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Daily Newsletter, Thursday, 09/04/2003

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PremierInvestor.net Newsletter                Thursday 09-04-2003
                                                   section 1 of 2
Copyright  2003, All rights reserved.
Redistribution in any form is strictly prohibited.

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

In section one:

Market Wrap:      Dr Deflation Strikes Again
Watch List:       CLS, HD, DHI, MACR and more!
Market Sentiment: Impressive Disbelief

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
      09-04-2003           High     Low     Volume Advance/Decline
DJIA     9587.90 + 19.40  9609.09  9541.72 1.82 bln   1779/1402
NASDAQ   1868.98 + 16.10  1870.00  1848.95 1.87 bln   1858/1367
S&P 100   516.18 +  1.68   516.72   513.04   Totals   3637/2769
S&P 500  1027.97 +  1.70  1029.17  1022.19
W5000    9967.22 + 20.10  9975.58  9912.29
RUS 2000  512.56 +  1.85   512.56   508.99
DJ TRANS 2757.15 -  4.30  2763.17  2743.01
VIX        19.89 -  0.54    21.24    19.86
VXN        30.91 -  0.28    32.16    30.75
Total Volume 3,977M
Total UpVol  2,953M
Total DnVol  1,328M
52wk Highs  872
52wk Lows    21
TRIN       1.03
NAZTRIN    0.38
PUT/CALL   0.68
=================================================================

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

Dr Deflation Strikes Again

Not one, not two but three Fed heads took to the podium today
and tried to talk up the economy and talk down bond yields. We
will not know if they were successful for sometime but the
impact on the stock market sent it back to new 52-week highs
once again. Ben Bernanke went on record not once but twice on
Thursday saying there was a good chance the Fed could cut rates
again. Somebody pinch me I must be dreaming.

Dow Chart


Nasdaq Chart


S&P Chart



This was a day full of surprises. In fact I am surprised we are
not butting heads at 9700 instead of 9600. There was good news,
great news and just enough lingering economic problems to keep
the plot in motion. The morning started with the Jobless Claims
which "surprised" everyone (except us) with a reading over
400,000 once again. Actually I expected it next week but it
appears enough workers went back to job hunting for the Fall to
turn the tide a week early. The headline number was 413,000 and
last weeks number was revised up to 398,000 and just nipping
under the 400K level. The four-week moving average broke the
400K barrier once again at 402,000 and continuing claims rose
again to 3.663 million the highest level in eight months. Get
this, the Labor Dept actually said the short week prevented
some numbers from being reported and the 413K would be revised
next week. Duh! And what is different from any other week? This
is setting up next week as a pivotal number for the markets.

The Factory Orders for July jumped +1.6% compared to estimates
of only +0.7%. This is the highest level since May-2001.
Nondurable orders rose +2.4% and shipments +2.5%. What the heck
is going on here? We are actually seeing the economic reporting
for the bounce that Intel said they saw in July. This number
is a very lagging indicator and could decline in August but
investors have their sights set on Dow 10,000 and they are not
going to be deterred by old data. The key here is the positive
trend and one that is not likely to go negative again.

The ISM Services blew past estimates of 62.0 with a headline
number of 65.1, which matched last months surprise number. The
global services business has been trending up so this number
was expected to be strong but nowhere near this strong. New
Orders rose to 67.6 while inventory fell to 49.0 from 49.5.
This is setting up a strong future bounce when that inventory
needs to be replenished. One component throwing the number
out of line was the rise in prices to 55.7 from 50.6. This
is primarily due to higher oil prices being passed through
to the consumer. This distorted the headline number to the
upside.

Productivity rocketed +6.8% in the 2Q according to the revision
posted on Thursday. This was higher than estimates of +6.3%
and most of the increase was due to higher output numbers.
This is a two edged sword. While the output and productivity
is increasing it is doing so at the expense of more job cuts.
Hours worked fell another -5.9%. We are likely to see more
evidence of this with the Jobs Report on Friday. The current
unemployment rate is around 6.2% or nine million workers out
of work. I will get to the differing outlooks later but the
Jobs report is the key for tomorrow. The estimate is for a
gain of +10,000 jobs. The whisper number has been heard for
a loss of as many as -50,000 jobs. Even if we get a drop in
jobs the unemployment number is likely to fall as more and
more workers decide to give up looking. We will get to hear
Elaine Chao go on CNBC once again to tell viewers that the
drop in unemployment is good for the economy and proof the
administrations employment program is working. It makes no
difference what the numbers are tomorrow because she will
say the same thing and she will probably quote the numbers
wrong once again. I do not know whose idea it was to put her
in front of a camera but they need to be demoted. More
disposable camera fodder I assume.

Elaine Chao


The Jobs Report is the last major economic report for the week
and it is before the open. Elaine is not the only one confused
about jobs as different Fed governors voiced different opinions
about the jobs future today. Ben Bernanke said he expected the
jobs picture to remain bleak through Q4 of 2004 at the worst.
McTeer said he felt the growing economy would increase jobs
before the year end and drop the unemployment rate under 6%.
Obviously if there is a difference in opinion at the top the
outlook is very cloudy. The term Jobless Recovery has turned
into Jobloss Recovery in common usage. Historically employers
will not want to add new hires until they are confident the
recovery and demand is here to stay. We are still a long way
from that stage now.

There was so much news today the following paragraphs may
seem unconnected but I need to get it all out. Retail sales
was stronger again at +5.1% and many of the majors reported
strong gains in same store sales. Wal-Mart reported a +6%
gain in sales BUT, and here is the key, they lowered estimates
going forward. The late summer binge and a stronger than
expected back to school rush just as tax checks and tax cuts
hit consumers produced the perfect retail storm. While
rejoicing most retailers are cautioning that the majority of
the impact from those factors has already been seen. Most
retailers traded down because expectations were for an even
greater gain in sales. Investors are never satisfied.

Home buyers got a boost from Hovnanian (HOV) who said they
were able to raise prices due to demand outstripping supply.
Whoa! What happened to that bursting housing bubble? This is
just a historical trend when interest rates spike up. Buyers
rush to snap up available homes and lock in rates before any
further increases. If Bernanke was able to put some fear into
bonds again today then that interest rate window may be
opening again soon.

The chip stocks were back in form today after a brief hiatus.
The fear of the Intel mid quarter update tonight was diffused
by AMD saying business was picking up despite concern over
a potential lack of staying power. Cypress Semi said demand
was picking up although prices were still dropping. National
Semi reported earnings of 15 cents and said current quarter
bookings were the strongest in the last ten quarters. UBS
upgraded most of the chip stocks this morning and added to
the euphoric stupor. This kept the Nasdaq from selling off
at the close on fear of Intel. Intel came through in the
clinch despite the four days of back tracking by the
officers after the August update. It appears the caution
was misplaced and Intel raised its guidance to the top of
the previous range and affirmed the gross margin at 56%.
Considering the expected revenue is between $7.6-$7.8 billion
that is a massive profit. Pass the chips please, I think we
are about out of dip. Of course once all the good news is
out there is nothing for investors to look forward to.
Futures are up only slightly in after hours on the news.

An August survey of CIOs showed that 46% planned on increasing
their hardware budget while only 15.5% were planning on
decreasing it. Security software was the big winner with 51%
planning on increasing spending on security. Spending on
infrastructure software fell to only 28.6% down from 33.2%
in July. The total for the study projected an increase of
+6.4% in IT spending over the next 12 months compared to
only +4.5% for the same study in July. This matches the
Dell comments earlier in the week that there was improvement
but no meaningful pickup in spending. Intel also said the
product mix was responsible for the improvement in guidance
more than unit volume. Laptops are still leading and those
chips are more expensive than desktop computers.

Cisco added their voice to the "orders improving" chorus but
Chambers was quick to add it could only be temporary and
may not be sustainable. The caution across tech land is very
thick and I think everybody is looking behind the increase
in orders to see if there is anything in the pipeline but
they are afraid to look real close.

The Fed heads were at it today on all fronts. Mcteer,
Gramlich and Bernanke all spoke with Bernanke wielding the
biggest hammer. His speech summarized several outside groups
that do economic projections and on average suggested the
GDP would grow at a 4.7% rate through Q4-2004. Not exciting
but decent. Where he drew the most attention was commenting
on rate changes. He said he could see no "significant" rate
hike in the near future. OK, does that mean we are going to
be quarter pointed to death every month? Not according to
Ben. He even went so far as to say the next change could be
another rate cut. This slammed bond yields along with his
comments again that inflation was not the enemy but the
return of an unwelcome drop in inflation. This failure to
use the D word in repeated Fed head speeches just amazes me.
They don't trust us with the D word. We might hurt ourselves
so they are spelling it out so only the financially educated
among us can figure it out. Get real. Bernanke has tackled
the deflation monster so aggressively he has earned the
title of Dr Deflation in some circles. Just in case he did
not make himself clear in the morning speech he repeated
his comment about the next move could be a rate cut in a
late day appearance. Get this, he also said it was not the
size of the cut that mattered but how the Fed talked about
it. Bingo! This is exactly where the Fed floundered in June
and the bond market penalized them for it. It appears Ben
has taken it upon himself to be the standard bearer for the
Fed and to preach to the choir every chance he gets. Might
not be a bad strategy for a promotion should Greenspan not
get the nod for a new term. Go get them Ben!

The markets extended their run and closed at new 52-week
highs. Will wonders never cease? The Nasdaq stretched its
winning streak to seven days and a feat not seen since Feb
of 2000. The Nasdaq is closing in on 1900 and even the
bullish traders are wondering when the pause will appear.
The Dow traded over 9600 several times and tacked on a
respectable +19 points but the excitement seems to be
fading. It could have been fear of Intel keeping the wallet
on the hip. Now that Intel has passed the test we will see
if the bulls can hold the line for one more day and the
Nasdaq stretch its streak to eight.

The blue chips were mixed today with MMM getting killed to
the tune of -2.61 on valuation concerns but was offset by
PG +2.63 on another guidance increase. IBM spiked back over
$88 and GE is about 30 cents away from a new 52-week high.
Speaking of new highs there were 1186 yesterday across all
markets and 872 today. This compares to only 21 new lows
today. This market breadth is tremendous but the A/D line
is only marginal at 4:3 advancers over decliners. The volume
today was nearly a billion shares less than the total market
volume yesterday but still decent. Wednesday's volume was
the strongest since June.

It appears we are in the eye of the perfect storm across
the broader markets. Internals are good, volume is decent,
economics continue to improve and tech stocks are raising
guidance. The Fed is talking rate cuts, yields are dropping
and we are in earnings warning season with no warnings.
What else could go right? Multiple press conferences of
fraudulent insider trading by mutual funds and hedge funds
as well as massive bond trading allegations failed to deter
investors. Bullishness has risen to 55.5% with bearishness
only 18.2% according to Investors Intelligence. These are
very bad numbers on a contrarian view. The VIX closed under
20 once again and nobody seems to care. Should they?

Apparently not if all the possible factors are lining up
in favor of stocks. At least that is the predominant view.
If the economy is on fire and several estimates for the
3Q are now over +5% GDP growth then damn the technicals
and full speed ahead. Shucks, Martha, 10,000 is just over
the hill. We can get there before we run out of gas. In a
month where the term "new highs" is seldom mentioned the
markets are setting them on a daily basis. There appears
to be nothing to hold them back. Professional traders are
dumbfounded over the lack of weakness despite the good news.
It is simply a law of the market that pullbacks on profit
taking occur routinely. Except, when the bulls are charging.
With nothing but green pastures in sight each bearish stand
is promptly trampled into the dirt. The wall of worry has
turned into a super highway and traders simply see no reason
to sell. Today was a prime example. With Intel after the
close and the Jobs Report before the open you would have
thought there would be some cautious profit taking but it
did not happen. Right at the close when you would have
expected it to happen we had Dr Deflation promising another
rate cut if economic conditions did not continue to improve.
Instead of taking profits traders were adding to positions.
Pass me some more of them chips Martha. I can't wait to see
if those Fed boys will speak at the NFL halftime tonight. Do
you think they will bump Britney so Dr Deflation can speak
again?

All seriousness aside there is no reason for the markets to
sell off other than profit taking. There is also no real
resistance other than psychological between here and 10,000.
What am I missing? I feel as clueless as the dummy they send
to the kitchen for more drinks in a Scream movie never to be
seen alive again. Traders are acting like a corral full of
bulls fighting to get on the ramp to the truck thinking it
was going to a greener pasture just a few hundred points
away. They just don't know it could be going to the slaughter
house instead. Or is it? Just how high is high?

Using four different ways to calculate the potential top on
the S&P we get a surprising confluence of numbers. Using the
Bollinger bands on a monthly chart we should see an intersection
of price with the top band somewhere in the 1140 range. Using
a target from the reverse head and shoulders from 2002-2003
we project 1140 again. Coincidence? Taking a Fib retracement
from the 2000 high to the 2002 low we run into the 50% level
at 1160. Finally using a horizontal resistance from 1998, 2001
and 2002 highs we top out at 1175. I am not saying we are
going to be anywhere close any time soon but if we did continue
up this is where the granddaddy of all resistance levels
appears to converge. Somewhere in the 1140-1175 range and
it promises to be serious resistance. Now, with that in
perspective Keith's 1060 possibility for this current rally
looks like a real possibility. (Keith gives Elliott Wave
projections in the Futures Monitor.)

S&P Monthly resistance chart


Friday could be a pivotal day in the markets. We could easily
go either way a couple hundred points and nobody knows which
way. The Jobs report is already factored in despite what
Elaine says on CNBC tomorrow. The 413,000 Jobless Claims
today accomplished that task. Unless it is a disaster it
will be taken as just one more month in the Jobloss Recovery
and a necessary mile marker in the road to 10,000. Once that
is out of the way the direction will be up to the bulls. The
bears have no strength and every dip they manufacture is
quickly bought. Until the bulls tire of the game and garner
more profits than they want to risk we are still in dip
buying mode. The bulls have shaken off their fear of the
calendar and until that fear returns we are likely to see
even more higher highs and higher lows. Just remember that
some of the worst sell offs came when the markets were the
most bullish. Keep those seatbelts fastened and those stops
in place.

Enter Very Passively, Exit Very Aggressively!

Jim Brown



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

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

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

Celestica - CLS - close: 19.40 change: +1.15

WHAT TO WATCH: With Semiconductor stocks continuing to soar amid
myriad upgrades, shares of CLS are getting with the program,
breaking out to their best level in nearly a year.  With volume
rising sharply, this looks like the beginning of a move that has
some significant upside.  While there is some resistance in the
$20.00-20.50 area, a breakout over that obstacle should have room
to run to the $25 level.  A pullback into the $18.50 area will
provide the best entries, although with the strong volume on
Thursday, a continued rally from here is certainly possible.

Chart=


---

Home Depot - HD - close: 34.24 change: +1.45

WHAT TO WATCH: Could the fourth time be the charm?  HD has been
turned back thrice from the $34.75 level, but the strong advance
on Thursday (with volume more than double the ADV) amidst another
strong rally in Housing stocks could be the beginning of the
eventual breakout.  Wait for a breakout over $34.75 before
playing and target an initial move to $38.

Chart=


---

D. R. Horton - DHI - close: 32.79 change: +0.96

WHAT TO WATCH: With continued strong housing numbers, the Home
Construction index ($DJUSHB) is looking strongly bullish again,
gaining nearly 2% on Thursday.  DHI is the first stock in the
group to break its June highs and the stock is now in new high
territory.  Target entries on a mild pullback into the $31.50-
32.00 area (confirming that old resistance is new support) and
then look for an initial move up to the $35-36 area.

Chart=


---

Macromedia, Inc. - MACR - close: 27.09 change: +1.05

WHAT TO WATCH: Breaking out to new yearly highs is one thing, but
MACR is looking to raise the bar.  The stock broke out to new
yearly highs on Wednesday, and with volume running very strong,
the bulls used that momentum to drive the stock over $27 on
Thursday, ending just shy of the highs from May and December of
2001.  Aggressive traders can target entries on a rise over
$27.25 (the 12/01 highs), while those with a more conservative
stripe will want to wait for a move over the $27.65, which will
better the May 2001 high.  Look for an initial move into the $30-
31 area, with a solid chance of reaching next strong resistance
in the $34-35 area.

Chart=



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

DCLK $12.60 - If there was any doubt about Internet stocks making
their comeback, the likes of DCLK should remove all doubt.  The
stock blasted through its June highs today on better than double
its average volume, and it looks like a sure bet to test its 2002
highs near $13.75.  But the way these stocks have been rallying
lately, the stock looks like it could reach for next resistance
near $15.

CMVT $17.86 - Everywhere you turn, Technology stocks are breaking
out, and CMVT is joining the party with this week's move over
$17.  Look for a mild pullback to confirm support in the $16.50-
17.00 area and then jump aboard for the ride up to next strong
resistance at $20.

GE $31.32 - It isn't just Technology that has gotten the bulls'
attention, as even stodgy old GE is making bullish strides.
While the stock hasn't yet broken its June highs near $31.75,
once it does so, it should set the stage for a swift move up into
the $33-34 area, with $36 being the high-end target, as it is
strong resistance from 2001-2002.  Wait for the breakout before
playing and make sure the buying volume remains strong.




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

Impressive Disbelief
- J. Brown

Once again the morning began with a truckload of positive analyst
comments for the tech sector.  This time the focus was chip
stocks, which helped propel the SOX index to a 2.5% gain.  This
in turn kept the NASDAQ afloat to strike its seventh consecutive
gain in a row.  The NASDAQ Composite was joined by the Russell
2000 and the Wilshire 5000 in this feat of sequential gains.

Bullish investors found the market's ability to maintain its
gains impressive.  On the other hand, bearish traders were left
dumbfounded in disbelief.  One might suspect the berth of this
rally is fading as several major market indices ended the day
down fractionally in the red.  However, the after hours mid-
quarter update from Intel was mildly positive and could set the
markets up to make it eight in a row for the NASDAQ.

We've said it before... several of the major indices and plenty
of individual equities are looking very extended and in need of
some consolidation.  The bullish percent numbers below, with many
at 5-year extremes, support this notion.  Playing the trend is
great but be patient and wait for the right entry point.

We still have a busy economic day tomorrow with nonfarm payrolls,
the unemployment number, hourly earnings all coming out before
the opening bell.


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

Market Averages

DJIA ($INDU)

52-week High:  9609
52-week Low :  7197
Current     :  9587

Moving Averages:
(Simple)

 10-dma: 9410
 50-dma: 9214
200-dma: 8623

S&P 500 ($SPX)

52-week High: 1029
52-week Low :  768
Current     : 1027

Moving Averages:
(Simple)

 10-dma: 1007
 50-dma:  992
200-dma:  922

Nasdaq-100 ($NDX)

52-week High: 1376
52-week Low :  795
Current     : 1373

Moving Averages:
(Simple)

 10-dma: 1332
 50-dma: 1270
200-dma: 1121


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

Unfortunately, it's just more of the same.  The VIX is back under
20 and the VXN has developed a habit of gapping at the open only to
fade into the close.

CBOE Market Volatility Index (VIX) = 19.89 -0.54
Nasdaq Volatility Index (VXN)      = 30.71 -0.28

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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.68        676,086       458,851
Equity Only    1.10        554,715       611,450
OEX            1.33         17,836        23,640
QQQ            4.08         24,642       100,559


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

Bullish Percent Data

           Current   Change   Status
NYSE          71.7    + 0     Bull Confirmed
NASDAQ-100    78.0    + 2     Bear Correction
Dow Indust.   80.0    + 0     Bull Correction
S&P 500       80.2    + 1     Bull Confirmed
S&P 100       87.0    + 2     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  1.92
10-Day Arms Index  1.79
21-Day Arms Index  1.45
55-Day Arms Index  1.38


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    1551      1768
Decliners    1268      1317

New Highs     222       266
New Lows       10         3

Up Volume    980M     1372M
Down Vol.    786M      493M

Total Vol.  1796M     1877M
M = millions


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

Commitments Of Traders Report: 08/26/03

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

There is no significant change in the long or short positions
for the large S&P futures contracts.  We continue to see the
commercials or "smart money" inch up their short positions while
retail traders inch up their long positions.  Since they both
tend to take the opposite sides of the market, this is normal.


Commercials   Long      Short      Net     % Of OI
08/05/03      395,633   450,988   (55,353)   (6.5%)
08/12/03      399,414   456,767   (57,353)   (6.7%)
08/19/03      404,665   455,381   (50,716)   (5.9%)
08/26/03      410,378   472,987   (62,609)   (7.1%)

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
08/05/03      159,971    72,951    87,020    37.4%
08/12/03      158,821    71,040    87,781    38.2%
08/19/03      162,034    87,064    74,970    30.1%
08/26/03      170,424    76,967    93,457    37.8%

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


E-MINI S&P 500

In contrast we're seeing the commercials add strongly
to their long positions in the e-minis.  The latest reading
shows the most bullish position in a very long time.
Just as expected the small traders has loaded up on short
positions and this marks the strongest net short position
for months.


Commercials   Long      Short      Net     % Of OI
08/05/03      310,662   249,004     61,658    11.0%
08/12/03      306,014   217,233     88,781    17.0%
08/19/03      296,971   235,779     61,192    11.5%
08/26/03      338,766   234,841    103,925    18.1%

Most bearish reading of the year: (354,835)  - 06/17/03
Most bullish reading of the year:  103,925   - 08/26/03

Small Traders Long      Short      Net     % of OI
08/05/03       56,663    95,919   (39,256)  (25.7%)
08/12/03       62,534   106,403   (43,869)  (26.0%)
08/19/03       90,428   125,980   (35,552)  (16.4%)
08/26/03       52,131   120,853   (

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 remain net short on the NASDAQ 100 futures
while small traders are still swinging for the fences
with heavy net longs.


Commercials   Long      Short      Net     % of OI
08/05/03       32,813     52,383   (19,570) (23.0%)
08/12/03       34,374     53,015   (18,641) (21.3%)
08/19/03       32,107     53,665   (21,558) (25.1%)
08/26/03       33,991     55,849   (21,858) (24.3%)

Most bearish reading of the year: (21,858)  - 08/26/03
Most bullish reading of the year:   9,068   - 06/11/02

Small Traders  Long     Short      Net     % of OI
08/05/03       22,188     7,783    14,405    48.1%
08/12/03       23,957     7,871    16,086    50.5%
08/19/03       25,607    10,134    15,473    43.3%
08/26/03       26,108     8,864    17,244    49.3%

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

The flurry of short positions for the DJ Industrials
two weeks ago have mostly evaporated, meanwhile the
small trader has eliminated a few short positions as well.


Commercials   Long      Short      Net     % of OI
08/05/03       23,981     9,264   14,717      44.3%
08/12/03       24,942     9,878   15,064      43.3%
08/19/03       21,088    18,984    2,104       5.3%
08/26/03       24,586    10,386   14,200      40.6%

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
08/05/03        5,716    10,422   (4,706)   (29.2%)
08/12/03        6,933    13,248   (6,315)   (31.3%)
08/19/03       15,717     9,143    6,574     26.4%
08/26/03       14,115     5,592    8,523     43.2%

Most bearish reading of the year:  (8,777) - 10/12/01
Most bullish reading of the year:   8,523  -  8/26/03


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




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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

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Copyright ) 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                Thursday 09-04-2003
                                                   section 2 of 2
Copyright ) 2003, All rights reserved.
Redistribution in any form is strictly prohibited.

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

Play of the Day:  Still Running

Stop Loss Update: FMC

Stock Split Announcement: CCBI

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

FMC Corporation - FMC - cls: 24.89 chng: +0.44 stop: 24.30*new*

Company Description:
FMC Corporation is a diversified, global chemical company
providing solutions, applications and products to a wide variety
of end markets.  The company operates in three distinct business
segments.  Agricultural Products' principal focus is on
insecticides and herbicides.  Specialty Chemical consists of the
company's biopolymers and lithium businesses and focuses on food
ingredients that are used to enhance texture, structure and
physical stability, pharmaceutical additives for binding and
disintegrant use and lithium specialties for pharmaceutical
synthesis and energy storage.  The company's Industrial Chemicals
division manufactures a range of inorganic materials, including
soda ash, hydrogen peroxide, specialty peroxygens and phosphorus
chemicals.

Why we like it:
Good things happen when preparedness meets opportunity, and our
FMC play appears to be a good example of that.  We initiated
coverage last weekend as the stock had risen to just below the $25
resistance level and looked ready for a breakout.  We played it
cautiously with an entry trigger of $25.10, just over the recent
intraday highs and we didn't have to wait long for that trigger to
be tripped.  After an initial rejection just below that level
yesterday morning, the bullishness in the broad market yesterday
afternoon pushed the stock through that level on robust volume,
resulting in a close at $25.22.  Confirming that breakout was both
increasing volume and today's continuation to just below the
$25.50 level.  Intraday pullbacks near the 10-dma (currently
$24.70) look like good continuation entry points, while more
aggressive traders can enter on a continued rally through the
$25.60 level (just above today's intraday high).  Keep in mind
that we're initially targeting the $27.50 level, so for the
momentum traders out there, make sure to weigh risk vs. reward
before playing.  Note that our stop is currently set at $24.00, as
a break below there would require a break of both the 20-dma and
last week's intraday low ($24.06).

Why This is our Play of the Day
Clearly we added FMC to our bullish play list at the perfect time,
as it moved through our initial trigger on Tuesday and despite the
pause in the broad market rally, this stock has continued running
higher.  Yesterday's session saw the stock pause just below the
$25.50 level, and the bulls continued the buying spree today,
tacking on another 1.8% to end just below $26, just off the
intraday high. Volume has been robust the past 2 sessions as well,
running at its best levels of the past month.  Should this bullish
action continue, our $27.50 profit target should be achieved early
next week.  After the gains this week, it is hard to justify new
entries into further strength, but a pullback to the $25 area
could be just what the doctor ordered for a new entry.  Note that
the 10-dma ($24.86) has been acting as support since the middle of
August and should provide support on the next pullback as well.
We'll continue ratcheting our stop up just behind the 20-dma
($24.33), so it rises to $24.30 tonight.

Annotated Chart of FMC:



Picked on August 31st at  $24.89
Change since picked        +1.06
Earnings Date           10/28/03 (unconfirmed)
Average Daily Volume =     254 K


=================================================================
Stop Loss Updates
=================================================================


FMC - long
Adjust from $24.00 up to $24.30




=================================================================
Stock Splits
=================================================================

Announcements:
-------------

CCBI finances a 3-for-2 stock split

Minutes before the opening bell, Commercial Capital Bancorp, Inc's
(NASDAQ:CCBI) Board of Directors declared a 3-for-2 stock split of
its common shares.

The stock split will be payable on September 29th, 2003 to
shareholders on record as of September 15th.  The stock split will
increase the company's shares outstanding to 22,327,507 from
approximately 14,885,005.

This is CCBI's first stock split since being listed in 2002.


About the company:
CCBI, headquartered in Irvine, CA, is a multifaceted financial
services company which provides financial services to meet the
needs of its client base, which includes income-property real
estate investors, middle market commercial businesses, and high
net-worth individuals, families and professionals. At June 30,
2003, CCBI had total assets of $1.4 billion, was the 3rd largest
multi-family lender in California during the 12 months ended March
31, 2003 (source: Dataquick Information Systems) and has
originated approximately $2.5 billion in multi-family and
commercial real estate loans through June 30, 2003. Commercial
Capital Bank (the "Bank"), the Company's bank subsidiary, was the
fastest growing banking organization in California, based on
percentage growth in total assets over the 36 months ended March
31, 2003 (source: www.fdic.gov). The Bank has full service banking
offices located at the Company's headquarters in Irvine, Rancho
Santa Margarita, Riverside, and loan origination offices in
Sacramento, Corte Madera (Marin County), Oakland, Burlingame,
Woodland Hills, Encino, Los Angeles, Irvine, and San Diego, CA,
and plans to open a banking office in La Jolla, CA in September of
2003. Commercial Capital Mortgage, Inc. ("CCM"), the Company's
mortgage banking subsidiary, funds and sells those loans which the
Bank elects to assign to CCM. ComCap Financial Services, Inc., the
Company's NASD registered broker dealer, provides fixed income and
mortgage-backed securities advisory and brokerage services to
corporations, high net-worth individuals and other financial
institutions. Commercial Capital Asset Management, Inc., the
Company's asset management subsidiary, provides asset management
services to alternative investment funds, made available to
accredited investors.
(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

HOV     Hovnanian Enterprises      66.11     +0.86
RYL     Ryland Group               72.15     +2.39
CHKP    Check Point Software       20.39     +1.30
BZH     Beazer Home                87.20     +0.80
LEN     Lennar Corp                71.59     +1.99
BPOP    Popular Inc                39.02     +0.54

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

CLS     Celestica Inc              19.41     +1.16
DCLK    DoubleClick                12.56     +1.07
ELN     Elan Corp                   5.88     +1.01
IDTI    Integrated Device Tech     14.57     +1.19
CCRT    Compucredit Corp           17.65     +1.03
ONXX    Onyx Pharmaceuticals       19.74     +1.22

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

PBR     Petroleo Brasileiro        23.74     +1.01
CHIR    Chiron Corp                54.78     +1.93
INFY    Infosys Technologies       62.92     +4.24
ABS     Albertson's Inc            22.86     +1.90
NSM     National Semiconductor     32.00     +3.18
HAR     Harman Intl Inc           100.50     +1.46
FDRY    Foundry Networks           22.12     +1.35

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

BAC     Bank of America            76.24     -1.76
LLY     Eli Lilly                  61.04     -1.06
BSX     Boston Scientific          58.68     -1.32
TLB     Talbots Inc                35.36     -2.79
ANPI    Angiotech Pharmaceutical   39.56     -2.04

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

MAY     May Dept Stores            26.82     -1.35
PSUN    Pacific Sunwear            33.18     -1.85
ANN     Ann Taylor Stores          33.10     -1.67
ERES    Eresearch Tech             31.18     -2.74
DG      Dollar General             21.94     -0.63
FINL    Finish Line Inc            27.15     -0.75



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

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

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Do not duplicate or redistribute in any form.

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