PremierInvestor.net Newsletter Thursday 12-18-2003 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: Option Blowout! Watch List: AIG, IGT, EBAY, FDX and more! Market Sentiment: The Return of the NASDAQ ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 12-18-2003 High Low Volume Advance/Decline DJIA 10248.08 +102.90 10254.08 10137.34 1.92 bln 2388/ 838 NASDAQ 1956.18 + 34.90 1957.68 1924.62 1.71 bln 2185/1075 S&P 100 540.49 + 5.29 540.66 535.20 Totals 4573/1913 S&P 500 1089.18 + 12.70 1089.50 1076.48 W5000 10582.82 +127.40 10585.96 10455.22 RUS 2000 546.90 + 8.18 547.62 538.07 DJ TRANS 2987.16 + 20.90 2987.48 2953.76 VIX 16.16 + 0.58 16.19 14.66 VXO (VIX-O)16.25 + 0.90 16.30 14.54 VXN 24.53 - 0.59 25.36 24.07 Total Volume 3,949M Total UpVol 3,296M Total DnVol 592M 52wk Highs 664 52wk Lows 35 TRIN 0.55 NAZTRIN 0.42 PUT/CALL 0.65 ================================================================= =========== Market Wrap =========== Option Blowout! Maximum pain was inflicted to call option writers this month and the result was broken resistance and new 52-week highs. The quadruple witch week caught traders off guard with prices well above those where they wrote the options and the short covering began in earnest at the open. Once it was obvious the market was not going to dip and give them a cheaper exit the short covering began. It was still continuing at the close despite strong resistance finally slowing the advance. Dow Chart - 120 min Dow Chart - Weekly Nasdaq Chart - 120 min Nasdaq Chart - Weekly Helping to stimulate the shorts to cover were blowout numbers in both the Chicago Fed Index and the Philly Fed Survey. The Chicago Fed National Activity Index posted a +0.55 headline number for November compared to only +0.19 for October. The three month moving average jumped to +0.33 from +0.01. Output components added +0.44 to the index with employment components only providing a negative drag of -0.05. This was the first three consecutive months of positive gains in three years. The Philly Fed Survey also blew past estimates of 25.0 with a 32.1 headline number. Shipments jumped to 41.1 from 26.8 and new orders jumped to 41.8 from 20.8, almost doubling! Back orders rose to 17.5 from 9.0 and employees actually spiked to 21.9 from only 3.3. This was a VERY positive report and when accompanied by the Chicago report on the same day they are probably dancing in the halls at the Fed. The Philly Survey had many positive comments but they also said that overall "expectations" for the next six months remain positive but most future indicators were lower. This means there was a spike in manufacturing but the survey respondents are beginning to ratchet down their expectations for 2004. This could be just caution and an easing of the bullish sentiment into something closer to reality. As long as the current conditions continue to improve nobody is going to complain. Jobless Claims fell more than expected to only 353,000 from 375,000 last week. For the first time in over 90 weeks the number for the prior week was revised down as well. That was a real surprise. It was only -3,000 but we will take what we can get. Evidently the Thanksgiving holiday did skew the numbers into the following week and that skew has now been corrected. This suggests we could be under 350,000 soon assuming there are no mass layoffs after the holidays. Unfortunately January is known for companies going on an employee diet and starting the new year from a trimmed down level. Still the trend is positive and we hope to see that sub 350K number in 2004. The markets got some help from the retail sector after WMT and BBBY were upgraded to buy from neutral by UBS. BBBY raised estimates by +2 cents yesterday after reporting an increase in same store sales of +6.4%. Wal-Mart announced today they were launching a website where consumers could download songs for 88 cents a title, -11 cents less than Itunes. The category killer is looking for another category to invade. With the Wal-Mart clout they are sure to attract attention and market share in whatever they do. Wal-Mart had said on Monday that same store sales were tracking at the low end of estimates at around +3%. Retailers will have their chance to catch up this weekend. 41% of holiday sales are made between Dec-17th and Dec-24th. Saturday is the biggest shopping day of the year. Analysts have reported some pickup in sales this week with the weather better than the prior week. Chip stocks are likely to get some help tomorrow after the Book-to-Bill number came in at 1.04 tonight. Last months number was revised up to 1.01 making November the second consecutive positive month. The November 1.04 was the highest level since the 1.02 in August 2002. The number reached a low of 0.78 in October 2002. Orders climbed +6.9% in November for the fourth monthly rise. The rate of increase in all the components is slow but at least it is continuing to increase. Intel is rumored to be announcing a chip for those large screen HDTV sets that will significantly lower the cost of the units. They are expected to announce this chip at the January 8th Consumer Electronics show in Las Vegas. This is a good step for Intel as it puts them into the consumer market with a high dollar product that is likely to have high margins. Current manufacturers are TXN, HIT, PHG and SNE. Because of Intel's capacity and technology they are expected to be a major player very quickly. Analysts said TVs made with the Intel chip could drop to the $2,000 range by next Christmas. The same product now runs from $3,000 to $10,000. Seven million HDTV sets will be sold in 2003 and they expect more than twice that amount in 2004. Naked call writers took it on the chin today or maybe I should say took a hit in their wallet. The levels where the most options would expire worthless and produce the maximum profit for option writers were significantly below the current market levels. Traders short calls had been hoping for one more dip before the Santa rally to buy back those calls or pickup stock to offset the damage. When we did not get a failure on Wednesday after Tuesday's gains they began to get nervous. Especially when there was a sprint into the close. The futures traded up overnight and traders held their breath at the open. After a short period of volatility where prices failed to fall the gold rush began. Traders began to bite the bullet and buy stock. The Dow surged to 10200 by 10:00 and that resistance held until 2:00. Once the Dow cleared the 10200 level there was a strong rush of short covering aided by a fast buy program at 2:30. The Dow finally topped at 10254 and gravity took hold once again. There was no drop but the ceiling was in for the day. Even the Nasdaq was feeling the love again with a +35 point gain. The Nasdaq charged out of the gate and ran smack into resistance just below 1950 and could not break free until the 2:30 buy program. Once that line broke the volume really spiked. The close at 1954 was the highest close since Dec-4th. That was the day after the Nasdaq touched 2000. Needless to say there was a lot of surprised traders and a lot of delighted funds. If the funds were holding their breath last week with the dip below Nasdaq 1900 while watching their profits slip away then today was a relief. With three real trading days left before Christmas there is little risk that we are going down hard. Skip three more days of zero volume and the Christmas holiday and that leaves funds with only three more days on pins an needles. Considering that those light volume holiday days are typically bullish the funds just got a "get out of 2003" free pass. With the jump to strong resistance at 10250 today and only stronger resistance above to 10300 the odds are very good we are not going much higher. The good news is the odds are very good we are not going much lower either. There is simply too much riding on the year-end close and the odds of going back under 10,000 are almost nonexistent. The great press potential of a year-end close over 10K and the massive profits the funds will pocket at this level will keep everyone on the sidelines feeding the bears just enough to keep them at bay until January. For Friday there are no material economic reports and Monday is blank as well. This leaves us to trade on continued bullish sentiment and holiday euphoria. With a huge chunk of options expiration already out of the way with the SPX and DJX options now history we will not have as much upward pressure tomorrow. Odds are very good that anybody who needed to cover has already done so on the individual stocks and other indexes. Any remaining scramble will occur at the open and then traders will begin leaving for the holidays. With the indexes other than the Nasdaq at new highs this is a perfect opportunity for traders to clear the table and take a long holiday. I have already received dozens of emails from traders doing just that and signing off until January. With strong resistance at 10250-10300 and SPX 1100 the odds of another blowout are very slim. The Nasdaq and Russell are already well below their highs on profit taking despite the strong gains today. Friday's close is when the Nasdaq rebalance occurs and selling in those issues being removed could be a drag. The S&P Indexes are also being rebalanced at the close of business on Friday. These rebalancings could produce some heavy volume in late trading but it is not expected to have a material directional impact on the market. I am looking for a range bound market for the next week between 10000-10300 and for volume next week to be very slow. Volume on Thursday was good but not exceptional. There were less than four billion shares traded across all markets although the up volume was 6:1 over down. If we can't break four billion shares on a day like today you can imagine what next week will look like. Investors are going to end this year with a smile on their face and that includes me. 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 --------------------------------- American International Group - AIG - close: 64.80 change: +0.85 WHAT TO WATCH: Shares of AIG turned bullish late last week with the breakout over the long-term descending trendline near $61. Since then, the stock has continued to surge higher and is on the cusp of another major breakout. A move through $65 looks good for momentum entries ahead of an expected rally towards the $70 level. A pullback to the $63 area ahead of that breakout can be used for a lower-cost entry. --- International Game Technology - IGT - close: 36.96 change: +1.56 WHAT TO WATCH: After consolidating for the past few weeks, shares of IGT exploded higher today on volume that dwarfed the ADV. While the stock seems a bit extended after that move, the $35 level should now be strong support and a pullback near that level would make for a great entry ahead of a continued rally towards the $40 level. --- eBay Inc. - EBAY - close: 60.00 change: +2.71 WHAT TO WATCH: Momentum investors are piling into this old favorite, propelling it to a nearly 5% gain on Thursday. It looks like a breakout is brewing as anticipation of a strong holiday performance by the online shopping crowd. A pullback into the $58-59 area would make for the best entry, while momentum traders can enter on a breakout over $60.50, just over the closing highs from October. --- Federal Express - FDX - close: 69.70 change: -1.31 WHAT TO WATCH: Over the past few months, shares of FDX have traced out a H&S topping pattern and on Thursday broke below the sloping neckline at $69. Although there was a strong rebound off the lows, the stock now looks ripe for a downside play. Target entries on a rollover in the $70-71 area and target a decline to the 200-dma near $65. =================== On the RADAR Screen =================== CC $10.24 - In the battle for dominance in the electronic retailing world, CC is clearly losing the battle to BBY, as demonstrated by their recent disappointing earnings report. The stock looks ripe for an oversold bounce from the $10 support area, but that should set up rollover entries back near $11 at the 50-dma. Target a drop to strong support in the $8.50-9.00 area. WAG $35.75 - In sharp contrast to the rest of the market, shares of WAG have been doing poorly this week. Thursday's sharp drop violated the ascending trendline of the past several weeks and despite the rebound from the 50-dma, the stock appears headed significantly lower. Look for this bounce to fail below $36.50 and use that rollover for entry, targeting a drop to $33 and possibly strong support at $32, near the 200-dma. TRMS $19.75 - Where's the bottom? It seems nothing can stem the slide in shares of TRMS and today's drop under $20 looks ominous, as it was accompanied by strong volume. Use a failed bounce below $21 resistance and look for a continued decline to the $16- 17 area. =============================== Market Sentiment =============================== The Return of the NASDAQ - J. Brown After a month of lagging behind the DJIA the NASDAQ finally bounces back with a strong 1.8% gain. Investors were in a holiday buying spree with visions of tech stocks dancing in their heads. Some of today's strongest gains were found in hardware, software, and Internets but only the rebound in the semiconductors could come close to the surge in oil service stocks! Setting the mood this morning were a batch of bullish broker upgrades and strong economic news. The better than expected drop in jobless claims to 353,000 for the week supports the expectation that the labor market is improving. The real surprise today was the Philly Fed Index, which surged to 32.1 in December. Many economists were expecting a drop from November's already robust 25.9 reading. The market internals were merry as advancing stocks danced past decliners 21 to 7 on the NYSE and 21 to 10 on the NASDAQ. Up volume was six times down volume on the NYSE and five times down volume on the NASDAQ. It was definitely a broad-based rally today. We did see some volatility in the volatility indices with a strong surge in the last two hours after the VXO hit new lows near 14.50. I suspect it may be some last hour adjustments before tomorrow's quadruple witching expiration when all stock index futures, stock index options, individual stock futures and stock options all expire. Overall it was an extremely bullish day and it looks like the trend for a Santa Claus rally will hold true again this year. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 10254 52-week Low : 7416 Current : 10248 Moving Averages: (Simple) 10-dma: 10026 50-dma: 9811 200-dma: 9136 S&P 500 ($SPX) 52-week High: 1089 52-week Low : 788 Current : 1089 Moving Averages: (Simple) 10-dma: 1070 50-dma: 1052 200-dma: 982 Nasdaq-100 ($NDX) 52-week High: 1453 52-week Low : 795 Current : 1431 Moving Averages: (Simple) 10-dma: 1406 50-dma: 1410 200-dma: 1257 ----------------------------------------------------------------- The VXO hit new intraday lows near 14.50 before skyrocketing higher in the last two hours of trading. I think the quadruple witching options expiration tomorrow had traders big and small trying to even up their positions, which may have produced a surge in put buying. CBOE Market Volatility Index (VIX) = 16.16 +0.58 CBOE Mkt Volatility old VIX (VXO) = 16.14 +0.79 Nasdaq Volatility Index (VXN) = 24.53 -0.59 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.65 1,083,462 704,617 Equity Only 0.55 665,543 363,051 OEX 0.94 76,123 71,640 QQQ 1.39 44,362 61,512 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 75.1 + 1 Bull Confirmed NASDAQ-100 67.0 - 1 Bear Confirmed Dow Indust. 80.0 + 0 Bull Correction S&P 500 81.0 + 0 Bull Confirmed S&P 100 80.0 - 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: 0.94 10-dma: 1.09 21-dma: 1.03 55-dma: 1.09 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 2127 2090 Decliners 698 971 New Highs 392 140 New Lows 12 15 Up Volume 1602M 1375M Down Vol. 245M 273M Total Vol. 1874M 1661M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 12/09/03 Weekly COT report discloses positions held by small specs and commercial traders of index futures contracts at the Chicago Mercantile Exchange and Chicago Board of Trade. COT data can be found at www.cftc.gov. Small specs are the general trading public with commercials being financial institutions. Commercials are historically on the correct side of future trend changes while small specs tend to be wrong. S&P 500 There is just a hint of bearishness in the Commercials who have upped their short positions. Right on cue the small traders have increased their long positions but to a greater extent. Commercials Long Short Net % Of OI 11/11/03 389,965 415,259 (25,294) (3.1%) 11/18/03 393,893 414,442 (20,549) (2.5%) 12/02/03 394,531 414,223 (19,692) (2.4%) 12/09/03 396,882 420,859 (23,977) (2.9%) 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 11/11/03 136,072 74,249 61,823 29.4% 11/18/03 147,842 80,047 67,795 29.7% 12/02/03 154,788 85,776 69,012 28.7% 12/09/03 172,178 99,484 72,694 26.8% Most bearish reading of the year: (1,657)- 5/27/03 Most bullish reading of the year: 114,510 - 3/26/02 E-MINI S&P 500 The spread is narrowing between longs and shorts in the commercials. The opposite is happening in small traders' positions with longs surging more than 20K contracts. Commercials Long Short Net % Of OI 11/11/03 249,864 258,503 ( 8,639) ( 1.7%) 11/18/03 249,286 264,083 (14,797) ( 2.9%) 12/02/03 283,199 268,833 14,366 2.6% 12/09/03 294,006 288,385 5,621 1.0% 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 11/11/03 94,649 51,815 42,834 29.2% 11/18/03 95,119 61,975 33,144 21.1% 12/02/03 119,555 77,609 41,946 21.3% 12/09/03 142,173 76,171 66,002 30.2% Most bearish reading of the year: (77,385) - 09/02/03 Most bullish reading of the year: 449,310 - 06/10/03 NASDAQ-100 There is a similar surge in commercial positions for the NDX as seen in the S&P futures. Small traders also increased long and shorts but leaning heavily on new longs. Commercials Long Short Net % of OI 11/11/03 35,889 49,201 (13,312) (15.6%) 11/18/03 35,608 49,689 (14,081) (16.5%) 12/02/03 35,569 48,552 (12,983) (15.4%) 12/09/03 39,612 51,443 (11,831) (13.0%) 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 11/11/03 26,212 10,730 15,482 41.9% 11/18/03 32,034 10,356 21,678 51.3% 12/02/03 21,594 9,429 12,165 39.2% 12/09/03 25,842 10,228 15,614 43.3% Most bearish reading of the year: (10,769) - 06/11/02 Most bullish reading of the year: 19,088 - 01/21/02 DOW JONES INDUSTRIAL There is little to report for DJ futures by commercial traders but small traders have significantly increased their short positions. Commercials Long Short Net % of OI 11/11/03 20,209 11,660 8,549 26.8% 11/18/03 20,746 11,080 9,666 30.4% 12/02/03 21,128 12,379 8,749 26.1% 12/09/03 20,378 11,934 8,444 26.1% 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 11/11/03 6,105 8,201 (2,096) (14.7%) 11/18/03 5,655 8,607 (2,952) (20.7%) 12/02/03 6,667 9,302 (2,635) (16.5%) 12/09/03 6,858 12,006 (5,148) (27.3%) 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 12-18-2003 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: Bucking For A Breakout Stop Loss Adjustments: CIT, MRO Stock Split Announcements: HRBT, YAKC 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) =============== CIT Group - CIT - close: 34.80 change: +1.10 stop: 32.75*new* Company Description: CIT Group Inc. (NYSE:CIT), a leading commercial and consumer finance company, provides clients with financing and leasing products and advisory services. Founded in 1908, CIT has nearly $50 billion in assets under management and possesses the financial resources, industry expertise and product knowledge to serve the needs of clients across approximately 30 industries. CIT, a Fortune 500 company, holds leading positions in vendor financing, U.S. factoring, equipment and transportation financing, Small Business Administration loans, and asset-based and credit-secured lending. CIT, with its principal offices in New York City and Livingston, New Jersey, has approximately 6,000 employees in locations throughout North America, Europe, Latin and South America, and the Pacific Rim. Why we like it: Since March, CIT has charged up a rising regression channel on its daily chart, and it looks ready to do it again. As it has done numerous times since March, it retraced to the bottom of that channel, finding support at the (black) 30-dma. RSI turned up again, and stochastics slow their descent in mid-channel, looking as if they might hook up again. One note of caution sounds when we study the P&F chart, because CIT long ago exceeded its $28.00 objective. It has also exceeded the Morgan Stanley and UBS targets of $26-27, so is subject to a downgrade on valuation. If this bullish play is living on borrowed time, however, CIT sure doesn't know it, as the bar chart shows. We have noted bearish MACD divergence on the chart, but the same bearish MACD divergence showed up months ago, between the July and September, and September and October peaks, and CIT continues to climb. That MACD divergence alerts us to be careful of stops, but since CIT has such a well-defined channel, that should not prove difficult. Initially, we're setting the stop just below the (pink) 50-dma, with the initial stop at $32.40. We're setting a tight target, too, at $37.50, the site of a swing high on the monthly chart. We see the possibility for CIT to climb much higher, however, but would rather exit ahead of the volatility we expect at that level. This week, CIT Equipment Finance, one division of CIT, announced that a survey of U.S. construction industry leaders showed that in eight out of the nine regions surveyed, respondents revealed double-digit growth in optimism. CIT Equipment Finance's president crowed about the outlook, calling the results the best in the survey's 28-year history. An ideal entry would occur on a pullback to the (black) 30-dma or to the trendline, but we're not sure those entries will be offered. Entries could also be taken at the current level. Why This is our Play of the Day Our CIT play got off to a bit of a rocky start this week, pulling back near the 30-dma ($33.53) before gaining some traction. But the bulls made up for lost time on Thursday, using that 30-dma as a springboard to vault the stock higher by nearly 3% today. That rally propelled the stock through a couple layers of near-term resistance, bringing it up very near its recent closing highs. Traders that took advantage of the recent dip are sitting pretty right here, and momentum traders may get an opportunity to enter on a breakout above the 12/01 intraday high of $35.15. One note of caution though is related to the fact that tomorrow is December options expiration. That could cause the stock to be artificially pinned to that $35 level, meaning that the better approach for momentum entries will be to wait for continued strength on Monday. Pullbacks near the 30-dma still look attractive for new entries. Note that we've raised our stop to $32.75, just below the 50-dma. Annotated Chart of CIT: Picked on December 12th at $34.05 Change since picked: +0.75 Earnings Date: 01/22/04 (unconfirmed) Average Daily Volume: 1.01 mln ================================================================= Stop Loss Adjustments ================================================================= CIT - long Adjust from $32.40 up to $32.75 MRO - long Adjust from $29.98 up to $30.40 ================================================================= Tech Stocks / Netbulls - ================================================================= CLOSED PLAYS ------------ Closed Short Play ----------------- Ultratech, Inc. - UTEK - cls: 27.53 chng: +1.43 stp: 27.50 The strong volume that accompanied UTEK's rebound on Wednesday caused us some concern, as noted in last night's update. That concern turned out to be well-founded, as the stock continued its strong rebound today. Joining in the overall market rebound, the stock actually stretched as high as $18.15, before pulling back slightly at the close to end just a few pennies above our stop. While the rebound could stall here, the bullish oscillator configuration combined with the strong buying volume indicates that there is more upside to come. This possibility is what had us getting aggressive with our stop, and it took us out of the play today with minimal damage. If still holding open positions, we would suggest exiting on any early weakness tomorrow. Picked on December 7th at $28.20 Change since picked -0.67 Earnings Date 1/15/04 (unconfirmed) Average Daily Volume = 385 K ================================================================= Non-Tech Stocks / Active Trader - ================================================================= CLOSED PLAYS ------------ Closed Short Play ----------------- Dollar Tree - DLTR - close: 30.23 change: +0.79 stop: 30.25 Continuing the Retail rally from Wednesday, the RLX index tacked on another 1.4% today on yet another dose of positive economic news. While there was no company-specific news, DLTR managed to ride the sector rebound for a second consecutive day. With today's 2.68% gain, DLTR broke above the 10-dma ($29.78) and closed right at its high of the day and a mere 2 pennies below our stop. With oscillators turning strongly bullish, the stock has moved from experiencing an oversold bounce to a likely trend reversal. It looks like a near certainty that our stop will be hit on any additional strength on Friday, so we'll concede defeat early and close the play for a fractional loss tonight. Should DLTR drop early in the day tomorrow, we would suggest using that to gain a more favorable exit from the play, not to initiate new positions. Picked on December 10th at $29.54 Change since picked: +0.71 Earnings Date: 1/22/03 (unconfirmed) Average Daily Volume: 1.64 mln ================================================================= Stock Split Announcements ================================================================= Announcements ------------- HRBT banks on a 2-for-1 stock split. During today's trading session, Hudson River Bancorp, Inc (NASDAQ:HRBT) announced that its Board of Directors has approved a 2-for-1 stock split of its common shares outstanding. The payable date for the stock split is set for January 15th, 2004 to shareholders on record as of December 31st, 2003. This would be HRBT's first stock split since being listed on the NASDAQ in 1999. About the company: The Company had total assets of $2.5 billion and total deposits of $1.8 billion at September 30, 2003. Headquartered in Hudson, NY, the Company provides full-service banking, as well as investment management, brokerage, insurance, trust, private banking and commercial services through its subsidiary, Hudson River Bank and Trust Company ("Hudson"), and its 50 branch offices located throughout the Capital District area. The Company also services municipal customers through Hudson River Commercial Bank, a subsidiary of Hudson. Customers' banking needs are served 24 hours a day through an extensive ATM network system and through the Company's automated telephone banking system. The Company offers the convenience of Internet Banking through its Web site at www.hudsonriverbank.com. (Source: Company Press Release) --- YAKC connects shareholders with a 2-for-1 stock split Before today's opening bell, YAK Communications, Inc (NASDAQ:YAKC) announced that its Board of Directors has approved a 2-for-1 stock split of its common shares outstanding. The payable date for the stock split is set for January 29th, 2004 to shareholders on record as of January 15th. About the company: YAK Communications, Inc. (the "Company") (NASDAQ: YAKC - News) was incorporated in December 1998 in Florida to provide international long distance discount services to business and residential customers. The Company specializes in offering these services to consumers by way of a dial-around (known as "10-10"). The Company is a facilities-based reseller, which utilizes its own switching systems. Visit www.yak.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 BCS Barclays Plc (ADR) 35.60 +0.65 CVX ChevronTexaco 83.55 +1.81 USB US Bancorp 28.91 +0.55 BAC Bank of America 78.90 +1.02 XOM Exxon Mobil 39.41 +0.53 HMC Honda Motor Corp 21.55 +0.59 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- RHAT Red Hat Inc 14.28 +1.11 ATVI Activision Inc 19.00 +2.59 ASPT Aspect Communication 15.32 +1.03 OMCL Omnicell Inc 17.08 +1.02 SCOX SCO Group 19.08 +1.69 MMPT Modem Media Inc 7.07 +1.12 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- AXP American Express 46.77 +1.77 QCOM QUALCOMM 51.48 +2.16 SLB Schlumberger Ltd 52.75 +2.35 CAT Caterpillar Inc 83.71 +1.69 HON Honeywell 31.57 +1.31 DE Deere & Co 66.65 +1.08 IGT Intl Game Technology 36.96 +1.56 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- FDX Fedex Corp 69.70 -1.31 CL Colgate-Palmolive 50.30 -3.58 COGN Cognos Inc 29.98 -1.48 AMLN Amylin Pharmaceuticals 21.88 -1.55 TTWO Take-Two Software 27.84 -2.55 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- FCX Freeport McMoran 43.52 -1.38 VNO Vornado Realty Trust 54.00 -1.66 KROLL Kroll Inc 25.35 -0.15 ================================================================= 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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