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Daily Newsletter, Wednesday, 08/06/2003

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PremierInvestor.net Newsletter                Wednesday 08-06-2003
                                                    section 1 of 2
Copyright (c) 2003, All rights reserved.
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In section one:
--------------

Market Wrap:      Below the Trendlines

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)

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
     08-06-2003         High     Low     Volume Advance/Decline
DJIA     9061.74 + 25.42  9134.57  8997.11 1.75 bln   1212/1995
NASDAQ   1652.68 - 20.82  1675.46  1648.42 1.84 bln   1610/1607
S&P 100   488.13 +  1.47   492.70   484.68   Totals   2822/3602
S&P 500   967.08 +  1.62   975.74   960.84
RUS 2000  453.91 -  3.54   458.24   452.79
DJ TRANS 2533.81 - 10.05  2556.31  2526.38
VIX        23.30 -  0.81    25.88    23.11
VXN        34.42 +  0.19    35.98    33.84
Total Volume 3,875M
Total UpVol  2,372M
Total DnVol  1,442M
52wk Highs     157
52wk Lows       92
TRIN          0.80
PUT/CALL      0.88
=================================================================

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

Below the Trendlines
Jonathan Levinson

In a tale of two markets, the Dow added 25 points today and the
Nasdaq lost nearly 21.  Both results were surprising, as it
appeared possible this morning that we might see a full-fledged
meltdown following John Chambers' less-than-stellar attempt to
talk up CSCO's most recent results, and the selling frenzy in the
futures following the cash close yesterday.

20 day 30 minute INDU



The Dow's 30 minute candlechart is open to interpretation, to say
the least.  However, the strong bounce off the morning low
violated the downtrend off Thursday's high, and the close left us
right on that trendline for a retest with the oscillators lagging
the closing drop.

20 day 30 minute COMPX


The equivalent chart of the COMPX avails itself of no such
bullish interpretation, although the descending channel from
Thursday could be construed as a bull flag.  The CSCO-show
effectively prevented the breakout we saw today in the INDU, and
note the strong stochastic divergence on the closing sell candle.
The up-phase in progress from this morning's opening low aborted
early on both indices, a bearish development on the COMPX and the
INDU.

6 month daily chart of the INDU



Zooming out to the 6 month chart of the Dow, we see that today's
25 point gain did nothing to correct the damage done by
yesterday's trendline break.  The oscillators are in downphases,
and it will take a strong push from the bulls to regain the
trendline and reverse the sell signals on the stochastics and
macd.

6 month daily chart of the COMPX



We have the same setup on the 6 month Nasdaq chart, except that
today took the index lower still, and paints a pretty unequivocal
picture.  While the optimistic bull flag drawn on the 30 minute
chart above is not technically incorrect, I find it difficult to
think bullish thoughts about the index when looking at the daily
chart.  A bounce and even possible trendline retest is possible
from here, but the onus has clearly shifted from the bears to the
bulls.

The Mortgage Bankers Association (MBA) announced this morning
that seasonally-adjusted demand for mortgage refinancings, the
MBA refinancing index, declined 2.4% for the week ended July 31
following the previous week's 32.9% drop.  Demand for loans with
which to buy homes, the Purchase index, rose 6.9% following the
previous week's 3.5% loss.  The Application index rose 1.1%
following the prior week's 24.9% decline, posting its second
lowest reading for the year.  The average interest rate for a 30-
year fixed rate mortgage rose to 6.37% from 5.87%, a 50 basis
point increase in one week.  Given the continued rise in yields
and the fact that most home equity borrowers probably aren't
watching the stochastics, Macd and ADX on the Ten and Thirty year
yield charts, I'm thinking that the uptick is simply stragglers
and latecomers to the market who had been procrastinating.  I do
not expect to see home borrowing and refinancing activity
continue to advance side-by-side a climb in yields.

On that basis, so long as bonds continue along their downtrend, I
expect to see mortgage activity and overall borrowing contract.
Whether this is the cause or the effect of an overall contraction
in liquidity, or rather in the availability of money to the
financial system, is a chicken-or-egg question worthy of
bounteous discussion.  But the result is the same, which is good
enough for us traders.  With a contraction in liquidity comes
what the Fed has been calling "dis-inflation," and for an idea of
the effects of dis-inflation on the markets, take your charts of
Jan-June and turn them upside down.  You'll see the US Dollar
Index rising, mortgage and refi activity falling, yields
rising/bonds dropping, stocks dropping, gold falling.  I believe
that the efforts to avoid or at least ease the effects of the
former will cause the latter, gold, to outperform, but I do not
believe that commodities will be exempt from price declines in an
overall deflationary.  If dollars come to be worth more, then
assets valued in those dollars will sell for fewer of them.

It's worth recalling a quote from Vice president JP Morgan Chase,
Peter Smith: "Gold is nobody else's paper."  This applies to
commodities and "hard assets" in general.  The fear of deflation
derives from its potential to cause a descending spiral in a
high-debt economic environment such as we have currently.  If
liquidity contracts and bond prices drop, yields will increase,
requiring higher payments from debtors.  At the same time, as
money is increasing in value/becoming harder to come by, business
investment softens, and unemployment persists.  This causes
debtors to default on their debt, which ultimately pressures
creditors holding that paper, and so on.  This is the trend that
the Fed has been fighting. In such an environment, hard assets
are not vulnerable to default.  While their return on investment
might be poor, their return OF investment is far more certain
than in the case of paper assets.

Updated chart of Total Consumer Credit Outstanding


Total Loans and Leases at Commercial Banks



Bank Prime Loan Rate 1949-2003



The above discussion is intended to put some context behind the
current market action we've been seeing and the recent releases
from the Fed.  One would think that equities would be far weaker
than they have in fact been, and I'm not suggesting that we
grit our teeth and go short, awaiting a certain crash.  We've
been seeing the beginning of an uptick in economic activity in
some of the reports of the past few weeks, and as even Doug
Noland has speculated, the aggressive inflation of the money
supply by the Fed and aggressive consumer spending even on
foreign goods, must have at least some stimulative effect on the
economy.  For example, discount air carrier JBLU reported today
that its July load factor rose 2.8%  over July 2002's level to
90.6%, with a 79% increase in traffic and a 74% increase in
capacity.  We've also seen declines in the initial jobless claims
data in recent  weeks.

Furthermore, more directly related to the markets themselves, the
aggressive inflation of the money supply, lowering of rates and
expansion of debt serve to inflate the price of all financial
assets.  This effect was, in my view, the cause of the rally in
stocks and bonds this spring.  While the value of stocks and
bonds may not be increasing or even diminishing, their price
rises as increasing amounts of money seek different investments.
For this reason, and given the huge stakes, traders, particular
options and futures traders, must remain nimble.  The equity and
commodity markets are very small relative to the treasury and
currency markets, and each ripple in those larger markets is a
potentially huge wave in equities and commodities.

The Energy Department reported that U.S. crude oil inventories
rose by  2.9 million barrels to 280.2 million in the week ended
August 1. Yet again, analysts got it wrong, predicting a drop for
the week.  The American Petroleum Institute (API) reported a 1.6
million barrel gain for the same period.  Gasoline inventories
dropped by 2.7 million barrels to 201.8 million barrels according
to the Energy Department, with the API reporting a 4.5 million
barrel drop. Distillate supplies gained 1.7 million barrels to
119.1 million barrels, with the API reporting a lower 400,000
barrel increase to 116.1 million barrels.

The second day of this quarter's record 60B treasury auction saw
18B in five year treasury notes sold at a 3.30% yield, compared
with last quarter's 2.68% yield.  The notes were well-received at
that rate, generating a bid-to-cover ratio of was 2.48 vs. the
average over the previous four quarters of 1.86.  The demand was
unexpected after the softness in seen yesterday, with three year
notes generating a mere 1.32 bid-to-cover.  The strength in
treasuries throughout the day, with no apparent assistance from
the Fed via its open market operations, bodes well for tomorrow's
18B ten year note auction.


We have the following economic data due tomorrow:

               Report                   Briefing  Market    Prior
                                        Expects   Expects
Aug 07 8:30 AM Initial Claims 08/02 -      400K     395K     388K
Aug 07 8:30 AM Productivity-Prel Q2 -      3.5%     4.0%     1.9%
Aug 07 10:00 AM Wholesale Inventories Jun -0.2%     0.0%    -0.3%
Aug 07 3:00 PM Consumer Credit Jun -      $5.5B    $6.0B    $7.3B

Today's session left us with more questions than it answered.
Was the decline in the Nasdaq merely CSCO-related, or does it
represent the confirmation of the trendline break yesterday?  I
believe that the failure of the Dow to put together more than a
25 point gain following its trendline break yesterday points to
something beyond CSCO.  More puzzling, however, was the strong
bid in treasuries and the positive reception of the 5 year
treasury auction.  The Fed did not add reserves via its open
market operations this morning, and if treasuries were being
bought by "value" players looking for bargains at current yields,
then we have perhaps witnessed the bottom in treasuries.  I'm at
a loss to explain it, as the 18B of new 5 year paper should have
drained liquidity from stocks and bonds, compounding yesterday's
losses.  We'll watch the ten year auction tomorrow for clues, but
for the moment, it remains puzzling.  As Jeff Bailey noted in a
comment from a reader, the Fed is meeting tomorrow, and while the
Fed Funds futures are predicting zero possibility of a rate cut,
perhaps some of the bid in bonds today was frontrunning the
possibility.  I do not know.

The economic data tomorrow before the cash open should go a long
way toward determining market direction.  Initial claims are
expected to come in relatively low, and an upside surprise could
move economic concerns back to the forefront of the market's
attention.  See you at the bell!



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

BSC     Bear Stearns Companies     67.81     +1.61
NCEN    New Century Financial      23.92     +1.00
HELE    Helen of Troy              18.36     +0.68
SIGI    Selective Insurance        26.96     +1.45
GOLD    Randgold Resources         22.39     +1.63

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

PDII    PDI Inc                    18.24     +1.10
AUO     AU Optronics               10.25     +1.05
EVOL    Evoling Systems Inc         7.77     +1.50

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

DRIV    Digital River              22.50     +2.33
DVN     Devon Energy Corp          49.62     +2.77
TOL     Toll Brothers Inc          28.23     +1.76
PLNR    Planar Systems             24.49     +1.73
ZMH     Zimmer Holdings            50.43     +3.13
BKST    Brookstone Inc             26.70     +2.97

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

AET     Aetna                      52.70     -4.97
LAMR    Lamar Advertising          31.14     -2.21
WPI     Watson Pharmaceuticals     37.58     -1.37
OHP     Oxford Health Plans        37.12     -1.94
TARO    Taro Pharmaceutical        49.58     -1.12
CVH     Coventry Health Care       46.95     -3.32

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

SNDK    Sandisk Corp               52.02     -4.88
SRDX    Surmodics Inc              33.66     -1.55
YUM     Yum! Brands                29.07     -0.47
MGA     Magna Intl Inc             74.00     -0.84
CR      Crane Co                   24.00     -0.47
AAP     Advance Auto Parts         66.50     -1.60



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PremierInvestor.net Newsletter                Wednesday 08-06-2003
                                                    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
=================================================================

Tech Stocks
  Bullish Play Updates:  ALTR

Active Trader (Non-tech)
  New Bearish Plays:     FDP
  Bullish Play Updates:  CTAS, NEM
  Bearish Play Updates:  DAL, GPT, JPM
  Closed Bearish Plays:  HOV

High Risk/Reward
  New Bearish Plays:     SOHU
  Bullish Play Updates:  BEAS

SplitTrader/Announcements
  Split Announcement:    CHDX

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

============
PLAY UPDATES
============

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


Altera Corp. - ALTR - close: 18.89  change: -0.12 stop: 18.69

What a difference half a week makes.  At the end of last week,
the SOX rose and ALTR rose even higher on a relative basis,
moving up a greater percentage than the semiconductor index.
Wednesday, ALTR outperformed to the downside, losing 0.63 percent
on a day the SOX lost 0.28 percent.

Monday, ALTR introduced the Nios(R) Development Kit, Stratix (TM)
Professional Edition, meant to give hardware engineers tools to
accelerate development of complex, high-performance designs.  It
also announced that one of its products would replace a previous
version of processor in a line of Intervac's night-vision
cameras.

New products or not, ALTR succumbed to the weakness in the tech-
related stocks.  Wednesday, ALTR opened only two cents off our
stop.  It moved up, piercing through the 21-dma, but fell back
just below that average.  Volume did not pick up as ALTR fell
this week, and the indicators don't yet look fully committed to
the downside move.  A fall beneath current support will probably
tug them down into full bearish mode, however, but we'll be
stopped out of the play if that happens.  We're keeping our stop
at $18.69, and would not suggest new entries at this time.

Annotated Chart for ALTR:


Picked on August 3 at 19.75
Change since picked:  -0.86
Earnings Date:    07/22/03 (confirmed)
Average Daily Volume:  8.2 million





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

=========
NEW PLAYS
=========

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

Fresh Del Monte Prod. - FDP - cls: 26.20 chng: -0.31 stop: 27.50

Company Description:
Fresh Del Monte Produce, Inc. is primarily engaged in the
worldwide sourcing, transportation and marketing of fresh and
fresh-cut produce.  The company's products include bananas,
pineapples, cantaloupe, honeydew, watermelons, grapes, non-
tropical fruits (including citrus, apples, pears, peaches, plums,
nectarines, apricots and kiwi), plantains, Vidalia sweet onions
and various greens.  FDP sources its products primarily from
Central and South America and the Philippines.  The company also
sources products from North America, Africa and Europe and
distributes its products in Europe, the Asia-Pacific region and
South America.

Why we like it:
With the broad markets showing their most concerted bout of
weakness of the past several months, we've got a technical setup
that is just too good to pass up.  Shares of FDP have just
effectively put in a double top in the $28-29 area and over the
past several sessions have fallen right to the neckline (just
below $26) between the those two recent highs.  Adding to the
bearish picture is the daily Stochastics.  While the late July
price high is higher than the mid-July high, Stochastics put in a
lower high this time around and that is classical bearish
divergence.  It isn't a guarantee of a breakdown, but it does
hint that when price does break support, it ought to do so with
more force.  While a case could be made for the neckline being at
$26, we're drawing it a bit more conservatively at $25.80
(erroneously labeled as $27.80 on the chart below), which
coincides with the 7/21 intraday low.  Adding to the significance
of this support level is the 50-dma, which is currently $25.61,
but rising to roughly $25.74 by Thursday.

On the outside chance that FDP might rebound from the $26 level,
we're setting a trigger of $25.70, as the stock will have to
break horizontal support and the 50-dma to exercise that trigger.
Once FDP does break down, we'll be looking for an initial target
of $24, but we're really looking for the stock to fall low enough
to test and possibly break into the $20.75-23.00 gap from early
June.  Aggressive traders can enter on the initial breakdown,
while more conservative traders may want to wait for a failed
bounce to confirm newfound resistance in the $26.00-26.50 area.
Initial stops are set at $27.50, which is above the 20-dma
($27.20) and the 10-dma ($27.49), both of which are now rolling
over and should act as overhead resistance going forward.

Annotated Chart of FDP:


Picked on August 6th at  $26.20
Change since picked       +0.00
Earnings Date          10/28/03 (unconfirmed)
Average Daily Volume =    548 K




============
PLAY UPDATES
============

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


Cintas Corp. - CTAS - close: 38.95 change: -0.38 stop: 38.50

That's twice CTAS has faked us out with a breakout over $40 and a
subsequent failure.  Today's drop back and close below $39
doesn't look encouraging either, especially with volume running
solidly above the ADV.  We're still willing to give the stock the
benefit of the doubt though, as there's the potential for a
rebound from just above our $38.50 stop.  The bottom of the 7/24
gap is $38.54 and the 20-dma has now risen to $38.52, so if there
is to be a solid rebound, that will be the place.  Aggressive
traders that want to buy a rebound from that level will need to
see strong volume on the rebound in order to have any confidence
that it is more than a weak bounce, especially with daily
Stochastics and MACD now clearly in bearish rollovers.  The best
approach for new entries is to make CTAS prove it has bullish
intentions by rallying back over the $40 level and closing over
the 200-dma.

Picked on July 30th at   $39.90
Change since picked       -0.95
Earnings Date           10/14/03 (unconfirmed)
Average Daily Volume =  1.17 mln



---

Newmont Mining - NEM - cls: 36.88 chng: +1.13 stop: 35.15*new*

Gold bugs rejoice!  While there wasn't much life in the price of
the yellow metal on Wednesday, with the August futures contract
ending at $350, our NEM play caught a very strong rebound from
the 10-dma ($35.92), ending the day at $36.88, a new 5-year high.
We've been looking for entries either on a bounce from just above
$35 or on a breakout through last week's intraday high of $36.90.
So far, this week has provided both, with Monday's intraday low
of $35.29 and today's intraday high of $37.00.  Volume was on the
high side as well, confirming the strength of the breakout, and
once over $37, NEM should be able to make steady progress towards
our $39 target.  Traders still looking for new entries will want
to look for either another rebound from the 10-dma or a clean
break above $37.  Raise stops to $31.15, just below the bottom of
the recent consolidation pattern.

Picked on July 23rd at   $35.28
Change since picked       +1.60
Earnings Date            7/31/03 (confirmed)
Average Daily Volume =  4.47 mln




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


Delta - DAL - close: 10.51  change: -0.28 stop: 12.01*new*

Being a bigger company isn't necessarily better in the world of
airliners.  DAL calls itself the leading U.S. carrier across the
Atlantic and the world's second largest airline if using
passengers carried as a measurement.  When U.S. airliners
reported July traffic this week, the low-fare carriers reported
better numbers than their larger competitors.  DAL traffic
decreased 2.7 percent month-over-month.  However, DAL's load
factor, the percentage of seats filled, rose 4.9 percent as the
carrier trimmed seats offered by 8.5 percent.  Average fares
remained soft across the industry, one source stated.

Tuesday, a car bomb targeting one of Jakarta's top hotels killed
14, reviving terrorism fears.  DAL dipped at the open, but then
attempted a recovery in the middle of the day, with much talk on
CNBC centering on how little affected the airlines had been by
the bombing. The effect of the bombing and the decreased traffic
shows up on the chart, however.

Monday, DAL broke through the bottom of a "b" distribution
pattern.  Since then, it's been dropping slowly toward last
week's $10.31 low and the support that might be expected at
$10.00.  We expect a first bounce attempt at $10.00.  We are
therefore keeping a rather wide stop but are lowering it to
$12.01.  New entries can be sought on a bounce and rollover
anywhere under $11.20.  We would not suggest a momentum entry on
a drop through last week's low as our target lies only $1.51
below DAL's current level.  We're targeting $9.00, just above
$8.80 support and the bottom of a rising regression channel from
DAL's weekly chart.

Annotated Chart for DAL:


Picked on July 30 at 11.15
Change since picked: -0.64
Earnings Date:    07/17/03 (confirmed)
Average Daily Volume:  3.3 million




---

Greenpoint Fin. - GPT - close: 49.66 change: +0.68 stop: 51.01

Treasuries rebounded in Wednesday's trading.  Wednesday's auction
of five-year notes went better than the previous day's auction of
three-year notes.  In addition, the Mortgage Bankers Association
released its market composite index of mortgage loan
applications, showing an increase of 1.1 percent.  Market pundits
think some would-be homeowners are scrambling to get into homes
before interest rates rise any higher, although they deemed
today's increase a modest one.  The refi portion dropped 2.4
percent.

Both developments probably helped GPT's national mortgage
business. GPT rose 1.39 percent on heavier-than-average volume,
topping the 0.87 percent rise in the BKX, the PHLX/KBW Bank
Sector Index.  The DJUSHB, the Dow Jones U.S. Home Construction
Index, rose an even greater 4.01 percent, however, showing the
impact of the modest increase on this group.

Despite Wednesday's gains, GPT remains below the neckline of its
H&S formation and within the "b" consolidation formation.  Even
with Wednesday's gains, prices closed below $50.  MACD remains
bearish, crossing below zero for the first time since March.
However, stochastics and RSI hint that GPT has not yet completed
its test of $50.00 and the H&S neckline.

Both the 21- and 50-dma's now gather just over our 51.01 stop,
and would lend pressure to GPT should it rise to test next
resistance.  We're keeping our stop at $51.01.  Traders looking
for a new entry could target a drop below the bottom of the "b"
distribution pattern, but should be aware of next possible
support at $47.00.

Annotated Chart for GPT:


Picked on August 3 at 49.37
Change since picked:  +0.29
Earnings Date:     07/15/03 (confirmed)
Average Daily Volume:   581 thousand



---

J.P. Morgan Chase - JPM - close: 32.99 change: +0.23 stop: 35.25

After giving us the breakdown we were looking for, JPM is hanging
onto the $33 level by its fingernails, but it almost seems
inevitable that we'll get the big breakdown we've been expecting.
The stock has successfully broken below the neckline (which was
actually at $34) of the Head & Shoulders pattern that was built
over the past 2 months and the minimum downside objective is $30.
Now that we've gotten the initial breakdown, we can look to open
new positions on a failed rebound below the $34.00-34.50 area or
on a break below Monday's intraday low of $32.40.  Once below
$32, downside momentum should continue to increase, leading to
the test of $30 support.  Monitor the Broker/Dealer index (XBD.X)
for signs of sector weakness, as now that $550 support has been
broken, it should offer stiff resistance.

Picked on July 30th at   $33.36
Change since picked       -0.37
Earnings Date           10/15/03 (unconfirmed)
Average Daily Volume =  9.55 mln





============
CLOSED PLAYS
============

  --------------------
  Closed Bearish Plays
  --------------------

Hovnanian Ent. - HOV - close: 51.08 change: +2.68 stop: 50.25

The success of Wednesday's bond auction lit a fire under the
Housing stocks, with the $DJUSHB index vaulting sharply higher to
gain nearly 4% on the day.  After performing quite well over the
past few weeks, our bearish play on HOV caught fire as well,
launching higher by more than 5.5%, clearing the 10-dma and our
50.25 stop in a single bound.  There should be no question about
closing this successful play tonight, as the bearish trend
appears to have ended.

Picked on July 16th at   $54.25
Change since picked       -3.17
Earnings Date           08/27/03 (unconfirmed)
Average Daily Volume =  1.06 mln





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

=========
NEW PLAYS
=========

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


SOHU.com, Inc. - SOHU - close: 32.27  change: -1.84 stop: 35.01

Company Description:
SOHU.com is one of China's most recognized and established
Internet brands and indispensable to the daily life of millions
of Chinese who use the portal for e-mail, alumni club, short
messaging services, news, search, games, browsing and shopping.
Apart from continuous product and services development, SOHU.com
also concentrates its efforts on making the Internet ubiquitously
available, whether in the office, at home or on the road.
SOHU.com, established by Dr. Charles Zhang, one of China's
Internet pioneers, is in its seventh year of operation.  (Source:
Company Press Release.)

Why We Like It:
The early part of the summer treated SOHU well.  SOHU ramped up
into its inclusion in the Russell 2000 on July 10.  It even added
to its gains over the next few days.  From early June until its
high on July 15, SOHU had gained 73 percent as it climbed from
25.02 to 43.40.

After pulling back slightly before its July 23 earnings, it
ramped up again after posting strong second-quarter results,
although it could not quite achieve its previous high.  Still,
that was an amazing performance.  However, that advance wasn't
nearly as amazing as the climb from last year's prices.  Until
last November, SOHU traded below $5.00.

If you're a SOHU investor sitting on such big gains and with a
memory of the last Internet bubble, that's not amazing.  That's
alarming.  We think it's time for the shorts to profit, and
intend to be among those profiting.  SOHU dropped 5.39 percent in
Wednesday's trading, and was joined by other declining Internet-
related ADR's such as NTES and IIJI, stocks that dropped 4.23
percent and 9.22 percent, respectively.

SOHU's drop did technical damage on the chart, too, pushing it
below its 50-dma, horizontal support, and an ascending trendline.
Oscillators are in full bear roll.  It's on a triple bottom
breakdown P&F sell signal.  We're targeting $26.50, just above
next support.  Entries can be made at the current level or on a
rollover anywhere below $35.00.

Annotated Chart for SOHU:


Picked on August 6 at 32.27
Change since picked:   0.00
Earnings Date:     07/23/03 (confirmed)
Average Daily Volume:   4.6 million




============
PLAY UPDATES
============

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

BEA Systems - BEAS - close: 12.89 change: -0.22 stop: 12.74

It's hard to believe that BEAS has been teasing us, stuck between
support and resistance for over 2 weeks now, but it has.
Breakout attempts over the $13.50 level have been short-lived,
each time coming back to test support.  We've been systematically
removing risk from the play by raising our stop just below the
20-dma.  Well it looks like that irresistible force is about to
meet the immovable object, with price getting ever closer to
breaking the 20-dma.  We're keeping our stop in place at $12.74,
which is just a nickel below our picked price.  If BEAS taps that
level, we'll take our leave of the play.  After the sideways
action of the past 2 weeks, we aren't advocating new entries
unless the stock can close back over the $13.30 level.  More
conservative traders may want to wait for a breakout over $14
before playing.  Don't forget, the company is a late reporter for
earnings and their report is due out next Thursday.

Picked on July 20th at   $12.79
Change since picked       +0.10
Earnings Date            8/14/03 (confirmed)
Average Daily Volume =  10.8 mln






==================================================================
Split Trader - Split Announcements
==================================================================


Announcements
-------------


CHDX medicates shares with a 2-for-1 stock split

This morning ahead of today's trading session, Chindex
International Inc's (NASDAQ:CHDX) Board of Directors declared a 2-
for-1 stock split of the company's common shares.

The company's stock split will be payable on September 2nd, 2003,
to shareholders on record as of August 18th.  The stock is up 200%
over the past two months.

This is CHDX's first 2-for-1 split.  In 2000 and 2002 the company
announced a 11:10 split.  They also announced a reverse split (1-
for-8) in 1999.


About the company:
The Company is a leading American company in healthcare in the
Chinese marketplace including Hong Kong. It provides
representative and distribution services to a number of major
multinational companies including Siemens AG (diagnostic color
ultrasound scanners under the Acuson and Siemens brand names),
Becton-Dickinson (including vascular access, infusion and critical
care systems), Johnson & Johnson (clinical chemistry analyzers),
and Guidant (interventional cardiology products including stents,
balloon catheters, and guide wires). It also provides healthcare
services through the operations of its private hospital
corporation in China. With twenty years of experience, more than
600 employees, and operations in the United States, China and Hong
Kong, the Company's strategy is to expand its cross-cultural reach
by providing leading edge healthcare technologies, quality
products and services to China's professional communities.
(Source: Company Press Release)






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