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Daily Newsletter, Tuesday, 08/17/2004

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PremierInvestor.net Newsletter                  Tuesday 08-17-2004
                                                    section 1 of 2
Copyright (c) 2004, 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:      See Note
Watch List:       Semis to Hamburgers and more!
Market Sentiment: Good News But Stocks Slip From Their Highs

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
     08-17-2004            High     Low     Volume Advance/Decline
DJIA     9972.83 + 18.28 10023.94  9952.11 1.54 bln   1619/1179
NASDAQ   1795.25 + 12.41  1804.59  1791.95 1.36 bln   1745/1254
S&P 100   528.40 +  1.10   530.54   527.16   Totals   3364/2433
S&P 500  1081.71 +  2.37  1086.96  1079.34
RUS 2000  530.00 +  1.94   533.28   528.06
DJ TRANS 3044.60 -  6.54  3070.67  6036.55
VIX        17.02 -  0.55    17.28    16.16
VXO        17.28 -  0.28    17.66    16.98
VXN        25.55 -  1.17    26.63    25.37
Total Volume 3,228M
Total UpVol  2,251M
Total DnVol    917M
52wk Highs      88
52wk Lows      160
TRIN          0.86
PUT/CALL      0.95
=================================================================

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

Due to technological difficulties there will be no Market Wrap
tonight.  Look for the next edition of the Market Wrap in
Wednesday’s email.  We apologize for any inconvenience this may
cause you.


==================================================================
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
---------------------------------

Semis to Hamburgers and more!

Tekelec - TKLC - close: 18.03 change: +0.70

WHAT TO WATCH: Bullish traders may want to give TKLC a good look.
The stock appears to be channeling higher and shares just bounced
from the bottom of their channel.  The recent breakout over most
of its moving averages and the $18.00 level looks like a bullish
entry point.  Short-term technicals are positive (RSI and
stochastics) and its MACD is nearing a new "buy" signal.  We
would consider a trigger above today's high at $18.10 and target
the $20 level even though the top of the channel is higher.  The
bullish P&F chart points to $23.00.




---

NVIDIA - NVDA - close: 10.97 change: +0.57

WHAT TO WATCH: The SOX semiconductor index is trying to rebound
and if it can then NVDA, which just broke to a new post-gap down
high, could make big progress toward filling the gap.  The first
test is its simple 10-dma.  However, keep in mind that AMAT just
reported earnings after the bell tonight and they guided lower.
This could be a serious drag on chip stocks tomorrow.  Aggressive
traders may want to watch NVDA for a dip and bounce from the
$10.00 mark.  We would consider this a very aggressive play.




---

McDonalds - MCD - close: 26.37 change: +0.62

WHAT TO WATCH: MCD outpaced its fellow Dow-components today with
a 2.4% rally.  The stock is back above the $26.00 mark and bulls
can watch it for a rally through the simple 200-dma just
overhead.  Short-term technicals like the RSI and stochastics are
edging higher and the MACD is suggesting a new "buy" signal soon.
Short-term traders may want to consider a trigger over $27.00
with a $29.00 target.




---

Indymac - NDE - close: 34.41 change: +1.11

WHAT TO WATCH: We're seeing some strength in the banking sector
and NDE has broken out to a new four and a half month high.  This
looks like a bullish entry point.  Traders could target a move
toward the April highs near $37.50.  However, we'd use a tight
stop under $33.00 to keep losses at a minimum.





-----------------------------------
RADAR SCREEN - more stocks to watch
-----------------------------------

NPSP $19.28 +1.20 - NPSP rallied more than 6.6% on strong volume
to breakout above its descending trendline of resistance and its
40 and 50-dma's.  Readers may want to consider aggressive bullish
positions on a move through the $20 mark.

NYB $19.89 +0.19 - We're still watching this banking stock for a
breakout over the $20.00 mark.


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

Good News But Stocks Slip From Their Highs
 - J. Brown

A lot of market pundits were a bit surprised at Monday's rally.
I include myself in that group since crude oil rose to another
new high on Monday.  I suspect the rally was more of a sigh of
relief that the Olympics got off to a successful and uneventful
(a.k.a. there were no terror events) start.  Monday's oversold
bounce was pretty impressive and a lot of stocks that had broken
through support last week were suddenly climbing back through
support.  That kind of whipsaw action can be painful and
frustrating for traders (yet another category I include myself
in).

The momentum continued today with the positive inflation data and
strong earnings from Home Depot (HD).  Stocks also got an early
boost as oil began to fade but this didn't last very long.  News
that the courts rejected an appeal for Russian oil giant Yukos on
its $3.4 billion bill sent oil climbing again to close at $46.80
a barrel.

Watching CNBC today one of their guests, Ernie Ankrim with Russel
Investment Group, offered a great way to describe investor
sentiment in the markets.  He called it a vowel market as in
AEIOU.  "A" stands for anxiety, which of course is fueled by the
terrorism fears with targets like the Olympics and the upcoming
Republican national convention.  "E" stands for the November
Presidential elections.  Right now not knowing who is likely to
win the election makes investors hesitant to place any bets.  "I"
stands for interest rates.  Is the Fed going raise rates again in
September?  Can the economy handle another rate hike?  Will they
keep to their "measured pace"?  "O" stands for oil.  Rising crude
oil prices have been a major influence on stocks and the economy.
"U" represents general uncertainty about the economy and
corporate earnings.

Market internals were mostly bullish.  Advancing stocks
outnumbered decliners 16 to 11 on the NYSE and 17 to 12 on the
NASDAQ.  Up volume outweighed down volume by almost 2-to-1 on the
NYSE and more than 3-to-1 on the NASDAQ.

After the bell Applied Materials (AMAT), the largest
semiconductor equipment company on the planet, announced earnings
and beat estimates by 1 cent with sales that doubled over last
year.  Unfortunately, they followed up with bad news and warned
that the next quarter would be under analysts' expectations.

The AMAT news combined with the rising oil prices could be a real
struggle for techs stocks tomorrow, especially since the momentum
was already beginning to fade this afternoon.


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

Market Averages

DJIA ($INDU)

52-week High: 10753
52-week Low :  9230
Current     :  9972

Moving Averages:
(Simple)

 10-dma:  9933
 50-dma: 10115
200-dma: 10240


S&P 500 ($SPX)

52-week High: 1163
52-week Low :  983
Current     : 1081

Moving Averages:
(Simple)

 10-dma: 1075
 50-dma: 1099
200-dma: 1109


Nasdaq-100 ($NDX)

52-week High: 1559
52-week Low : 1256
Current     : 1335

Moving Averages:
(Simple)

 10-dma: 1331
 50-dma: 1396
200-dma: 1443


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

CBOE Market Volatility Index (VIX) = 17.02 –0.55
CBOE Mkt Volatility old VIX  (VXO) = 17.28 –0.28
Nasdaq Volatility Index (VXN)      = 25.55 –1.17


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

          Put/Call Ratio  Call Volume   Put Volume

Total          0.95        711,771       678,781
Equity Only    0.69        537,330       371,034
OEX            1.42         38,689        54,952
QQQ            1.17         61,828        72,514


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

Bullish Percent Data

           Current   Change   Status
NYSE          53.0    + 0     Bear Confirmed
NASDAQ-100    26.0    + 1     Bear Confirmed
Dow Indust.   46.7    + 0     Bear Confirmed
S&P 500       47.4    + 1     Bear Confirmed
S&P 100       45.0    + 0     Bear Confirmed


Bullish percent measures the number of stocks in an index
currently trading on a buy signal on their point and figure
chart.  Readings above 70 are considered overbought, and readings
below 30 are considered oversold.

Bull Confirmed  - Aggressively long
Bull Alert      - Cautiously long
Bull Correction - Pause or pullback in upward trend
Bear Alert      - Take defensive action if long
Bear Confirmed  - High risk if long, good conditions for shorting
Bear Correction - Pause or rebound in downtrend


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

 5-dma: 1.27
10-dma: 1.44
21-dma: 1.28
55-dma: 1.26


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    1619      1745
Decliners    1179      1254

New Highs      54        30
New Lows       25        68

Up Volume    946M     1038M
Down Vol.    556M      297M

Total Vol.  1534M     1360M
M = millions


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

Commitments Of Traders Report: 08/10/04

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 has been almost no change in the commercial traders'
positions for the large S&P 500 futures contracts.  They remain
marginally bearish.  Meanwhile small traders have upped their
bets in both longs and shorts but remain net bullish.


Commercials   Long      Short      Net     % Of OI
07/22/04      404,828   419,017   (14,189)   (1.7%)
07/27/04      397,354   422,914   (25,560)   (3.1%)
08/03/04      401,619   419,429   (17,810)   (2.2%)
08/10/04      397,576   419,734   (22,158)   (2.7%)

Most bearish reading of the year: (111,956) -  3/06/02
Most bullish reading of the year:   23,977  - 12/09/03

Small Traders Long      Short      Net     % of OI
07/22/04      138,123    94,990    43,133    15.5%
07/27/04      135,136    90,433    44,703    19.8%
08/03/04      128,510    88,833    39,677    18.3%
08/10/04      135,689    93,897    41,792    18.2%

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

Commercial traders have upped their stakes in both their
long and short positions but the net results was a small decrease
in bearishness.  Small traders pared back their longs and added
to their shorts to decrease their bullish stance some but they
remain net bullish (albeit the least bullish in a month).


Commercials   Long      Short      Net     % Of OI
07/22/04      309,972   428,240   (118,268)  (16.0%)
07/27/04      337,615   429,477   ( 91,862)  (12.0%)
08/03/04      340,053   428,736   ( 88,683)  (11.5%)
08/10/04      369,547   441,055   ( 71,508)  ( 8.8%)

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
07/22/04      212,078     62,416   149,662    54.5%
07/27/04      186,211     68,930   117,281    46.0%
08/03/04      195,105     68,717   126,388    47.9%
08/10/04      179,940     89,239    90,701    33.7%


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


NASDAQ-100

There was very little movement from the commercial traders.
They did add positions on both sides but the result was a
small move closer to neutral.  Small traders are really
undecided and a very close to a dead heat.


Commercials   Long      Short      Net     % of OI
07/22/04       45,069     37,975     7,094    8.5%
07/27/04       43,042     35,935     7,107    9.0%
08/03/04       42,771     36,863     5,908    7.4%
08/10/04       43,968     38,351     5,617    6.8%


Most bearish reading of the year: (21,858)  - 08/26/03
Most bullish reading of the year:  25,160   - 06/01/04

Small Traders  Long     Short      Net     % of OI
07/22/04        9,398    11,776    (2,378)  (11.2%)
07/27/04       14,543    14,518        25     0.0%
08/03/04        8,995    13,901    (4,906)  (21.4%)
08/10/04       10,081    10,858    (  777)  ( 3.7%)


Most bearish reading of the year: (20,270) - 06/01/04
Most bullish reading of the year:  19,088  - 01/21/02

DOW JONES INDUSTRIAL

Commercial traders reduced their short positions but a few
thousand which increased their bullish stature.  Small traders
naturally moved the opposite direction and increased their
shorts to boost their bearish outlook.


Commercials   Long      Short      Net     % of OI
07/22/04       27,957    20,389    7,568      15.7%
07/27/04       27,577    21,427    6,150      12.5%
08/03/04       30,118    25,029    5,089       9.2%
08/10/04       30,634    22,994    7,640      14.2%

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
07/22/04        4,857     7,297   (2,440)   (20.1%)
07/27/04        5,310     6,099   (  789)   ( 6.9%)
08/03/04        4,325     5,212   (  887)   ( 9.3%)
08/10/04        6,450     8,488   (2,038)   (13.6%)

Most bearish reading of the year: (12,106) -  3/09/04
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.

Please read our disclaimer at:
http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html

*****************************************************************
ADVERTISING INFORMATION

For more information on advertising in PremierInvestor.net
Newsletter, or any Premier Investor Network newsletter please
contact Contact Support.

*****************************************************************


Copyright ) 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.





PremierInvestor.net Newsletter                  Tuesday 08-17-2004
                                                    section 2 of 2
Copyright (c) 2004, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
=================================================================

Stop Adjustments: None
Closed Plays:     AMR, ENDP, DLTR
Stock Splits:     CFC

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)


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

None


=================================================================
Closed Plays
=================================================================

AMR Corp - AMR - close: 8.13 change: +0.19 stop: 8.01

It doesn't make sense to us.  Crude oil prices have risen to new
all-time highs at $46.80 a barrel in the last two days yet
airline stock has rallied with the broader market.  The easiest
explanation is that the group was so oversold it didn't matter
what oil was doing shorts were going to cover and bulls were
going to buy the bounce in the markets on the hope it was a
bottom.  Now AMR has gapped up above round-number resistance at
the $8.00 level and stopped us out at $8.12.  We'd probably keep
an eye on the stock for another drop through $7.50.

Picked on August 15 at $ 7.42
Gain since picked:     + 0.71
Earnings Date        07/21/04 (confirmed)
Average Daily Volume:     5.2 million



---

Endo Pharmaceuticals - ENDP - cls: 16.70 chg: -0.33 stop: 17.26

The BTK biotech index has rallied pretty sharply in the last two
days and pushed through technical resistance at the 21-dma while
forming a new "buy" signal in its MACD indicator.  ENDP was
relatively immune to the bullishness yesterday but managed a
sharp spike this afternoon on big volume.  ENDP shot to $17.31 to
stop us out at $17.26 for an 11 percent drop.  The intraday move
was fueled by news that ENDP has secured exclusive rights to
market Frova in N. America.  Frova is a migraine treatment made
by Vernalis.

Picked on July 26 at $19.49
Gain since picked:   - 2.79
Earnings Date      07/14/04 (confirmed)
Average Daily Volume:   871 thousand



---

Dollar Tree - DLTR - close: 23.93 chg: +0.76 stop: 23.71

Hmm... there doesn't appear to be any specific news that sent
shares of DLTR higher.  Traders were just responding to the
bullish market these last two sessions and DLTR hit our stop loss
at $23.71 today - closing the play for an 8.6 percent drop.
We've been encouraging readers to take profits recently.  In the
Sunday newsletter we suggested some profit taking when DLTR was
at $22.46.  It may be worth noting that DLTR's P&F chart is still
bearish and points to a $17 target.  We would watch DLTR
carefully to see if it breaks out or rolls over near the $25.00
level. There could be another play in the near future just watch
out for earnings on August 25th.

Picked on July 26 at $25.95
Gain since picked:   - 2.02
Earnings Date      08/25/04 (unconfirmed)
Average Daily Volume:   1.5 million




=================================================================
Stock Splits
=================================================================

Announcements
-------------

CFC shareholders approve 2:1 split

This afternoon Countrywide Financial Corp (NYSE:CFC) announced
that shareholders had approved a measure to increase the number of
authorized shares from 500 million to 1 billion.  In doing so
shareholders have approved a previously announced 2-for-1 split
reported on June 25th.

The split, to be paid as a stock dividend, is payable on August
30th, 2004 to shareholders on record as of August 25th.  CFC will
begin trading post-split on August 31st.


About the company:
Founded in 1969, Countrywide Financial Corporation is a member of
the S&P 500, Forbes 2000 and Fortune 500. Through its family of
companies, Countrywide provides mortgage banking and diversified
financial services in domestic and international markets.
(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

FNM     Fannie Mae                 73.09     +1.12
BAC     Bank of America            86.84     +0.74
MCD     McDonalds                  26.40     +0.65
GCI     Gannett Co Inc             83.30     +0.55
STT     State Street               44.78     +0.74
BEN     Franklin Resources         50.35     +0.76

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

PIR     Pier 1 Imports             17.69     +1.45
NPSP    NPS Pharmaceuticals        19.28     +1.20
TOO     TOO Inc                    15.27     +1.60

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

HD      Home Depot                 35.19     +1.21
RL      Polo Ralph Lauren          36.13     +1.60
CCJ     Cameco Corp                62.71     +1.67
VIP     Vimpel Communications      93.90     +4.65
RYL     Ryland Goup                86.08     +3.53
BJ      BJ's Wholesale             25.10     +1.71
ELBO    Electronics Boutique       27.02     +2.05

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

VLO     Valero Energy              64.33     -3.64
EL      Estee Lauder               40.10     -3.40
EOG     EOG Resources              55.44     -2.05
NBR     Nabors Industries          41.94     -1.68
UPL     Ultra Petroleum            36.80     -2.86
EASI    Engineered Support         43.53     -2.73
-----------------------------------------
Recently Overbought With Bearish Signals (Stocks over $20)
-------------------------------------------

TPL     Texas Pacific Land Trust   77.95     -2.05


=================================================================
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.

Please read our disclaimer at:
http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html

*****************************************************************
ADVERTISING INFORMATION

For more information on advertising in PremierInvestor.net
Newsletter, or any Premier Investor Network newsletter please
contact Contact Support.

*****************************************************************

Copyright 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.





DISCLAIMER

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