Weekend Issue for November 3, 2002

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Free Weekend Newsletter for November 3, 2002

TABLE Of Contents 1) MARKET SUMMARY 2) POST-SPLIT PLAY 3) TECHNICAL PLAY 4) COVERED CALL PLAY 5) IPOs No Inactivity Fees!

Free Stock Split Email Notices Investing Q & As Glossary

1) MARKET SUMMARY
Fourth up week ends with the start of a breakout.

– Working toward a very important breakout as a confluence of events is changing the landscape.
– Economic reports show little life, but again there are some important features.
– The indexes are still giving mixed signals but the scales are tipping again to the upside.
– Team Trades.

See full story.Try “The Daily” with no risk for 2 weeks!

2) Stock Splits Playing stock splits can be very profitable, but it takes know-how. Our stock split service focuses on three main types of plays: 1) pre-announcement (where we forecast an upcoming split prior to the company making the announcement); 2) pre-split (these plays are made in the days leading up to the actual split day); and 3) post-split plays (plays made after the actual stock split where the stock is showing continued or renewed strength). For post-splits, we can play them as we would pre-splits (very short term), but we prefer to stretch our horizons, playing the trend. When playing options, we look further out, 2 or more months at least. We let the trend carry us along if there is one, but we will also take profits if the technical pattern degenerates, e.g., breaks a trendline. The main difference between post-splits and pre-splits plays is that we really have to like the pattern. Pre-splits can run right before their splits even with poor technical indicators. For post-splits, we are looking at the stocks from more of a longer term “would I buy this stock at this juncture?” position. Now there are times when a hot stock splits and investors pile in to get in while the stock is ‘cheaper.’ We play those, but with more of a short-term, pre-splits mentality in that we will be ready to get out fast if the momentum fades. Remember, everything we do has to pass muster with the market that day … don’t fight the market on these plays. Here’s a post-split play to watch and our current analysis. Chart by StockCharts.com

COH (Coach–$31.4; +1.65; optionable): Handbags, etc.
Company Profile
STATUS: Testing the breakout. This is the move we were looking for as COH tested the breakout, held the 18 day MVA on the test, and then started back up on sharply higher, above average volume. This is a picture perfect test and recovery, and a good point to enter into new positions.
Volume: 1.176M Avg Volume: 1.016M
BUY POINT: New positions: 31.55 (orig. $30.25). Volume=1.5M Target=$36.35 Stop=$29.85
POSITION: COH BY – Feb. $27.50c (65 delta) and/or Stock.
Click here for more information on our Stock Split Report! Chart by StockCharts.com

3) Technical Play
ARTI (Artisan Components–$13.84; +0.81; no options): Semiconductors.
Company Profile
STATUS: Cup w/handle breakout. ARTI formed a very short handle last week and then shot higher Friday on some continued solid volume. Showing a lot of life as the semiconductors improve with positive accumulation since March. Accumulation has really picked up in the latter part of the base and money flow is up ahead of the price.
Volume: 177.554K Avg Volume: 85.582K
BUY POINT: $14.05 Volume=150K Target=$16.94 Stop=$13.07
POSITION: Stock (no option chain).
Click here for more information on our Technical Traders Report! Chart by StockCharts.com

4) Covered Call Play
HLT – Hilton Hotels Corp. is currently trading at $12.64. The December $12.5 Calls (HLTLV) are trading at $1.05. That provides a return of about 8% if HLT is above $12.5 on expiration Friday in December.
Company Profile
Click here for more information on our Covered Calls Service!

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5) IPOs
China Telecom (0728.HK)(CHA.N) will likely set the revised terms of its huge, delayed initial public offering over the weekend, sources said on Friday.
Many market insiders expect the size of the IPO, which would have been the world’s third largest this year, to be slashed, and some fund managers are also clamouring for a lower price.
(This IPO story is continued on our website in the IPO Forum.)

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