NYSE decliners beat advancers by
nearly +200 issues. New 52-week lows rose to levels not seen
in months.

Not only are the interest rates a problem for the market the
30-year fixed mortgage hit 6.14% today. Refinance applications
have dropped -50% in the last four weeks. This is a major blow
to the consumer supported economy. Like financial junkies we
have been living off our equity for years and that equity just
dried up faster than a busted drug dealer. The shock to the
system will be strong and the tax cut/credit may not be able
to take up the slack. This shock to the economy has traders
talking of asset allocation programs again ONLY from stocks
to bonds. Boy, talk about full circle. There were several
rumors on the floor today about major institutions, fearing
for the future and dumping stocks. It was not hard to find
believers if you look at the major hits to the averages on a
blowout bullish day.

The Dow dropped -50 points on a sell program just after the
open with bullish news floating all boats. It fell -60 points
on another sell program right after the PMI was announced
with a huge bullish jump. Clearly the programs were keyed in
and waiting for the bullish news to break so they could sell
into the heavy volume. The Dow dropped -70 points at 2:25
on a very strong sell program from the highs of the day. The
last one came at 3:20 and knocked a full -100 points off the
Dow in a very short period of time. Think about this a minute.
On the most economically bullish day I can remember this year
four monster sell programs knocked -280 points off the Dow for
no apparent reason. There were plenty of buy programs as well
but those were to be expected. Why are the big guys selling?
What do they know that we don't? Did they find out Saddam has
a dozen clones?

Another factor, which should be considered, is the August record.
In the last 15 years August has been the worst performing month
for the Dow and S&P, period. With the big gains in stocks and
the sell off in bonds I could see where institutions may want
to asset allocate. They did it constantly on the way down when
bonds were growing to the sky and with them in the cellar and
August in front of us it would only be prudent to revise the
ratios again.

Personally I think the major reversal in the market today on
the most bullish news in months is very negative. It could
completely reverse again tomorrow and set another new high on
good ISM and Jobs data but tonight I am skeptical. I was ready
to join the bulls and party till January when the Dow hit a
new high today but the breadth kept bothering me. The sell
programs at the open bothered me. The rumors of a major fund
collapse worry me the most. I remember losing money on the
Russia default, the Brazil default, the Thailand default,
Long Term Capital and a dozen smaller financial events over
the last ten years. They all tend to appear just as the market
is about to hit new highs. It must be a karma thing or the
worlds biggest repeating coincidence. Either way Friday should
be exciting and I am sure we can expect some serious volatility
at the open. After that it is a coin toss on a summer Friday.
Volume is likely to die by noon as traders head for the beach
or the mountains to escape the heat. Look at the bright side.
We have the three most volatile months of the year beginning
tomorrow. If you can't make money trading over the next three
months you should find another hobby. I get excited just
thinking about it and I hope you do too.

Enter Very Passively, Exit Very Aggressively!

Jim Brown



==================================================================
WATCH LIST
==================================================================

The PremierInvestor.net watch list is not designed to be read
as full fledged stock picks.  Rather we would prefer to offer
it as an extra tool in today's investor toolbox.  Think of it
as a radar screen with your own radar operator pointing out
interesting developments, technical patterns or potential plays
that you may or may not have seen on your own.  Due to time
constraints we do glance at the news but rarely do we have
time to fully read pertinent news stories, due background
research and other necessary screens that investors should do
before making a decision.  A common exercise is to read the
entry, glance at the sector and other stocks in that industry
and then compare what's happening in the stock to what's
happening in the broader market indices.  We hope you enjoy
the Watch List and that it proves to be a useful tool for your
own trading success.

STOCKS WORTH WATCHING
---------------------------------

Aventis - AVE - close: 49.85 change: -1.79

WHAT TO WATCH: Breakdown in progress!  AVE gave a clear breakdown
from its H&S top pattern on Thursday and looks vulnerable back
down to major support near $42.  A failed rebound below the 200-
dma would provide the best entry point, although there's
certainly nothing wrong with jumping onto the breakdown that has
already begun.  Target a move to $44.




---

Research In Motion - RIMM - close: 24.08 change: +2.43

WHAT TO WATCH: Now that's a powerful reversal.  After falling out
of its ascending channel a couple weeks ago, RIMM was looking a
bit bearish, but after today's high-volume rebound right back
into that channel and a new 52-week high, it looks like full bull
ahead.  Entering on a dip and rebound from the $23.50 level
presents less risk than chasing the stock higher.  Target an
initial move to resistance in the $26-27 area.




---

Anthem Inc. - ATH - close: 75.51 change: -3.46

WHAT TO WATCH: ATH certainly isn't the picture of health, after
getting pummeled on Thursday to the tune of more than 4% and
falling right to major support near $75.  Clearly, investors
weren't happy with the company's earnings that beat estimates by
"only" 6 cents.  Upside guidance didn't help either.  This could
be the beginning of a major "sell the news" breakdown.  Consider
entering on a failed rebound near the broken 50-dma or wait for a
break under today's intraday low before playing.




---

CVS Corporation - CVS - close: 29.99 change: +1.04

WHAT TO WATCH: Following yesterday's solid earnings report, we
were looking for some bullish action from CVS and apparently we
weren't the only ones.  Morgan Stanley upgraded the stock this
morning and the resultant buying frenzy pushed the stock through
major resistance on a gap move.  Look to enter new bullish
positions on a pullback and rebound from the bottom of the gap
near $29, targeting a near-term move to $31 resistance.





===================
On the RADAR Screen
===================

AGN $80.48 - Don't look now, but AGN is battling its way back
from its recent test of the 50-dma.  Look for a break above $82
to clear the recent resistance and pave the way for a sharp rally
higher as that would generate a triple-top PnF Buy signal.  Next
resistance is found in the $85-86 area.

AMGN $69.43 - Consistency is the name of the game and AMGN has
been delivering for months.  Every touch of the 50-dma seems to
produce another leg up the chart.  While the latest dip didn't
manage to get that low, the 30-dma (which has also been pivotal
on this multi-month rally) did produce a bounce.  Look for
another dip near that moving average to set up an entry for
another run at fresh 2-year highs.

CME $73.65 - Can you feel the breakdown coming?  CME just isn't
looking very healthy, and Thursday's close just above the 7/21
intraday low and just under the 30-dma ($73.82) looks like the
recipe for a momentum entry to the downside.  Trigger entries on
a drop under $73.50 and look for a near-term drop to the 50-dma,
just below $70.



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

Reversal day on good news
Jonathan Levinson
 
Equities looked set to launch today, buoyed by excellent economic
data before and immediately following the cash open.  The indices
were coiled within pennants, having printed inside days, and
exploded higher as might have been expected.   The TRIN and
TRIN.NQ were buried at extreme low levels, and bulls were
targeting the highs.
 
What followed was a valuable lesson for traders.  Price traded
sideways along the top of a narrow range near the highs of the
day, finding support close underneath.  After a number of
successful tests, the price broke south, bounced, and then dived
sharply.  My news ticker was still running stories about stocks
rallying on positive economic data as the price plunged.
 
The price of stocks, and stock indices, is determined by supply
and demand.  Outside influences, such as news stories or economic
data, may impact the demand for that paper, but supply is another
story.  Those with the greatest quantity of that paper cannot
sell to a thin market without collapsing the price, and so it's
precisely during buying frenzies such as we saw today that the
biggest sellers will be selling.  As an older broker once told
me, "When the fish are biting, feed them."
 
Just as the markets rallied through the spring on abysmal
economic and corporate data, it's possible that they will fall on
positive data.  Or, they may rally.  Whether Joe Granville's
"News is for suckers" line is true or not, I obey the charts and
the indicators in attempting to suss out where the big players
are seeking to go.  Be it rumors, economic or earnings reports,
let the charts and indicators guide your trades.  This year has
taught us that news is noise, and that supply and demand for the
securities we trade is the final arbiter.


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

Market Averages

DJIA ($INDU)

52-week High:  9353
52-week Low :  7197
Current     :  9233

Moving Averages:
(Simple)

 10-dma: 9194
 50-dma: 9066
200-dma: 8523

S&P 500 ($SPX)

52-week High: 1015
52-week Low :  768
Current     :  990

Moving Averages:
(Simple)

 10-dma:  989
 50-dma:  983
200-dma:  910

Nasdaq-100 ($NDX)

52-week High: 1316
52-week Low :  795
Current     : 1277

Moving Averages:
(Simple)

 10-dma: 1266
 50-dma: 1230
200-dma: 1087


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


After all the fuss earlier this week about the VIX finally hitting
and closing under 20, we're still not seeing much movement in the
markets.  As we've always said, the VIX is more art than science
and traders should acknowledge the signals when they occur and
include them in their overall market evaluation.

CBOE Market Volatility Index (VIX) = 21.24 +0.52
Nasdaq-100 Volatility Index  (VXN) = 31.22 +0.36


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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.68        646,507       437,626
Equity Only    0.55        476,800       263,649
OEX            0.98         38,368        37,903
QQQ            1.50         28,645        42,940


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

Bullish Percent Data

           Current   Change   Status
NYSE          69.9    + 0     Bull Confirmed
NASDAQ-100    75.0    + 0     Bull Confirmed
Dow Indust.   83.3    - 3     Bull Confirmed
S&P 500       77.8    + 0     Bull Correction
S&P 100       83.0    - 1     Bull Confirmed


Bullish percent measures the number of stocks in an index
currently trading on a buy signal on their point and figure
chart.  Readings above 70 are considered overbought, and readings
below 30 are considered oversold.

Bull Confirmed  - Aggressively long
Bull Alert      - Cautiously long
Bull Correction - Pause or pullback in upward trend
Bear Alert      - Take defensive action if long
Bear Confirmed  - High risk if long, good conditions for shorting
Bear Correction - Pause or rebound in downtrend

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

 5-Day Arms Index  0.95
10-Day Arms Index  0.94
21-Day Arms Index  0.97
55-Day Arms Index  1.11


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

            -NYSE-   -NASDAQ-
Advancers    1414      1828
Decliners    1443      1256

New Highs     114       165
New Lows       41         6

Up Volume   1087M     1321M
Down Vol.    765M      477M

Total Vol.  1908M     1816M

M = millions


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

Commitments Of Traders Report: 07/22/03

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

Not much new for us to decipher in the full contracts of the
S&P 500 futures.  Commercials remain slightly next short and
the small traders remains significantly net long, expecting
the markets to rise.


Commercials   Long      Short      Net     % Of OI
07/01/03      415,976   453,005   (37,029)   (4.3%)
07/08/03      415,053   453,720   (38,667)   (4.5%)
07/15/03      414,020   453,033   (39,013)   (4.5%)
07/22/03      411,206   442,131   (30,925)   (3.6%)

Most bearish reading of the year: (111,956) -  3/06/02
Most bullish reading of the year:   18,486  -  6/17/03

Small Traders Long      Short      Net     % of OI
07/01/03      150,232    75,937    74,295    32.8%
07/08/03      152,239    74,749    77,490    34.2%
07/15/03      148,716    70,279    78,437    35.8%
07/22/03      155,891    76,466    79,425    34.2%

Most bearish reading of the year:  (1,657)- 5/27/03
Most bullish reading of the year: 114,510 - 3/26/02


E-MINI S&P 500

In contrast to the full size S&P contracts above, the E-minis
is showing a drastic change.  Commercial traders have been
moving from net short to net long the last four weeks and
the longs have finally out numbered the shorts.  Right on
cue, the small traders have turned the most bearish they
have been in months.


Commercials   Long      Short      Net     % Of OI
07/01/03      175,893   216,993    (41,100)  (10.5%)
07/08/03      192,815   224,124    (31,309)  ( 7.5%)
07/15/03      214,274   218,765    ( 4,491)  ( 1.0%)
07/22/03      249,392   249,386          6     0.0%

Most bearish reading of the year: (354,835)  - 06/17/03
Most bullish reading of the year:        6   - 07/22/03

Small Traders Long      Short      Net     % of OI
07/01/03       57,639    67,449    (9,810)   (7.8%)
07/08/03       56,394    72,090   (15,696)  (12.2%)
07/15/03       45,372    54,654    (9,282)   (9.3%)
07/22/03       45,945    76,071   (30,126)  (24.7%)

Most bearish reading of the year: (30,126)  - 07/22/03
Most bullish reading of the year: 449,310   - 06/10/03


NASDAQ-100

There is little change in the NDX futures by the commercial
traders or small traders.


Commercials   Long      Short      Net     % of OI
07/01/03       28,662     48,265   (19,603) (25.5%)
07/08/03       30,489     48,311   (17,822) (22.6%)
07/15/03       28,467     49,154   (20,687) (26.7%)
07/22/03       32,502     48,139   (15,637) (19.4%)

Most bearish reading of the year: (20,687)  - 07/15/03
Most bullish reading of the year:   9,068   - 06/11/02

Small Traders  Long     Short      Net     % of OI
07/01/03       26,777     8,498    18,279    51.8%
07/08/03       26,136     9,035    17,101    48.6%
07/15/03       26,489     8,004    18,485    53.6%
07/22/03       27,321     8,844    18,477    51.1%

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

Commercial traders are becoming even more bullish on the
Industrials while small traders are slowing increasing
their net short positions.


Commercials   Long      Short      Net     % of OI
07/01/03       20,504    11,871    8,633      26.7%
07/08/03       20,752    11,860    8,892      27.3%
07/15/03       21,607     7,855   13,752      46.7%
07/22/03       22,198     8,176   14,022      46.2%

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
07/01/03        5,799     6,822   (1,023)   ( 8.1%)
07/08/03        5,005     8,093   (3,088)   (23.6%)
07/15/03        5,475     9,717   (4,242)   (27.9%)
07/22/03        6,110    10,898   (4,788)   (28.2%)

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

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



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DISCLAIMER
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Copyright ) 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                Thursday 07-31-2003
                                                   section 2 of 2
Copyright (c) 2003, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
=================================================================

Play of the Day:     Same Song, Different Verse

Split Announcements: EVG, MMSI

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)


=================================================================
Play-of-the-Day  (bullish)
===============

Hovnanian Ent. - HOV - close: 49.35 change: -1.78 stop: 51.50*new*

Company Description:
Hovnanian Enterprises constructs and markets single-family
detached homes and attached condominium apartments and townhouses
in more than 196 new home communities in New Jersey, Pennsylvania,
New York, Maryland, North Carolina, Texas and California.  The
company offers a wide variety of homes that are designed to appeal
to the full range of buyers, from first-time to luxury buyers.
Additionally, HOV provides financial services, including mortgage
banking and title services to the homebuilding operations
customers.  The company does not retain or service the mortgages
it originates, but rather sells them and the related servicing
rights to investors.

Why we like it:
Over the past week, the Dow Jones Home Construction index
($DJUSHB) has been gravitating to the $425 level as bond yields
continue to hold near their 52-week highs.  At the same time, our
HOV play has continued to drift lazily lower.  The 10-dma (now at
$51.72) has been providing intraday resistance, while the stock
continues to find intraday support just above $50.  At this point,
it looks like things could go either way, so we're erring on the
side of caution and tightening our stop, while at the same time
allowing for the expected breakdown to materialize and take us
deeper into the profit zone.  Our stop moves lower to $52.30
tonight, which is above both the 10-dma and yesterday's intraday
high.  Should HOV rally above that level, we'll want to take a
quick exit, preserving a modest gain.  The only way we want to
consider new entries here is on a breakdown under $50, which
should be good for a quick run down to our eventual $45-46 target
area.

Why This is our Play of the Day
With bond yields soaring again shortly after the open this
morning, the stage was set for weakness in stocks affected by
rising rates, most notably the home builders.  But after the
group's resilience recently, it really wasn't any surprise to see
the lack of an immediate reaction, especially with equities seeing
some strong buying interest.  The truth seemed to hit home by mid-
afternoon though, and HOV picked up speed to the downside, finally
puncturing the $50 support that has been propping it up since last
Tuesday.  the Dow Jones Home Construction index ($DJUSHB) felt the
pain too, sliding to within striking distance of the critical
$414-415 support area we've had our eye on.  Should this support
break, next support is found at $390 and such a bearish move in
the $DJUSHB will only add further downside pressure to HOV, and it
should have our $45-46 profit target coming into play in short
order.  Note that we've lowered our stop to $51.50, which is just
above the 10-dma.  If this breakdown is the real deal, then that
level shouldn't be threatened again.

Annotated Chart of HOV:


Picked on July 9th at    $54.25
Change since picked       -4.90
Earnings Date           08/27/03 (unconfirmed)
Average Daily Volume =  1.02 mln



=================================================================
STOP LOSS UPDATES
=================================================================

-Longs -

BEAS - We're raising our stop loss to $12.50


CTAS - We're raising our stop loss to $38.50


-Shorts-

HOV - We're lowering our stop loss to $51.50



=================================================================
Stock Split Announcements
=================================================================

EVG develops a 2-for-1 split

Prior to the opening bell this morning, Evergreen Resources, Inc.
(NYSE: EVG) reported record Q2 earnings of $18.4 million and
announced a 2-for-1 stock split.

EVG's Board of Directors approved the split of its common stock
for shareholders on record as of August 29th, 2003.  The payable
date for the split should be September 15th.  Once the split is
completed EVG should have about 39 million shares outstanding.

This is the first stock split in over a decade for EVG.

About the company:
Evergreen Resources is an independent energy company engaged in
the exploration, development, production, operation and
acquisition of unconventional natural gas properties. Evergreen is
one of the leading developers of coal bed methane reserves in the
United States. Evergreen's current operations are principally
focused on developing and expanding its coal bed methane project
located in the Raton Basin in southern Colorado. Evergreen has
also begun coal bed methane projects in Alaska and Kansas.
 (Source: Company Press Release)


---


Merit Medical Offers 4-for-3 Stock Split

Just before the opening bell this morning Merit Medical Systems
Inc. (NASDAQ: MMSI) announced that its BoD had approved a 4-for-3
stock split of their common shares.

The split will be payable on August 14th, 2003 to shareholders of
record as of August 11th.  Shareholders will receive one
additional share for every three shares already held.  Post split
MMSI should have 19 million shares outstanding.

The company last split their stock 5:4 both in 2001 and in 2002.


About the company:
Founded in 1987, Merit Medical Systems is a publicly traded
company engaged in the development, manufacture and distribution
of proprietary disposable medical products used in interventional
and diagnostic procedures, particularly in cardiology and
radiology. Merit serves client hospitals worldwide with a domestic
and international sales force totaling approximately 74
individuals. Merit Medical employs approximately 1,200 individuals
worldwide, with manufacturing facilities in South Jordan and Salt
Lake City, Utah; Santa Clara, Calif.; Angleton, Texas; and Galway,
Ireland. (Source: Company Press Release)



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

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

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

RDN     Radian Group               46.81     +2.20
LAF     Lafarge North America      33.50     +0.60
MMS     Maximus Inc                30.00     +0.93
UCI     UICI                       13.98     +0.75
PMI     The PMI Group              33.13     +1.74
BAY     Bayer Aktien               23.66     +0.55

---------------------------------------
Breakout to Upside (Stocks $5 to $20)
---------------------------------------

HEPH    Hollis-Eden Pharma         19.57     +1.17
CRAY    Cray Inc                   11.08     +1.38
MERX    Merix Corp                 10.65     +1.04
PWER    Power-One Inc              10.59     +1.87
BCO     Brink's Co                 16.44     +1.20
REMC    Remec Inc                   9.61     +1.07

---------------------------------------
Breakout to Upside (Stocks over $20)
---------------------------------------

GNTX    Gentex Corp                35.54     +1.54
KOSP    KOS Pharmaceuticals        34.14     +7.13
UNTD    United Online              31.38     +1.19
TUES    Tuesday Morning            28.33     +1.23
PCAR    Paccar Inc                 77.24     +2.91
SFG     Stancorp Fincl             55.80     +1.34
CHS     Chico's FAS Inc            27.15     +1.58

-------------------------------------------
Breakout to Downside (Stocks over $20)
-------------------------------------------

QLGC    QLogic Corp                42.10     -1.09
SFD     Smithfield Foods           21.30     -1.45
IRM     Iron Mountain              36.60     -2.55
MCK     McKesson Corp              32.26     -2.10
CAH     Cardinal Health            54.75     -9.71
ABC     AmerisourceBergen          63.09     -2.95

-----------------------------------------
Recently Overbought With Bearish Signals (Stocks over $20)
-------------------------------------------

FIC     Fair Isaac                 54.04     -4.81
OCR     Omnicare Inc               33.97     -2.65
UNH     UnitedHealth Group         52.09     -2.66
MICC    Millicom Intl              33.42     -2.44




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