PremierInvestor.net Newsletter Tuesday 09-28-2004 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: Sun Still Shining Watch List: Hardware to Air Couriers. Market Sentiment: Bounce of Speed bump? ================================================================= MARKET WRAP (view in courier font for table alignment) ================================================================= 09-28-2004 High Low Volume Adv/Dcl DJIA 10077.40 + 88.90 10099.52 9977.92 1.72 bln 2061/1058 NASDAQ 1869.87 + 10.00 1873.86 1852.59 1.56 bln 1906/1172 S&P 100 534.19 + 3.17 535.07 529.86 Totals 3967/2230 S&P 500 1110.06 + 6.54 1111.77 1101.29 SOX 373.69 - 3.30 377.88 370.17 RUS 2000 565.66 + 7.30 565.73 558.36 DJ TRANS 3208.58 + 31.20 3214.81 3167.30 VIX 13.83 - 0.79 14.84 13.69 VXO (VIX-O)13.23 - 1.07 14.68 13.05 VXN 21.36 - 0.56 22.23 21.20 Total Volume 3,577M Total UpVol 2,199M Total DnVol 1,324M Total Adv 4461 Total Dcl 2532 52wk Highs 261 52wk Lows 161 TRIN 1.01 NAZTRIN 1.44 PUT/CALL 0.92 ================================================================= =========== Market Wrap =========== Sun Still Shining by Jim Brown Oil crossed $50 and the world did not end. In fact the Dow ended with a +88 point gain and even more amazing the Transports closed with a +31 point gain. Feel like you are seeing the Twilight Zone come to life? You are not alone as millions of investors wonder how oil can double in price and the transports can soar. Dow Chart Nasdaq Chart SPX Chart The morning started off with a reaction dip after some disappointing economic news on top of $50 oil but it recovered on end of quarter window dressing. The morning reports started off with Chain Store Sales that fell -0.3% on top of the -1.1% for the prior week. Nothing new here with weak back to school buying and high gas prices. Year over year growth was actually up +3.5% and the best YOY growth since July. The worst report for the day was Consumer Confidence and it dropped from 98.7 to 96.8 for September. This was the lowest level since May and most of the drop was due to the present conditions component that fell more than -5 points to 95.5 from 100.7. Consumers felt the jobs market had weakened significantly. Those who felt jobs were plentiful fell to their lowest level since May. Those consumers planning to buy homes and cars fell slightly as well. You can bet that the constant reporting on $50 oil is not going to improve confidence any time soon. Let's dive right into the oil conversation since it is controlling the majority of air time. Oil broke $50 and the world did not come to an end and there was not an immediate sell off. Oil traded over $50 and closed at $49.90 an all time high. I use that term loosely because in inflation weighted dollars the 1970s oil crisis saw oil at levels that would equate to $80 today. The actual contract price today at $50 is the highest actual price on record and it may not get any better. The high prices today were brought to you by Nigeria if you believe the talking heads on TV. Nigeria has a serious internal problem with militants. They kidnap and ransom hostages to achieve their demands and target oil production to emphasize those demands. They are currently warning they will declare all out war on oil on October 1st if their demands are not met. Various oil producers are evacuating workers from the country until the problem is resolved. Nigeria currently exports about 2.5 million barrels per day of which 1.6 million come to the U.S. That makes them our fifth largest importer. With the world currently in an oil crisis we don't need to lose 2.5 mil bbls of light sweet crude. That brings us to the next topic. Saudi Arabia said today they were going to up production from 9.5M to 11M barrels per day. Almost immediately an entire army of oil experts hit the airwaves to dispute this increase. The general consensus is that Saudi could increase total output to 11 million but it would take weeks if not months for the production increase to occur. Secondly the additional oil would be "heavy" oil, not the light sweet crude that refiners want. According to several sources there is no refinery capacity available to refine any additional heavy oil. That is like pulling into a filling station for unleaded and the dealer saying he only has diesel. That may help somebody else but it will not help you. Think $50 is high, stick around most analysts expect even higher levels soon. T. Boone Pickens said today that $60 oil was just around the corner and he was not alone. Cambridge Energy Research Associates said this years rate of demand growth has more than doubled the average for the last six years. They claim over the last decade there was always a 3-5 million bbl cushion between peak demand and average capacity. This cushion kept prices in check and smoothed out the peaks and valleys of seasonal demand. Currently this cushion has dropped to only 1.4 million bbls and less than the levels at the beginning of the 1973 crisis. Every time you hear about Iraq sabotage taking them offline for several days that eliminates the cushion. If Nigerian militants takes their production offline for a week that eliminates the cushion and puts us in a deficit. If Yukos stops production in some sector because they no longer have the cash to pay for transportation that puts us into a deficit. The bottom line is the world economy is careening down the highway with a gas tank running on empty. We are filling up at every filling station we pass but the first time we hit one that is dry the economic bus will stop. I have preached several times about Hubbert's Peak and the coming global peak in production currently estimated for 2008. Once that peak has arrived we will be pumping less oil every day that passes than the day before. Critics claim that new technology will continue to improve drilling and pumping and let us recover more oil from new and existing fields than in the past. This is true but, picture the earth as a big sponge. When oil drilling first began you could literally find it oozing to the top on its own in many places. Wells were drilled in hundreds of feet. Current technology lets us drill wells that are miles deep in up to 10,000 feet of water in the roughest parts of the ocean. We are light years from our beginning but we are sucking oil out of the sponge at record rates. If you pickup a wet sponge out of the kitchen sink the first couple squeezes produce plenty of water. After the first couple squeezes it takes more and more effort to get any more water to flow. New technology may be able to milk a few more drops if you have the patience to wait. If you are using the sponge to put out a fire on the stove you don't have time to wait. Currently the global oil demand is 82.5 million bbls per day according to recognized estimates. Some say this is absurdly low and the real demand is already near 88 million bbls because producing countries are keeping more and more for their own uses and it is not counted in the "official" quotes. Using the "quoted" demand levels our demand curve looks like this: Millions of barrels per day 2004 2005 2006 2007 2008 2009 82.5 85.0 87.5 90.0 92.5 95.0 82.5 MBPD = 30.1 BILLION barrels per year 95.0 MBPD = 34.7 BILLION barrels per year Remember, demand growth this year is DOUBLE the average growth rate of the prior six years. That means the chart above was probably outdated the day after it was produced. As we can see from the daily barrage of news stories current demand is pushing production levels to record twenty five year highs and to the breaking point. Every minor crisis puts us that much closer to more demand than production and when that happens $50 oil will look cheap. It will happen. The only question is when. How much longer can we continue finding, drilling and pumping an additional 30+ billion barrels per year? The situation is becoming serious and there was a news story after the close that the Chinese military was said to be eying oil rich lands in Malaysia and Indonesia. While I doubt the veracity of this story it will not be long before there will be wars over the few remaining drops of oil in our global sponge. Peter Schiff of Euro Pacific Capital sees $100 oil by the end of the decade. The problem for investors is not your next tank of gas but the eventual impact to corporate earnings. Currently only one of every ten companies claim the higher oil prices are impacting profits. I would also hasten to remind everyone that oil was trading at $25 this time last year. You and I understand that oil prices cannot double without a material impact to earnings for almost every company. Investors and corporations are still in denial. Everyone believes that this is just a spike and it will pass. A Saudi representative was interviewed again today and he quoted a future price target of $25. This jawboning is keeping the general public in the dark about the disaster ahead. We know that there is a pre election event risk in oil because the analysts have told us there is. Right or wrong this is what everyone believes. Everyone also believes that once the election is over oil will return to more reasonable levels. While I agree there may be some event risk priced into the crude futures and we may decline after the election we will still face the rising demand and slowing production problem. Sell oil stocks the week before the election and buy the post election energy dip and hold for the long term. Oil was not the only thing on the markets mind today but you would have to look hard to find anything else. One point of note was a positive guidance update from CAT. Caterpillar said sales were so strong that revenue will rise +25% to +30% for the full year. Before you rush out and buy CAT you should know their prior forecast was for a +25% increase. Always check your facts before pulling the trigger. CAT said earnings would rise +80% to +85% which was right inline with its previous forecast. Traders hearing the news rushed to buy the stock and Dow component CAT spiked nearly +$3 intraday. Not bad for a basically inline guidance update. To be fair there was some concern they would miss the prior estimates and Caterpillar comments like "unprecedented surge in orders" and "demand for heavy duty truck engines has skyrocketed" are always good for some knee jerk buying. It was a good day for Google. The 40-day quiet period expired which prevents brokerage companies from issuing research about stocks they IPO. CSFB, Thomas Weisel Partners, JP Morgan, Morgan Stanley and WR Hambrecht all instituted coverage at an "outperform" but the comments were less than exciting. The price target of $145 was considered light in relation with its current gains. The companies made sure they expressed the risks as well as potential rewards and the risks were many. The main focus was increasing competition and a maturing market. Mary Meeker, Internet analyst for Morgan Stanely gave the following comment. "We believe IF Google continues to execute, the company SHOULD be well positioned to benefit from ongoing secular Internet user and usage growth." The keywords there were obviously IF and SHOULD. TWP analyst Christa Charles pointed out that Google has not been "overtly advertiser friendly" and it would have to correct that to be successful. She also said "We believe the likelihood that Google invests in negative projects is high." Still traders flocked to the stock and shorts were squeezed once again with a +$8.60 gain to $126.70. On the downside Cypress Semiconductor warned for the second time in a month citing additional weakness across multiple markets. Share of CY fell to a 16-month low at $8.50. Earnings are now expected to be less than a nickel compared to their prior forecast of up to 15 cents per share. This sent the SOX into negative territory and shook it free from 380 support. Oddly the Nasdaq and Russell finished in positive territory with the Russell on fire with a +7.30 gain. After the bell MSPD warned and that should apply additional pressure to the SOX on Wednesday. The problem was a drop in orders from Asia and a "widespread buildup of inventory at key customers." Same song, 87th verse. The Caterpillar bounce sent the Dow above 10040 resistance and short covering began. When a Dow stock like CAT jumps +$3 it impacts not only the Dow but the S&P. When the announcement was made the markets had been hovering near the highs and the spike just upset the balance of power. A buy program at 2:PM also kept the movement going. Dow 10100 appears to be current resistance and a level I would watch on Wednesday. The Nasdaq was weak due to the SOX weakness but the end of day buy program pushed it back to yesterday's resistance highs. There was very little decline into the close and 1875 remains initial resistance. The rebound off the day's lows gave all the appearances of weak end of quarter window dressing. The stocks bought were the recent winners and would make funds look a lot smarter to investors with those stocks in their statement. It was no surprise the energy sector found itself the recipient of late day cash flows. For Wednesday we will start out with the GDP report with expectations for a +3.0% gain. This could be a challenge or a surprise but the risk is to the downside. At 10:30 we will get the weekly crude oil inventories and we have seen a drop in supplies for eight straight weeks. Last week inventories dropped -9.1 million bbls with -7 mil drop the week before. Traders are saying they expect another drop of -1.5 mil but a much larger drop could really explode prices higher. Economic reports increase on Thursday and Friday as we begin to get the September production data. With two days left in the quarter the potential for another window dressing day is strong although the impact should be minimal. The coming economic reports should put a little fear into the market just as we enter October. Speaking of fear, the VXO is right back down and with the low today of 13.05 very close to retesting the eight year low set last Tuesday. Remember last Tuesday? That was when the Dow was at 10270 and the Nasdaq 1925, a two month high. Be very careful with the VXO this low. Enter Passively, Exit Aggressively. Jim Brown Editor ================================================================== WATCH LIST ================================================================== The PremierInvestor.net watch list is not designed to be read as full fledged stock picks. Rather we would prefer to offer it as an extra tool in today's investor toolbox. Think of it as a radar screen with your own radar operator pointing out interesting developments, technical patterns or potential plays that you may or may not have seen on your own. Due to time constraints we do glance at the news but rarely do we have time to fully read pertinent news stories, due background research and other necessary screens that investors should do before making a decision. A common exercise is to read the entry, glance at the sector and other stocks in that industry and then compare what's happening in the stock to what's happening in the broader market indices. We hope you enjoy the Watch List and that it proves to be a useful tool for your own trading success. STOCKS WORTH WATCHING --------------------------------- Hewlett Packard - HPQ - close: 18.24 change: -0.16 WHAT TO WATCH: We're going to keep an eye on HPQ. The stock appears to be struggling with resistance at $19.00, which is close to the top of the gap down in August. The MACD is nearing a new "sell" signal and the lack of participation in today's rally is rather bearish. Watch for a drop under $18.00. --- ASV Inc - ASVI - close: 35.97 change: +2.47 WHAT TO WATCH: After several months of trading sideways between $28 and $36 shares of ASVI look ready to breakout through the top of its range. Shares soared 7.3 percent on very big volume (for ASVI). We don't see any news to explain the move at least not yet. Traders may want to consider bullish positions if ASVI trades over today's high (36.78) or the $37 level. The P&F chart is already bullish with an ascending triple-top buy signal and a $48 price target. --- EGL Inc - EAGL - close: 28.91 change: +1.66 WHAT TO WATCH: Air courier EAGL soared to new three-year highs on huge volume today breaking out over resistance at the $28.00 level. This looks like a bullish entry point but then again it could just be window dressing before the quarter ends. A bounce from $28.00 might be the better entry point. Watch out though the P&F chart only points to a $30 target. That doesn't mean it can't run past $30 but it is a caution flag. --- Tyco Intl - TYC - close: 29.90 change: +0.24 WHAT TO WATCH: If you prefer more liquid stocks then TYC might be a candidate for you. The stock is testing support near $29.50 and its simple 200-dma. A breakdown under $29.50 and traders might try for a drop toward $27.00. A bounce back over $30.50 and traders might try for $32.00. The P&F chart is very bullish with a $54 target but it's showing a high-pole warning, which suggests a possible bearish reversal. =============================== Market Sentiment =============================== Bounce of Speed bump? - J. Brown Yesterday the markets were looking pretty sour. The Dow Industrials closed under the 10,000 mark for the first time since August 17th while crude oil prices hit $50.00 barrel in New York for the first time ever. Today stocks look a little bit stronger with a bounce in the indices despite another gain for crude. What's going on here? Are investors totally disconnected from reality? Oil is 10 cents away from $50 a barrel and crude barely budged when the Saudis said they would raise production from 9.5 million to 11.0 million barrels a day. The oil pits were focused on new violence in Nigeria, the world's seventh largest exporter of oil and known for its light sweet crude which is more easily refined. Rebels in Nigeria have specifically targeted oil rigs and oil companies as they fight government forces. If $50 oil wasn't enough the consumer confidence numbers this morning declined for the second month in a row. While the drop wasn't huge it's not a positive trend. Yet despite it all stocks bounced higher with only homebuilders, semiconductors and networking stocks trading lower. What's going on here? I think it is just window dressing before the end of the quarter. Fund managers saw the Dow under 10,000 and decided to "buy the dip" before the quarter ends on Thursday. A positive revenue warning from Dow-component Caterpillar (CAT) certainly didn't hurt stocks either. Throughout the day there was also talk of short covering after the Industrials 300-point decline in the last several days. Given the bounce back above 10,000 for the Dow, the bounce from the simple 50-dma and the 1850 level on the NASDAQ and the 1100 level on the S&P 500 I could certainly see stock churn sideways for the remainder of the month. That is unless the earnings warnings don't pick up. We had at least four more earnings warnings today from DJO, SNA, STE and CY. Cypress Semiconductor (CY) actually warned for the second time this quarter. What is really interesting was the big drops in the volatility indices today. Both the VIX and VXO fell back under the 14 level towards their recent lows. This remains a big bearish flag and I'd be mindful to double check those stops on any bullish plays. So the question to ask is this bounce a turnaround or a speed bump on the way down? I'm still bullish for the fourth quarter but the next two or three weeks can be painful. Although I will admit that this September has been pretty mild for the "worst" month of the year. ----------------------------------------------------------------- Market Averages DJIA ($INDU) 52-week High: 10753 52-week Low : 9230 Current : 10077 Moving Averages: (Simple) 10-dma: 10147 50-dma: 10108 200-dma: 10296 S&P 500 ($SPX) 52-week High: 1163 52-week Low : 990 Current : 1110 Moving Averages: (Simple) 10-dma: 1116 50-dma: 1101 200-dma: 1117 Nasdaq-100 ($NDX) 52-week High: 1559 52-week Low : 1301 Current : 1389 Moving Averages: (Simple) 10-dma: 1410 50-dma: 1380 200-dma: 1440 ----------------------------------------------------------------- CBOE Market Volatility Index (VIX) = 13.83 -0.79 CBOE Mkt Volatility old VIX (VXO) = 13.23 -1.07 Nasdaq Volatility Index (VXN) = 21.36 -0.56 ----------------------------------------------------------------- Put/Call Ratio Call Volume Put Volume Total 0.91 689,020 630,321 Equity Only 0.85 520,063 442,490 OEX 0.88 23,050 20,327 QQQ 1.51 40,339 60,887 ----------------------------------------------------------------- Bullish Percent Data Current Change Status NYSE 63.2 + 0.2 Bear Correction NASDAQ-100 43.0 - 1 Bull Alert Dow Indust. 56.6 + 0 Bear Correction S&P 500 60.8 - 0.4 Bear Correction S&P 100 59.0 + 0 Bear 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: 1.46 10-dma: 1.25 21-dma: 1.16 55-dma: 1.20 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 1915 1869 Decliners 899 1142 New Highs 181 54 New Lows 40 61 Up Volume 1164M 797M Down Vol. 542M 700M Total Vol. 1725M 1520M M = millions ----------------------------------------------------------------- Commitments Of Traders Report: 09/21/04 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 The latest COT data shows a big drop in positions for both commercials and small traders but commercials remain slightly net bearish and small traders remain net bullish. Commercials Long Short Net % Of OI 08/31/04 406,637 416,778 (10,141) (1.2%) 09/07/04 415,952 426,342 (10,390) (1.2%) 09/14/04 442,049 469,982 (27,933) (3.0%) 09/21/04 404,746 425,560 (20,814) (2.5%) 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 08/31/04 144,120 114,343 29,777 11.5% 09/07/04 157,732 130,817 26,915 9.3% 09/14/04 167,310 126,513 40,797 13.9% 09/21/04 134,943 108,036 26,907 11.1% 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 passing of the quadruple-witching Friday cut a large chunk of open positions among long and shorts, big and small. Yet the remain positions still open have sent commercials to their most bearish bias in weeks and the small trader to their most bullish. Commercials Long Short Net % Of OI 08/31/04 372,071 543,100 (171,029) (18.7%) 09/07/04 371,111 600,593 (229,482) (23.6%) 09/14/04 377,643 586,139 (208,496) (21.6%) 09/21/04 213,014 397,844 (184,830) (30.2%) Most bearish reading of the year: (354,835) - 06/17/03 Most bullish reading of the year: 133,299 - 09/02/03 Small Traders Long Short Net % of OI 08/31/04 258,624 77,036 181,588 54.0% 09/07/04 286,194 80,075 206,119 56.2% 09/14/04 289,155 81,314 207,841 56.1% 09/21/04 256,315 60,275 196,040 61.9% Most bearish reading of the year: (77,385) - 09/02/03 Most bullish reading of the year: 449,310 - 06/10/03 NASDAQ-100 Wow! It looks like last week's option expiration has produced some major shifts. There is a huge drop in open positions that have produced dramatic changes in bias. Commercials are now strongly bullish and small traders are incredibly bearish. To be honest I'm not sure how much I trust these numbers. Commercials Long Short Net % of OI 08/31/04 48,167 43,411 4,756 5.2% 09/07/04 51,814 44,179 7,635 7.9% 09/14/04 64,282 59,808 4,474 3.6% 09/21/04 54,530 30,827 23,703 27.7% 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 08/31/04 14,635 10,572 4,063 16.1% 09/07/04 16,817 12,561 4,256 14.5% 09/14/04 36,372 28,584 7,788 12.0% 09/21/04 7,417 25,821 (18,404) (55.3%) 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 The Dow Jones futures show the same dramatic drop in open positions with the recent option/futures expiration. However, the DJ futures do not show a big switch in bias. Commercials Long Short Net % of OI 08/31/04 29,143 24,147 4,996 9.3% 09/07/04 29,128 24,011 5,117 9.6% 09/14/04 41,951 34,486 7,465 9.7% 09/21/04 30,816 27,200 3,616 6.2% 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 08/31/04 4,929 7,122 (2,193) (18.2%) 09/07/04 5,041 8,656 (3,615) (26.4%) 09/14/04 8,121 14,425 (6,304) (27.9%) 09/21/04 4,467 6,748 (2,281) (20.3%) 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 ) 2004 PremierInvestor.net. and The Premier Investor Network. Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter Tuesday 09-28-2004 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 ================================================================= In section two: UCL, ETM Stop Loss Adjustments: UCL, ETM Active Trader (Non-tech Stocks) Closed Bearish Plays: -- SMRT Stock Splits Announcements: NFB 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 ================================================================== UCL - non-tech long - Heads up! UCL is soaring with the rising price of oil and strength in energy stocks. UCL added another 3 percent today and is nearing the bottom edge of our $44-45 price target. Short-term traders can prepare to exit at $44.00. We are raising our stop loss to $41.75 ETM - non-tech short - Almost there. Be prepared to exit at $32.00. Or more patient traders can keep the play open and merely adjust the stop loss lower as ETM declines. Who knows maybe ETM can hit the $30 level. ============ Closed Plays ============ Closed Bearish Plays -------------------- Stein Mart - SMRT - close: 15.55 change: +1.11 stop: 15.51 We seriously doubt that today's news announcements that SMRT closed a few stores during the last hurricane in Florida had anything to do with the 7.6 percent rally on big volume. No, instead this looks like short covering and/or buying the dip to $14.00. We had grown cautious over the last few days and tightened our stop loss to $15.51. Now more than ever we're beginning to think this may be a short-term bottom, especially with the new buy signal on its MACD indicator. Picked on September 15 at $14.93 Gain since picked: + 0.62 Earnings Date 08/19/04 (confirmed) Average Daily Volume: 384 thousand ================================================================== Stock Splits ================================================================== Announcements ------------- NFB declares 3-for-2 stock split This afternoon just before 1:00 PM ET the North Fork Bancorp Inc (NYSE:NFB) announced that its Board of Directors had approved a 3- for-2 stock split of its common stock and a 10% increase in its cash dividend. The cash dividend of 33 cents per share will be paid on a pre- split basis. Both the cash dividend and the stock split will be paid on November 15th, 2004 to shareholders of record on October 29th. The merger with GreenPoint will close on October 1st so GreenPoint investors will also take part in the two dividends. About the company: North Fork Bancorporation, Inc. is merging/acquiring GreenPoint Financial Corp and together the combined companies will have total assets of approximately $56 billion and will rank among the top 20 bank holding companies in the country. (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 WB Wachovia Corp 47.12 +0.78 COP Conoco Phillips 83.21 +2.15 HD Home Depot Inc 38.83 +0.52 XOM ExxonMobil 48.53 +0.57 JNJ Johnson & Johnson 57.10 +0.57 MO Altria Group 46.23 +1.08 --------------------------------------- Breakout to Upside (Stocks $5 to $20) --------------------------------------- BLDP Ballard Power 7.90 +1.68 NABI NABI Biopharma 13.48 +1.79 JLG JLG Industries 17.29 +1.19 OS Oregon Steel Mills 16.81 +1.12 ADBL Audible Inc 17.83 +1.24 DRTK GTS Duratek Inc 17.42 +1.17 --------------------------------------- Breakout to Upside (Stocks over $20) --------------------------------------- NEM Newmont Mining 44.29 +1.69 SU Suncor Energy 32.56 +1.50 CNQ Canadian Natural Resources 39.80 +1.80 UCL Unocal Corp 43.39 +1.27 RIG Transocean Inc 36.19 +1.10 ROH Rohm & Haas Co 42.24 +1.21 PD Phelps Dodge 93.60 +4.26 ------------------------------------------- Breakout to Downside (Stocks over $20) ------------------------------------------- MERQ Mercury Interactive 32.36 -1.48 FMD First Marblehead 44.96 -2.04 SNA Snap-On Inc 27.83 -3.85 TSCO Tractor Supply Co 34.52 -1.59 HYSL Hyperion Solutions 31.93 -1.15 SBTV SBS Broadcasting 32.71 -1.32 CBM Cambrex Corp 21.25 -1.05 KNSY Kensey Nash 26.36 -2.22 NMHC Ntl Medical Hlth Card Sys 20.67 -1.79 ----------------------------------------- Recently Overbought With Bearish Signals (Stocks over $20) ------------------------------------------- DVN Devon Energy 72.16 -1.71 NIHD NII Holdings 40.55 -1.72 NCEN New Century Holdings 60.30 -1.39 IMH Impac Mortgage Holdings 26.03 -1.27 TZOO Travelzoo Inc 56.42 -14.62 KBAY Kanbay Intl 21.09 -1.15 UIC United Industrial Corp 31.83 -1.57 ================================================================= To stop receiving this PremierInvestor.net Newsletter, send email to Contact Support ================================================================= DISCLAIMER ================================================================= This newsletter is a publication dedicated to the education of stock traders. The newsletter is an information service only. The information provided herein is not to be construed as an offer to buy or sell securities of any kind. The newsletter picks are not to be considered a recommendation of any stock but an information resource to aid the investor in making an informed decision regarding trading in stocks. It is possible at this or some subsequent date, the editors and staff of PremierInvestor.net may own, buy or sell securities presented. All investors should consult a qualified professional before trading in any security. The information provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. PremierInvestor.net staff makes every effort to provide timely information to its subscribers but cannot guarantee specific delivery times due to factors beyond our control. 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