Monday’s Stock Watch

January 26, 2002
TradingMarkets Editors

The
indexes closed mixed today with the Dow and the S&P 500 leading in
the green, and the Nasdaq lagging in the red. Slightly
above average volume on the NYSE countered below-average volume on the
Nasdaq, as technology issues comprised both the strongest and weakest
sectors. Stocks on our watch lists were mixed, with most stocks
recording low-volume days.

Market breadth was mixed,
with NYSE advancing issues over declining issues by a ratio of 1.06,
and up volume over down volume by a 1.26 ratio. Nasdaq declining
issues issues over advancing issues came in at 1.14, and down volume
beat up volume by a 1.76 ratio.

Â	NYSE	NASDAQ
Advancing Issues	1,594	1,658
Declining Issues	1,493	1,891
Advancing Volume	723,998,000	697,008,000
Declining Volume	572,199,000	929,354,000
Total Volume	1,324,541,000	1,642,237,000
New 52-week Highs	32	21
New 52-week Lows	5	2

Weekly Perspective:

Despite the heavy selling
that dominated the beginning of the week, the major averages managed to make slight gains. The Dow finished up 68.23 points for a
0.06% gain, the S&P 500 finished up 5.7 points for a 0.05% gaim,
and the Nasdaq finished up 7.36 points for a 0.03% gain. With the
indices bouncing from key support levels , traders are speculating the
likelihood of the 50-day moving averages on the upside being met,
versus selling through support levels.

A fresh batch of earnings
to be released next week will give the financial community much to
digest. The markets are still vulnerable to news events, though two
days of accumulation in the major averages tell us bad news may easily
be parted with. Economic reports may also play a key roll in price
action as the FOMC meeting on Tuesday, as well of a slew of economic
data will help piece together the state of our economy.

Top sectors with new highs
for last week include medical, restaurants, drugs, and regional banks.

Top sectors:

Oil Service Sector Index

(
$OSX.X |
Quote |
Chart |
News |
PowerRating) up 2.87% at 84.45.

Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating)
up 2.33% to 535.94.

Losing sectors:

GSTI Software Index
(
$GSO.X |
Quote |
Chart |
News |
PowerRating)
down 2.14% at 189.04.

TheStreet.com
Internet Index
(
$DOT.X |
Quote |
Chart |
News |
PowerRating) down 1.81% to 176.21.

Sectors With New
Highs:

Watch List Action

Direct Focus Inc.
(
DFXI |
Quote |
Chart |
News |
PowerRating) fell
1.25% on below-average volume. Ideally we would like to see heavier
volume on the days when the stock is up.

PEC Solutions
(
PECS |
Quote |
Chart |
News |
PowerRating) returned to
hard times with a loss of 7.51% on low volume. The stock resumed its
downtrend after a brief pullback, and where it bottoms is anyone’s
guess. I know a lot of people felt they missed the boat on the
breakout in November, and those who caught it would have been wise to
have booked a profit already. It pays to take quick profits in highly
questionable markets, and this has been a difficult one for IT
traders. We hope to be able to add more candidates in the near future.
Patience is critical to this strategy.

Recent Breakouts

We monitor the action of Recent
Breakouts as an indicator of the market health for IT traders. When
breakouts are acting well, this is a good sign for the likelihood of
further sustainable breakouts. When breakouts are failing, IT traders
should be even more cautious.

American Healthways Inc.
(
AMHC |
Quote |
Chart |
News |
PowerRating),
down 2.19% on very low volume.

Copart Inc.
(
CPRT |
Quote |
Chart |
News |
PowerRating), down 3.36% on
low volume.

Genesis Microchip
(
GNSS |
Quote |
Chart |
News |
PowerRating), up 1.46%
on above-average volume.

MTR Gaming Group
(
MNTG |
Quote |
Chart |
News |
PowerRating), down
3.39% on above-average volume.

Nvidia Corp.
(
NVDA |
Quote |
Chart |
News |
PowerRating), down 0.25% on
below-average volume.

Panera Bread Co.
(
PNRA |
Quote |
Chart |
News |
PowerRating), up 2.14%
on average volume.

Company Name	Symbol	12 Month RS	Price	Price Change	Average Volume
American Healthways Inc.	( AMHC \| Quote \| Chart \| News \| PowerRating)	98	29.36	– 0.66	313,200
Copart Inc.	( CPRT \| Quote \| Chart \| News \| PowerRating)	87	22.14	– 0.77	1,000,300
Direct Focus Inc.	( DFXI \| Quote \| Chart \| News \| PowerRating)	92	36.50	+ 0.45	907,800
Genesis Microchip	( GNSS \| Quote \| Chart \| News \| PowerRating)	98	56.17	+ 0.81	3,050,000
MTR Gaming Group	( MNTG \| Quote \| Chart \| News \| PowerRating)	96	15.64	– 0.55	586,800
Nvidia Corp.	( NVDA \| Quote \| Chart \| News \| PowerRating)	95	65.47	– 0.17	9,010,900
Panera Bread Co.	( PNRA \| Quote \| Chart \| News \| PowerRating)	96	59.15	+ 1.24	273,800
PEC Solutions	( PECS \| Quote \| Chart \| News \| PowerRating)	95	27.17	– 2.21	743,100

Stocks Forming a Handle

Integra Lifesciences
(
IART |
Quote |
Chart |
News |
PowerRating) down
0.804% on below-average volume.

Company Name	Symbol	12 Month RS	Price	Price Change	Average Volume
Integra Lifesciences	( IART \| Quote \| Chart \| News \| PowerRating)	90	30.75	– 0.25	344,100

Stocks Building A Base

Multimedia Games Inc.
(
MGAM |
Quote |
Chart |
News |
PowerRating), down
1.12% on high volume for a distribution day.

Company Name	Symbol	12 Month RS	Price	Price Change	Average Volume
Multimedia Games Inc.	( MGAM \| Quote \| Chart \| News \| PowerRating)	99	33.52	– 0.38	187,600

danielb@tradingmarkets.com

Monday’s Stock Watch

BUY THE FEAR, SELL THE GREED

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