PremierInvestor.net Newsletter Tuesday 08-19-2003 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: Over the Backs of Bears Watch List: ASKJ, MNC, MEDI, YCC and more! Market Sentiment: Taking Stock ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 08-19-2003 High Low Volume Advance/Decline DJIA 9438.90 + 16.50 9445.08 9351.73 1.59 bln 2076/1135 NASDAQ 1761.11 + 21.60 1761.63 1737.37 1.70 bln 2068/1167 S&P 100 503.92 + 1.13 504.28 499.77 Totals 4144/2302 S&P 500 1002.35 + 2.61 1003.30 995.30 W5000 9683.31 + 40.10 9685.77 9618.22 RUS 2000 488.70 + 7.78 488.70 480.92 DJ TRANS 2663.95 + 20.10 2665.59 2642.61 VIX 19.23 - 0.05 20.19 18.11 VXN 26.50 - 0.12 27.76 26.50 Total Volume 3,568M Total UpVol 2,537M Total DnVol 978M 52wk Highs 747 52wk Lows 66 TRIN 0.93 NAZTRIN 0.69 PUT/CALL 0.64 ================================================================= =========== Market Wrap =========== Over the Backs of Bears Most of the major indexes closed at new 52-week highs and it was done by climbing over the backs of screaming bears. Well, maybe sleeping bears. The volume was still light and the gains were not strong but those bears who were run over were in denial. I know I was there. The Dow hit a new high at 11:00 of 9445 and then traded down the rest of the day until the low of 9351 was hit at 2:40. Bears were backslapping each other that the long awaited failure at the top had arrived when the market suddenly reversed. No problem. Just like the three lower highs since 11:00 they hit the short button again, and again, and again, only to see a strong ramp into the close. The Dow did not return to its high of the day but did close at a new 52-week high. Dow Chart - Monthly Nasdaq Chart - Monthly The morning started off bad with the Retail Sales falling -0.5% from last week but that was written off as blackout related. Also the end of sales tax holidays in several states made the prior week comparisons hard. Helping hold the line were more tax checks and good weather for back to school shopping. WMT said unit sales of school supplies were up but dollar volume was down due to discounting and competition. ShopperTrak said over two-thirds of sales lost due to the blackout were recovered before the weekend was out. Residential Construction soared to 18-year highs at 1.87 million on an annual basis as builders race to complete houses before the interest rate rises any further. The housing permits fell, which indicate a future slowing but for now they are racing weather and interest rates to complete available units before the fall rains. The June starts were revised upward to +5.7% from +3.7%. This was another shot of speed to investors looking for signs of economic strength. Futures soared in the premarket and setup a gap to new highs despite the impending Michigan Sentiment report 15 min later. The Sentiment report for August fell to 90.2 from 90.9 and was less than the expected 91.2. Ho-hum. Traders completely ignored it and continued to push the Dow higher. The sentiment has moved sideways in the 90 range since its high of 92.1 in May. For those that have jobs things are improving with lower taxes, tax rebate checks and retail prices dropping on everything but energy. Despite the interest rate gains they are still low when compared to levels seen over the last ten years. When this number is updated later this month the blackout is sure to lower it significantly but the new market highs may be an offset. After the bell tonight the Semi Book-to-bill number of 0.97 was released. This was an improvement over the 0.93 in June and should help the semiconductor index explode even higher. The index broke strong resistance already this week at 400 and closed on Tuesday at 425. Despite the level of orders still flat for the year the +5.7% increase for the month broke a 3-month downtrend. Orders are down -21% from last year and shipments are down -19%. While .97 is better than .93 it just means the rate of decline is slowing. Until the number climbs over 1.0 the chip companies are receiving fewer orders than they are shipping. The numbers are much better than the three month slump to .90 in Mar-May and traders will get high on semi again tomorrow. Also impacting tomorrows trading will be the Hewlett Packard earnings after the close. They missed earnings by -3 cents and lowered guidance going forward. They said the PC sector was still weak and only laptops were seeing any gains. HPQ said it was a tough quarter despite losses being erased in several divisions. The CEO said aggressive pricing and weak demand contributed to the earnings miss. Personal system sales saw a loss of -$56 million for the quarter but that was still better than the -$140 million for the same quarter last year. They said volume had declined in Unix servers and that was one area of strength before. While HPQ dropped to $19.76 from its close at 22.12 the futures were not showing that much impact. Many analysts claimed the HPQ results were specific to HWP and should not be taken as an industry wide problem. The Dow managed to close up +16 points after spending much of the day in negative territory. The Nasdaq was never in doubt and rebounded +21 to 1761. The big winner however was the Russell-2000, which gained +1.61% or nearly +8 points to close at 488. This was an explosion over downtrend resistance at 480. The S&P closed at 1002 for a gain of +2.61 and a close over the 100 DMA for the second day. The Wilshire 5000 was the party pooper with a +40 point gain to 9683 but still under strong resistance at 9700. With the only economic reports tomorrow the Mortgage Application Index and the Monthly Mass Layoff report traders should be taking their cue from the book-to-bill and pressing their bets to the long side. The wildcard is the HPQ earnings and their impact on the sentiment. After today I am not sure if anything will damage sentiment but that is normally when the worst events happen. The two bombings in Iraq and Israel today had little or no impact on sentiment so it is doubtful the HPQ news will either. Bonds closed near the highs of the day and yields dropped impressively. The stock market failed to take money from bonds and with positive economic numbers they performed very well. Is there anything that can derail this train? The challenge now is the downtrend resistance on the Dow from April 2001, which intersects at just over 9500. Nasdaq resistance is the July high at 1776 then it is pretty much clear sailing to 1900. If all this sounds a little like the Twilight Zone it is probably because it is. With the September/October period in front of us the concept of a rally that reaches 1900 on the Nasdaq is about as foreign as sauerkraut on strawberries instead of whipped cream. If you are long, congratulations and keep those stops tight. If you are flat, hold your nose and go long and definitely keep those stops tight. The VIX put in a nearly sub 19 day and the VXN traded at a new all time low. VIX at new lows, markets at new highs? Just keep looking around every corner as the bulls climb the wall of worry because that is a recipe for eventual disaster. The VIX can go lower and many times does. Something in the 17 range would be my storm cellar warning but until then hang on to your parachute as we move higher. I apologize for the short wrap and the lateness tonight. I got the blue screen of death about 2 hrs into it and spent another 2 hrs trying to recover before giving up and starting over on another PC. Thank you Microsoft for another wonderful evening. 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 --------------------------------- Ask Jeeves, Inc. - ASKJ - close: 18.20 change: +0.43 WHAT TO WATCH: Led by shares of EBAY, the Internet stocks have been on fire again this week and ASKJ has been joining in the bullish party over the past 2 days. Closing back over $18 on Tuesday, shares of the online search service look poised for a breakout move to new all-time highs. This play isn't for the timid, but with volume running nearly double the ADV, this looks like a good old-fashioned momentum run. --- Monaco Coach Corp. - MNC - close: 16.55 change: +0.75 WHAT TO WATCH: Apparently consumers are still spending money without a care. At least that seems to be what is reflected in the action in shares of the manufacturers of motor homes and recreational vehicles. MNC has been recovering modestly for the past couple weeks and blasted higher over the past 2 days, clearing near-term resistance at $16.30. The stock looks poised to test next resistance at $17.25 and if the bullish mood prevails, a run at the $19.50 area looks possible. Conservative traders may want to wait for the stock to trade through the 6/12/03 high of $16.75 before playing. --- Medimmune Inc. - MEDI - close: 35.47 change: -0.61 WHAT TO WATCH: Not every sector of the market is seeing gains, and MEDI is a notable area of weakness, as the stock has clearly violated its rising channel that contained price action from last October until the breakdown earlier this month. The stock appears to be trying to bounce from the $35 support level, but a failed rally near the bottom of that channel (also the site of the 50-dma) could set up a nice bearish trade down to strong support at $32.50, also the site of the 200-dma. --- Yankee Candle Company - YCC - close: 23.25 change: -1.12 WHAT TO WATCH: Just when it looked like YCC was going to break out on Friday, the bears exercised their veto and have been selling the stock hard this week, with volume running over double the ADV. This has the stock on the verge of a breakdown from its 2-month consolidation and today's break under the 50-dma certainly looks bearish. With oscillators early in their bearish roll, current levels (or even a failed rebound below $24) look good for new entries. More conservative traders may want to wait for the $22 support level to break before playing. Look for a downside move towards $20, with support likely to be offered by the 200-dma, currently just below that level. --- =================== On the RADAR Screen =================== MO $38.97 - After a failed rally attempt in June, shares of tobacco giant MO have fallen back to consolidate just over strong support near $38, with added support offered by the 200-dma at $38.44). Should the stock break below $38, it will likely have the bears getting more aggressive as the stock moves into the "fast move" area from May's rally off the $34 level. Entering on the breakdown with a target of $34 looks like a solid bearish trade setup, especially with the PnF chart already on a Sell signal with a price target of $30. FLEX $12.84 - Upgrades still carry a punch, judging by the strong breakout in shares of FLEX today, as the stock vaulted higher by more than 10% on the heels of a Wells Fargo upgrade and an increased price target of $15. That's too big a move to chase, but a pullback to confirm new support in the $11.75-12.00 might be just the ticket for a favorable entry before the bullish move continues. Note that the PnF chart is already bullish with a vertical count of $21.50. We aren't looking for anything near that level, but a move to the $15 Wells Fargo target certainly seems reasonable. PAAS $9.75 - Investors have clearly come to terms with the bull market in gold and gold stocks, but silver stocks seem to have been overlooked. At least until you start looking at some price charts. PAAS is closing in on major resistance at $10 and actually posted an all-time closing high on Tuesday. A breakout over $10 looks like it has room to run, with the PnF bullish price target currently at $15.25. It probably won't be a fast mover, but the stock certainly has a positive looking trend. =============================== Market Sentiment =============================== Taking Stock Jonathan Levinson It's difficult to find anything bearish in the intraday charts of the major indices, while the indicators continue to urge caution. We see the Nasdaq-related volatility indices setting new record lows, and the VIX following along with its own low readings. Bullish percents remain at levels commensurate with market tops, as do the various breadth measures. Despite all of these compelling signals, the indices have been extending their gains steadily, with volume increasing today. These indicators urge caution for bulls and warn that our risk/reward calculations favor downside over upside. Unfortunately, price has not obliged. It does not pay to ignore indicators, but they must be taken in context. Every indicator gives a different snapshot of a current facet of the market. As we've discussed in the past, a very low TRIN reading either indicates a blowoff spike in buying pressure, of the beginning of a trending wave of buying pressure. The reading in each case is the same, but its message can vary 180 degrees. It is for this reason that account management and trading discipline are essential. Let the data here and in the charts suggest the trades, but use stop losses and appropriate account management to control your risk. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 9445 52-week Low : 7197 Current : 9428 Moving Averages: (Simple) 10-dma: 9265 50-dma: 9170 200-dma: 8580 S&P 500 ($SPX) 52-week High: 1015 52-week Low : 768 Current : 1002 Moving Averages: (Simple) 10-dma: 985 50-dma: 989 200-dma: 916 Nasdaq-100 ($NDX) 52-week High: 1316 52-week Low : 795 Current : 1299 Moving Averages: (Simple) 10-dma: 1243 50-dma: 1247 200-dma: 1104 ----------------------------------------------------------------- The volatility indices continue to trade at or new near lows and they should continue to do so as long as the broader indices continue to scratch out new gains. As Jon reminds us above, trade carefully. CBOE Market Volatility Index (VIX) = 19.23 –0.05 Nasdaq Volatility Index (VXN) = 26.50 –0.12 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.64 623,106 396,897 Equity Only 0.50 541,483 268,511 OEX 1.04 13,461 14,050 QQQ 0.87 40,606 35,144 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 69.4 + 1 Bull Confirmed NASDAQ-100 68.0 + 3 Bear Confirmed Dow Indust. 80.0 + 0 Bull Correction S&P 500 75.4 + 1 Bull Correction S&P 100 82.0 + 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 0.86 10-Day Arms Index 0.86 21-Day Arms Index 0.97 55-Day Arms Index 1.07 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 1838 2004 Decliners 993 1094 New Highs 230 278 New Lows 26 7 Up Volume 1094M 1240M Down Vol. 471M 448M Total Vol. 1579M 1710M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 08/12/03 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 Commercials added slightly to their long positions in the S&P, whilesmall traders maintained their positions, adding a net 761 contracts for the week. Commercials Long Short Net % Of OI 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%) 08/12/03 399,414 456,767 (57,353) (6.7%) 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 07/22/03 155,891 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% 08/12/03 158,821 71,040 87,781 38.2% 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 Commercials added heavily to their long positions in the e-mini, posting their most bullish reading of the year, while small traders added further to their short positions. Commercials Long Short Net % Of OI 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% 08/12/03 306,014 217,233 88,781 17.0% Most bearish reading of the year: (354,835) - 06/17/03 Most bullish reading of the year: 88,781 - 08/12/03 Small Traders Long Short Net % of OI 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%) 08/12/03 62,534 106,403 (43,869) (26.0% Most bearish reading of the year: (48,707) - 07/29/03 Most bullish reading of the year: 449,310 - 06/10/03 NASDAQ-100 Commercials and small traders moved in the same direction on the NDX, as commercials lightened up slightly on their short positions, while small traders added to their longs. Commercials Long Short Net % of OI 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%) 08/12/03 34,374 53,015 (18,641) (21.3%) 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 07/22/03 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% 08/12/03 23,957 7,871 16,086 50.5% Most bearish reading of the year: (10,769) - 06/11/02 Most bullish reading of the year: 19,088 - 01/21/02 DOW JONES INDUSTRIAL Commercials added slightly to their long positions on the Dow, but the move was sufficient to post a new bullish high for the year, close to reaching the October 2001 high of 15,135 contracts. Small traders added more substantially to their shorts. Commercials Long Short Net % of OI 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% 08/12/03 24,942 9,878 15,064 43.3% 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 07/22/03 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%) 08/12/03 6,933 13,248 (6,315) (31.3%) Most bearish reading of the year: (8,777) - 10/12/01 Most bullish reading of the year: 1,909 - 1/16/01 ----------------------------------------------------------------- ================================================================= To stop receiving this PremierInvestor.net Newsletter, send email to Contact Support ================================================================= DISCLAIMER ================================================================= This newsletter is a publication dedicated to the education of stock traders. The newsletter is an information service only. The information provided herein is not to be construed as an offer to buy or sell securities of any kind. The newsletter picks are not to be considered a recommendation of any stock but an information resource to aid the investor in making an informed decision regarding trading in stocks. It is possible at this or some subsequent date, the editors and staff of PremierInvestor.net may own, buy or sell securities presented. All investors should consult a qualified professional before trading in any security. The information provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. PremierInvestor.net staff makes every effort to provide timely information to its subscribers but cannot guarantee specific delivery times due to factors beyond our control. Please read our disclaimer at: http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html ***************************************************************** ADVERTISING INFORMATION For more information on advertising in PremierInvestor.net Newsletter, or any Premier Investor Network newsletter please contact Contact Support. ***************************************************************** Copyright ) 2003 PremierInvestor.net. and The Premier Investor Network. Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter Tuesday 08-19-2003 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: Going For The Gold Closed Plays: HOTT, DAL, SHRP Stop-Loss Adjustments: IRF, HELE, LSI 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 ) =============== Newmont Mining - NEM - cls: 38.91 chng: +0.87 stop: 37.40 Company Description: Newmont Mining Corporation is a holding company and is principally engaged in gold mining. As of the end of 2002, the company had gold reserves of 86.9 million equity ounces and an aggregate land position of approximately 63,000 square miles. NEM has operations in North America, South America, Australia, New Zealand, Indonesia, Uzbekistan and Turkey. In 2002, the company obtained more than 69% of its equity gold production from politically and economically stable countries, namely the United States, Canada and Australia. Why we like it: We're having some fun now! Actually, sleeping through Friday's session would have proved to be more exciting than actually watching the "action". Our NEM play traded in a painfully tight 56 cent range near the top of its recent move, and it's no great surprise with the December gold futures contract (GC03Z) trading a paltry 60 contracts vs. a normal day where from 1400 to 2500 contracts change hands. This is mostly the result of the power outage in the Northeast and with no action in the futures contract, it was no surprise to see the gold shares trade in muted fashion as well. We'll have to wait for more clarity next week. NEM is very close to our profit target of $39 and it has been dancing around up here for most of the week. Conservative traders should have already harvested gains, which just leaves those with a more aggressive risk profile holding on for a potential move into the $39-40 area, at which point, they should also take the money and run. There's not much we can do to limit our risk in the play from here, but we are inching our stop up to $37.40, just under Wednesday's intraday low. Just to be perfectly clear, we are not recommending new entries at this time. Why This is our Play of the Day NEM has been a frequent guest in the Play of the Day slot during its tenure on the bullish play list, and the simple reason is that it continues to perform. Despite the renewed strength in the dollar, gold and gold stocks have been holding up well. On Tuesday, NEM once again tested the $39 resistance level, with an intraday high of $38.99. Looking at the daily candles gives a picture reminiscent of 2 weeks ago, when the stock was threatening to break out over the $37 level. We all know how that played out, with a successful breakout and the subsequent consolidation at this higher level. We're looking for one more strong bullish move into the $39-40 area and based on the rising volume, we could see that materialize as early as tomorrow. Rather than get greedy, we're going to recommend harvesting gains on such a bullish move, primarily due to the strength of resistance at $40, as well as it being the bullish price objective from the breakout of the June/July consolidation, following the preceding rally. Due to the proximity of that resistance, we obviously are not advocating new positions at this time. Consider this a heads up to plan your exit accordingly, as a breakout tomorrow will likely have NEM transitioning gracefully to the drop list. While we're maintaining our stop at $37.40, more conservative traders may want to tighten theirs up a bit, perhaps to $37.60, just below today's intraday low. Annotated Chart of NEM: Picked on July 23rd at $35.28 Change since picked +3.63 Earnings Date 7/31/03 (confirmed) Average Daily Volume = 4.60 mln ================================================================= Closed Plays ================================================================= Active Trader ------------- -------------------- Closed Bullish Plays -------------------- Hot Topic, Inc. - HOTT - close: 33.25 change: +0.96 stop: 30.25 Earnings and split runs appear to be back in fashion. Since we entered our long play on this retail stock, it leaped above its rising regression channel and charged up the charts in an almost vertical fashion. Our bullish play received a boost when tax checks arrived about the time HOTT's teen customers headed back to school. Not even a downgrade of Too, Inc., another retail store targeting teens, impacted HOTT. We're sorry to let this one go, but HOTT reports earnings tomorrow after the bell, and it's our policy to drop plays ahead of their earnings announcements. Although MACD remains strong, other oscillators begin to look toppy. HOTT appears due for a pullback, although nothing in the charts necessarily predicts when the pullback will occur. This stock has gained 11% since August 8th. We'll take a look at it again after it's settled down from the volatility that usually comes after an earnings announcement. Picked on Aug 10 at 30.16 Change since picked: +3.09 Earnings Date: 08/20/03 (confirmed) Average Daily Volume: 448 thousand -------------------- Closed Bearish Plays -------------------- Delta - DAL - close: 12.06 change: +0.32 stop: 11.86 Buoyed by the resumption of routes shut down by last week's power outages, the airline stocks started the week flying higher. DAL did, too. Tuesday, DAL announced a redesign of the Fort Lauderdale--Hollywood International Airport, with the redesign meant to reduce airport wait times significantly and improve the travel experience. The redesign includes improvements in technology, but DAL will also add customer service roles that will enhance customer interaction. DAL also announced plans to increase jet service at the Wilmington, N.C. airport, offering a nonstop flight between Wilmington and Atlanta beginning in October. DAL opened cents above our $11.86 stop, pulled back to the 200- dma, and then sprang above our stop again. Although volume proved light, stochastics and RSI moved into a distinctively bullish mode. MACD curves up strongly, too, although it remains below zero. DAL's advance stopped today just above resistance at $12.00, and it will find next resistance near $12.75 and then at the 50-dma, now at $13.17. Picked on July 30 at 11.15 Change since picked: +0.91 Earnings Date: 07/17/03 (confirmed) Average Daily Volume: 3.3 million ---- Sharper Image - SHRP - close: 28.67 change: +2.31 stop: 26.75 The retail index $RLX might have headed down in Tuesday's trading, but SHRP polished its image and headed up the charts. By midmorning, SHRP had stopped us out of our play. By the end of the day, SHRP had gained 8.76 percent on almost double average daily volume. What happened? We're not sure, but earnings are scheduled for Thursday after the close. Perhaps someone knows something about earnings or perhaps we got caught in a short-squeeze ahead of earnings. On Monday, RSI broke through its trendline of descending highs, hinting at strength. Stochastics moved up, but MACD remains below zero. We notice that the strong climb moved SHRP right back to the shoulder level of the former head-and- shoulder formation with the advance stopping there, but we wouldn't count on the stock rounding over again into a second right shoulder. Picked on Aug 10 at 24.65 Change since picked: +4.02 Earnings Date: 08/21/03 (confirmed) Average Daily Volume: 260 thousand ========================= Stop-Loss Adjustments ========================= IRF – Raise from $32.00 up to $33.60 HELE – Raise from $19.60 up to $20.39 LSI – Raise from $9.25 up to $9.50 ================== 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 UTX United Technologies Corp 78.73 +1.74 PGR Progressive Corp 69.16 +1.33 UB Unionbacal Corp 45.51 +1.74 ODP Office Depot Inc 17.37 +1.02 PHM Pulte Homes Inc 67.74 +2.79 RCII Rent a Center Inc 77.07 +2.75 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- MU Micron Technologies Inc 13.86 +1.10 FLEX Flextronics International 12.84 +1.19 CLS Celestica Inc 17.06 +1.81 SCRI Sicor Inc 19.27 +1.51 PLXS Plexus Corp 15.70 +1.20 JDAS JDA Software Group Inc 15.87 +1.20 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- RTP Rio Tinto Plc (ADR) 88.09 +2.09 HIT Hitachi Ltd 49.10 +2.27 A Agilent Technologies Inc 24.29 +1.83 SPLS Staples Inc 22.53 +2.15 BRCM Broadcom Corp CI A 25.35 +2.50 JBL Jabil Circuit Inc 27.20 +1.17 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- HD Home Depot Inc 32.16 -1.74 CME Chicage Mercantile Exchange71.60 -6.32 ENH Endurance Specialty Holding27.90 -1.05 CTR Cato Corporation (THE) 23.75 -1.15 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- None ================================================================= To stop receiving this PremierInvestor.net Newsletter, send email to Contact Support ================================================================= DISCLAIMER ================================================================= This newsletter is a publication dedicated to the education of stock traders. The newsletter is an information service only. The information provided herein is not to be construed as an offer to buy or sell securities of any kind. The newsletter picks are not to be considered a recommendation of any stock but an information resource to aid the investor in making an informed decision regarding trading in stocks. It is possible at this or some subsequent date, the editors and staff of PremierInvestor.net may own, buy or sell securities presented. All investors should consult a qualified professional before trading in any security. The information provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. PremierInvestor.net staff makes every effort to provide timely information to its subscribers but cannot guarantee specific delivery times due to factors beyond our control. Please read our disclaimer at: http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html ***************************************************************** ADVERTISING INFORMATION For more information on advertising in PremierInvestor.net Newsletter, or any Premier Investor Network newsletter please contact Contact Support. ***************************************************************** Copyright 2003 PremierInvestor.net. and The Premier Investor Network. Do not duplicate or redistribute in any form.
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