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Commentary Thursday, September 28, 2000 
Return Of The Dead? This morning, before the market opened, the coroners were already dissecting the corpses. After merely an hour into the day, and with the indexes moving in and out of negative territory, commentators on CNBC were already lamenting what the impact of six down days would have on the markets. So much for the commentators. The market soon headed north and turned in an outstanding performance. From noon on curbs were in place frequently. After the NASDAQ (COMPX) bounced off support of 3,650 yesterday and again today, buyers flocked to the market and picked up many of the really beaten down stocks, lifting the COMPX up 122.02 points, or 3.34 percent, to 3,778.32. Many buyers also took to the old economy sector, too. The Dow Jones Industrial Average (INDU) moved ahead 195.70 points, or 1.84 percent, to 10,824.06. The movement today reflected real buyers and not just sector rotation. Rallies in consumer cyclical stocks, financials and techs led the way. The most active stock on the NASDAQ was bellwether Cisco (CSCO), gaining $2.13 to 59.43 on over 85 million shares. Broad market indicators were also green. Volume was heavy, as would be bears sold to ready buyers. Nearly 1.2 billion shares changed hands on the NYSE and nearly 2 billion shares traded on the NASDAQ. Advancing issues swamped decliners nearly 2:1 on both venues. But, up volume thumped downers by about 3:1 on the NYSE and 4:1 on the NASDAQ. Other big movers on the NASDAQ included many of its generals. Intel (INTC) added 0.56 to 44.43, WorldCom (WCOM) surged $2.94 to $29.00 and Dell (DELL) jumped $1.00 to $33.43. On the NYSE, Nortel (NT) moved higher $3.06 to $62.88, Motorola (MOT) dipped 0.12 to $28.94, AT&T (T) gained $1.13 to $28.75 and cyclical Proctor and Gamble (PG) cleaned up $5.18 to $66.94. The telecom equipment makers and the optical equipment sector ran into static this morning, as Sanford Bernstein jumped on the bandwagon and dropped their rating on NT and CSCO from the fear of a slowdown in capital spending by the Telecom service providers. However, CSCO and NT both gained nicely in spite of the downgrade, but other optical stocks were not as lucky. I wouldn't want to take this guy hunting with me, as he missed his targets but got everyone else. Corning (GLW) fell $4.00 to $306.00, MRV Communications (MRVC) lost $0.63 to $48.44 and Sycamore Networks (SCMR) tumbled $3.00 to $104 dropped. Analysts believe that as telecoms combine and face stiffer competition, there will be less demand for their products. This is in contrast to the suppliers who are moving frantically to expand capacity to meet current demand. The suppliers themselves are also consolidating meaning that a potentially smaller pie will be divided among fewer players. Makes you wonder if the analysts know more than the people running these companies. My bet would be on the companies and not the analysts. The product is not static. Fiber is not just a commodity like copper wire with finite demand. It is constantly being upgraded and newer technologies will be in demand as new cable backbones replace older technologies and new fiber cables penetrate new areas. After the close Apple Computer (APPL) warned that it will probably report earnings between $0.30 to $0.33 per share, which is way below the consensus estimate of $0.45. This faux pas caused many tech stops to drop in after-hours, although many mounted some recovery as investors gained confidence that it was company specific. Apple said that in a break from tradition, fewer apples were going to teachers because education sales were not as spicy as expected. Moreover, sales of their new Power Mac G4 Cube were also not as spice as hoped. This warning may be the excuse needed to cut the rally short tomorrow. Across the Atlantic, something was rotten in the State of Denmark, and it wasn't the apples. It was the Euro. Danes went to the polls in a referendum to determine their future involvement with the European Currency Union (ECU). From the results tallied so far, it appears sentiment is almost equally divided but leaning toward dropping out. This vote could be the proverbial straw that broke the camel's back. Union of currencies in Europe under the Euro was always tenuous at best. England never joined. Germans with their strong economy and national pride have always been skeptical of the currency. Other nations, like Denmark, that have strong social services are being forced to surrender these as a condition of membership in the ECU. Probably anticipation of this vote was a major factor sinking the Euro over the past few weeks. We will see if the stocks that sank with the Euro rise as it recovers. In the Treasury arena, the 30-year bond gained slightly, dropping the yield to 5.88%, but the 10-year note was virtually flat, with the yield holding at 5.82%. As for that all-important commodity oil, OPEC has been hawkish lately, assuring the world it will pump whatever it takes to drive oil prices down to the $ 25/ barrel range. Futures prices closed today at $ 30.55, well off the 10-year highs that stung many cyclical stocks. Will the stocks that warned of shortfalls raise expectations now that oil is dropping? Speculators who bet that spot market prices would stay high as oil companies moved to build inventories have found themselves awash in supply. The NASDAQ Composite bounced off the 3600 level again today, as it has each time it moved up sharply. On the following chart, there is little selling below 3800 and little buying above 4100 and money flow has remained constant. All the negatives in the market have not forced it out of this range, meaning a meltdown is unlikely providing for high readings of confidence.
With any luck, the COMPX will hold 3,600 (I'm sure Apple will have a lot to say about that.) If it can, we can avoid hitting that dreaded double bottom at 3,500.
Maris Eshleman
FREE LUNCH IN PHILADELPHIA November - 8th. OptionInvestor.com, Preferred Trade and E-Signal will hold a FREE seminar complete with handouts, freebies, door prizes and over six hours of solid information which can improve your trading results. Lightning trades, real time quotes, the best option strategies and a FREE BREAKFAST and LUNCH! How can you go wrong? It is free but you have to register so we can order food. http://www.optioninvestor.com/seminar/free
OCTOBER OPTIONS WORKSHOP EXPO DENVER - Oct 27-30th Here is the list you have been waiting for. The guest speakers and the course outline for the October Workshop Expo. The list of guest speakers is outstanding. Here they are:
Steve Nison - Steve Nison is not only the world's foremost expert on Candlestick Charting techniques, he's the author of the two top selling, definitive books on the topic: Japanese Candlestick Charting Techniques and Beyond Candlesticks. He has trained and lectured investors and investment firms around the world on how to integrate these methods into their investment strategies. Steve will be speaking on "Spotting Early Reversal Signals."
Gregory Spear - Author of the Spear Report. Gregory developed a unique "consensus" concept for picking stocks in the early 90's while trying to make sense of the myriad of financial newsletters in his mailbox. His unique "consensus" system has developed an average gain of 100% for his recommendations over the normal holding period which is about six months. The Spear Report is quoted or featured in dozens of financial publications and Greg's financial workshops are "standing room only." Greg will be speaking on the top market gurus, "What they are saying and why they are wrong."
Dick Arms - Richard Arms is the inventor of the Arms Index, otherwise known as the TRIN. He has been analyzing the market for over 35 years and is a constant visitor to CNBC as a market commentator. His work in technical analysis is older than most of the brokers now trading with his tools. His newest invention is the Equivolume charting system, the first new charting system since the 1930s. Dick will be explaining the TRIN and how we should use it to trade as well as his new Equivolume charting system. This will be an interactive session with plenty of attendee questions that Dick will answer.
Stan Kim - Stan has a MBA from UCLA and worked for IBM for many years. He realized he did not want to work for anybody else and did not want anybody working for him. He has been a full time trader ever since. He is the founder of the Snail Trader system of trading and is currently working on a new book. Stan consults and mentors traders and investment firms. His topic will be, "How to Trade for a Living When You Are Not a Stock Guru."
Jim Crimmins - Jim is president of TradersAccounting.com and a noted authority on tax issues for traders. Jim is an expert on gaining Trader Status and puts on seminars on "Tax Free Trading" around the country. If you have been to a money show you have probably seen Jim with flocks of people around him. Jim IS the authority on tax accounting for traders! Jim will be speaking on Trader Status, Mark to Market and IRS do's and don'ts for traders.
Add to this distinguished list above the fifteen plus speakers from OptionInvestor and you have an event you cannot afford to miss. The current roster of staff instructors includes:
Ryan Nelson - Managing Editor, OptionInvestor.com For a course outline click here: http://www.optioninvestor.com/workshop/outline The workshop is scheduled for the last weekend in October. Four days of intense, power packed option education. This is not your standard seminar. We start by putting you up in a luxury hotel and feeding you five times a day. We feed your mind from a fire hose as well with more than 15 speakers and special guests to educate you on every option strategy. There is something for everybody. Just mingling with over 15 professional option traders for four days is worth the price of admission. The entire weekend for the low price of $2995 plus your room. All meals, snacks and favors are provided and you will get a professionally produced set of videos of the entire weekend. Need we say more? If you want to learn how to be a better trader, making more and losing less then you should come to this seminar. We guarantee you will not be disappointed! For more info: http://www.optioninvestor.com/workshop If you have not been to one of our Denver Expo seminars before here are some comments from previous attendees: The words herein are totally inadequate to express what I am feeling about you and all the OptionInvestor organization. But this medium is all I have. Thank you more than these few simple words can say. Wow, what a seminar! In my 25 years of investing I have attended many instructional conferences, but I have never, never experienced one like your Options Expo. The instructors were absolutely tops. Subjects, generally were on target. Especially for me, the Skybox, index funds/options and the early morning strategies and trading were particularly great. The attention to the many details and nuances were especially evident, and I guess most of the credit that area goes to your great support team. Now, the real challenge is to apply and implement the powerful knowledge I was exposed to.
Sincerely and warmly,
Jim & Staff,
Please pass on my thanks to the entire OIN group for a fabulous EXPO. The seminar far surpassed any expectation that I would have fathomed, had I attempted to! OIN has the right attitude and the obvious ability to be a leader and I look forward to many years of positive experiences with you folks.
Kind regards,
GREAT JOB TO EVERYONE!
Need we say more? If you want to learn how to be a better trader, making more and losing less then you should come to this seminar. We guarantee you will not be disappointed! For more info: http://www.optioninvestor.com/workshop
REGIONAL SEMINAR SCHEDULE The San Francisco seminar is October 19/21st. Here is your chance to learn from the pros. The three day Technical Analysis Stock and Option Fall Seminar Series. Three days of in-depth education. Don't miss it! Some comments from recent attendees: I want to thank Chris, Steve and Scott for the excellent workshop held in Detroit last week. Having been to the Expo in Denver in March (which was fabulous), I was ready for a smaller, hands-on approach to hone my less-than-perfect skills. I was not disappointed. One can never get too much education in options investing, and Chris and Steve offer terrific, unique approaches. Laurie Chris & Steve, I would like to thank both of you for a great experience at the Atlanta Workshop. I learned more in the three days of the workshop about investing and trading than all of my undergraduate and graduate courses combined. It was a lot of information in a short time and I hope to put it to use very soon. Mike I attended the Atlanta seminar and wanted to forward my positive comments. The seminar "really lit my fire". I have been a trader for 20 years and often go to seminars and this was the first one that really taught me the most. Dr Lloyd Jim, I had the good fortune of attending the meeting in Orlando. Like your newsletter, it was a CLASS ACT. Chris and the others did a great job. Chris was by far the best performer but the gentlemen beside me was an option trader with several seminars under his belt and almost freaked out when Chris finished his Index Presentation. JC I am writing this note to compliment you and your staff on the great job they did in Atlanta. But more importantly I would like to single out Steve Rhoades as one of the finest speaker/teacher on technical analysis that I have ever had the pleasure of hearing. I am doing my best to persuade other members of the two investment clubs that I belong to, to attend the Detroit seminar. Sincerely, ML We guarantee you will not be disappointed. The class size is small so you will get plenty of individual attention from Chris Verhaegh, Steve Rhoads and staff. At less than the cost of a bad trade you can learn how to analyze stocks and trade options like the pros. Don't wait, do it now. Date City
Oct 19-21 San Francisco Has the market been beating you up? Did you give back your gains from April/August? Would you like to understand all the technical indicators our writers use? Does the alphabet soup of technical terms like RSI, DMA, MACD, ROC, Stochastics, Bollinger bands, sound like Greek to you? You can learn from the experts how to interpret all these indicators, read charts, pick stocks and which option strategies to use on those stocks for less than the cost of one bad trade. Reserve your seat now for one of our regional seminars. Click here for more info: http://www.optioninvestor.com/seminar/seminar.asp
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