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Daily Newsletter, Tuesday, 08/12/2003

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PremierInvestor.net Newsletter                 Tuesday 08-12-2003
                                                   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:      Ok, Now What?
Watch List:       TGT, NTAP, PDLI, MNST and more!
Market Sentiment: Volume patterns

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
      08-12-2003           High     Low     Volume Advance/Decline
DJIA     8310.06 + 92.70  9310.27  9208.80 1.36 bln   2211/ 996
NASDAQ   1687.01 + 25.50  1687.48  1660.66 1.30 bln   2162/1028
S&P 100   499.74 +  4.62   499.76   494.45   Totals   4373/2024
S&P 500   990.35 +  9.76   990.41   979.90
W5000    9530.43 + 99.10  9530.72  9431.38
RUS 2000  466.95 +  7.68   466.95   459.27
DJ TRANS 2607.47 + 21.70  2607.51  2583.89
VIX        20.21 -  1.21    21.60    20.19
VXN        30.21 -  1.91    32.90    29.89
Total Volume 2,863M
Total UpVol  2,242M
Total DnVol    573M
52wk Highs  309
52wk Lows    41
TRIN       0.86
NAZTRIN    0.72
PUT/CALL   0.77
=================================================================

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

Ok, Now What?

The long awaited FOMC meeting is history and the outcome was
no surprise to anyone. The Dow rocketed to close over 9300
and the Nasdaq is nearing 1700 once again. What is wrong with
this picture? Conviction, total lack of conviction and growing
disbelief that the economics will hold. Bears and bulls alike
are scratching their heads as the indexes move up but the
confirming volume is continuing to shrink. Today was the
second lowest volume day, behind Monday as first, since May
with less than three billion shares for the third consecutive
day.

Dow Chart

Nasdaq Compx Chart

S&P Chart

Wilshire-5000 Chart


Two economic reports today were far from positive for the
bulls. The Chain Store Sales rose only +0.1% from the prior
week despite sales tax holidays in six states and the second
wave of tax credit checks. Back to school sales are reportedly
off to a strong start but with only a +0.1% gain in sales it
would appear anemic.

Even more troublesome was the Richmond Fed manufacturing Survey
which came in at -7 for July. This was a substantial weakening
of the conditions and every component lost ground. New Orders
fell to -13 from zero, Shipments fell to -7 from +1. Order
Backlog fell to -17 from -15 and the six-month outlook fell to
28 from 41. There was nothing positive in this release and after
two months of improvement it appears the trend has reversed.
The survey showed four consecutive months of retraction which
ended in June with a barely positive +1 for the headline number.
The drop back into negative territory was the worst showing in
three months. Expected shipments fell to the lowest level since
October-2001. This report was in sharp contrast to the national
ISM survey announced last week, which showed an improvement in
conditions. If the Richmond Fed Survey is a leading indicator
for the August ISM then we could be in trouble.



Note how the Richmond Fed has performed in relation to the ISM
over the last seven months. It actually was more positive in
the June period but we see significant divergence in July. One
problem with the ISM bounce was the 44% increase from defense
spending which inflated the ISM. Without those defense numbers
the ISM may have been much closer to negative. More analysts
are beginning to worry that the bounce in the July numbers
across the board were a reaction to the temporary post war
economic bounce. If that bounce fails to grow legs soon the
fall economic recovery could evaporate once again.

After the close today there were some more discouraging signs
that all is not improving as much as traders had hoped. AMAT
announced earnings that beat the street after one time items
but then guided analysts lower for the coming quarter. New
orders fell -41% from the year ago quarter but +9% above the
2Q. The company said the semiconductor sector appeared to have
bottomed after a three year spending drought but then guided
analysts that revenue would be flat to only slightly up for
the next quarter. They estimate earnings of 4-5 cents when
analysts consensus was six cents. The CEO said expectations
were high that users would upgrade to the new 12 inch wafer
products but he said that bookings were less than expectations.
AMAT said it appeared capex spending would be flat to only
slightly improved over 2002 levels. AMAT fell in after hours
trading.

Also reporting after the bell was MXIM, which reported inline
with estimates said bookings for next quarter only rose +2%
and were less than analysts had expected. CSC also reported
inline with estimates but said the harsh climate has resulted
in a slow-down in corporate spending but government contracts
had held up well. They currently have $38 billion in federal
contracts in the pipeline. They guided inline with estimates
but some analysts said the slow down in non-government orders
was a concern.

The biggest news of the day was the FOMC meeting and the
monetary policy announcement. The results were as expected
with no rate change and with the Fed even going so far as to
say the current rate environment could be maintained for a
considerable period. This comment was an attempt by the Fed
to calm the bond market and slow the current explosion in
rates. This does not mean those rates will return to prior
lows but there should be a return to normalcy. Coupled with
the implied promise not to raise rates was another warning
that deflation, or "the risk of inflation becoming undesirably
low" as stated in the announcement, was still a threat. They
said that "an unwelcome fall in inflation" was greater than
the risk of rising inflation. On the positive side they said
underlying growth in productivity was continuing to support
economic activity (same sentence in June announcement) and
spending was firming.

The Fed did everything they could to say positive things
while keeping irrational exuberance in check. If they were
too bullish then the bond junkies would start dumping bonds
and pushing up rates. If they were too bearish stocks would
tank and damage the recovery sentiment. The markets
celebrated the Fed action but not immediately. Nearly 30
minutes passed after the announcement before a flurry of buy
programs at Dow 9200 support pushed the averages to the highs
for the day. Once the buy programs ended the markets bled
points for about 30 minutes until a market on close order
imbalance prompted another buying surge. Shorts faced with
indexes pressing the highs for the day, week and month
decided to surrender and bought the close. The Dow closed
over 9300 and the highest close in over a month. Only -50
points from the 52-week high it was very encouraging to
traders.

While the close was impressive the week is far from over.
The economic calendar is chock full of large reports over the
next three days and this is a triple digit expiration week.
We have PPI, CPI and sentiment along with numerous other
reports. The earnings expectations are very high and as we
saw from AMAT, MXIM and CSC tonight the future is not that
rosy. Above all the Fed announcement was already priced in
and the market reaction surprised most professional traders.
Tuesday was the fifth consecutive gain for the Dow and a
+310 point gain off last weeks lows. Also confounding the
bears is the calendar. August is historically the worst
month for the major averages and especially when there have
been big gains. Instead of weakness we are seeing new 52-week
highs beginning to grow and the volatility indicators falling.
The VIX closed at 20.21 and only .58 away from a new 52-week
low. That is only .28 away from the July 28th low of 19.93
and the beginning of the two week Dow decline. Note the
market reaction in the charts below when the VIX neared 20
in recent weeks. It is not always immediate but it will
happen.

VIX/Dow Chart


You be the judge. We had a nice rally and a nice bout of
normal profit taking. Was it enough? There are still very
large paper profits still on the books. With the Fed on
hold until after the Nov-2004 elections and economics that
suggest the bottom is behind us, is the future so bright
we need to wear shades? Nobody can tell the future in
advance but it appears there continues to be a bullish
undertone in the markets. Bulls are buying the dips and
climbing the wall of worry so fast they look like candidates
for the Olympic pole vault. Last week we had serious sell
programs hit on every good piece of economic news. Today
we had buy programs control the outcome. What gives?

There is only one thing ruining this picture. Without this
one piece of data all the gains over the last five days are
seriously at risk. That piece of data is volume. We had
the three lowest volume days in months beginning last Friday.
Volume has been declining since last Thursday's 3.98 billion.
Friday 2.9B, Monday 2.68B and Tuesday 2.8B. Three consecutive
days under 3.0 billion shares traded on all markets. When
volume returns we are going to get some huge moves. The
problem is which side is going to find the conviction first?
Were the bulls waiting for the Fed meeting to validate their
assumptions so they could add to positions? If so then the
upside volume should increase substantially on Wednesday.

Were the bulls waiting for the Fed and hoping to get one
more injection of speed to inflate their parachutes as they
sell to the retail traders venturing back into the market?
Maybe the bears were waiting for the Fed meeting to avoid
any nasty surprises before piling on for the slide into
October. Nobody knows in advance but they will know when
the next big volume surge hits stocks. Tomorrow, Friday or
next week is the question. We are at levels where the bulls
have failed on high volume several times before. They will
have to enlist help to climb from here. There is plenty of
help out there but it needs to be convinced to buy at the
top. Everybody know what normally happens in September/October
and until they can be convinced the Halloween party has been
cancelled they may elect to watch from the sidelines. Either
way the next week could be exciting. Watch the volume for
direction.

Enter Very Passively, Exit Very Aggressively!

Jim Brown
Editor



==================================================================
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
---------------------------------

Target Corp. - TGT - close: 40.00 change: +0.85

WHAT TO WATCH: With Retail stocks breaking out all over and the
Retail index (RLX.X) vaulting to a new 52-week high, bullish
momentum is with the group.  Shares of TGT haven't been slacking
off either, breaking out to fresh 52-week highs on Tuesday.
Further strength above today's intraday high looks good to run
towards strong resistance in the $44-45 area.




---

Network Appliance - NTAP - close: 16.97 change: +1.25

WHAT TO WATCH: No stranger to our bullish playlists, NTAP is
looking strong again after the bulls defended strong support near
$15 and sent the stock soaring for a nearly 8% gain on Tuesday.
A bit of profit-taking could ensue before the stock continues
higher, so buying a pullback near $16 looks like a winning
strategy ahead of a continuation up to test resistance near $18
and then possibly $19.50.




---

Protein Design Labs - PDLI - close: 14.34 change: +1.73

WHAT TO WATCH: A 13% gain in one day?  That looks like too big a
move to chase, but given the volume (nearly triple the ADV) on
Tuesday, this could be the beginning of something really big.
News that the company might be close to agreeing on licensing and
royalty terms on asthma treatment Xolair seemed to be the
catalyst behind today's move.  We'd feel better about entries on
a pullback near the 20-dma, but clearly this is a stock to watch.




---

Monster Worldwide - MNST - close: 24.03 change: +2.08

WHAT TO WATCH: Is the job market improving?  Not appreciably
according to the government reports, but MNST investors say
otherwise, as they have gone on a buying spree the past couple
days, solidifying the stock's rebound from its ascending
trendline just below $21.  With volume on the rise, look for the
stock to retest its recent highs in the $27-28 area in short
order.




---

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

MME $49.89 - We talked about MME on the way down and sure enough
the stock found support just above $45.  But the bounce appears
to be losing momentum.  Give it a couple more days to move into
strong resistance near $52-53, and we should have a nice short
play made to order.

ESE $42.50 - Look out below!  Shares of ESE got slammed lower on
Tuesday in response to the company's earnings report, as
investors ran for the exits.  Should the $42 support level give
way, it could be a quick trip to the 200-dma just below $38.

IR $55.49 - Another breakout in the making, shares of IR look
primed for an explosive move higher, especially after surging to
close a penny below the 7/22 intraday high.  A break above $55.50
will have the stock in fresh multi-year high territory and should
have the next solid level of resistance ($60) coming into play.



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


Jonathan Levinson

Today saw impressive upside fireworks from the bulls following
the requisite post-FOMC uncertainty.  The indices, which had
traded sideways until 2:15, dipped and then launched nearly
vertical rallies.  A brief pause and pullback was followed by a
second vertical move into the close.

The Dow is now up 5 sessions in a row, and the chart appears very
bullish.  However, volume is falling off on a daily basis, with
today's volume the lowest of the current rally.  The reason for
today's drop in volume, FOMC uncertainty, is reassuring to bulls
because of its non-recurrence for many weeks to come.   However,
the net effect is the same, namely a lack of strength at current
levels.

Traders pay close attention to "gaps" in the price charts,
because gaps have a tendency to fill.  The reason is that a gap
involves a sudden move in which volume is so low that no trades
execute as price lurches to its new level.  The implication is
that should price return to the gap level, there are no buyers or
sellers committed to the level in advance, and price has a
tendency to fill the gap.

Low volume sessions are a step closer to gaps, in that support is
relatively weak on low volume upside days, just as resistance is
weak on low volume downside days.  Bulls will want to see plenty
more buyers committing to current levels in order to reinforce
today's gains.  However, the tendency of volume to drop on each
successive upside day for the past week demonstrates a lack of
enthusiasm at higher prices, and implies that the current up-move
is corrective.  If volume does not accelerate with an upward
movement in price, the current gains will remain dubious.


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

Market Averages

DJIA ($INDU)

52-week High:  9361
52-week Low :  7197
Current     :  9310

Moving Averages:
(Simple)

 10-dma: 9171
 50-dma: 9136
200-dma: 8556

S&P 500 ($SPX)

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

Moving Averages:
(Simple)

 10-dma:  979
 50-dma:  988
200-dma:  913

Nasdaq-100 ($NDX)

52-week High: 1316
52-week Low :  795
Current     : 1240

Moving Averages:
(Simple)

 10-dma: 1240
 50-dma: 1241
200-dma: 1097


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

As would be expected the volatility indices or "fear" indices have
fallen the last several sessions just as the $INDU, SPX and OEX have
rallied the last four-to-five sessions.  Climbing equity prices
means investors have less and less fear which makes them complacent
and vulnerable to the next move, which is typically lower.  The VIX
is back at 20 again.  It is the "magic" level, which should flash a big
bright warning sign to traders: potential market top in the making!

CBOE Market Volatility Index (VIX) = 20.21 –1.21
Nasdaq-100 Volatility Index  (VXN) = 30.21 –1.91


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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.77        614,537       470,794
Equity Only    0.50        443,018       221,049
OEX            1.26         31,363        39,433
QQQ            0.71         25,820        18,419


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

Bullish Percent Data

           Current   Change   Status
NYSE          68.2    + 0     Bull Confirmed
NASDAQ-100    64.0    + 0     Bear Confirmed
Dow Indust.   80.0    + 0     Bull Correction
S&P 500       74.0    + 0     Bull Correction
S&P 100       80.0    + 0     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  0.85
10-Day Arms Index  1.04
21-Day Arms Index  1.00
55-Day Arms Index  1.10


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    2008      2096
Decliners     803       965

New Highs     113       108
New Lows       11         9

Up Volume   1009M     1099M
Down Vol.    321M      205M

Total Vol.  1346M     1321M
M = millions


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

Commitments Of Traders Report: 08/05/03

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

Commercial traders appear to be pruning some long positions and
moving that money to the short side.  As expected we see just
the opposite from the small trader.


Commercials   Long      Short      Net     % Of OI
07/15/03      414,020   453,033   (39,013)   (4.5%)
07/22/03      411,206   442,131   (30,925)   (3.6%)
07/29/03      405,429   445,114   (39,685)   (4.7%)
08/05/03      395,633   450,988   (55,353)   (6.5%)

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
07/15/03      148,716    70,279    78,437    35.8%
07/22/03      155,891    76,466    79,425    34.2%
07/29/03      155,216    73,030    82,186    36.0%
08/05/03      159,971    72,951    87,020    37.4%

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

The bulls in the commercial group continue to add to their
positions here but we did see an increase in short positions
as well.  This is the most bullish the commercials have been
in quite some time.  Meanwhile the large spread between longs
and shorts for the small traders narrowed a bit.


Commercials   Long      Short      Net     % Of OI
07/15/03      214,274   218,765    ( 4,491)  ( 1.0%)
07/22/03      249,392   249,386          6     0.0%
07/29/03      272,659   216,166     56,493    11.6%
08/05/03      310,662   249,004     61,658    11.0%

Most bearish reading of the year: (354,835)  - 06/17/03
Most bullish reading of the year:   61,658   - 08/05/03

Small Traders Long      Short      Net     % of OI
07/15/03       45,372    54,654    (9,282)   (9.3%)
07/22/03       45,945    76,071   (30,126)  (24.7%)
07/29/03       44,437    93,144   (48,707)  (35.4%)
08/05/03       56,663    95,919   (39,256)  (25.7%)

Most bearish reading of the year: (48,707)  - 07/29/03
Most bullish reading of the year: 449,310   - 06/10/03


NASDAQ-100

"Smart" money didn't do much last week as positions remain
relatively the same but we saw some small traders eliminate
a few long positions in the NDX.


Commercials   Long      Short      Net     % of OI
07/15/03       28,467     49,154   (20,687) (26.7%)
07/22/03       32,502     48,139   (15,637) (19.4%)
07/29/03       31,456     50,294   (18,838) (23.0%)
08/05/03       32,813     52,383   (19,570) (23.0%)

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
07/15/03       26,489     8,004    18,485    53.6%
07/22/03       27,321     8,844    18,477    51.1%
07/29/03       25,691     7,810    17,881    53.4%
08/05/03       22,188     7,783    14,405    48.1%

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

More shades of limbo here as well with the commercials
not making any new commitments and the small traders
holding steady going on a month now.


Commercials   Long      Short      Net     % of OI
07/15/03       21,607     7,855   13,752      46.7%
07/22/03       22,198     8,176   14,022      46.2%
07/29/03       23,696     9,572   14,124      42.5%
08/05/03       23,981     9,264   14,717      44.3%

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
07/15/03        5,475     9,717   (4,242)   (27.9%)
07/22/03        6,110    10,898   (4,788)   (28.2%)
07/29/03        5,744    11,601   (5,857)   (33.8%)
08/05/03        5,716    10,422   (4,706)   (29.2%)

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                 Tuesday 08-12-2003
                                                   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:     Resurgent Retail

Stop Loss Updates:   HELE, HOTT

Split Announcements: HOTT

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

Hot Topic, Inc. - HOTT - cls: 30.72 chng: +0.38 stop: 28.65*new*

Company Description:
Hot Topic, Inc. is a national mall-based specialty retailer of
music-licensed and music-influenced apparel, accessories and gift
items for young men and women principally between the ages of 12
and 22.  Torrid, the Company's second concept, is a mall-based
specialty retailer of plus-size fashion-forward apparel and
accessories that targets young women principally between the ages
of 15 and 29.  The Company currently operates 457 Hot Topic
stores in 49 states and Puerto Rico, 40 Torrid stores and
Internet stores www.hottopic.com and www.torid.com.  (Source:
Company Press Release)

Why we like it:
Hot Topic is a hot stock and it shows.  Wednesday, HOTT raised
its Q2 earnings forecast, saying July same-store sales had been
strong.  Thursday, First Albany raised HOTT to a buy rating,
citing unnamed catalysts that it expects to give the stock "a new
leg."  Competitor AEOS received the cold shoulder from
Prudential, with a downgrade to a hold rating from a buy rating.

HOTT's volume increased both Thursday and Friday as HOTT sprang
from its 50-dma and pushed above its 21-dma and recent
resistance, closing at an all-time high.  MACD and other
oscillators turned up along with the price.

The stock has maintained an ascending channel since March.  The
best entry might be on a pullback to the midline of the
regression channel.  Since March, HOTT has a habit of springing
up strongly, easing back to support, and then climbing along the
top of its regression channel.  Support on any such pullback
might coincide with the support offered at the top of a double-
bottom pattern seen on the chart.

HOTT's so hot that it might not pull back, however.  The break
through to an all-time closing high and above round-number
resistance at $30.00 might bring on momentum players, sending the
stock up higher in an old-fashioned earnings run into its August
20 earnings.  A momentum entry at current levels might be the
only opportunity provided for new entries.  No matter what the
entry provided, however, this play needs to work fast as we'll be
closing it ahead of earnings on the 20th.

Why This is our Play of the Day
Following on the heels of last week's upbeat Retail sales
numbers, the Retail index (RLX.X) has been surging strongly for
the past 5 sessions and staged a major breakout to new 52-week
highs at $348 today.  Today's 1.8% gain helped to rekindle the
fire in HOTT, which recovered from an early dip near $29.50 to
close at $30.72, also a new 52-week high.  It would have been
nice to see stronger volume on the breakout, but what can you
expect from an FOMC meeting day in August?  Dips into the $29.50-
30.00 area still look favorable for entry, as does a breakout
above today's $30.76 high.  Just keep in mind that the fuse is
short on the play, as the company is due to release earnings next
Wednesday, so when the fire begins to die out, the best course of
action will likely be to harvest gains and move on.  Raise stops
just slightly to $28.65, just below the 20-dma ($28.67).

Annotated Chart of HOTT:


Picked on Aug 10 at     30.16
Change since picked:    -0.00
Earnings Date:       08/20/03 (confirmed)
Average Daily Volume:   605 K


=================================================================
Stop Loss Adjustments
=================================================================

Bullish
------------

HELE – Raise from $18.79 up to $19.05

HOTT – Raise from $28.39 up to $28.65



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

HOTT retails a 3-for-2 stock split

After today's closing bell, Hot Topic Inc's (NASDAQ:HOTT) Board of
Directors declared a 3-for-2 stock split of its common shares.

The stock dividend will be payable to September 2nd, 2003 to
shareholders on record as of August 21st.  Fractional shares will
be paid in cash.  This will increase HOTT’s shares to
approximately 47.5 million.

This is the HOTT’s first stock split since the first quarter of
2002.  It's last few splits were 3:2 in February 2002, a 2:1 in
December 2000 and a 2:1 in December 1999.

About the company:
Hot Topic, Inc. is a national mall-based specialty retailer of
music-licensed and music-influenced apparel, accessories and gift
items for young men and women principally between the ages of 12
and 22. Torrid, the Company's second concept, is a mall-based
specialty retailer of plus-size fashion-forward apparel and
accessories that targets young women principally between the ages
of 15 and 29. The Company currently operates 459 Hot Topic stores
in 49 states and Puerto Rico, 41 Torrid stores and Internet stores
www.hottopic.com and www.torrid.com.
(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

CHA     China Telecom              26.95     +0.51
FPL     FPL Group Inc              62.36     +0.67
COF     Capital One Financial Corp 50.49     +2.40
SOTR    SouthTrust Corp            28.87     +0.66
IR      Ingersoll-Rand Limited     55.49     +1.71
CSC     Computer Sciences Corp     43.62     +0.93
EOG     EOG Resources Inc          41.74     +0.98
SCG     Scana Corp                 33.90     +0.75
BBI     Blockbuster Inc            18.70     +0.70

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

NTAP    Network Appliance Inc      16.97     +1.25
PDLI    Protein Design Labs        14.34     +1.73
EAGL    Eagle Inc.                 17.75     +1.46
LCAV    LCA-Vision New             15.10     +2.12

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

TJX     TJX Companies Inc          21.05     +1.13
DE      Deere & Co                 53.51     +2.53
MNST    Monster Worldwide Inc      24.03     +2.08
APPX    Amer Pharmaceutical Ptnr   44.91     +1.18
RMD     Resmed Inc                 43.60     +2.10
GPN     Global Permits Inc         35.96     +2.11
WGR     Western Gas Resources      39.95     +2.52
MVL     Marvel Enterprises Inc     21.50     +2.85
FOSL    Fossil Inc                 27.80     +1.63

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

AIV     Apartment Invest & Mgmt    37.62     -1.03
ZRAN    Zoran Corp                 22.86     -1.05
ESE     Esco Technologies          42.50     -2.00
PGTV    Pegasus Communications     22.05     -1.05

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

None




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