PremierInvestor.net Newsletter Thursday 11-13-2003 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: Easy as Dell, Oops! Watch List: MEDI, TRMS, TXU, ESRX and more! Market Sentiment: Holding Gains ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 11-13-2003 High Low Volume Advance/Decline DJIA 9837.94 - 10.90 9852.90 9792.01 1.63 bln 1725/1388 NASDAQ 1967.35 - 5.80 1970.40 1956.41 1.80 bln 1515/1571 S&P 100 522.99 - 1.20 524.19 520.86 Totals 3240/2959 S&P 500 1058.41 - 0.12 1059.62 1052.96 W5000 10329.90 + 2.90 10341.08 10281.26 RUS 2000 541.20 + 0.54 542.39 537.81 DJ TRANS 2948.45 - 4.80 2954.12 2935.58 VIX 16.45 - 0.30 17.13 16.45 VXO VIX-O 16.84 - 0.15 17.67 16.62 VXN 25.42 - 0.13 26.01 25.24 Total Volume 3,700M Total UpVol 1,701M Total DnVol 1,952M 52wk Highs 649 52wk Lows 20 TRIN 1.26 NAZTRIN 1.27 PUT/CALL 0.76 ================================================================= =========== Market Wrap =========== Easy as Dell, Oops! At 3:20 the markets were rallying in advance of Dell's earnings due out after the close and everyone was setting up their end of day strategy. Suddenly the news was accidentally released and the market went crazy. Stops were run to the upside and the downside as everyone scrambled to enter/exit/protect trades. After about 10 min the news was completely disseminated and the urgency was over. That bout of volatility was the highlight of the day. Dow Chart Nasdaq Chart The morning started with some bullishness after the Jobless Claims posted another week well away from the 400K level. The claims for this week were only 366,000 and the claims from last week were only revised up the normal 5000 to 353,000. It appears the big drop from last week is going to stick and the pace of layoffs is slowing. Continuing claims rose slightly but the trend is still down. This is a major change in the employment picture but we still need to see a consistent drop below 350,000 to indicate a stabilizing labor market. Import prices rose only +0.1% and less than expected. Export prices rose +0.3% due to higher agricultural prices. Beef and grains are soaring on the world market due to Canada's mad cow problem and droughts in crop belts around the world. The International Trade numbers showed a greater than expected deficit of -$41.3 billion. Were it not for a large jump in exports the numbers would have been much worse. We imported $127 billion and exported $86 billion. Each was an increase of about +3.7%. This would indicate the global economy is improving although slowly. A more negative tone was set by the Mortgage Application Survey for last week, which at 626.0 was at a 52-week low. Purchase applications fell -7.1% and refi applications fell -10.1%. This was a substantial drop and shows what we have been afraid of for months. The initial rise in rates caused a flurry of activity in October as those laggards who had been putting off taking the plunge were pushed into action. Now that activity is waning as the rates appear to be ready to start that long climb. Two Fed heads, Moskow and Poole, said today that they do not see any rate hike soon but the perception by the consumer is higher rates ahead. The biggest negative for the morning was an earnings miss by Dow component Wal-Mart. The king of the category killers said increased competition, apparel write downs and too big a focus on sale items cut their margins and lowered profits. Considering the term competition is normally used against WMT with the adjective unfair in front of it the turn about is amazing. Also, WMT said that customers were focusing on the sale items and not the broader range of merchandise. This confirms the adage that you can sell anything if you lower the price enough. Unfortunately you cannot make a fat profit on the transaction. Not only did the normally bulletproof WMT miss earnings but they said consumers were remaining cautious. This was the major hiccup. If WMT consumers, the most price conscious shoppers in the worlds most competitive store, are holding back on purchases because they are cautious then the entire consumer driven recovery is in question. If these consumers are hoarding cash then this is the broadest indicator of sentiment available. WMT also said inventory levels were higher than normal but manageable. This was another negative to analysts. If WMT thinks inventory levels are too high going into the holiday shopping season then the outlook for that season may be too high. WMT lost -2.44 (-4.2%) on the news and wiped out all the economic bullishness before the open. Traders were unable to recover from the initial weakness until late in the afternoon. The Nasdaq failed to capitalize on the AMAT earnings after the close on Wednesday. They beat the street by a penny and said order growth for the 4Q was up +20%. AMAT dropped -70 cents and the SOX lost -5.32. The culprit was the -16% drop in sales, a falling gross margin and insider selling. While AMAT was pounding the drum on the future traders were looking at the past and what could be seen by some as an expensive stock price. In reality it was just a sell the news event once again. The SOX had just hit 531 and very near a new 52-week high and had plenty of expectations already priced in. We also saw on Wednesday that the Gartner Group had predicted +20% chip growth in 2004 and $210 billion in revenue for the chip sector. With this bullish data pushing the chip sector up the negatives in the AMAT report produced some disappointment. This same scenario could be seen today when Dell announced earnings that were inline with estimates. Sales in all sectors were up strongly with their printer business up +80%, servers +30% and so on. The stock fell in after hours after Dell said that although revenue would be up +25% in the 4Q earnings would not rise as much. The CFO continued to say that sales to consumers were good but that business spending had only stabilized. This has been the complaint from every major tech stock that business buying has not increase materially but has only ceased dropping and has stabilized. Nasdaq futures were down -5.50 in after hours after the Dell conference call. Tomorrow we have a Greenspan speech in Washington and all eyes will be glued to his every word. Today we heard from Poole that he saw rates remaining at the current level beyond March. This was an effort to head off the rising bet that the Fed would hike at the March meeting if not before, well before. Moskow also chimed in with a "Fed can remain accommodative" for some time comment. Of course it was quickly pointed out that the Fed could see itself as accommodative even after several rate hikes. The current rate is several points below the historical average. There was no shortage of buyers for the $16 billion in 5-yr notes on Wednesday and the $17 billion in 10-yr notes today. There was also significant buying in bonds and the 10-yr note yield fell -1.41 or -3.19% to 42.71 today. 92% of the S&P companies have announced earnings for the 3Q and the results are very strong with earnings growth at +20.7% from the 3Q-2002. This was the second strongest quarter in recent memory with Q2-2000 the strongest at +21.6% growth. The 4Q earnings are also expected to be strong but Chuck Hill at First Call said the comparisons stop there. The growth for Q1-2004 is up for grabs considering the much stronger 2003 comparisons. The Q3 growth was funded by the tax cuts, mortgage refi boom and the low interest rates. Q1 will see another boost from the tax checks but the other two factors have slipped into the historical mode. The mutual fund scandal saw its first settlement today with Putman settling with the SEC and agreeing to make some major changes in the way it does business and by paying some yet to be determined penalty. MMC, the parent of Putman, saw a sharp spike in price on the news. Unfortunately it was short lived because the biggest threat is the state probes headed by NY AG Spitzer. He is still on the attack and issuing new probes into still more funds and is planning on criminal charges. GE, INTC and MSFT saw further weakness today and it appeared the funds were still liquidating positions. IBM was the only major big cap tech to keep its gains from yesterday when IBM and GE helped push the indexes higher by making bullish comments at the IBM conference. GE traded 25 million shares, which is about 25% more than the average daily volume. The volume in the market was not heavy with only 3.7 billion across all markets. Despite the lighter than average volume and the decline in the averages the internals were still strong. New 52-week highs were 696 compared to 590 on Wednesday when the indexes were strongly bullish. Advancing/declining volume was even. The Dow held on to the majority of its gains from Wednesday and is poised to move higher. It held above support at 9800 and showed very little profit taking. Considering the strong gains on Wednesday this was a win for the bulls. If you took out the WMT loss the Dow would have finished in positive territory around 9850. Tomorrow the bullish trend could easily return. The Nasdaq tried three times to rally back to positive territory and finished only 34 points from N2K. It may have been a negative day for the indexes but it was a positive day for the markets. I told you on Tuesday to watch the internals for the real trend and we saw 5:1 advancing to declining volume on Wednesday. Very strong. Continue to watch the internals to see if any weakness on Friday is just a dip, like today, or the real thing. Friday we have several important economic events. We have the PPI, Retail Sales, Industrial Production and Michigan Sentiment. Considering how positive the economics for the last couple weeks have been the bar may be very high for these reports. The consensus estimates are for little gain in the surveys but the whisper numbers could be much higher. Unless there is a real disaster I predict they will be ignored and the bulls will continue to buy the dips. That is the current trend. Buy the dips not buy the tops. Each time we near the prior highs the bids evaporate and we go back down again. Despite the strong internals the market still feels heavy. This is giving the bears hope and helping to push it higher every time they are forced to cover their shorts. One thing I noticed today was a rotation into drug stocks. This could be a leading indicator of some tech weakness ahead. Drugs have literally been killed over the last year while techs have been climbing. When institutional investors decide techs are overblown they tend to rotate into drug stocks for safety until the techs correct. This was the second day that drugs have rallied and PFE, MRK, LLY, etc all rallied strongly. PFE jumped +1.05 on 2.5 times its normal volume. PFE was helped by some news that Lipitor slowed the buildup of plaque in arteries. This is the kind of news that is typically used as an excuse for the rotation but a quick look at a few drug company charts shows the uptick started several days ago. Watch the drugs for strength, the techs for weakness and the internals for direction. There was also a warning that was picked up by only a few news outlets after the close. According to the reports someone named Al-Hijazi and claiming to be a commander close to Osama is warning that a huge attack against the U.S. is going to kill as many as 100,000 and will be launched during Ramadan. A different report said the attack would be before the Solar eclipse on November 23rd. While I seriously doubt this will come to pass it may create a cloud over any Friday gains. Investors may not want to be long over the weekend. As long as the Dow continues to hover just below 9900 we are always in striking distance of Dow 10,000 and the unofficial target for some profit taking. Nasdaq 2000 is also close and could easily be touched first. One of the reasons we may be having trouble moving higher is the nearness to those levels. If the entire professional trading community is planning on selling there then we could be seeing front running of those levels. The bulls are buying the dips but not the tops and that leaves us stuck in the range until the deadlock is broken. If you need proof that the sentiment is still off the scale bullish you need only look at the VXO which closed at 16.84 and another five year low today. 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 --------------------------------- Medimmune Inc. - MEDI - close: 26.53 change: +1.53 WHAT TO WATCH: It definitely takes an optimist to see a bullish tinge to MEDI's chart, as the stock has been steadily headed south for the past 2 months now. But with price now rebounding from strong support near $25 and on strong volume today, this could be the beginning of a bullish reversal. This one isn't for the timid, but could provide a nice ride up to the vicinity of $31-32 if there's some life to this nascent rebound. --- Trimeris, Inc. - TRMS - close: 23.93 change: -0.99 WHAT TO WATCH: The excitement over new drug candidates seems to have faded of late, as TRMS has broken below one support level after another. Thursday's session was particularly gloomy, with the stock shedding nearly 4% on above average volume and barely clinging to support near $23. The breakdown seems imminent and using a trigger below $23 should yield a solid entry with room to run to the downside. Next solid support appears near $18, near the 1999 lows. --- TXU Corp. - TXU - close: 22.00 change: -0.38 WHAT TO WATCH: Utility stocks have been pulling back a bit over the past couple weeks, so we can cut TXU some slack. But the daily chart looks an awful lot like a pending breakdown. Entries on a break below Thursday's low should have room to fall down to solid support at $20. --- Express Scripts - ESRX - close: 60.70 change: +2.53 WHAT TO WATCH: ESRX has been mired in a persistent downtrend for more than 3 months now, but that pattern broke with emphasis on Thursday. The stock broke above the top of the descending channel, gaining more than 4% enroute to ending the day just above the 200-dma. A continued upswing above Thursday's high looks good for new entries, targeting $65 on the upside. =================== On the RADAR Screen =================== MRX $67.78 - Shares of MRX have really been on a tear since late October and today the stock broke out to new multi-year highs...again. But this isn't the time to look for an entry, as the stock is right up against the top of its rising channel. Look for a pullback to confirm support in the $65 area before considering bullish entry. BRL $79.00 - Can you say breakout? BRL is right on the cusp of delivering another ini what has been a series of breakout moves in recent months. Despite being in the upper half of its rising channel, a breakout over $79.40 will have the stock at new all- time highs and could be used for new momentum entries. More cautious traders will want to watch for a pullback entry near the midline of the rising channel. ICN $22.58 - What goes up, must come down. Shares of ICN surged higher last Thursday on news of the company initiating Phase III trials on its anti-viral compound Viramidine. But the excitement seems to have worn off and the stock fell back inside its gap today. This could make for a quick and aggressive bearish play enroute to filling the gap back near the $19 level. =============================== Market Sentiment =============================== Holding Gains - J. Brown The major averages may have closed in the red today but losses were mild and after yesterday's big rally investors shouldn't complain. Considering that Wal-Mart, the biggest retailer on the planet (and Dow component), missed earnings by a penny bulls should count themselves lucky that the DJIA only dropped 10 points. The market's strength today really was the big story. WMT said that shoppers continued to be cautious which is not what investors or Wall Street wants to hear. For the last few weeks we've heard nothing but how strong this coming holiday shopping season was likely to be. Now WMT is casting a big shadow over those expectations. This morning's economic reports and initial jobless claims were a non-event. Jobless claims came in low as expected and marked another week under the pivotal 400,000 level. Tomorrow could be a big day with the PPI, retail sales (likely to be anti- climatic), industrial production and utilization numbers and the Michigan Sentiment report. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 9903 52-week Low : 7197 Current : 9837 Moving Averages: (Simple) 10-dma: 9816 50-dma: 9634 200-dma: 8899 S&P 500 ($SPX) 52-week High: 1062 52-week Low : 768 Current : 1058 Moving Averages: (Simple) 10-dma: 1053 50-dma: 1034 200-dma: 955 Nasdaq-100 ($NDX) 52-week High: 1453 52-week Low : 795 Current : 1439 Moving Averages: (Simple) 10-dma: 1430 50-dma: 1388 200-dma: 1207 ----------------------------------------------------------------- Wow! We have a new closing low for VXO (old VIX) at 16.84. The VIX hasn't been this low in years. Of course there is nothing to stop it from dropping lower and that may be the case as the markets hover near one-year highs. This remains a growing storm cloud for the bulls. CBOE Market Volatility Index (VIX) = 16.47 -0.28 CBOE Mkt Volatility old VIX (VXO) = 16.84 -0.15 Nasdaq Volatility Index (VXN) = 25.45 -0.10 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.78 721,852 560,283 Equity Only 0.63 609,893 383,694 OEX 0.73 25,410 18,445 QQQ 1.34 28,087 37,747 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 73.4 + 0 Bull Confirmed NASDAQ-100 71.0 + 0 Bear Confirmed Dow Indust. 83.3 + 0 Bull Correction S&P 500 80.8 + 0 Bull Confirmed S&P 100 81.0 + 1 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: 1.07 10-dma: 1.09 21-dma: 1.10 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 1590 1516 Decliners 1227 1539 New Highs 278 268 New Lows 14 15 Up Volume 827M 850M Down Vol. 813M 976M Total Vol. 1662M 1840M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 11/04/03 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 10/14/03 391,972 410,299 (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%) 11/04/03 391,079 415,136 (24,057) (3.0%) 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 10/14/03 133,940 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% 11/04/03 137,829 78,206 59,623 27.6% 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 10/14/03 221,897 233,066 (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%) 11/04/03 242,409 270,785 (28,376) ( 5.5%) 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 10/14/03 161,208 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% 11/04/03 135,525 63,006 72,519 36.5% 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 10/14/03 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%) 11/04/03 34,159 48,293 (14,134) (17.1%) 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 10/14/03 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% 11/04/03 24,132 9,703 14,429 42.6% 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 10/14/03 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% 11/04/03 21,756 11,903 9,853 29.3% 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 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%) 11/04/03 5,099 9,160 (4,061) (28.5%) 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 Thursday 11-13-2003 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: Breakout Squared Tech Stock Closed Plays: FLML Stop Loss Adjustments: -none- Stock Split Announcements: CLBK 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 ) =============== Steel Dynamics - STLD - close: 20.10 change: +0.32 stop: 17.99 Company Description: Steel Dynamics, Inc. [provides] a broad range of flat-rolled products to the market, including light gauge micro-alloyed and high strength steels for demanding automotive applications. (Source: Company Press Release.) Why we like it: Late last week, the World Steel Dynamics said it expected a world- wide shortage of steel in Q1 of the next year. Across the globe, shares of steel manufacturers have risen. U.S. steel manufacturers have been in the news, too, as countries demanded that Bush remove the steel tariffs he enacted to protect U.S. steel manufacturers. Wednesday, STLD broke above weekly resistance that had held since mid-1999, and it did so on volume that was more than double average daily volume. As if that weren't enough to pique our interest, we notice that STLD produced a double-top breakout signal back in March with an upside target of $57.00. While we have no intentions of hanging around through the twists and turns that might eventually bring STLD up to $57.00, we wouldn't mind hanging on for an upside target of $25.00. Because STLD has not yet had a reversal from the X column that formed that P&F target, the target might go higher. It's also possible that STLD will pull back at some point into that first three-box reversal, so we're placing this entry in the high-risk, high-reward category. MACD bearish divergences have abounded in stocks and indices as they've added to recent gains, but not in STLD. MACD has followed prices higher, not signaling divergence. RSI and 5(3)3 stochastics already trend at levels indicating overbought conditions, as would be expected in a strongly trending stock. We have a quandary about the entry for this stock. While $20.00 is clearly important round-number resistance, Wednesday's strong volume confirms the importance of the breakout over that long-term weekly resistance. While we're reluctant to enter just ahead of $20.00, we think pullbacks and bounces from above $19.00 would make ideal entries. Such entries might not be offered, however, and in that case, strong-volume moves above $20.00 would make appropriate momentum entries. We're setting a stop at $17.99, just below the rising 21-dma. Why This is our Play of the Day There certainly isn't anything to dislike in our new play on STLD, with the stock blasting to a new 4-year high on Wednesday and following that up today with another 1.6% gain and its first close over $20 since April of 1999. Based on the strong volume that is accompanying this rally out of the bull flag formation, we're looking for higher levels ahead. Next upside resistance comes in at $22, but it doesn't really start to solidify until the $23-24 area. This breakout over $20 certainly looks like a nice momentum move and we're in favor of new entries on further strength. Of course, more conservative traders may still want to hold out for a near-term pullback - perhaps to the $19.25-19.50 area, confirming old resistance as new-found support. In either event, we're maintaining our stop just below $18, with support likely to be strong at the combination of the recent consolidation lows near $18.40 and the 20-dma ($18.26). Annotated Chart of STLD: Picked on November 12th at $19.78 Change since picked: +0.32 Earnings Date: 1/21/03 (unconfirmed) Average Daily Volume: 319 K ================================================================= Tech Stocks ================================================================= Closed Short Play ----------------- Flamel Tech. S.A. - FLML - cls: 27.85 chng: +3.12 stp: 26.25 With Tuesday's close just above $23, it seemed FLML was going to achieve our downside target without much of a struggle. But something in the wind changed yesterday, with the stock rebounding sharply to close just below $25 resistance. We expressed caution in last night's update, but there wasn't yet enough strength to believe this rebound would be anything other than another entry point. Any bearish rollover hopes were dashed at the open though, with the stock blasting through our $26.25 stop on the opening bar and then continuing higher right into the closing bell for a total gain of more than 12.5%. Clearly, our concerns of a potential reversal were fulfilled today and FLML must be dropped as a losing play. Picked on November 2nd at $25.25 Change since picked +2.60 Earnings Date 1/29/04 (unconfirmed) Average Daily Volume = 1.61 mln ================================================================= Stop Loss Adjustments ================================================================= No Stop Adjustments ================================================================= Stock Split Announcements ================================================================= Announcements ------------- CLBK declares 5-for-4 stock split and a quarterly dividend During today's trading session, Commercial Bankshares, Inc. (NASDAQ:CLBK) announced that its Board of Directors has approved a 5-for-4 stock split of its common shares. The payable date for the stock split is set for January 2nd, 2004 to shareholders on record December 11th, 2003. This is CLBK's first stock split since the fourth quarter of 2002. In addition to the stock split, CLBK has announced a regular cash dividend of $0.16 per common share and a special cash dividend in the amount of $0.05 per common share. The dividends will be payable on January 2nd, 2004 to shareholder on record December 12th, 2003. The cash dividends will be paid on the newly issued shares of CLBK (a.k.a. dividends will be paid on a post-split basis). About the company: Commercial Bankshares, Inc. is the parent company of Commercial Bank of Florida, a $780 million, state chartered, FDIC insured commercial bank and a member of the Federal Reserve. The Bank operates 14 branches in Miami-Dade and Broward Counties, Florida. The Company's stock is traded on Nasdaq under the symbol CLBK. (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 TOT Total Sa (ADS) 79.10 +0.61 GSK GlaxoSmithKline (ADR) 46.76 +1.58 CVX ChevronTexaco 75.75 +1.04 NOC Northrop Gruman 91.41 +1.23 BR Burlington Resources 49.50 +0.94 ASD American Standard Cos 96.81 +0.58 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- AEOS American Eagle Outftrs 18.34 +1.02 ARM Arvinmeritor 18.76 +1.27 QADI Qad Inc 13.70 +1.17 AUDC Audiocodes Ltd 10.59 +1.31 CACS Carrier Access Corp 13.01 +1.23 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- PFE Pfizer Inc 33.45 +1.05 MRK Merck & Co 45.80 +1.55 LLY Eli Lilly & Co 69.05 +2.86 BDX Becton Dickinson & Co 37.85 +1.39 WFMI Whole Foods Market Inc 64.68 +5.95 PNW Pinnacle West Capital 37.99 +1.11 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- WMT Wal-Mart 55.52 -2.44 TIF Tiffany & Co 44.70 -3.43 FDO Family Dollar Stores 40.24 -1.58 ICN ICN Pharmaceuticals 22.58 -1.44 ESPD eSpeed Inc 23.30 -3.10 BEBE Bebe Stores 25.26 -2.17 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- GP Georgia-Pacific Corp 25.81 -1.19 NTLI NTL Inc 55.15 -2.12 MICC Millicom Intl Cellular 61.20 -3.75 ================================================================= 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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