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Daily Newsletter, Tuesday, 10/28/2003

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PremierInvestor.net Newsletter                Tuesday 10-28-2003
                                                   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:      Did You Blink?
Watch List:       S, JCOM, MBI, SBUX and more!
Market Sentiment: Strong Volume for the Bulls

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
      10-28-2003           High     Low     Volume Advance/Decline
DJIA     9748.31 +140.20  9749.94  9609.72 2.07 bln   2182/1026
NASDAQ   1932.26 + 49.40  1932.26  1892.43 2.08 bln   2236/ 964
S&P 100   518.64 +  7.87   518.64   510.77   Totals   4416/1990
S&P 500  1046.79 + 15.66  1046.79  1031.13
W5000   10181.20 +154.00 10181.26 10027.22
RUS 2000  525.85 + 10.50   525.86   515.35
DJ TRANS 2883.27 + 41.90  2885.06  2841.48
VIX        16.82 -  1.23    17.89    16.77
VXO (VIX-O)17.84 -  1.26    19.17    17.71
VXN        25.00 -  1.12    26.22    24.78
Total Volume 4,480M
Total UpVol  3,304M
Total DnVol  1,116M
52wk Highs  670
52wk Lows    30
TRIN       0.76
NAZTRIN    1.03
PUT/CALL   0.75
=================================================================

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


Did You Blink?

If you blinked you missed it. Last Tuesday the VXO closed at
17.82 after hitting 17.50 intraday. The Dow dropped -250 points
to trade under 9500 three days later. If you blinked you missed
it and the Dow closed today within four points of last Tuesday's
close at 9749. Unfortunately the VXO closed at 17.84 again
today. Does that mean we are headed down?

Dow Chart


Nasdaq Chart


S&P Chart


Before we tackle the VXO question again we need to wade through
the economic reports. Chain store sales fell again and by a
larger margin than the prior two weeks. Sales posted a -0.9%
drop and prompted the Bank of Tokyo to lower estimates for
October yet again to +2.5% to +3.0%. They had been as high
as +5% just three weeks ago. The lack of tax checks, tax
holidays and mortgage refinancing is impacting sales. Despite
reportedly strong Halloween sales the retailers are still
seeing overall weakness. October sales are on track to be
less than half the September levels.

The advance Durable Goods report came in less than expected
at +0.8% when estimates were for +1.0%. This was the third
monthly gain in four months but it was also another month in
a down trend from the June highs. The jump in June was +2.5%
followed by +1.6%, -0.1% and September's +0.8%. The gains
were mostly in the private sector with defense orders falling
-26.7%. Inventories fell again for 31 of the last 32 months
and back orders rose for the seventh time in eight months.
There are positive internals and the falling inventory number
will eventually spark a demand rally. They have been saying
that for much of the last 32 months but eventually it has
to come true. The rising back orders indicate that production
is not keeping up with the pace of new orders and that is
a very positive sign.

Also positive was the +4.1 jump in Consumer Confidence to
81.1 after a -4.7 dip last month. The present situation
component rose to 66.8 from 59.7 a much bigger gain than
the + 2 point jump in the expectations component to 90.7.
Those planning to buy an auto jumped to 6.7 from 5.4 last
month. Analysts attribute that to the new model year and
another round of heavy advertising of new incentives. The
recovery in the headline number instead of a continued
downtrend was met with a long sigh of relief and a short
term spike in the markets. The spike did not last and we
retreated to neutral territory to wait for the FOMC
announcement at 2:15.

That FOMC announcement came as expected and only slightly
changed from the prior months statement. They did say that
spending is firming and the labor market appears to be
stabilizing. The bad news was that business pricing power
and increases in core consumer prices remains muted. They
continued the statement about the risks of sustainable
growth remain roughly equal but the unwelcome fall of
inflation was the greatest concern for the near future.
No change there. The comment the bond market was keying
on was the no policy change for a "considerable period."
This is Greenspeak for we are not going to raise rates
for several more months. The bond market soared on the
news and the analyst chatter is predicting no increase
until the end of the first quarter. According to the
Fed Funds Futures they are not expecting a 25-point rate
increase until May-2004. After today's Fed announcement
the fourth quarter is open for clear sailing in the bond
and equity markets according to the analysts. The next
meeting is Dec-9th but the Fed rarely changes policy in
December to prevent a holiday spending backlash. In reality
the Fed may try to keep rates at this level through next
summer to continue to pump the markets and ease the deficit
in front of the election. Nothing like a wave of stock
profits to fill the income tax coffers.

The major stock news today was Sony's announcement they
were going to lay off 20,000 workers or 13% of their work
force. This had been rumored with statements over the
last couple weeks about a 50% excess in capacity in their
factories.

The fire in California is depressing insurance companies
despite claims that they have plenty of reserves to deal
with the expected $1 billion in claims. Allstate is the
largest insurer at risk with 14% of the homeowners
insurance in California. It will be months before the
total of the damage is known.

Helping boost the markets today was new estimates that the
chip sector would grow by +14% in 2003 and +15-20% in 2004.
The SOX rocketed +29 points to 490.40 and a new 52-week
high. This pushed the Nasdaq to a +49 point gain. TSM
delivered the good news that plants were running at almost
full production to keep up with demand. TSM also said they
were going to raise capex spending to between 25% and 30%
of next years revenue. That could be as much as $2.2 billion
up from $1.2 billion in 2003. TSM net income soared +380%
over last years levels. They saw wafer shipments increase
+12% in the 3Q. This is what the market needed. Good news
to back up the Intel profits three weeks ago. The news from
the smaller chip makers has been spotty with guidance
changes both up and down. TSM is the world's largest chip
foundry and that is the one you want to hear brag.

The markets received even more bullish news from Charles
Biderman at TrimTabs.com. He said that fund inflows were
running at a record rate for October and could reach $30
billion. This is just barely behind the record for any
month which stands at $35 billion from Feb-2000. He said
the merger activity was strong and new offerings were
light which increases both sentiment and cash. The thought
of investors pouring billions into the market in hopes of
an October dip was too much for the bears to handle.

The indexes opened up on the semiconductor news and rallied
into the FOMC announcement. For 30 min after the Fed news
the buyers and sellers fought for control across a very
narrow range but once the Dow crossed above 9675 it was
all over for the bears. With the bulls pressing the averages
higher the shorts began to cover and it was a race to the
close. The Dow closed at 9745 and only 100 points from the
Oct-15th high. The Nasdaq closed at 1931 and only 35 points
from its October high of 1966. This is a major event for
the market but it came at a price.

The VXO (old VIX) closed at 17.84 and in danger territory.
The S&P closed at 1046 and only 4 points from very strong
resistance. While neither of these events are earth shaking
they are important. The markets break resistance all
the time and we all know how many levels of significant
resistance the S&P has had to break since October of last
year at 768. While it has broken through countless resistance
levels, some several times, the VXO has only traded in the
17s once before today. This is an indicator of extreme
bullish sentiment. Is that always bad?

Normally it is bad. However, these are not normal conditions
and bullish sentiment can get even higher. In July of 1998,
the last time we had levels this high the VXO traded at 18
or below for two weeks while the market made new highs. The
break finally came when the VXO traded intraday at 16.73.
Prior to the advent of Internet trading in Dec-96 the VXO
spent months at a time below 18. The lack of volatility came
from a Dow that had stocks like Bethlehem Steel and Sears
and all trades have to be screened by a broker over the
phone. There were less than 20 million brokerage accounts
and everyone was an investor not a trader. An investor made
a dozen trades a year maybe and a trader 4-5 a week. This
brings us back to the future. We are not in the pre Internet
days and we have Nasdaq stocks in the Dow and Internet stocks
in the Nasdaq. Volatility is a fact of life that we have to
live with.

That sets up a serious unknown for tomorrow and for the rest
of the week. The futures sold off after the close but after
a +140 point day you would expect that. Looking at the
internals for today and they were extreme. Extremely bullish!
The volume was high with over 2 billion shares traded on
the NYSE and the Nasdaq. Advancers beat decliners by better
than 2:1. Advancing volume across all exchanges was better
than 3.3 billion with declining volume only 1.1 billion.
This 3:1 ratio was strong, not as strong as traders would
really like to see for a confirmation day but this was not
a normal day. There was a FOMC meeting right in the middle.
Traders took half the day off waiting for the announcement
and still traded over 4 billion shares. This was very bullish
in my opinion.

We now have a directional problem. It appears on the surface
and on the internals that we could test resistance at S&P
1050 and Dow 9850 as early as tomorrow. This would drive
the VXO even lower. A break of that resistance could ignite
a new 4Q rally. All thoughts of an October dip and end of
fund year portfolio rebalancing would be forgotten. Actually
I think part of the rally today was investors who had been
expecting a bigger pull back than 9500 now chasing the
indexes. If funds really have $30 billion or more inflows
in October then they are awash with cash. Many had been
hoarding cash to either buy the dip or cover withdrawals
and neither has occurred.

This leaves us with a potentially explosive scenario. We could
see funds/investors throw cash at the market the rest of the
week and continue to chase it higher. I could easily see new
highs in place before Friday. I could also see a VXO induced
sell off but I have far less confidence in it today than I
did last Tuesday when I would have taken all bets. What I
would be worried about is Monday. Next week is the economic
reports from hell week with both ISM reports and the Nonfarm
Payrolls leading the list. It is also the first week in the
new year for mutual funds. There is a train of thought that
they did not sell stocks in October because they wanted to
go out at the top with a full portfolio to show massive
gains on fund statements and be fully invested. Many of
those stocks are very extended and could easily be targets
for dumping once the statement date has passed. This is just
speculation but one scenario that needs to be considered.

If buyers continue to chase prices then the VXO could continue
to plummet. The lower it goes the higher the risk. While there
may not be an event on Wednesday it will only be a matter of
time before we see another bout of profit taking. Hopefully
it will be from much higher levels. I personally think the
economic numbers, while weak, are slowly improving and while
much of it is already priced in there is still room to grow.
Every extended bull market continues to rally over the groans
of the analysts claiming stocks to be over valued. Instead of
climbing the wall of worry about economics and earnings the
wall becomes disbelief that the market is running away from
them. They begin to capitulate and chase prices driving the
markets into one final feeding frenzy. That frenzy normally
culminates in an extremely low VXO and a new high in the
market. In this case that target for me is still Dow 10,000.
I would be very surprised if we made it over on the first
attempt but I would not be surprised to see that attempt
this week. Just keep looking over your shoulder if we move
higher because Friday's goblins may be after more than candy.

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

Sears Roebuck Co. - S - close: 51.71 change: +1.69

WHAT TO WATCH: Positive economic news had the Retail index
charging higher right from the open on Tuesday and S is perfectly
poised for a breakout move tomorrow.  Today's 3% rise pushed the
stock back over the midline of its rising channel, and a trade at
$52 would have the stock hitting its best levels since summer of
2002.  Trigger entries on the breakout move and look for a near-
term rally to the top of the channel at $55, possibly followed by
a rally to challenge the all-time highs near $60.




---

j2 Global Communications - JCOM - close: 29.39 change: -1.82

WHAT TO WATCH: There's something very wrong with JCOM, the way it
continues to fall in contrast to the rising market.  The key is
last week's earnings report.  The earnings were actually alright,
but the company guided below consensus and the stock has been in
free fall ever since.  A break below the $29 support level should
have $25 coming into play shortly thereafter.  Aggressive traders
could even target a continued slide to major support near the
200-dma.




---

M B I A Inc. - MBI - close: 59.55 change: +0.67

WHAT TO WATCH: Getting ready for a breakout!  Shares of MBI have
been consolidating in a tight sideways pattern for the past few
weeks, and today's gain has the stock right on the verge of
breaking out to new all time highs.  The 2002 high of $60.11 is
the only thing standing between the stock and blue-sky territory.
Wait for the breakout and then look for a momentum play, using
$65 as the first upside target.  Position management is easy on
this one, as we can use a tight stop of $57.75, just under the
recent consolidation lows.




---

Starbucks Corp. - SBUX - close: 31.00 change: +0.99

WHAT TO WATCH: Another breakout!  We've had our eye on SBUX for
awhile now, looking for a viable pullback entry.  All the market
was willing to give us was a dip back to just under $30 and
today's breakout looks like a momentum entry.  SBUX won't move
quickly, but it sure has been consistent over the past year.
Look to enter on a pullback near $30 and then hold for a
continuation of the rally up towards $35.





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

IR $60.00 - Another breakout candidate?  You bet!  IR handily
beat earnings estimates last week and is in has been making
steady progress towards major resistance at $60.  The stock
closed right at that level on Tuesday and continuation of this
rally looks great for a momentum entry.  Target a move up to next
resistance at $65, using a stop at $57.50, just under the bottom
of Monday's gap.

HOV $80.90 - The parade continues, with the Housing index
($DJUSHB) continuing to charge to new all-time highs.  HOV
followed suit on Tuesday, cresting the $80 level for the first
time and closing strongly.  This is definitely not for the faint
of heart, already up more than $15 since the first of the month,
but with added risk comes greater potential returns.  Look for
this rally to continue up towards the $90 level, using the recent
lows near $74.75 as a stop.

PKI $18.25 - Apparently investors liked what PKI had to say in their
earnings report last week, as the stock rebounded smartly from its 50-
dma and then broke out with conviction over the past two days.  A
pullback near $17.50 would make for the best entry setup right now,
although momentum entries over $18.40 could work as well.  Target major
resistance at $20.


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


Strong Volume for the Bulls
- J. Brown

It was a nice day for bullish traders with a strong pop at the
open and a trend that crept higher all day before rushing even
stronger into the close.  What caused the rally?  Take your pick.
Another positive durable goods order report continued to show the
manufacturing sector in this country is improving.  The consumer
confidence numbers this morning were positive removing any fears
that investors could have about the consumer starting to pull
back.  This was in spite of lower weekly retail sales numbers,
which did very little to hold back the 2.73% rise in the RLX
retail index.

Speaking of investors, TrimTabs.com, the industry expert on
mutual fund inflows and outflows, noted that Americans have been
pouring money into funds this October and the total could hit $30
billion.  That would be a very bullish month indeed.  Wall Street
also got good news from the chip sector with Taiwan
Semiconductor, the largest chip foundry on the planet, reporting
strong demand and raising their capex spending plans.  Now when
was the last time you heard a tech company raising their capex
numbers?  Exactly, it's been a while.

Of course we did have the FOMC meeting this afternoon, didn't we?
Normally the markets tend to trade sideways ahead of the fed but
today's trend was definitely upward.  As expected the FOMC chose
to leave rates unchanged at 41-year lows of 1 percent.  More
importantly the Fed had positive things to say about the job
market stabilizing and the stream of economic reports pointing to
the recovery.

Up volume whooped up on down volume 3-to-1 on the NYSE and almost
as badly on the NASDAQ.  The advance/decline numbers were very
bullish at 19/9 on the NYSE and 22/8 on the NASDAQ.  Total volume
was very strong with more than 2 billion shares trading on both
exchanges.  You're probably heard it before, but volume is a tool
for the bulls.  Investors and analysts want to see the markets
climb higher on strong volume because it indicates conviction.



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

Market Averages

DJIA ($INDU)

52-week High:  9850
52-week Low :  7197
Current     :  9748

Moving Averages:
(Simple)

 10-dma: 9699
 50-dma: 9541
200-dma: 8812

S&P 500 ($SPX)

52-week High: 1053
52-week Low :  768
Current     : 1046

Moving Averages:
(Simple)

 10-dma: 1039
 50-dma: 1023
200-dma:  945

Nasdaq-100 ($NDX)

52-week High: 1439
52-week Low :  795
Current     : 1420

Moving Averages:
(Simple)

 10-dma: 1400
 50-dma: 1363
200-dma: 1182


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


Uh-oh.  The VXO (old vix) has rolled back over and closed under
the 18 level.  Yet I doubt this is a turning point just yet.
Look for the VXO as well as the VIX and VXN to move lower the
next couple of days as the market averages follow through on
this recent bounce.

CBOE Market Volatility Index (VIX) = 16.82 -1.23
CBOE Mkt Volatility old VIX  (VXO) = 17.84 -1.26
Nasdaq Volatility Index (VXN)      = 25.00 -1.12


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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.75        713,166       532,300
Equity Only    0.66        563,950       374,757
OEX            1.08         21,766        23,399
QQQ            3.24         32,054       103,958


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

Bullish Percent Data

           Current   Change   Status
NYSE          72.9    + 0     Bull Confirmed
NASDAQ-100    75.0    + 0     Bear Correction
Dow Indust.   83.3    + 0     Bull Correction
S&P 500       78.6    + 0     Bull Confirmed
S&P 100       78.0    + 0     Bull Correction


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-dma: 1.13
10-dma: 1.13
21-dma: 1.06
55-dma: 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    1920      2200
Decliners     903       881

New Highs     257       282
New Lows       17         7

Up Volume   1519M     1477M
Down Vol.    480M      571M

Total Vol.  2025M     2069M
M = millions


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

Commitments Of Traders Report: 10/21/03

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

Unfortunately we're still not seeing much change in sentiment
for the Commercials in the big S&P futures.  They remain slightly
net short.  Small traders aren't making many moves either and
they remain net long.


Commercials   Long      Short      Net     % Of OI
09/30/03      395,713   397,577   ( 1,864)   (0.0%)
10/07/03      390,232   402,964   (12,732)   (1.6%)
10/14/03      391,972   410,299   (18,327)   (2.3%)
10/21/03      394,176   411,246   (17,070)   (2.1%)

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
09/30/03      144,681    96,801    47,880    19.8%
10/07/03      138,644    88,018    50,626    22.3%
10/14/03      133,940    86,418    47,522    21.6%
10/21/03      136,643    88,290    48,343    21.5%


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

It's the same story here.  Commercials increased their positions
in both longs and shorts but remains slightly net short.  Small
traders trimmed some short positions and opened 30K more long
contracts just in time for the late week weakness.


Commercials   Long      Short      Net     % Of OI
09/30/03      163,828   218,991    (55,163)  (14.4%)
10/07/03      212,273   225,377    (13,104)  ( 3.0%)
10/14/03      221,897   233,066    (11,169)  ( 2.5%)
10/21/03      226,985   236,906    ( 9,921)  ( 2.2%)

Most bearish reading of the year: (354,835)  - 06/17/03
Most bullish reading of the year:  133,299   - 09/02/03

Small Traders Long      Short      Net     % of OI
09/30/03      131,698    65,259    66,439    33.8%
10/07/03      134,990    63,560    71,430    36.0%
10/14/03      161,208    59,213   101,995    46.3%
10/21/03      168,236    56,564   111,672    49.7%


Most bearish reading of the year: (77,385)  - 09/02/03
Most bullish reading of the year: 449,310   - 06/10/03


NASDAQ-100

Sorry...no big changes for the Commercial traders here either.
They remain net short while the Small Trader remains net long.


Commercials   Long      Short      Net     % of OI
09/30/03       33,571     42,993   ( 9,422) (12.3%)
10/07/03       33,253     40,861   ( 7,608) (10.3%)
10/14/03       34,639     41,880   ( 7,241) ( 9.5%)
10/21/03       36,314     43,305   ( 6,991) ( 8.8%)

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
09/30/03       19,803     9,917     9,886    33.3%
10/07/03       18,182     9,688     8,494    30.5%
10/14/03       16,822     9,046     7,776    30.1%
10/21/03       16,917     9,750     7,167    26.9%

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 one seems willing to make any big bets.  Commercials have
been stuck in the same range for weeks now and remain net long
the DJ futures.  Small traders took some money out of their long
and dumped some of it into shorts but not much.


Commercials   Long      Short      Net     % of OI
09/30/03       16,561     8,932    7,629      31.5%
10/07/03       16,277     9,528    6,749      26.2%
10/14/03       16,595     9,433    7,162      27.5%
10/21/03       16,876     9,037    7,839      30.3%

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
09/30/03        7,578     8,125   (  547)   ( 3.5%)
10/07/03        7,392     7,910   (  518)   ( 3.4%)
10/14/03        6,427     8,495   (2,068)   (13.9%)
10/21/03        5,392     8,842   (3,450)   (23.1%)

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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Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                Tuesday 10-28-2003
                                                   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:     Charging Higher

Stop Loss Adjusments:        BDK, IGT

Tech Stocks (NB)
  Closed Bearish Plays:      UTEK

Active Trader (Non-Tech)
  Closed Bearish Plays:      MHK

High Risk/High Reward
  Closed Bullish Plays:      MPS

Stock Splits/Announcements:  LYTS

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


Black Decker - BDK - close: 47.77  change: +0.87  stop:
45.20*new*

Company Description:
Headquartered in Towson, Md., Black & Decker is a leading global
manufacturer and marketer of power tools and accessories,
hardware and home improvement products, and technology-based
fastening systems.  (Source:  Company Press Release)

Why we like it:
October 22, BDK reported earnings that showed sales and profit
climbing.  The company raised estimates for the fourth quarter.
The stock surged, leaping above $44.00 and closing just under
$46.00.  As it climbed, it created a P&F bullish triangle
breakout.  It also climbed above the neckline of an inverse H&S
that had been building since early 2002.  The H&S formation
appears somewhat malformed, but the breakout on strong volume
confirms the neckline.  Thursday and Friday, price consolidated
just above historical support/resistance, further confirming the
stock's strength.

RSI and stochastics have moved into territory indicating
overbought conditions, but can stay pinned there for some time in
a strongly trending stock.  MACD lines separate and turn up from
above signal, also confirming strength.  The chart suggests two
entries.  After a period of consolidation, BDK might resume its
climb, and new entries could be found on a move above Friday's
high, also an area of light resistance on the weekly chart.  With
such strong gains to consolidate, it's possible that the
consolidation could involve a pullback, perhaps to the $44.75
level.  A pullback and bounce from above $44.50 would offer an
entry, too.  We expect some resistance near $48.00, but will
target $49.50.

Why This is our Play of the Day
Last week's breakout was clearly one with some follow-through, as
shares of BDK have solidified the break above $46 and are
approaching next resistance near $48.  Should BDK break above
that barrier, then it should be an easy run to $50.  Recall we're
looking to exit the play and harvest gains on a move into the
$49.50-50.00 area.  So traders looking to initiate new positions
will need to either enter on a pullback and rebound from above
$46 or enter on a breakout above $48, looking for a quick "hit
and run" type of play.  Since $50 is major resistance on the
weekly chart, we're betting BDK won't be able to break above
there on the first attempt and harvesting gains makes the most
sense.  In light of the proximity of the eventual target, we're
tightening our stop to $45.20, just below last Thursday's
intraday low.

Annotated Chart of BDK:


Picked on October 26th at  $46.16
Change since picked         +1.61
Earnings Date            11/04/03 (confirmed)
Average Daily Volume =   2.45 mln


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


BDK – Adjust from $43.74 up to $45.20

IGT – Adjust from $29.25 up to $29.74


=================================================================
Tech Stocks (NB)
=====================

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

Ultratech Stepper - UTEK - close: 30.90 change: +1.12 stop: 30.75

It didn't matter how good the technical setup looked for a
downside play in shares of UTEK last Friday.  The bulls decided
that $28 was the point to step up and buy the stock aggressively
and that's precisely what they did, pushing the price right back
up to the 50-dma by yesterday's close.  At that point, the play
still looked like it might roll over, but any thoughts of that
happening were dashed with a gap up open this morning and a
subsequent 3.76% gain, which violated our stop.  Obviously, we're
dropping UTEK tonight, as a busted play.

Picked on October 26th at $28.23
Change since picked        +2.67
Earnings Date            1/15/04 (unconfirmed)
Average Daily Volume =     408 K





=================================================================
Active Trader (Non-Tech)
========================

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

Mohawk Industries - MHK - close: 73.89 change: +2.39 stop: 72.50

Apparently breaking critical support and giving a fresh PnF Sell
signal is the new battle cry for the bulls.  That's precisely
what MHK handed to us last week, before turning on a dime and
running sharply higher over the past four sessions.  Today's 3.3%
gain was particularly painful, as MHK ran more than $1 beyond our
stop and looks like it has further upside in store.  Any open
positions should have already been stopped out, but for those
still holding on, we'd suggest using any weakness tomorrow as an
opportunity to trim losses and exit.

Picked on October 22nd at $68.92
Change since picked        +4.97
Earnings Date            1/15/04 (unconfirmed)
Average Daily Volume =     398 K





=================================================================
High Risk/High Reward
=====================

  --------------------
  Closed Bullish Plays
  --------------------

MPS Group INC. - MPS - close: 9.88 change: -0.68 stop: 9.49

Although we printed MPS’s earnings date for all to see, we
neglected to officially close the play Monday night. Tuesday, MPS
reported Q3 earnings that rose 13%, meeting forecasts, but the
company said that Q4 earnings would come in below projections.
Revenue fell.

MPS gapped down, but did not hit our stop until shortly before
the FOMC decision was announced.  After that decision was
announced, MPS bounced with other stocks, moving back above our
stop.  The decline was on strong volume, but that strong volume
included spikes both near the opening declines and then when MPS
climbed into the close.  MPS did manage a close above its 50-dma
and a long-term ascending trendline, but RSI turns down
strongly.  Stochastics produced a bearish kiss, but did not fully
turn down from levels indicating overbought conditions.  MACD
threatens a bearish cross, too, but from above signal.  Those
oscillators create doubt about MPS’s ability to climb back over
$10-10.10 resistance.

Picked on Oct 15 at $10.40
Change since picked: -0.66
Earnings Date:    10/28/03 (confirmed)
Average Daily Volume:  466 thousand





=================================================================
Stock Splits/Announcements
==========================


LYTS sheds light on a 5-for-4 stock split

Before today's opening bell, LSI Industries Inc.'s (NASDAQ:LYTS)
Board of Directors declared a 5-for-4 stock split of its common
shares.

The payable date on the stock split is November 14th, 2003 to
shareholders on record November 7th.  This is LYTS's first stock
split since 2001.

About the company:
LSI Industries, headquartered in Cincinnati, is an integrated
design, manufacturing, and imaging company supplying its own
high-quality lighting fixtures and graphic elements for both
exterior and interior applications primarily in North America.
The Company's major markets are the petroleum / convenience store
market, the multi-site retail market (including restaurants,
automobile dealerships, and national retail accounts), and the
commercial / industrial lighting market. LSI employs
approximately 1,600 people in sixteen facilities located in Ohio,
California, Georgia, New York, Kansas, Kentucky, Oregon, Rhode
Island, South Carolina, Tennessee, Texas and Washington. The
Company's common shares are traded on the Nasdaq National Market
under the symbol LYTS.
(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

GS     Goldman Sachs               92.25     +4.06
STGS   Stage Stores                30.25     +0.66
HOV     Hovnanian Enterprises      80.90     +1.80
BWA     Borg Warner                77.00     +1.24
NXTL    Nextel Communications      23.32     +0.95
USB     US Bancorp                 27.22     +0.54

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

TSM     Taiwan Semiconductor       11.56     +1.12
AMKR    Amkor Technology           19.38     +3.19
ACF     Americredit Corp           13.16     +1.15
CHINA   Chinadotcom Corp           10.38     +1.44
CMOS    Credence Systems           16.30     +1.93
STLD    Steel Dynamics             19.29     +1.45

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

TXN     Texas Instruments          29.35     +1.25
AMAT    Applied Materials          22.55     +1.83
BTI     British American Tobacco   24.89     +2.87
STI     SunTrust Banks             68.90     +1.68
BBBY    Bed Bath & Beyond          42.91     +1.46
TXT     Textron Inc                48.78     +1.02
MCHP    Microchip Technology       31.72     +3.52

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

APD     Air Products & Chemicals   44.50     -1.61
ATH     Anthem Inc                 69.05     -2.00
OHP     Oxford Health Plans        41.63     -4.36
RCII    Rent-A-Center              31.30     -3.07
SAH     Sonic Automotive           22.00     -4.84
GPI     Group 1 Automotive         33.76     -1.34
JCOM    J2 Global Communications   29.35     -1.86

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

KZL     Kerzner Intl Ltd           37.12     -1.67



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