PremierInvestor.net Newsletter Thursday 11-06-2003 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: New Highs Before New Jobs Watch List: JCOM, CCU, AMZN, CSCO and more! Market Sentiment: The Markets Wait ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 11-06-2003 High Low Volume Advance/Decline DJIA 9856.97 + 36.10 9870.60 9773.12 1.77 bln 1848/1341 NASDAQ 1976.37 + 17.00 1977.91 1953.34 2.14 bln 1782/1325 S&P 100 523.84 + 3.59 524.27 518.14 Totals 3630/2666 S&P 500 1058.05 + 6.24 1058.94 1046.93 W5000 10324.30 + 61.20 10330.54 10220.74 RUS 2000 542.94 + 4.03 542.95 537.08 DJ TRANS 2985.49 + 52.80 2985.49 2924.50 VIX 16.74 - 0.12 17.37 16.62 VXO VIX-O 17.58 + 0.02 18.60 17.58 VXN 25.35 + 0.15 26.14 25.27 Total Volume 4,279M Total UpVol 2,910M Total DnVol 1,322M 52wk Highs 854 52wk Lows 23 TRIN 0.77 NAZTRIN 0.63 PUT/CALL 0.77 ================================================================= =========== Market Wrap =========== New Highs Before New Jobs Bullishness breaking out all over on positive economic news and hopes for good news tomorrow. The Nasdaq led the day on the strength of Cisco earnings and it rescued the Dow from a sure sell off. Traders bought the rumor of a good Jobs report tomorrow morning and the indexes closed near the highs of the day. Dow Chart Nasdaq Chart Starting the day off was the Chain Store Sales for October at +3.2% and nearly half the +5.9% rate for September. The same store sales rates across various retailers painted a picture of weather related slowness with warmer weather delaying the purchase of winter clothes. Halloween goods were reportedly strong but seasonal apparel was weak. The Bank of Tokyo is currently projecting a rebound to +5% growth in November and +4% in December as the economy continues to recover and comparisons with a weak 2002 become easier. The biggest surprise for the day was the huge drop in the Jobless Claims. The claims for last week dropped -43,000 from the prior week which was revised up to 391K just as we expected. The very unexpected drop was well below the consensus estimates of 376,000. This dropped the four-week moving average to 380,000 and its lowest level since Jan 2001. Any level under 400,000 signifies a stabilizing labor market and a number under 350,000 indicates a recovering labor market. Continuing claims have also fallen below 3.6 million for the last three weeks. This huge drop in claims is similar to the drop in 1992 when the economy was recovering from that recession and the Iraq war. Hopefully this is the start of a new trend. You know I cannot let this extreme deviation from the norm pass without expressing doubts about the numbers. Of the 52 states/territories that report claims ONLY SEVEN actually reported a drop in claims. 45 reported a rise in claims. Initially I immediately thought California must have had an impact on the drop due to the fires but they actually reported an increase of +13,539 for the week. I cannot find anything that would explain the drop given the state ratios but I would still be skeptical until next weeks revision. The market was also skeptical. There was a very small spike on the announcement which immediately sold off and no gains for the entire morning. Other bullish data that was also ignored was the Productivity for Q3 which increased at a whopping +8.1%. This was the biggest jump since Q1-2001. Helping fuel this gain was an increase in the hours worked. This increase in productivity was also due to the continued trimming of the work force. Fewer workers, longer hours, restructured manufacturing plants and more orders produced more output. The constant pressure to raise earnings in a down economy has forced employers to do more with less. The faster the order demand increases the more productivity will jump as the basic lines are in place and capacity utilization is still only in the 75% range. Last night Cisco beat estimates and soared in after hours trading. Overnight the futures sold off substantially from those highs after the Nikkei dropped -285 points despite the reasonably good tech news. After the very good Jobless Claims and high Productivity numbers this morning there was no bounce at the open and the Dow sank to support at 9780 right out of the gate. Traders were in shock again. Just like the very bad Layoff report earlier in the week they just did not know what to do with the numbers. If they were ready to sell good news it was more good news than they were ready to accept. The Dow hugged support at 9780 until just after noon and actually absorbed a very large amount of selling in that range. The volume was very strong until about 11:30 as the battle for control was fought and then it just suddenly stopped. The markets remained soft but slowly saw a pickup in the buying as the afternoon progressed as bulls bought the jobs rumor and shorts covered just in case the rumor was true. The rumor is of course the Nonfarm Payrolls on Friday. The consensus estimates run from +50,000 to +63,000 jobs. The whisper numbers run from +125,000 to a whopping +200,000 jobs. Helping to fuel this rumor were comments from both Greenspan and Bernanke on jobs growth. Sound familiar? Remember last month when five Fed heads hit the airwaves the day before the Payroll report with strong comments on the jobless recovery? The various comments led investors to believe that the jobs number was going to be a disaster and everyone was shorting heavily ahead of the number. The actual number was for a gain of +57,000 jobs and the market exploded on short covering after the news. Of course the Fed heads already knew the number when they went on their speaking binge. It was a perfect setup and the markets fell for it completely. Using the same thought process we discussed on the monitor today what we should expect after the Greenspan/Bernanke two step on jobs. Adding in the -43,000 drop in jobless claims and traders were thinking moon shot. First, the Jobless Claims were for last week and are only an advance number and will not be a factor in the payroll number. The payroll number is based on a survey done around the third week of the month. The jobless claims were in the 391,000 range for that week. This produces a potential for a disappointment on Friday. The +57,000 gain last month was the first gain in seven months and well over the consensus estimate of -25,000. Now, since the dynamic duo knew the outcome before they started speaking today were they trying to give investors hope because the number is going to disappoint or were they just trying to jump on the popularity wagon to push a positive release to even better heights? We will not know until tomorrow but the markets are setup for a potential disappointment if the consensus numbers are not beaten. Still what will a disappointment mean to the markets. With the rally on the bad layoff news this week it appears the markets are bad news driven more than good. We sold off on the good Jobless and Productivity and rallied on the layoffs. Everyone believes there is a recovery in progress and every piece of bad news we get now will just keep the Fed on the sidelines longer. It is a bad news/good news joke in progress. Despite the positive reports this morning the Fed Funds futures are still not predicting any change until May. This and the "considerable period" comments from the Fed have taken the risk out of the bond market for the near term and should continue to fuel the recovery. The first quarter will see another round of tax checks to help the consumer sector and that should be the final shot that the Fed will ignore before the rate hike cycle begins. If they could I am sure they would like to wait until Q3-2004 and give the home builder sector one more massive injection of liquidity before the lid slams shut. The Fed Funds rate is not the real controlling factor for consumer interest but the bond market controls that sector. The bond rates are already rising and that will put pressure on the recovery but they cannot get too far ahead with the Fed funds at one percent. A bigger challenge to the market this month is the mutual fund trading scandal. Every day the number of funds under investigation grows and now the investigation is moving into the brokers who recommended those funds. The NASD said today they had found problems with a dozen major brokers and were expanding their probe. The evidence of the impact of the scandal came in the cash flow numbers today. Remember two weeks ago when TrimTabs was saying that October could go down as a record month for inflows with an estimated $30 billion? Surprise, October flows slowed dramatically with the advent of the probes and the current tally shows October ending with only $17 billion in inflows. That $13 billion drop from the estimates could easily have been a result of offsetting outflows or simply a hesitance to put more money into funds that may be guilty. Two weeks ago funds saw $4 billion in inflows, last week only $1.2 billion. If the spigot is tightening until the scandal is over then we could be in for a long dry spell. There are rumors of an impending settlement with funds but we are far too early in the process to know how each fund may be impacted by the settlement. It could literally be in the billions and it could cause some funds significant cash flow problems. I think this may be the sleeping giant that could awaken to bite us. We got some more good news today from the Semiconductor Industry Association. They upgraded their estimates for revenue growth for 2003 to +15.8% and to +19.4% for 2004. To put this into perspective the 2002 growth was only +1.3%. This is good news for tech stocks and chips in general as it means the top line is increasing. This helped push the Nasdaq to close at 1976 and only a stones throw from 2000. This was another new 52-week high for the index. The semiconductor index hit a new high of 525 on the news. The stage is set for Friday. Dow 10,000 and Nasdaq 2,000 are just one strong move above us. A blowout Jobs number could cause massive short covering and bullish buying and we could easily hit those numbers at the open. EXCEPT that this would be too easy. There was some short covering into the close but it was limited. Very few people appear to be either short or concerned about being short. The Jobless Claims this morning should have sent the indexes to news highs at the open and it fizzled well before the open. Blowout good news could actually have a reverse impact on the markets. If jobs suddenly rocketed to +200K as some whisper numbers expect then bonds would get killed as well as stocks based on an acceleration of the rate hike time table. You saw it this morning. Great news and no positive market reaction. That leaves us with a quandary. If the number is good and the market sells off do we buy the dip? Worked every week since March. If the number is bad do we buy the dip? I believe that whatever happens the indexes are still shooting for the 10000/2000 mark and traders will find some way to justify buying stocks this close to the psychological target. This could actually be investor suicide but bulls are not interested in that concept. The general consensus among traders (not investors) is the plan to short 10K/2K with both hands. Regardless of what scenario pushes it to that level the plan is no secret. Now, we all know what happens when the entire trading community agrees on a single plan? Disaster. It could be a monster bear trap. The Fed has already shown that is has no fear of doing whatever is required to juice the markets. If ever there was an opportunity to catch traders off guard this could be it. They could be feeding the market just enough to keep the bullishness going until we get to that level. Once all the bears load up on shorts the Fed could trigger a massive support program and we blow out the top to new highs well over 10K. I know there are a lot of readers that think this is heresy. However one of the Fed mandates is to power the economy and one way to do that is the juice the markets. Governments buying securities happens all the time and it would be no stretch of the imagination to have Greenspan strike a deal with an Asian country that is hoarding dollars. They could easily put those dollars to work in our markets when signaled and actually make a profit on the deal. The Fed intervenes in markets for them on request so turnabout is fair play. Obviously this is just speculation but there have been so many unexplained buy programs at key turning points in the past that it would be easier to believe this scenario than one where millions of investors suddenly decided to invest their life savings in the market at the same exact moment. Don't fight the Fed. That axiom did not just appear over night. It has been around far longer than most of us have been trading. The bottom line tonight is uncertainty. Nobody knows what will happen at the open but I would expect the better odds are for a sell the news event than an explosion on good news. Either way if we do not have a big market move by noon trading will probably go dormant and attention will shift to the Richmond and Kansas City Fed reports on Monday. We are at the highs and earnings are over. The VXO is still around 17.50. Funds are in trouble and traders could be disappointed by the Jobs report. Tomorrow may be a tossup but next week could be a challenge. 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 --------------------------------- j2 Global Communications - JCOM - close: 28.50 change: -1.35 WHAT TO WATCH: We recently had JCOM listed as a bearish play and regretfully we had our stop set just a bit too tight and got taken out on an intraday spike. But the stock is once again rolling over and looks like a solid breakdown candidate below $28.25. Look for an initial drop to $25, with the potential for continuation down to strong support near $22.50. --- Clear Channel Communications - CCU - close: 42.17 change: +1.30 WHAT TO WATCH: It has been a bit of a volatile ride for investors in CCU over the past several weeks, with the stock ping-ponging between $38-42. But things changed in favor of the bulls on Thursday, with the stock breaking and closing above $42. This looks like a legitimate breakout. Entries near current levels look viable ahead of an expected rally up towards the September highs near $46. --- Amazon.com, Inc. - AMZN - close: 54.99 change: -1.75 WHAT TO WATCH: It seemed the Internets would never fall out of favor, but that certainly appears to be what is happening right now. AMZN is leading the weakness and with today's break back inside its ascending channel, the stock has risk down to the $50 area, with potential down to strong support at $47. Use a trigger below $54 and a stop of $57. --- Cisco Systems - CSCO - close: 22.90 change: +1.10 WHAT TO WATCH: It may be a bit soon to play it after the company announced earnings yesterday, but investors seemed to like the news, launching the stock through major resistance for a 5% gain on more than 115 million shares today. A pullback to confirm new support in the $22.00-22.50 area will likely make the best entry into the play, with $25 being a viable upside target. =================== On the RADAR Screen =================== MMM $79.60 - This is definitely not for the faint of heart, as MMM has risen enough since July to give a bull vertigo when looking at the weekly chart. But the price action near $80 resistance looks interesting and a breakout above that level appears to have room to run. DNA $84.45 - Shares of DNA got hit by a serious bout of profit taking over the past several weeks, but things are changing this week, with a rebound from support near $80 helping to create a breakout over recent congestion. Look for a return to the recent highs near $88 and a potential breakout, with $95 being a longer- term target. PGR $76.01 - The Insurance stock for momentum bulls, PGR looks like it is about to embark on another breakout move. Nearly 5 months after first reaching the $76 level, the stock has once again achieved that goal, this time with a very bullish looking ascending channel chart pattern. Use a trigger over $76.25 and look for an initial move to $80, with potential for higher levels based on the way the stock tends to trade. =============================== Market Sentiment =============================== The Markets Wait - J. Brown The sentiment will be brief tonight because investors are all waiting on one thing - the Jobs report tomorrow. Or more specifically the non-farm payrolls report. The general estimate is for an increase of 67,000 jobs but several big analyst firms have estimates in the 120,000 to 125,000 range. There is even a whisper number closer to 200,000. Should the report disappoint it could be very painful for the bulls. Jim does an excellent job discussing the jobs report in his wrap tonight. The CSCO report last night had set up tech traders with expectations for a rally today so the early morning weakness came as a surprise. Yet by the close most stocks were higher with the heaviest buying in technology (software, semiconductors, biotech) and the heaviest selling in gold. The market internals were pretty bullish and are much more revealing than the closing numbers on the DJIA or the COMPX. Advancing issues outpaced decliners 17 to 11 on the NYSE and 17 to 12 on the NASDAQ. Up volume was about double down volume on the NYSE and the NASDAQ. Total volume was decent. Trade carefully. There are a lot of traders just waiting for the indices to hit the psychological markers at 10,000 and 2,000 on the Dow and NASDAQ. Whether that proves to be a top or the beginning to our next surge higher is up for grabs but I'd be extra cautious about betting on the bulls. They're looking mighty tired. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 9896 52-week Low : 7197 Current : 9856 Moving Averages: (Simple) 10-dma: 9767 50-dma: 9604 200-dma: 8855 S&P 500 ($SPX) 52-week High: 1061 52-week Low : 768 Current : 1058 Moving Averages: (Simple) 10-dma: 1047 50-dma: 1030 200-dma: 950 Nasdaq-100 ($NDX) 52-week High: 1445 52-week Low : 795 Current : 1440 Moving Averages: (Simple) 10-dma: 1416 50-dma: 1380 200-dma: 1196 ----------------------------------------------------------------- There is little change here. The fear indices were little changed as the broader markets crawled higher. CBOE Market Volatility Index (VIX) = 16.74 -0.12 CBOE Mkt Volatility old VIX (VXO) = 17.58 +0.02 Nasdaq Volatility Index (VXN) = 25.35 +0.15 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.77 669,108 512,323 Equity Only 0.61 548,140 336,513 OEX 1.03 15,694 16,108 QQQ 0.73 22,150 16,076 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 73.7 + 0 Bull Confirmed NASDAQ-100 74.0 - 2 Bear Correction Dow Indust. 80.0 + 0 Bull Correction S&P 500 80.6 + 1 Bull Confirmed S&P 100 79.0 + 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: 1.08 10-dma: 1.06 21-dma: 1.06 55-dma: 1.10 Extreme readings above 1.5 are bullish, and readings below .85 are bearish. These signals don't occur often and tend be early, but when they do, they can signal significant market turning points. ----------------------------------------------------------------- Market Internals -NYSE- -NASDAQ- Advancers 1704 1782 Decliners 1101 1261 New Highs 291 296 New Lows 14 12 Up Volume 1115M 1426M Down Vol. 591M 646M Total Vol. 1725M 2086M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 10/28/03 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 It's been a long week since last we looked at the COT data and we're still not seeing any big moves by the Commercial traders. The same holds true for small traders but they did reduce some of their short positions. Commercials Long Short Net % Of OI 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%) 10/28/03 391,596 412,498 (20,902) (2.6%) 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 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% 10/28/03 137,791 76,791 61,000 28.4% Most bearish reading of the year: (1,657)- 5/27/03 Most bullish reading of the year: 114,510 - 3/26/02 E-MINI S&P 500 Hmm... we are seeing some movement in the e-minis. Commercials have upped their short positions by 24K contracts. Small Traders may have gotten the hint too. Short interest is up but the real change is the 45K drop in long contracts. Commercials Long Short Net % Of OI 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%) 10/28/03 220,171 260,644 (40,473) ( 8.4%) 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 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% 10/28/03 123,569 59,742 63,827 34.8% Most bearish reading of the year: (77,385) - 09/02/03 Most bullish reading of the year: 449,310 - 06/10/03 NASDAQ-100 This time it's the Small Traders making a move in the NDX futures. Long contracts are up nearly a third to more than 21K. Commercials are still comatose but the trend is growing slowly more bearish with a small bump in short positions. Commercials Long Short Net % of OI 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%) 10/28/03 36,168 46,272 (10,104) (12.3%) 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 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% 10/28/03 21,640 8,830 12,810 42.0% 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 There is very little change here for the Small Trader but Commercial Traders have upped both their longs and their shorts. Commercials Long Short Net % of OI 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% 10/28/03 20,504 11,366 9,138 28.7% 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 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%) 10/28/03 5,295 8,864 (3,569) (25.2%) 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. 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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PremierInvestor.net Newsletter Thursday 11-06-2003 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: Into The Gap Stop Loss Adjustments: FLML, T, IR Stock Split Announcements: CRRC 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 ( bearish ) =============== Flamel Tech. S.A. - FLML - cls: 24.30 chng: -0.56 stop: 27.50*new* Company Description: Flamel Technologies S.A. is a biopharmaceutical company principally engaged in the development of two polymer-based delivery technologies for medical applications. The company's Micropump technology is a multi-particulate technology for oral administration of small molecule drugs with applications in controlled release, tastemasking and bioavailability enhancement. FLML has three major products based on its Micropump technology: Asacard, a controlled-release formulation of aspirin for the treatment of cardiovascular disease; Metformin XL, a controlled- release form of Metformin that is in development for use for the treatment of Type II diabetes, and Genvir, a controlled-release acyclovir for the treatment of genital herpes. In addition, Flamel has developed new herbicide delivery systems and has patented a biomaterial, ColCys. Why we like it: While it isn't setting any speed records, FLML is performing nicely so far, having crept its way below the $25 support level on Wednesday, although just barely. Ever since this downtrend began, the 10-dma ($26.86) has been providing intraday resistance and it did just that again on Tuesday as FLML rolled over again. The price is now technically into the gap from late August. That's the first step along the path to reaching our $20 target and traders that took an entry on the failed rebound at the 10-dma yesterday look to be in good shape. Additional failed bounces near that moving average can still be used for entry, while momentum traders can now look for entry on a break below today's intraday low ($24.20). There may be some mild support found in the $22.25-22.50 area on the way down, so conservative traders can look to harvest some gains near that level, once reached. Lower stops to $28, which is just above the intraday highs on Tuesday. Why This is our Play of the Day Making steady progress since breaking into the late-August gap, FLML has just been inching its way lower in very methodical fashion. That last failed bounce earlier this week rolled over right at the 10-dma (now at $26.43) and we should see that behavior repeated between now and the time the stock fills in its gap down to the $21.30 level. Of course, we're still targeting a drop to $20 due to the fact that it looks like a more substantial support level than the bottom of the gap. Failed bounces below the 10-dma look like the best entry strategy for now, although with the way FLML continues to deteriorate, entering on a break below today's intraday low ($23.97) should work as well. Lower stops to $27.55 tonight, which is just above the top ($27.50) of the failed rebound from earlier in the week. Annotated Chart of FLML: Picked on November 2nd at $25.25 Change since picked -0.95 Earnings Date 1/29/04 (unconfirmed) Average Daily Volume = 1.58 mln ================================================================= Stop Loss Adjustments ================================================================= FLML - short Adjust from $28.00 down to $27.50 T - short Adjust from $20.49 down to $20.05 IR - long Adjust from $57.50 up to $58.30 ================================================================= Stock Split Announcements ================================================================= CRRC publishes a 3-for-2 stock split and quarterly cash dividend Mid session today, Courier Corporation (NASDAQ:CRRC) announced that its Board of Directors has approved a 3-for-2 stock split of its common shares and a quarterly cash dividend. The payable date for the stock split is set for December 5th, 2003 to shareholders on record November 17th. Along with the stock split CRRC announced a quarterly cash dividend of 13.125 cents per share of common stock. This is 17% higher than their previous quarter cash dividend of 11.25 cents per pre-split share of common stock. The payable date for the new quarterly cash dividend is set for December 5th, 2003 to shareholders on record November 17th. This is CRRC's first stock split since the middle of 2001. About the company: Courier Corporation publishes, prints and sells books. Headquartered in North Chelmsford, MA, Courier has two lines of business: full-service book manufacturing and specialty publishing. For more information, visit www.courier.com. (Source: Company Press Release) ================== Trading Ideas ================== This section contains stocks that meet criteria which may make them of interest to long and short side traders. These are not recommendations, nor have they been reviewed by PremierInvestor editors for investment potential. However, each of them has technical and fundamental characteristics that make them worthy of further review by traders and investors looking for fresh ideas. New stocks will appear daily following the market close. Value Plays With Bullish Signals --------------------------------- Ticker Company Name Close Change UTX United Technologies 87.33 +0.93 GCI Gannett Co 85.57 +0.86 BNK Banknorth Group 32.65 +0.60 ROST Ross Stores 53.75 +1.63 WL Wilmington Trust 34.68 +0.64 BJ BJ's Wholesale 26.56 +0.56 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- ARXX Aeroflex Inc 11.63 +1.25 TOO Too Inc 18.28 +1.38 TTEC Teletech Holdings 8.01 +1.32 SMTL Semitool Inc 11.30 +1.45 SIPX Sipex Corp 10.76 +1.08 ACET Aceto Corp 17.89 +1.72 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- CSCO Cisco Systems 22.90 +1.10 BUD Anheuser-Busch 50.49 +1.27 UNP Union Pacific 64.93 +1.62 HIG Hartford Financial Srv 57.45 +2.44 GPS Gap Inc 20.28 +1.57 TJX TJX Companies 22.20 +1.55 FD Federated Dept 48.26 +1.21 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- IACI Interactive Corp 32.66 -1.53 KSS Kohl's Corp 52.30 -1.90 TLB Talbots Inc 29.64 -3.36 MWRK Mothers Work 24.37 -3.86 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- RIO Vale Do Rio Doce 44.00 -1.20 DLTR Dollar Tree Stores 36.86 -1.53 NFLX Netflix Inc 50.83 -7.89 RX IMS Health 22.55 -0.32 ================================================================= 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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