PremierInvestor.net Newsletter Tuesday 09-09-2003 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: Trend Change? Watch List: GPI, TIN, ISPH, TSCO and more! Market Sentiment: Chalk It Up ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 09-09-2003 High Low Volume Advance/Decline DJIA 9507.20 - 79.10 9584.95 9490.84 1.77 bln 1234/1958 NASDAQ 1873.43 - 15.20 1886.27 1867.81 2.29 bln 1363/1835 S&P 100 513.92 - 4.10 518.02 512.95 Totals 2597/3793 S&P 500 1023.17 - 8.47 1031.64 1021.14 W5000 9932.85 - 77.70 9991.02 9914.10 RUS 2000 513.57 - 3.56 517.13 512.51 DJ TRANS 2732.19 - 29.50 2767.01 2730.80 VIX 19.68 + 0.89 20.02 19.20 VXN 30.38 + 0.83 31.26 29.91 Total Volume 4,383M Total UpVol 1,495M Total DnVol 2,838M 52wk Highs 659 52wk Lows 10 TRIN 1.63 NAZTRIN 0.87 PUT/CALL 0.82 ================================================================= =========== Market Wrap =========== Trend Change? Markets are down two out of three days but we are far from a new bear market. Despite the selling and the change in internals we are still stuck in the trading range we have seen for the last week. The major difference was in the internals which could be a leading indicator of future direction. As we creep quietly deeper into September traders are looking for any clue as to when the historical trends may appear. Dow Chart Nasdaq Chart Economically this was not a good day. Not bad, but not good either. The Wholesale Trade report was slightly below consensus at +0.4% but down from last month at +1.6%. Inventories remained unchanged for the second month but the inventory-to-sales ratio returned to its record low of 1.52. This would tend to show pessimism that the recovery may not hold because nobody is stocking up for future sales. This is a mixed message because historically very low inventory numbers would spark a huge spike in manufacturing if demand suddenly increased. Without a recovery in sales that manufacturing bounce will not occur. The drop in sales from +1.6% in June to only +0.4% in July would be more troubling were it not for the many corporate references to a pickup in business in July. Did it really pickup or was it just a temporary post SARS bounce? We will have to wait for the August data to see for sure. The Richmond Fed Manufacturing Survey rose to zero in August from -7 in July. While this was overall positive it was only barely so. The biggest gain was in the New Orders, which became less negative at -4, up from -13. The Backlog of Orders dropped from -17 to -20 but the six month outlook rose to 31 from 28. Smaller backlogs, order flow still negative but getting better with the outlook still improving. This was disappointing when measured by the ISM gains and all the components were below their June values. This only reflects the manufacturing in the Richmond area but it is not in agreement with the ISM. It could be a sign that the ISM is in trouble for August. Chain Store Sales continued to rise at +0.5% as back to school sales were still ringing the registers. This was the largest gain in five weeks but now that the Labor Day shopping weekend has passed we could see some weakness ahead. The BOT-M lowered estimates for September to a +3.5% gain from +4.0% after WMT, S and TGT lowered estimates for September. Tax rebate checks have slowed and mortgage refinancing has dropped more than -80%. This will reduce the flow of spending cash until the year end holiday season begins. We will get another look at the REFI index tomorrow with the Mortgage Application Survey. The REFI index has dropped to 1981 from the May high of 9977 and loans started in May/June would have already closed by now. Only 30 days ago the index was 4145 and we have seen a 50% haircut since then. Goldman lowered its outlook on retail stocks saying the leading consumer indicators were slowing and retail stocks were trading above their five year average. Goldman downgraded most retail sectors to cautious from neutral except for supermarkets and drug stores which they left at neutral. They cut HD, LOW, FD and MAY to inline. Part of the downgrade on HD and LOW was due to mortgage rates and the impending deceleration in housing turns. Merrill jumped on the valuation downgrade wagon with a SELL on Albertsons. Nokia depressed the market at the open after the CFO said that phone prices were falling. NOK still said earnings would come in at the high end of expectations but the falling prices comment touched quite a few players. Falling prices puts pressure on chip and component makers as well as profitability of other phone makers like QCOM, ERICY and MOT and service sellers like Verizon and AT&T. Increasing competition was given as the reason by Nokia. Falling prices can mean lack of general demand and the sector ripples were light but broad. DB upgraded CSCO before the bell but it closed in negative territory despite a valiant try to hold the higher ground. The networking index fell -2.2% with CMVT and LU losing -6% while FDRY bucked the trend at +4.1%. 12 of the 15 stocks declined. 11 of 13 stocks in the communication index fell as well. Most of this weakness was attributed to the Nokia news but there was also fall out in the communication sector on news that WCOM had reached agreement to come out of bankruptcy leaner and meaner. This is frustrating for other companies who were hoping the company would be liquidated to cut down on competitors. After the close today XLNX and TXN issued mid quarter updates and the outlook was not as positive as traders had hoped. XLNX said sales of its programmable chips would be flat to only slightly higher and inline with prior guidance. XLNX fell in after hours trading. TXN refined its guidance to the high end of its prior levels. TXN had said revenue would be in the $2.29 to $2.49 billion range and they narrowed that range to $2.39 to $2.49 billion. Earnings were expected to be in the 20-22 cent range, up from the 18-23 prior guidance. TXN fell -1.60 in after hours as traders were expecting the new guidance to be outside the prior range. USB began the worry over tech valuations with comments that the current prices reflected a PE of 31 based on NEXT years earnings and those earnings were still questionable. They said the historical PE for this time in the cycle was 28. Salomon however raised chips yesterday based on an acceleration of earnings anticipated for 2004. It is all in the timing as one man's over bought could easily be another's breakout. The NOK warning this morning was only one of a the few warnings we have had so far this quarter. According to First Call only 20% of the pre announcements have been negative compared to a normal 25% average. This should mean the 3Q earnings are going to be better than expected but then WHAT is actually expected? The market appears to be expecting a blowout quarter after Intel guided up twice. Unfortunately if you examine the earnings of the S&P companies the numbers do not add up. For the 3Q the S&P earnings are expected to jump +12% but revenue is only expected to rise +1.2%. The 4Q earnings are expected to rise +20% but revenue is only expected to rise +2.3%. Obviously the earnings ramp is huge and any slowing of revenue growth could be dangerous. The earnings are predicated on drastically reduced costs and higher productivity. (fewer workers) Everything is priced to perfection and any cracks in that perfection model could get ugly. The current market has risen +2200 Dow points since the March lows. The Nasdaq has risen +650 points. In 1998 and the start of the great bubble the Dow only rose +1920 points, +25% from the lows. In 1999 the Dow gained +2400 points, or +27%. The current Dow has rallied +29% from the March lows. This is more than either of the bull market bubble years and has done so without any material pullback. In 1998, admittedly a strong bull market the Dow lost -1966 points from the July high to the October lows but recovered all of it to close the year higher. In 1999, another strong bull market, the Dow dropped -1389 points from the August high to the October lows and recovered all of it to close the year higher. What is driving professional traders crazy is the total lack of selling this year after a +29% gain in the Dow and a +51% gain in the Nasdaq in only six months. What is different this time? The early 1998 Dow low was 7450 and only 34 points higher than our low in March. The market levels are basically the same. Where are the bears? Where are the profit takers? Where is the normal September weakness from portfolio rebalancing? The bullishness is so rampant there are simply no sellers. While this is not a healthy trend it can be self perpetuating. The main difference between our current conditions and 1998/1999 is the Internet explosion and the Y2K build out. PCs were flying off dealers shelves at an average price of about $2500 to beat the Y2K bug and allow buyers to surf the net with amazing speed on their new 56K modems. One hundred million PCs were sold. Quite a tech wave for those new surfers. The difference this time around is that we do not have a wave. Investors are buying techs like there is no tomorrow but the wave powering earnings is more of a ripple. Certainly nothing you could surf. Computers cost $750 now fully equipped but the dot.com surplus is still with us. I threw away two dozen 1999 computers last month because I could not sell them. The 450mhz Y2K computers were scrap compared to what you can buy today for $399 new. My only point tonight is this. We have had a huge move in the last six months without any serious profit taking. Over $3 trillion in gains have been made in the Wilshire-5000 since March without any serious pullback. We are moving into the most dangerous six week period on the calendar and nobody appears worried. The 15 EMA on the VIX touched 20 today after the VIX closed under 19.0 last night. The last time this happened was Sept-5th 2000 and EXACTLY at the Dow high before the -1745 drop over the next six weeks to the October 18th low. The last time before that was July-20, 1998 and EXACTLY the Dow high before dropping -1900 points to the Oct-8th low. You can choose to ignore the VIX if you want and you can believe we are going to hit 10,000 before 9,000. What we believe is immaterial. The market will continue to move based on what the herd decides to do not what the various indicators and historical calendar trends say it should do. The market exists for many as the great humiliator and any of us who put our thoughts in print on a daily basis have been the object of that humiliation many times over. All we can do is point out what COULD happen and then get out of the way. An informed trader is a better trader. The buying in the futures markets today was unbelievable. The numbers of contracts coming in at bid on every minute dip were several times the number we have seen over the last week. The dip buying was simply amazing but the market finished down. Is this a change in the trend? The most telling news for me was the Nasdaq volume at 2.2 billion shares. This was the second highest volume since May. Down volume beat up volume but only slightly at 6:5. 52-week highs at 369 beat lows at 1. Yes, one. The NYSE on the other hand had nearly 2 billion shares but the down volume was 3:1 over up volume. 52-week highs 204, lows 5. Despite the increase in down volume the internals were still very bullish on both exchanges. It was disguised because the indexes fell but it was still bullish. At least that is what it appears on the surface. Many would point to the massive volume over the last five days, over 4 billion shares across all markets each day, and the lack of upward movement and suggest there was serious distribution underway at the top. Selling is very heavy but so is the buying in order to hold these levels and somebody is going to be wrong. What direction you believe in will not change with this article. That is fine I am not trying to tell anyone that we are going up or down. I am only trying to alert you to the possibilities. Nothing is ever guaranteed. In 1995 and 96 there was no October dip. In 1994 it was so small as to be insignificant to the overall picture. In 1997 and the beginning of the Internet trading revolution it was only -1300 points. There is no right answer to what lays ahead. If you are prepared there is also no danger. Keep those stops tight and think about some index puts for insurance. Remember the Boy Scout motto and "Be Prepared". 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 --------------------------------- Group 1 Automotive - GPI - close: 39.96 change: +1.54 WHAT TO WATCH: It seems one automotive stock after another keeps finding its way onto our bullish list and GPI is just the latest. The stock has been steadily ascending since March, leaving a trail of higher highs and higher lows in its wake. Tuesday's breakout over $39.50 puts the stock at fresh 52-week highs and a further rally above $40 should have the $45 level and possibly the 2002 high of $50 in play. A breakout over $40 or a pullback into the $38.50-39.00 should both work well for new entries. --- Temple Inland - TIN - close: $51.70 change: +1.70 WHAT TO WATCH: Basic Materials rule! That certainly seems to be the message the markets are sending, with one Basic Materials stock after another breaking over major resistance. TIN is just the latest to log fresh 52-week highs, as the stock delivered a 3.4% gain on Tuesday on volume that more than doubled the daily average. Regardless of the root cause behind the move, this is a trend that looks like it has some room to run. A pullback to confirm support near $50.00-50.50 will provide the best entries ahead of a continued rally up to major resistance in the $56-58 area. --- Inspire Pharmaceuticals - ISPH - close: 17.75 change: +1.93 WHAT TO WATCH: Biotechs were on fire again on Monday and in a delayed reaction, shares of ISPH blasted higher on Tuesday to the tune of more than 12%. Of course a new FDA approval and a new $25 price target from Deutsche Securities didn't hurt. This appears to be too large a move to chase, but it was a major breakout, clearing resistance going back to January of 2001. A pullback to confirm new support in the $16.25-16.50 area should provide a solid entry for the next leg up. --- Tractor Supply Company - TSCO - close: 33.70 change: -1.35 WHAT TO WATCH: See, we can still find bearish plays! TSCO has had one heckuva run over the past several months and it looks like it is time for a breather. After tagging a new high at $36, the stock has been rolling lower and shed nearly 4% on Tuesday on volume that nearly quadrupled the ADV. While there is some mild support to be found in the $32 area, we're thinking the stock looks vulnerable to its 50-dma just below $29. A failed rebound below $35 will provided the best entries, although there's certainly nothing wrong with a momentum entry below Tuesday's intraday low. --- =================== On the RADAR Screen =================== MATK $52.00 - It certainly seems the Biotechs can do no wrong lately and MATK bears that out with a fresh all-time closing high on Tuesday and volume expanding nicely. A brief pullback near $50 may provide a favorable entry into this strong bullish run. MEDI $36.53 - After breaking down out of its 8-month ascending channel last month, shares of MEDI appear to have found their footing again, with the 200-dma providing strong support near $33. The buyers have been getting active again and with buying volume on the rise, the stock looks poised to make a run at its recent highs in the $40-41 area. AAP $68.90 - Not everything is coming up roses in the Automotive sector. AAP has been in strong rally mode since the March lows, but the effects of a downgrade after such a strong rally can be painful. The stock broke down hard on Tuesday and is now poised just above its 50-dma. A break below that average should havew the stock seeking out the $60 level as the profit taking moves into high gear. =============================== Market Sentiment =============================== Chalk It Up - J. Brown A less than stellar mid-quarter update from Nokia and a round of downgrades from Wall Street helped set the tone today. Despite the sour mood and declines across most major indices and sectors the losses were not overwhelming. Most commentators merely chalked it up to long overdue profit taking. I'm prone to agree with them. The DJIA managed to stem its losses and close above the 9500 level while the NASDAQ is still trading above 1850; even the S&P 500 is still above 1020. Does that mean aggressive bears aren't speculating on further declines? No, it doesn't but there are still plenty of investors willing to buy the dip. The sterner mood set by Wall Street analysts this week merely has buyers being more selective in their choices. I realize this is starting to sound stale but I would expect weakness ahead of the 9/11 anniversary on Thursday, especially given the strength of the markets in August and the first week of September. Who's to say the big spike in gold today wasn't a little pre-9/11 ramp up by speculators? I'll be impressed if the major indices can hold these levels and just trade sideways the next couple of sessions. In the meantime, bullish traders should probably be waiting for that next big intraday dip (and bounce) from their favorite equities to trade. Just be careful - the next round of valuation downgrades could hit your pet stock next. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 9609 52-week Low : 7197 Current : 9507 Moving Averages: (Simple) 10-dma: 9474 50-dma: 9252 200-dma: 8643 S&P 500 ($SPX) 52-week High: 1032 52-week Low : 768 Current : 1021 Moving Averages: (Simple) 10-dma: 1015 50-dma: 994 200-dma: 924 Nasdaq-100 ($NDX) 52-week High: 1387 52-week Low : 795 Current : 1370 Moving Averages: (Simple) 10-dma: 1351 50-dma: 1281 200-dma: 1126 ----------------------------------------------------------------- No change here. As would be expected the volatility indices crept higher on the market weakness. CBOE Market Volatility Index (VIX) = 19.37 -0.52 Nasdaq Volatility Index (VXN) = 30.70 -0.21 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.83 634,583 523,614 Equity Only 0.67 521,716 347,457 OEX 1.47 19,503 28,820 QQQ 3.97 16,692 66,222 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 72.4 + 0 Bull Confirmed NASDAQ-100 80.0 + 1 Bear Correction Dow Indust. 86.7 + 0 Bull Confirmed S&P 500 81.8 + 0 Bull Confirmed S&P 100 89.0 + 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 1.15 10-Day Arms Index 0.95 21-Day Arms Index 0.94 55-Day Arms Index 1.05 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 1014 1252 Decliners 1793 1819 New Highs 191 278 New Lows 6 4 Up Volume 408M 907M Down Vol. 1315M 1281M Total Vol. 1743M 2204M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 09/02/03 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 More of the same for commercial traders in the large S&P futures contracts, but we do see a slight bump in short positions. There is barely any change between longs and shorts for the small traders. Commercials Long Short Net % Of OI 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%) 09/02/03 417,973 482,392 (64,419) (7.2%) 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 08/12/03 158,821 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% 09/02/03 169,030 75,748 93,282 38.1% 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 bullish trend of growing long positions for the commercials in the e-minis has continued. The latest report shows drop of 10K short positions and 9K new long positions. Locksteppening in the opposite direction are the small traders with a big jump in short positions to the most bearish we've seen them in a long time. Commercials Long Short Net % Of OI 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% 09/02/03 347,724 224,011 123,713 21.6% Most bearish reading of the year: (354,835) - 06/17/03 Most bullish reading of the year: 123,713 - 09/02/03 Small Traders Long Short Net % of OI 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 (68,722) (39.3%) 09/02/03 56,709 134,094 (77,385) (40.6%) Most bearish reading of the year: (77,385) - 09/02/03 Most bullish reading of the year: 449,310 - 06/10/03 NASDAQ-100 Commercials caught part of the stampede fever and added some long positions to their NDX futures. Meanwhile small traders rotated some money out of longs and into shorts but no big change. Commercials Long Short Net % of OI 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%) 09/02/03 37,002 55,379 (18,377) (19.9%) 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 08/12/03 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% 09/02/03 23,168 10,561 12,607 37.4% 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 No serious changes among the commercial traders while small traders have grown fur and drastically reduced their bullish positions. The spike in shorts have them looking for a INDU drop. Commercials Long Short Net % of OI 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% 09/02/03 25,462 10,447 15,015 41.8% 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 08/12/03 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% 09/02/03 6,629 13,402 (6,773) (33.8%) Most bearish reading of the year: (8,777) - 10/12/01 Most bullish reading of the year: 8,523 - 8/26/03 ----------------------------------------------------------------- ================================================================= 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. 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PremierInvestor.net Newsletter Tuesday 09-09-2003 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: Into Space Closed Plays: TWR Stop-Loss Adjustments: FDC, GOLD, INSP Stock Split Announcements: PLMD 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 ) =============== InfoSpace.com - INSP - cls: 18.65 chng: +0.89 stop: 17.00*new* Company Description: InfoSpace, Inc. (Nasdaq:INSP) provides wireless and Internet software and application services. The Company develops software technologies that enable customers to efficiently offer a broad array of network-based services under their own brand to any device. (Source: Company Description) Why we like it: The recipient of a positive mention in Business Week this week, INSP climbed Friday to a closing high not seen since March 2002. It also gained on high volume, with MACD strength confirming the move. While climbing this week, the stock created a double-top breakout P&F buy signal. It's been maintaining an ascending regression channel for many months, and this week moved back across the midline. It appears to be headed toward the top of the channel again. We wish the YIH, the Internet Infrastructure HOLDRS Index, and XIS, the Industry Standard 100 Internet Index, two indices of which INSP is a component, had gained Friday, too. However, they've each recently broken above their consolidation patterns and may have been pausing to gather strength again. The COMPX, too, retreated after its own hard, fast run up the charts. In addition to the positive mention in Business Week, INSP's name has been included in other papers: court papers requiring the co-founders to repay the company $247 million for illegal stock sales. On Thursday, the co-founders appealed the decision. Entries can be found at the current level or after a pullback and bounce from above $16.00. We're setting the stop at $15.75 and our first target at $19.50, just below the expected resistance at $20.00. Why This is our Play of the Day Last week's breakout in shares of INSP had us eyeing more upside, with an initial target of $20. Little did we suspect just how quickly that target would be achieved. Opening right at Friday's close on Monday, the stock pushed sharply higher early in the day and you had to be quick to get an entry, but there it was. As if that 6.8% gain wasn't exciting enough, the stock followed through with a gap and run up to $20.25 this morning (a 10.3% intraday gain) before backing off considerably at the end of the day to post 'only' a 4.8% gain. Now that our first target has been achieved, this looks like a good point to harvest gains for those that were quick enough to get that early entry. INSP looks like it could work still higher, perhaps up into the $22-23 area, based on the very strong volume (more than triple the ADV) again on Tuesday. But this is not the place to be looking for new entries. Look for a pullback to consolidate near $18, or perhaps as low as $17.35-17.40. We're raising our stop to just below break even tonight at $17.00, which is just below yesterday's intraday low and will also be below the 10-dma (currently $16.70) by tomorrow. Annotated Chart of INSP: Picked on September 7th at $17.19 Change since picked: +2.06 Earnings Date: 07/30/03 (confirmed) Average Daily Volume: 369 K ================================================================= Closed Plays ================================================================= High Risk/High Reward --------------------- -------------------- Closed Bullish Plays -------------------- Tower Automotive - TWR - close: 4.90 change: +0.00 stop: 4.75 We certainly can't complain about the performance we've gotten from TWR over the past couple weeks, as the stock has vaulted higher by nearly 20% from our picked price. Last week's breakout brought the stock up to tag our conservative exit target of $4.80 and since then, we've been aggressively tightening the stop, forcing it to either rise to reach our ultimate target of $5.00 or trigger our stop. The bulls gave it an honest effort again on Tuesday, rallying the stock up to $4.92 at the close. Unfortunately, that followed the opening dip down to $4.71, which triggered our stop at $4.75. No matter, we're out with a nice gain and ready to find a fresh candidate. Traders that are still holding open positions should look to close out the play first thing tomorrow morning. Picked on August 20th at $4.10 Change since picked +0.80 Earnings Date 10/21/03 (unconfirmed) Average Daily Volume = 532 K ========================= Stop-Loss Adjustments ========================= FDC – Raise from $38.50 up to $39.50 GOLD – Raise from $22.49 up to $22.70 INSP – Raise from $15.75 up to $17.00 ========================= Stock Split Announcements ========================= PLMD medicates its shareholders with a 2-for-1 stock split Before today's opening bell, PolyMedica Corp 's (NASDAQ:PLMD) Board of Directors declared a 2-for-1 stock split of its common shares. The stock split will be payable on September 29th, 2003 to shareholders on record as of September 19th. After the stock split PLMD will have approximately 25 million shares of common stock outstanding. This is PLMD's first stock split since the two splits they announced in 1996. About the company: PolyMedica is a rapidly growing national medical products company. The Company is best known through its Liberty brand name and innovative direct-to-consumer television advertising to seniors with diabetes and respiratory disease. Building on its technology-based operating platform and compliance management focus, PolyMedica continues to expand its product offerings in these chronic disease and other categories. (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 WYE Wyeth 47.12 +0.76 BTY British Telecom 29.90 +0.60 PHS Pacificare Health Sys 54.26 +1.51 PKN Petrokazakhstan 18.62 +1.25 LZB La-Z-Boy Inc 24.12 +0.97 LEND Accredited Home Lenders 20.32 +1.52 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- XMSR XM Satellite Radio 16.10 +1.52 QLTI QLT Inc 17.13 +3.15 NKTR Nektar Therapeutics 13.50 +1.91 REMC Remec Inc 11.78 +1.10 ISPH Inspire Pharmaceuticals 17.75 +1.93 BWC Belden Inc 19.90 +1.04 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- AVE Aventis 52.91 +1.38 MEDI MedImmune Inc 36.53 +1.37 MYL Mylan Labs 38.50 +1.02 NVDA NVIDIA Corp 20.74 +1.20 TIN Temple Inland 51.70 +1.70 RIMM Research In Motion 34.55 +6.31 PRX Pharmaceutical Resources 67.55 +8.40 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- BSX Boston Scientific 57.90 -1.20 MAY May Dept Stores 25.20 -1.14 AZO AutoZone Inc 86.03 -3.76 ITT ITT Industries Inc 62.37 -2.56 GLH Gallaher Group 34.51 -1.24 CPS Choicepoint 34.31 -5.04 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- LOW Lowe's Companies 51.92 -1.78 TYC Tyco Intl 20.20 -0.55 COH Coach Inc 55.93 -1.18 ================================================================= 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. 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