CMOS - Credence Systems Corp $127.44 -13.94 (-21.31)

The colossal run-up in semiconductor stocks has also benefited companies that provide test equipment for semiconductor circuits. A standout in its field, Credence Systems (CMOS) has built a wide range of products for testing digital, mixed-signal and memory semiconductor equipment. The company's strategy of being a cost- effective supplier of automatic test equipment (ATE) has had positive results and investors have agreed. A strong performance in the stock prompted the Board of Directors to announce a 2:1 stock split on 3/23, with a payable date set for May 17th. Before that, earnings will be reported May 15th, after the close, so that's our target date. Most recently, shares have consolidated in a $120 to $150 range since the 3/23 split announcement. We believe that with earnings and the payable date set for next week, some upside potential exists, with a good opportunity to enter near the bottom of the trading range. First, shares will have to break through initial resistance (previously support) at the 50-dma ($131.44), before higher ground is reached. As for support, the $120 mark should be fairly solid unless the market kicks the chair out from under us. Time your entries near support, when prices bounce sharply off them. Also, include trailing stops to lock in future profits. Design your exits ahead of the earnings report, by exiting your positions no later than the May 15th close of trading.

Picked on May 9th @ $127.44 Change since picked 0.00

PWAV - Powerwave Technologies Inc. $183.25 -1.75 (-11.75)

There's a first time for everything. And so it is with Powerwave Technologies, the manufacturer and marketer of ultra-linear radio frequency (RF) power amplifiers. Their products are used to increase the amplification of frequencies in wireless devices like cell phones while reducing interference. On Tuesday, May 16th, PWAV will effect their first ever stock split, a 3:1. The payable date is the day before on May 15th. On April 26th, the company announced the split, which sent the stock into orbit, running up 36 points over the next 3 trading sessions. Last week the stock took a breather while investors took their profits during the market selloff. This week the company will be spoken about at the Hambrecht & Quist Technology conference, the 4 day event dubbed the High-Tech Beauty Pageant, which gives analysts an opportunity to see the future plans of leading tech companies. The recent price swings are not new to PWAV, which can add or drop 10-20 points in a day. In January of this year the stock broke out of a 2 month base at $70 and hasn't looked back since. May 1st saw PWAV hit a new all-time high at $218.75, but volume came in suspiciously low for a stock hitting a new high. The following day the stock received a 17.50 point haircut. Since then the stock has been consolidating around its present level. Now, with the payable date nearby and the market showing signs of a near-term bottom, we believe an opportunity exists to enter the play at a good level. We note that this is a very short-term play and will not be suitable for everyone's risk tolerance. An intra-day bounce off $180 with good volume (900k or better) would be a good entry point. Support under that is at $170. A strong move back up through the 10-dma at $194 would also be an encouraging sign. We will exit this play by this Friday, May 12th, which is one day ahead of the payable date, to avoid the possibility of profit taking. Adjust trailing stops based upon your own level of tolerance. Confirm market direction in the NASDAQ and the Telecommunications sector.

Picked on May 9th @ $183.25 Change since picked 0.00

NEW SPLIT CANDIDATE PLAYS

ADI - Analog Devices, Inc. $60.69 -4.25 (-8.25)

Despite incredible growth, record profits and sales for the semiconductor industry in all time record territory, the leaders have been suffering some excruciating share price losses. Perhaps ADI did get ahead of itself when it traded at $94.50 but the correction may have hit its nadir. Today, ADI began shipment of some of the fastest and most energy conserving amplifiers ever built. ADI is probably here to stay; it is just a matter of when the stock will begin trading up again. One possible positive influence on the price of the stock will be the earnings report expected to be released on May 17th before the market. Estimates are for a profit of $0.24 a share. Having already split 2:1 just this past March, another split seems very unlikely in the near future, but we are playing the stock for its established momentum history as we approach the earnings report. Today saw a real slam-dunk in the shares of ADI as the stock closed nearly 6 points below its intraday high. Brave souls who have bought spike down drops like this have been occasionally rewarded with some quick profits. The drop had more to do with the unbelievably apathetic volume in the overall market than it had to do with anything negative going on fundamentally. This is definitely a bounce play, but a risky one nevertheless. You never know how many more days there will be of this lack of interest in the market. The MACD did turn negative today and the Relative Strength Indicator has plenty of room to the downside. If we do not get a bounce right away, you should probably avoid this play. There is resistance at the 5-DMA at $66 followed by the 10-DMA at $69.38. Unless support was established today, it is hard to find the next support level. That said, the April low of $54 should provide the next major support. We will exit this position before the earnings, which means you should exit by the close on May 16th.

Picked on May 9th @ $60.69 Change since picked 0.00

CIEN - CIENA Corporation $120.44 -4.69 (-17.12)

CIENA Corporation makes optical networking equipment for tele- and data-communications service providers worldwide. The Company offers optical transport, intelligent switching and multi-service delivery systems that enable service providers to manage and deliver high-bandwidth services to their customers. Tuesday, Qwest Communications (Q) entered into a multi-year agreement to buy equipment from CIEN. Terms were not disclosed, but Company officials estimated the deal to be in the hundreds of million. That's a little unclear, but positive news nevertheless. CIEN has rebounded from its April lows and is trending up into their earnings announcement on 5/18. We believe that the recent weakness has created a good opportunity to enter plays on CIEN. The Company currently 140 million shares outstanding and 460 million shares authorized. The stock price is within split range and we are looking for a split announcement with their earnings release on 5/18 after the bell. On the technical side, CIEN has support at $120, then $117 with additional support at the 20-dma, currently at $113. Resistance is $125 and then the 50-dma at $131. Initiate new plays near support levels or on a break through the 50-dma. Open new positions on heavy volume, only in a rising market. Plan to exit no later than 5/18.

Picked on May 9th @ $120.44 Change since picked +0.00

FLEX - Flextronics International $50.63 -1.81 (-3.88)

Business is going well for Flextronics (FLEX) who has been able to tap into the highly lucrative electronics contract manufacturing (ECM) market. An electronics contract manufacturer might sound like a highly technical business, but it's actually very easy to understand. Consider Nokia, a major client of FLEX, wants 100,000 cell phones by the end of the week. Nokia will contract out with FLEX for their expertise in integrating together the cell parts into one phone. Essentially, Nokia and other companies are able to outsource production of their products more cost-effectively through an ECM like FLEX. Traders and investors seem to have once again sensed an opportunity with this stock as they have again sent shares higher to pre-split territory. Currently, the company has 115.5 million shares outstanding with 250 million authorized, so a 2:1 split is a real possibility. As for the stock performance, shares have steadily dropped from highs ($70) made earlier in the month down to support at $50. If prices can rebound from this level, then a double bottom pattern will be the result. Still, if more selling pulls shares lower, then anticipate the 200-dma ($45.07) to be firm. If the stock can advance from current levels or rebound off support, then potential entries can be initiated. On the upside, advances will likely meet some resistance at $60, bolstered by the 20-dma of $59.84. Stronger opposition should follow at the 50-dma ($63.99). When the stock can advance sharply through resistance, look to open new positions when strength in the market can be confirmed. Use trailing stops to lock in profits or minimize losses. We'll be going on chart indications for our buy/sell signals since we have no news on a pending BoD meeting and earnings are not due until July.

Picked on May 9th @ $50.63 Change since picked 0.00

ITWO - I2 Technology $104.12 +0.50 (-12.94)

A move higher today, albeit a very small one, may be indicative of the possibility that ITWO has seen its lows for the week. One of the reasons why we feel this Company will emerge as one of the survivors of the technology correction is because of the critical need for their products. ITWO provides the vast majority of the supply chain management software for the electronics industry. As long as computers and chips and anything silicon based (besides glassware I suppose) is built, these OEM companies are going to need ITWO's software. Demand for computers remains solid and there is no reason why it will not remain so, regardless of what the stock market is saying these days. ITWO has already split this year, a 2:1 in February, so it really is not a split candidate at this time, but we like the upside potential of the stock. Earnings have already been reported and they were solid, beating estimates by 2 pennies. The main reason why we like the stock is because it is exhibiting stronger technical characteristics than most. The stock was able to gain a huge amount of relative strength today because it was able to rally convincingly back over the critical $100 level after having fallen below it. On top of that, ITWO traded 50% more than its average daily volume today, which is exceedingly rare in this market especially without any news. Somebody wants to own it at these prices and we are not going to argue with them. The MACD is still positive but is threatening to rollover so be careful. The Relative Strength Indicator is not offering us any information because it is neutral. There was a nice pop up in On Balance Volume today. Today's high of $111.25 is resistance and it sits right between the 5-DMA of $109 and the 10-DMA at $114.50. This one is a roller coaster so protect yourself at support of $100 and take profits on the first sign of a loss of momentum. There are currently no events on the horizon that will force us to exit this position.

Picked on May 9th @ $104.12 Change since picked 0.00

SUNW - Sun Microsystems $82.12 -3.25 (-8.38)

Sun Microsystems, Inc. is a leading provider of products, services and support solutions for network computing environments. The Company sells scalable computer systems, high- speed microprocessors and high performance software for operating network computing equipment and storage products used for commercial and technical applications in various industries including telecommunications, manufacturing, financial services, government, energy, and healthcare. The real story with SUNW has to do with their Internet servers and their proprietary computing language known as Java. As stated in their ads, they are the dot in dot-com. The stock has been flying since 1998, hitting an all- time high of $106.75 on 3/28. SUNW fell shortly afterwards, trading as low as $74 on 4/14. Recently, the stock has been in a trading range of $80-95. On Tuesday, SUNW hit the low end of its range and bounced back. This is a great opportunity to enter the stock near the bottom of the range, since this seems to be a range-bound market that we are stuck in. The stock is at previously established split-levels and they currently have 1.75 billion shares outstanding and 3.6 billion shares authorized so a split could come at any time. The Company is expected to announce earnings in July and we are looking for split out of their next BoD meeting or with the earnings release. For now, the stock has support at $80, with additional support at $74. Resistance is $90 and then $95. Use an entry near $80 or a move above $90 on heavy volume to open new positions. Confirm market sentiment and sector direction before starting new plays.

Picked on May 9th @ $82.12 Change since picked +0.00

SPLIT RUN PLAY UPDATES

GILTF - Gilat Satellite Networks $77.50 -3.38 (-4.47)

Gilat is yet another NASDAQ stock that is drifting lower during these waiting days before the FOMC meeting. There is nothing wrong with the stock, just an incredible amount of buying apathy that will have to change soon if we are going to keep this play. The bounce at $80 never materialized and nobody seems to care that the Company will probably be posting a solid quarter on Monday and has a pending 3:1 split. However, these factors could lead to a resurgence in interest in the stock in the event of a counter rally. To protect yourself we suggest you place a stop at $73, just in case more cash is raised ahead of Tuesday's meeting. Although the RSI is not yet oversold, the MACD is still positive but it is a bit shaky. The comeback has to start soon or else GILTF could easily fall back into correction mode. The 5-DMA, which once offered support now offers resistance at $81.25. We will be exiting this position either due to the stop or before the earnings on Monday.

Picked on May 4th @ $84.50 Change since picked -6.97

JNPR - Juniper Networks Inc. $177.00 -12.00 (-16.38)

On Monday Juniper Networks and Nokia moved beyond the adoption phase of a deal to combine the two companies technology. Juniper is in the business of developing Internet backbone routers that help Internet providers and other telecommunication service providers keep up with the rapidly growing Internet. This new alliance with Nokia will combine the technology of the two companies with special emphasis to reach the growing market share in the overseas markets. Despite this news and the final approval of a stock split, which came last Friday, the shares closed lower both days this week. Juniper is scheduled to split its stock 2:1 with a paydate of June 15th. The company previously had a 3:1 split back in January of this year. The split in June will be the company's second since going public in June of 1999. The volume Tuesday was almost twice normal at 6.3 million shares, probably because selling came in when the stock moved below the established 100-dma at $91. Tuesday's weakness may have been due in part to valuation concerns in Cisco Systems (CSCO), which single-handedly pulled down the entire tech sector. JNPR's primary competition is CSCO. Fortunately, a late day recovery from the lows at $170 came on good volume. We now see light support at $170 and then all the way back at the April lows at $160. Resistance is overhead at $180, then the 100-dma at $190. A positive move will need to be decided soon and we'd like to see momentum return and push the stock back through the 100-dma. We suggest opening plays only if the stock can push through its first resistance area with conviction, meaning solid intra-day volume. Confirm any new positions with the broader markets. We suggest that stops we placed at $169.87 to avoid further declines.

Picked on April 27th @ $208.94 Change since picked -31.94

TXN - Texas Instruments, Inc. $141.31 -5.50 (-11.87)

Texas Instruments and Novell agree that faster is better. On Monday the two companies announced a demonstration of their combined technology to increase the speed in which broadband technology is transmitted to homes and businesses. TXN flexed its growth muscles overseas as well on Tuesday, with the announcement that it would be investing an additional $450 Million dollars in its production facility in Germany. The increased production in Germany should begin to see effects by mid- 2001. The news of continued growth did little to help the stock however, as sellers dominated the market both days this week. TXN is 2 weeks away from their 2:1 stock split with a scheduled paydate of Monday, May 22nd. Tuesday, the stock bounced off the 100-dma at $139, before closing slightly higher by day's end. Volume came in at about 500k shares higher than average at 5.7 million shares. The upcoming split will be the company's 6th. The stock now has support at the 100-dma at $139 with resistance overhead at $150, the 20-dma. A strong move off support with good intraday volume as its guide would make a good entry point. We will want to see the general condition of the market confirm direction before entering this play. Be careful ahead of the FOMC meeting scheduled for Tuesday, May 16th. We will limit ourselves to a stop loss set at $138.

Picked on May 4th @ $155.50 Change since picked -14.19

SPLIT CANDIDATE PLAY UPDATES

AFFX - Affymetrix $139.50 -8.62 (-16.56)

Affymetrix took a beating on Tuesday as the biotech sector sold off. Shares of AFFX fell below the 5-dma, hitting an intra-day low of $136.25 before bouncing back on average volume. On the positive side, the stock held at its 10-dma ($138.38) and the short-term uptrend remains intact. Hopefully, AFFX will be able to rally from here. The Company is holding its Annual Shareholder Meeting on 6/8 at which time the shareholders will vote on an increase in the number of authorized shares. We are hoping for a split announcement out of the meeting. If they do, it would be the first in their history. This week, there are two biotech conferences occurring, so we are hoping for some news out of the biotech sector. Tuesday, the AMEX Biotech Index slid 3.5%, but held important support at the 500-point level, closing at 505.14. AFFX currently has support at $135, with stronger support at the 20-dma, at $125. Resistance is the 5-dma at $146 and then $150. Look for a bounce off of $135 or a move above $146 to initiate new plays. Open new positions on heavy volume, only in a rising market.

Picked on May 7th @ $156.06 Change since picked -16.56

AMAT - Applied Materials $90.62 -5.06 (-11.26)

Applied Materials has been falling along with most of its peers. The Cisco (CSCO) value call hurt many of the high-flying NASDAQ issues, AMAT included. On Tuesday, shares of AMAT continued to slide on sector weakness in pre-earnings profit taking. The Company is scheduled to announce earnings on Wednesday after the bell and we are looking for a possible split announcement to come out with the earnings release. We realize that this would be a far-lower split level than the previous announcement, but we are playing the pre-earnings run here. We plan on dropping this play as of Wednesday's close so are not recommending opening any new positions on AMAT at this time. For those people still in, there is support at $90 with stronger support at the 100-dma ($83). Place stops under $83 as protection. Resistance has come down to $100 and then $105. Exit no later than the closing bell on Wednesday.

Picked on Apr 30th @ $101.81 Change since picked -11.19

AMD - Advanced Micro Devices $84.31 -4.44 (-7.50)

Flash memory is in big demand this year. Economics 101 will teach that when demand exceeds supply it creates a very positive environment for suppliers who can meet that demand. Advanced Micro Devices is likely to share in the growth of flash memory sales that are projected this year to rise from $4.5 Billion to $10 Billion. Flash memory is used to store data and programming algorithms in cell phones digital camera and MP3 music players. Tuesday, AMD lost ground for the second day despite the promising news, trading lower with the broad market. AMD is about 2 weeks away from their shareholder meeting and a possible stock split announcement. On 5/25 shareholders will vote to increase shares from 250M to 750M. If the company does announce a split, it will be the first time since 1983. The company has split its stock 5 times, three times in the 80's and twice in the 70's. Volume during Tuesday's session was 4.75 M, slightly below their average of 5.2M. Support is now at the 20-dma at $82. Resistance is overhead at the 5-dma at $88 and then at $90. A bounce off the 20-dma on good volume would offer a good entry point, since $80 is a key level that the stock is likely to hold, unless the market really get ugly. On the upside, a strong move back through $90 would be a good entry point if the stock gathers momentum once again. Confirm market direction before establishing any new plays. Be cautious of the volatility ahead of next Tuesday's FOMC meeting. Our suggested stop will be set at $79.87.

Picked on May 9th @ $84.31 Change since picked +18.31

BRCD - Brocade Communication Systems $110.06 -13.94 (-26.00)

Aligning its strengths with another large and reputable company, Brocade announced today a worldwide alliance with Hitachi Data Systems. Under the agreement, Hitachi Data Systems will market the BROCADE SilkWorm® 2400 and 2800 Fibre Channel fabric switches to provide an intelligent networking foundation for Hitachi storage area network (SAN) solutions. The BRCD SilkWorm switches will be available to Hitachi Data Systems customers today. "BROCADE's reliable and scalable storage networking foundation is an ideal complement to Hitachi's approach to delivering best-in- class SAN solutions for the enterprise," said Peter Tarrant, BROCADE vice president of marketing and business development. Though positive for future growth, BRCD has continued a sell-off from Friday's high of $136.06. Near term resistance will be set at this level, with more to follow at the $120-$121 level (5 and 10-dma's). Further up, look at $140 to offer further resistance, bolstered by a 50-dma of $138.69. However, if more selling continues we feel that a bounce off the century mark may be on the horizon. If support can be found at this level, followed by a sharp bounce, then look for potential entries. However, if prices continue to decline through $100, we'll put a stop in place for closes below this level. Confirm new positions with positive market momentum.

Picked on April 27th @ $115.00 Change since picked -4.94

CHKP - Check Point Software Technologies $160.19 -15.45 (-26.75)

We suggested in Sunday's report that the "Love Bug" rally has probably run its course and that CHKP would have to continue its rally due to some strength in the overall market, which obviously has not happened. A complete lack of volume coupled with an ever-increasing gallery just sitting on the sidelines has caused CHKP to cough up its gains for last week. CHKP sliced right through the 5 and 10-DMA's, both of which we thought would provide more support than they did. In reality we have seen CHKP do this a couple of times before. There have been five spike downs like this in the past few weeks and they have all been followed by a move higher than the previous one. It may be choppy, but it is an uptrend. Some of you may have been clever enough to take profits when the stock dropped back below $185, which was the old critical resistance point. Odds are that CHKP will probably recover some of its early week losses for the rest of the week. The RSI is neutral and the MACD is still positive. Support is just a little below today's close at the intraday low of $159. The 5 and 10-DMA's are now providing resistance at just above $177. We are a bit below split potential area but if we do get an announcement we will be exiting this play.

Picked on April 27th @ $179.00 Change since picked -18.81

CMGI - CMGI Inc. $56.63 -4.44 (-8.63)

We still like the potential for CMGI to become one of the survivors of the Internet Inquisition, but for now the stock appears to be just flopping around in a trading range. But it is tradable within this range and we are watching closely to make sure that it does not drop to the extreme low end of $50. To guard against this possibility, we recommend a stop at $54.50. If the stock drops below this price we will be exiting this position. It is critical that the NASDAQ does not close very far below the 200-DMA at 3550. We are guessing that it will hold because even though there is very little overall buying bias there is an equally low level of selling conviction. Trade the range and do not be afraid of taking profits. We suggested backing away from CMGI if it started dropping below the previous day's lows. Since this has happened you might want to be a little patient and wait for a small uptrend to start before buying again. There is some resistance at $62.25, just above the 5-DMA. The OBV and moneyflow are very anemic but the MACD is still positive. A split seems very unlikely so we will let the stop take us out or a yet to be determined target price to be hit in order to exit this position.

Picked on April 27th @ $66.19 Change since picked -9.56

CPN - Calpine Corporation $106.81 +3.81 (+8.06)

Looking for high-growth in the conservative utility sector? Calpine sticks out like a sore thumb. Defining and developing a whole new growth style for the utility business, CPN commands a hefty P/E of 54! This is a far cry from the industry average of 10-12. In an effort to maintain this high P/E, CPN is set to deliver 30% growth in earnings over the next five years. Calpine has stated that much of this growth will come from the company's ability to produce a sixfold increase in its generating capacity over these five years. One look at the chart and you'll see the positive effect that strong growth has had on the stock price. Presently, shares have advanced +8.06 points for the week and managed to finish up 3.70% on the day. With good volume (700k or better) being a part of this advance, shares may be on their way to re-testing all-time highs. Going forward, light resistance might be encountered at the $110 level, with stronger opposition near all-time highs ($120.00). Advances through resistance, when combined with good volume, will present us with an opportunity to add to positions. As for support, we expect the century mark to be firm, bolstered by the 5-dma of $100.21. Still lower, look to $95, supported by the 50-dma ($95.58) to provide additional defense. Use trailing stops to protect profits. Also, confirm strength in the utility sector prior to opening new positions. Keep in mind the shareholder's meeting on the 18th.

Picked on May 7th @ $98.75 Change since picked +8.06

CRA - Celera Genomics Group $85.81 -7.94 (-3.69)

How do you tell an X Chromosome from a Y chromosome? Pull its Genes down! Gene research, Genomics, biotechnology and a host of other computer-aided research may just be beginning of the end for major diseases in our lifetime. Celera Genomics is in the business of combining highly sophisticated computer software programs to engage in gene research, genetic markers, genetic variability and related consulting and research and development. This week there are two Genomics conferences taking place, which we believe, will contain positive announcements for the Biotech sector. These announcements could be enough to bolster investor sentiment back into the buying mode. The stock is obviously trading way below its previous split price, but we like the recent upturn we have seen in the biotech sector, which may mean that this stock could post big gains if the broad market can support us along the way. Volume in the stock has been lighter both days this week, slightly below its average of 1.7 million shares. Tuesday's close is just above the 10-dma at $84 and will serve as light support. Just below that is the 20-dma at $80. Resistance will be encountered at $90 and then at the century mark. Look for volume to increase back over 2 million shares for the stock to convincing make advances. Confirm the overall condition of the market, specifically the NASDAQ and the Biotech sector (BTX). We would suggest a stop be placed at $78 to limit losses.

Picked on May 7th @ $89.50 Change since picked -3.69

EMLX - Emulex Corp. $52.25 -4.31 (-10.25)

We were faked out by the partial-gap closing when the stock of this data storage services provider started to look strong last week, only to get beat up handedly early this week. Bottom line is that there just was not enough interest in the tech stocks generally to have any sort of follow through rally. It has been a big percentage drop and if the trading range theory proves correct, then EMLX is near a low and should be ready to bounce back. If it does not we suggest placing a stop at $44.88 to protect against further losses. We do not anticipate reaching those rather low levels. We still like several of the technical indicators of the stock. The MACD is still positive and should start rising again and the RSI is very close to oversold levels. The OBV is also solid. If the stock can just hold on during this apathetic period, we may attempt to close that gap between $64.38 and $78. There are not any pending events that will force us to exit this position.

Picked on May 4th @ $62.63 Change since picked -10.38

INCY - Incyte Pharmaceuticals $77.09 -9.06 (-13.83)

Incyte had a rough day Tuesday. The Company announced a contract with the National Institutes of Health (NIH) to provide gene sequencing data free to the public. Investors are concerned that the collaboration with the NIH might depreciate Incyte's database of genes. Albert Rauch, an analyst at First Union Securities, stood by INCY, saying that the Company is looking more toward the business of making genomic reagents for other companies and researchers rather than relying on revenue from access to Incyte's proprietary database. He supported the move to free access. "They or someone else will have patents on the gene sequences. As more people have access to the sequences, there will be more demand for reagents," Rauch said. The stock fell $9.06 on average volume, closing just above its 200-dma. On 6/5, the Company is holding its Annual of Shareholder Meeting at which time the shareholders will vote on an increase the number of authorized shares. We are looking for a split announcement following the meeting, or in July when the company announces earnings. In the meantime, the stock has moved back down to 200- dma support, which is at $75. INCY has held closely to the 200- dma for much of the month of April, so we feel fairly comfortable at this level. More support is at $70. There is resistance at $80 then $90. Initiate new plays on a bounce off of $75 or a move above $80 on heavy volume. Confirm market sentiment and sector direction before opening new positions. Plan to exit in the session following a split announcement.

Picked on May 7th @ $90.94 Change since picked -13.83

LSCC - Lattice Semiconductor $58.38 -1.88 (-5.50)

Still no split from Lattice. The only news on the stock came from the CEO and Chairman, Cyrus Tsui. He registered 100,000 shares of the chipmaker for sale, according to a Form 144 released by the SEC on Monday. Tsui said he planned to sell the shares on May 2nd, using Morgan Stanley as broker for the transaction. This did not help LSCC. The stock closed on its intra-day low on Monday. For now, support has fallen to $57. Additional support may come in at $54. Set hard stops under $54, as we will drop this play if the stock trades below $54. Resistance is now $61 (the 100-dma) and then $70. Use a bounce off of $57 or a move above $62 to start new plays. Open new positions on heavy volume, only in a rising market. If the stock holds support, we will be trading on chart technicals and sector momentum, since trigger events are in June. Therefore, use trailing stops or stop losses to protect your capital.

Picked on Apr 23rd @ $62.94 Change since picked -4.56

PMCS - PMC Sierra Inc. $157.69 -9.81 (-22.31)

The point man always gets it first. When Marines go on patrol they assign a point man, someone who leads the others on patrol. When an attack comes, the point man usually gets it first. So it is with PMCS and other chip stocks that had been leading the market back from the April lows. The gods have recently looked with disfavor upon PMCS, the manufacturer of Internetworking semiconductor solutions for high-speed transmission and networking systems. Both days this week have seen profit taking and stop loss selling in PMCS. The company is being spoken about this week at the H&Q Technology conference in San Francisco, but not enough to offset the slide in the NASDAQ. Tuesday the stock closed down on volume of 6.2 million shares or about 1.1 million shares higher than average. We are better than a month away from the scheduled shareholders meeting and a possible split. On June 15th, the company will vote to increase shares. If approved and a split is announced, it will be the 4th split for PMCS since going public in 1991. The stock closed Tuesday just below the 20-dma at $162. Support is now at $150, we would like to see a bounce off this level on good volume to keep us interested in this play. Additionally, a strong move up through $170 on good volume would be a positive sign. At the very least, we would like to see a close over $160 to reestablish support at that level. Confirm any new play with the condition of the overall market. Suggested stops will be set at $149.

Picked on April 27th @ $182.62 Change since picked -24.94

SEPR - Sepracor Incorporated $106.75 +2.31 (+3.50)

In an effort to keep its current ICE (improved chemical entities) pipeline strong, Sepracor (SEPR) is aggressively pursuing the development of more than 20 major drugs! These new ICE drugs, when combined with the company's existing base, should help the company to reach their goal of tripling revenues this year. With future prospects for the company intact, investors have sensed the potential and flocked to the stock. Currently maintaining its strong uptrend, SEPR has added 3.50 points on the week to finish off at $106.75 on the day. This strong uptrend, combined with good volume (700K or better), suggests to us that prices are likely to rally to their previous highs of $126.81 before switching directions. However, to accomplish this, the stock will first have to progress through resistance at $110 and $120. On the flip side, look for good intra-day support to come at the 5- dma ($101.66), which has been providing good trendline-like support over the last few weeks. Also, expect the century mark to present an important psychological level for near term support. Confirm hard bounces off support or advances through resistance with strength in the biotech sector, prior to opening new plays. Also, incorporate trailing stops to lock in gains. Remember the meeting on the 24th.

Picked on May 7th @ $103.25 Change since picked +3.50

XLNX - Xilinx, Inc. $62.38 -2.06 (-6.50)

XLNX continues to give up ground grudgingly despite the fabulous potential for this programmable chip manufacturer. We suggested placing a stop at $63 on Sunday which was just below last week's lows, therefore many of you could be out of this play. However, we are keeping this play because we can sense that the short term selling will probably end soon. The NASDAQ pulled back to the 200-DMA today and could easily bounce or at least trade sideways for the rest of the week. XLNX is a leading semiconductor company and yet it could not rally on the good news report about the incredible growth in worldwide sales reported by the industry as a whole today. We suggest that very aggressive traders can attempt to buy the stock down to $60 in anticipation of a bounce. If you do buy the stock or you are still in it, we suggest a firm stop at $59. If the stock trades below this price we will be dropping this play. A move below $59 would indicate that the stock will probably retest the April lows at $54. In the meantime, look for XLNX to attempt to consolidate here in the mid-$60's. We will exit this position if we are stopped out or if we get a surprise-split announcement.

Picked on April 25th @ $70.38 Change since picked -8.00

YHOO - Yahoo! $117.44 -3.31 (-8.25)

Yahoo! is met with strong resistance every time it hits the 20- dma. On Tuesday, the stock did not even make it to the 20-dma, which is currently at $124.44. Instead, it hit an intra-day low of $115 and made a comeback late in the day. Volume remains light as the market searches for direction. The Company's Annual Shareholders Meeting is coming up on 5/12 when the shareholders will vote on an increase in the number of authorized shares. We are holding for the remote chance of a split announcement following the Annual Meeting. Since the current price is way below previous splits, we're actually holding more for the established momentum history of the stock, rather than a split announcement. Going forward, the stock has light support at $116 with stronger support at $115. Place hard stops at $114 to limit losses. We will drop YHOO if the stock trades below $114 intra- day. Resistance continues to hold at the 20-dma, now down to $124 and then next resistance is the 200-dma at $130. Look for a bounce off of $116 or a move above $124 on heavy volume to open new positions. Confirm market direction and sector momentum before starting new plays. If the company should actually announce a split following the meeting, we will hold for one session beyond the announcement to capture the gains.

Picked on Apr 18th @ $126.69 Change since picked -9.25

SPLIT RUN PLAY DROPS

LHSP - Lernout & Hauspie $104.00 -3.25 (-3.94)

We apologize for any of the confusion regarding the exit timing for this play. The Company announced earnings today after the close after we had anticipated earnings to be released on Wednesday. Sometimes we are unable to confirm the exact earnings release time. We did warn that the earnings date had not been set in stone and hopefully you were able to check the site today for the latest information. Because of the earnings release, consider LHSP dropped as of the close of today. Having said that, you may be lucky if you have to sell on the opening tomorrow. LHSP announced a huge quarter with EPS of $0.37, a full $0.17 ahead of estimates. There were some unrealized currency gains and the earnings might not be interpreted by the market as positively as the blowout seems to indicate.

Picked on May 4th @ $104.31 Profit/Loss -0.31 (0%) Best Profit +5.69 (5%)

SPLIT CANDIDATE PLAY DROPS

LXK - Lexmark International Group $91.31 -6.44 (-12.44)

Tuesday we experienced a printer jam with LKX. In Sunday's write up we noted that the stock has held above the $100 level and had recently established that level as support. Monday the stock closed below $100 on slightly higher volume. Tuesday was the nail in the coffin for this play with negative volume increasing by 60% and further declines. We are dropping LXK as a split candidate at this time. We will monitor Lexmark for opportunities in the future and will advise you accordingly.

Picked on May 7th @ $103.75 Profit/loss = -12.44 (-12%) Best Profit = -0.75 (-1%)

MXIM - Maxim Integrated Products Inc. $63.75 -7.13 (-4.25)

Providing a quick advance this week, MXIM furnished us with at least some profit in this run up to their S&P 500 addition that we'd been anticipating. Ahead of the S&P addition, Friday's close outside of the consolidation range ($68.00), helped to set the stage for an advance above the $70 resistance mark on Monday. As mentioned, index funds that had to properly weight their portfolio's by buying MXIM probably provided the impetus for the advance. Near term prospects remain positive for the company and we'll keep you posted on future plays as they develop.

Picked on May 4th @ $67.25 Profit/Loss = -3.50 (-5%) Best Profit = +4.37 (+6%)