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Email Version, Section 1, Monday 04/30/01
The SplitTrader.com Newsletter           Monday  04/30/01  1 of 1
Copyright 2001, All rights reserved.
Redistribution in any form is strictly prohibited.

 - Your World Leader for Trading Stock Splits on the Internet -

Posted online for members at: http://www.SplitTrader.com

To view this email newsletter in HTML format with imbedded
charts and graphs, click here:
http://www.splittrader.com/htmlemail/043001_1.asp
===============================================================

In This Newsletter:
===================
Market Commentary - Another Rotation Monday
Definition of the Day
Monday's Split Announcements - none
Tuesday's Expirations
Tuesday's Play-of-the-Day - AYE
================================================================

Market Commentary
=================

Another Rotation Monday

The end of the earnings season appears to be giving way to the
portfolio adjustment process.  Traders looking for opportunities
must stay on top of this process of jumping in and out of sectors.

That said, the stock market environment is becoming increasingly
favorable for bulls.  We are probably entering a period of
consolidation with an upside bias.  However, if today's action is
any indication for what lies ahead, we probably will not see the
phenomenon of a "rising tide lifting all boats."

As for trading today, the Dow Jones Industrials (INDU) sputtered
into the close and finished a once promising session with a loss
of 75.08 and closed at 10,734.97.  The NYSE saw decent volume of
1.22 billion shares.  Winners did manage to outpace losers by a 17
to 14 margin.  Helping to keep the INDU out of the black was
General Electric (NYSE:GE), which fell $1.42 to $48.53, and
Citicorp (NYSE:C), which lost $1.76 to $49.15.

Meanwhile, the NASDAQ (COMPX) was driven by a renewed interest for
technology stocks and climbed 40.63 and closed at 2116.31.  Volume
crossed the 2 billion-share threshold while breadth was solid with
24 advancers for every 15 decliners.

Driving the NASDAQ (COMPX) were some old favorites.  Cisco Systems
(NASDAQ:CSCO) renewed its bounce with a gain of $1.38 to $16.98,
JDS Uniphase (NASDAQ:JDSU) popped back up over $20.00 with a nice
gain of $2.13 to $21.39, Juniper Networks (NASDAQ:JNPR) moved up
$4.01 to $59.03 and Ciena (NASDAQ:CIEN) powered ahead by $4.77 to
$55.06.

Another solid performer was Micromuse (NASDAQ:MUSE), a provider of
software for the monitoring and management of information
technology infrastructures.  MUSE picked up $5.60 to $49.50.  The
stock has more than doubled from its low of $23.20, which was
established less than a month ago.

The Splittrader.com list was relatively quiet today, though
several of our stocks managed to keep their winning streaks alive
by establishing new highs in the early going.  Stocks establishing
new highs include GTECH Holdings (NYSE:GTK), which gained $0.36 to
$32.60, and H & R Block (NYSE:HRB), which moved up $0.40 to
$55.00.

The bulk of today's sector gains were seen by the PHLX
Semiconductor Index (SOX), which surged 20.05 to 662.65, and the
Biotechnology Index (BTK), which gained of 23.18 to 568.04.

The rally in the biotechnology sector was fueled by a major
takeover announcement.  Aurora Biosciences (NASDAQ:ABSC) agreed to
be acquired by Vertex (NASDAQ:VRTX).  The terms of the deal call
for Vertex to exchange 0.62 of its shares for each Aurora
Biosciences share.  ABSC saw a nice gain of $6.35 to $23.20 while
VRTX pulled back $0.69 to $38.56.

The news after the market close has been mostly positive.
Globespan (NASDAQ:GSPN) beat consensus earnings estimates by 2
pennies, reporting profits of 12 cents.  GSPN, which closed at
$22.00 during regular trading, is up more than two dollars in
after hours trading.  Caliper Technologies (NASDAQ:CALP), which
manufactures chips for the pharmaceutical industry, reported solid
profits of a $1.03 a share.  Although CALP currently is not moving
in after hours trading, it, nevertheless, closed the regular
session with a gain of $1.37 to $23.00.

The B2B sector may get a boost tomorrow due to the unexpectedly
good results from Netegrity (NASDAQ:NETE).  The e-business
solutions provider posted profits (yes profits) of 10 cents, which
was a couple of pennies ahead of estimates.  NETE closed the
regular session up 99 cents to $39.99 and is trading a couple of
dollars higher in after hours trading.

The clouds are parting and it is becoming clear that the major
indices have made a major bottom.  The Dow Jones Industrials
(INDU) made a move to test the 11,000 resistance today.
Unfortunately, vertigo gripped traders and the index quickly
retreated.  This is clearly a pattern that suggests that the
average is going through a period of consolidation.  Looking
forward, the INDU needs to hold support of 10,666 or else we may
see a test of the 10,400 support.  A drop to the second level of
support and a subsequent bounce may prove to be an excellent
buying opportunity.  The RSI is telling us that the INDU is a
little overbought in the short term. A continued pullback may be
necessary before the INDU can gather the strength to take out
resistance.

The NASDAQ (COMPX) has a little more rally room than the INDU, so
today's pattern may hold for the next couple of days.  Look for
the NASDAQ to test the 2250 resistance later this week.
Additionally, the RSI still has room before an overbought
condition is indicated, and the MACD is still rising nicely.

However, traders cannot expect the markets to simple roar right
back into monster bull mode.  It will likely take some time,
perhaps another quarter or two, for huge money to pour into this
market.  This leaves us with the prospect of pouncing on sector
rotations for our profits.  These swings typically last two or
three days, and traders have to be pretty nimble to profit from
these moves.

Meanwhile, long-term investors can probably start determining
which stocks to buy for their core holdings.  The best companies
in the market have probably achieved their lows and now could be a
good time to start picking up some favorites for the long haul.

Good Luck! And may all of your trades be winning ones!

Jim Booth
Research Analyst


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Definition of the Day
=====================

Uncovered Put

This is a form of option writing in which the writer of the
contract does not own the underlying security or a different
option on the same security.

For the complete definition, please go to:
http://members.splittrader.com/glossary/viewglossary.asp?glossaryid=388


============================
Monday's Split Announcements
============================

None


=====================================
Tuesday's Expirations by Payable Date
=====================================
Trading Split-Adjusted May 1

Penn Engineering (PNN) splits 2:1


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=====================
SplitTrader.com Plays
=====================

The PLAY LEGEND:

SplitTrader.com Play Recommendations.

Play-of-the-Day is our number one play recommendation for the
FOLLOWING trading day.

You will see:
Stock Symbol, Company Name, Closing Price, Change for the Week.
Following the play you will find: Picked at Date and Change Since Picked

Terms:
BoD = Board of Directors meeting
ADV = Average Daily Volume
dma = daily moving average

At the SplitTrader.com website, we have comprehensive profiles
for each stock that we are playing or have played in the past, as
well as hundreds of others. Please take the time to visit the site
to view the profile of the stock(s) you wish to learn more about.
==================================================================

Play of the Day (For Tuesday)
Monday, April 30, 2001
=============================

AYE - Allegheny Energy $51.16 +0.56

Sunday's Comment:

Allegheny Energy, Inc. is a diversified utility holding company
that provides electric generation and distribution services in
Maryland, Ohio, Pennsylvania, Virginia and West Virginia. The
stock has performed well over the past year after hitting a 4-year
low of $23.62 on 3/10/00. On Friday, shares of AYE hit an all-time
high of $51.30, representing a 117% gain from the low. The stock
has posted gains in the last four sessions following its earnings
announcement on Monday evening. On Thursday night, the company
sold 12.4 million common shares in a stock offering at $48.25 per
share, raising $598.3 million in gross proceeds. We believe that
AYE could continue to trend higher now that it has cleared the
earning announcement and the stock offering. We are also looking
for a stock split out of the Annual Meeting on May 10th. The
company already has enough shares for a split with 260 million
shares outstanding and 123 million shares issued. Going forward,
AYE has support at Thursday's intra-day high of $49.20 with
stronger support at $48.17, the 10-dma. Resistance is currently at
Friday's intra-day high of $51.30 and then possibly $53. Traders
may consider opening new positions on a bounce off of $49.20 or a
breakout above $51.30 on volume greater than 300,000 shares by
noon. We plan to place stops at $47 as downside protection.

Monday's Update:

We think Allegheny could climb further thanks to continued
strength in the energy sector and the stock's stout technical
indicators, which are showing strong momentum on a positive MACD
and up-trending On-Balance Volume.  At current levels, Allegheny
has support at its 10-day moving average at $48.49, with
additional support provided by an intermediate trendline formed in
late March.  Since Allegheny is trading at all-time high levels,
there is no obvious resistance overhead, though the stock could
run into some resistance at the psychologically-significant $55
level.  Traders considering a position in Allegheny should look
for strong volume, 250,000 shares or more traded by noon EDT, on a
move through Monday's intra-day high of $51.16 or a bounce off $50
before placing their trades.

Picked on April 29th @ $50.60
Change since picked +0.56
Stop Loss @ $47.00

 


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