" Change is the law of life. And those who look only to the past or
present are certain to miss the future "

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WEEK IN REVIEW :
The stock market started the fourth quarter on a high note. The Nasdaq
closed at its highest level since 2001 and the Dow finished at an
all-time high despite negative early-morning news. The fact that the
market rallied in the wake of these warnings is a reflection of the
improvement in sentiment that followed the Fed's rate cuts last month. Today's
action suggested that investors are feeling that the worst of the credit crisis
is already priced in the market. That consideration, along with early quarter
inflows, short-covering, and arguably, a fear of missing out on the next leg
higher, bolstered Monday's gains. The Transportation index got above 50 dma
Monday. It needs a sustained break of this range top/200 dma (4964/4967) to
improve the intermediate term neutral bias. OEX stocks that were bought the most
during buy programs executed by program trading firms: KFT, BA, HAL, SLB, JNJ,
GD, TXN,GOOG, MDT, UTX, INTC, VZ, EP, T, RTN, CVX, DELL, COP, ORCL, PG, CSCO,
CL.OEX stocks that were sold the most during sell programs executed by program
trading firms:CMCSA, CI, FDX, GM, MSFT, HNZ, LTD, HD, CPB, MS,F, MCD, AMGN, CBS

It was an unusual day of trading Tuesday. Most days , the major stock
indexes closely track one another. Today the Dow Jones industrials
closed with a moderate loss while the Nasdaq composite had a moderate
gain. Given the market's quick, sharp rebound from August's credit
market squeeze and stock selloff, it was to be expected that investors would
pause to adjust their portfolios as the fourth quarter gets under way. The Dow
fell as investors sold some of their large-cap stock holdings, which have
recently performed well. Also, with commodities prices retreating and the dollar
rebounding, big mining and oil companies such as Dow component Exxon Mobil
Corp.(XOM) may see dampened profits.

The Market extended its pullback Wednesday as investors,
retrenched from an optimistic stance early in the week and waited to see how
well corporate earnings and the job market have held up in an uneven economy. (
September employment report was due out Friday) Two days of choppy, negatively
biased action has inflicted no technical damage yet with the short term support
zone of interest at the highs from late last week. Wall Street appears to be
taking many economic readings in stride, perhaps expecting some slowdown before
the Federal Reserve's rate cut is reflected in economic data. Often, such cuts
can take more than a year to fully work themselves into the economy. OEX stocks
that were bought the most during buy programs executed by program trading firms:
USB, DOW, ATI, RF, WY, GM, CAT, WFC, UPS, CVX, AIG, MMM, CSCO, XOM, JPM, F, AA,
ROK, VZ, UTX, CL, WMT. OEX stocks that were sold the most during sell programs
executed by program trading firms:TXN, SLE, CMCSA, CI, XRX, MSFT, BA.

With little market-moving economic and corporate news on Thursday, the market
was in wait-and-see mode ahead of The Department of Labor employment report due
out on Friday. After a positive start, and then a dip into negative territory,
the major indices steadied to the unchanged mark around 12:00 ET and held there
until the final half hour of trading. At that time, modest buying interest
helped the indices finish with small gains. Eight of the ten economic sectors
finished the day in positive territory. The utilities
(+0.8%), telecom (+0.6%) and industrial (+0.4) sectors provided
leadership today. The underperformance from the consumer discretionary (-0.3%)
and technology (-0.1%) sectors helped prevent the stock market from making
further gains today.

Stocks surged on Friday following a better than expected employment report. As
the chart shows, the markets gapped up at the open and never looked back.
http://charts.dacharts.com/2007-09-15/Thelascone-269.png
The S&P finished at a new all-time closing high while the Nasdaq finished at
its highest level since February, 2001. The Dow was on pace for a record close,
but some profit taking in the final 20 minutes caused it to close roughly 30
points below its highest level. For the week , the Dow gained 170.38 points ,
the Nasdaq added 78.81 points, and the SP500 added 30.84 points. All in all, it
was a bullish end to the week and a bullish start to the fourth quarter.
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MUTUAL FUND FLOW :
Oct 3 - Equity Fund Inflows $4.5 Bil; Taxable Bond Fund Inflows $1.8 Bil
--------------------------------------------------------------------- US Housing
Derivatives

Commodity traders have a new toy, long-term bets on house prices. And the
initial results (analysis from admittedly light trading at Chicago's Merc)
aren't pretty for homeowners.According to TFS Derivatives of New York, traders'
actions translate to a bet that home prices will fall a lot further.This is how
regional housing indexes would fare, if the bets are correct, through Nov. 2011:

Miami, down 29.1% San Francisco, down 26.2% USA (10 cities), down 23.2%
Washington, D.C., down 20.7% Las Vegas, down 19.5% San Diego, down 19.2%
Denver, down 19.2% New York, down 18.3% Boston, down 17.7% Chicago, down
10.8%
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Watch the Transports

I have warned you about the transport index in the past. It needs to rally soon
or the rest of the complex will correct
to the downside. ( Dow Theory)
http://content.rightside.com/13390/1821_244ee43c2d8d31c9_MW_100307_10.gif


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Cash is King

When selecting a good stock , " Cash Flow " is a key financial gauge. Below is a
list of companies with good Cash Flow. Wynn
Resorts (WYNN) one of my favorites has a cash flow of more than 5 times its
annual earnings. HNP CHU AKS WYNN HK TEN TEF OI



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THIS WEEKS BREAKOUT / BREAKDOWN ALERTS

Check Point Sftwr - (CHKP) - 52 week high Stock notches new Friday session high
of 26.03, and closed just under the July/52-wk high of 25.99

General Electric - ( GE ) - 52 week high. Early run approaches Monday/52-wk
high at 42.15--Friday session high 42.05

Xerox- (XRX) - Testing its 200 sma. Stock notches minor new Friday session high
of 17.57, hovering modestly under its 200 sma and the early wk high at
17.67/17.73

S&P 500 - ($SPX) - all time high. Index clears July peak at 1555.90 to set new
all time high. The nasdaq comp needs to rally roughly 80% from current levels to
reach its all time high from 2000.

General Motors - (GM) - weekly high tests/breaks its previous high for the week
at 37.98-- Friday session high 38.26 Next level of note is its 52-wk high from
June at 38.66

Coca-Cola - (KO) - 52 week high approaching morning high and
Monday/52-wk peak at 58.27/58.33

Dow Transports - ($TRAN) - 200ema test. Stock test/pauses near early week high
and 200 ema at 4919/4927-- session high 4921
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Dentsply - (XRAY) - attempting to stabilize near its 20 day ema after 4 day
decline Stock was down for the fourth session in a row this morning for roughly
a 3.3% decline off Monday's 52-wk high.
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China's state forex investment company debuts

CHINA Investment Corporate Ltd, the country's long-awaited state forex
investment company set up to make better use of its huge foreign exchange
reserve, was inaugurated this week.The CIC, with a registered capital of US$200
billion, is a solely state-owned company. The company, to be operated in a
completely commercial way despite its governmental backup, will mainly pursue
combined investment in overseas financial markets. The company will try to
maximize the proceeds via long-term investments within a range of acceptable
risks. It will deal with its forex investment business independently by
persisting in the principle of separating
government functions from company management.
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Online Trader Talk :


Ron : Gabe - cud u give me 7 of ur profits so i can cover my loss for the day?
please

TheLascone : nobody .. I mean NOBODY offers you live charts with instruction
(for free) like this room does !!

JP : I'm sorry I had to bring this up but Colorado 27 OU 24

Doug77 : Lasc, 2 funny things I heard: one was the head of Nareit saying, "Now
is an excellent time to use a broker" (like, when have they ever changed that
tune?) and 2, now is a great buying opportunity to get a house... asking a
broker if you need to use a broker is like asking a barber if you need a haircut
. . . lol.

sally : markets anticipating another interest rate cut

MikeWinfrey : speaking of shorts, Bets and i were looking at RVs
this weekend and some lady left her underwear in one of the bedrooms. i thought
the salesman was going to choke.


Try a Trading system that
works : Free for the first 14 days http://www.ttwmacci.com/
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Companies reporting earnings the week of Oct 8th-12th include:

Monday:MERX, QMED, and YUM.

Tuesday: CMN.. , OXM, AA...

Wednesday: ACGY,
COST, HELE, HST, INFY, MON, PGR, CREL, EMKR, and RT...

Thursday:
FAST, PEP, SLM, WGO, and CAMP...

Friday: GE
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Conference/Events Calendar for the week of October 8th - 12th:

Monday: TEG Financial Analyst Meeting; ROC Analyst Meeting; HRL Analyst Meeting;
SFE Biotech 2007 Symposium; ARNA, JAZZ, OREX, TRGT, BABY, EPIX,CYTR, BIOD, CRXX,
BTRX, VPHM, BVF, MEDX, OSCI, ZOLL, NRGN, PFWD, ADLS,KNDL, IOMI, SOMX, VNDA,
AFFY, MITI, CPST, IART at Arena Pharmaceuticals at Natixis Bleichroeder Hidden
Gems conference ...

Tuesday: SFE Hosts "Analyst Day 2007"; JCI Strategic Review and 2008 Outlook
Analyst Presentation; HRL Analyst Meeting; HME Investor/Analyst Day; MMM 2007
Investor Day; FOMC Minutes Released; GENR at Biotech 2007 Symposium, RTK at
Chadbourne & Parke LLP Coal-to-Liquids Conference; WSTM at Human Resource
Executive Magazine Technology Conference; HLX, BDE, IAR, WTI,SFY, RTK, ANR, MVL,
GTLS, WLL, PLLL, TIVO, CRK, DVR, BEXP, LBTYA, LINTA,HOLL at Helix Energy
Solutions Group, Inc. at Natixis Bleichroeder Hidden Gems Conference; HERO at
Hercules Offshore at Pritchard Capital
Partners One-on-One Conference; Fed: Yellen...

Wednesday: HRL Analyst Meeting; PETM Analyst Meeting; MSCC Investor Analyst Day;
MMM 2007 Investor Day; WBSN M&A Calls/Presentation; CEGE, FVRL, NKTR, OLGC,
TGEN,GLOB, KBP, RXI, LNS, ACI, CYT, TGD, AMBT, CLB, PEP, NEOP, NEX, KOR,
FRP,MRN, TWT, AVID, GERN, GTCB, IMGN, TRGT, ZIOP, BPA, GNVC, ONXX, RIGL,AFFY,
ANDS, EBS, EPCT, NTEC, QTRX, AVGN, ACAD, CADX, CYCC, NVD, SUPG,ARNA, GNTA, INFI,
TRCA, ACUS, BIOM, EXEL, PTN, OREX, INSM, PARD, VICL,BMTI, DOW, INO, MHA, PPHM,
XOMA, BOL, OLGX, KG, MITI, SPPI, YMI, ALSE,CRIS at Biotechnology Industry
Organization Investor Forum; HERO, PLLL
at Hercules Offshore at Pritchard Capital Partners One-on-One
Conference; MDY at Moody's Investors Service Conference; Fed:
Rosengren...

Thursday: HRL Analyst Meeting; IHS Host Second Annual
Investor Day; MSCS Analyst/Investor Meeting: Management Presentations;LMNX,
CHAK, VVUS, ALBA, DERM, IVIO, MEDP, INGN, MDVN, OXGN, PPCO, OSP,AVGO, DRRX, IDP,
AVRX, BIOD, IMRX, SBIO, LXRX, SYI, VIAP, ERC, SLZ,IDMI, SGXP, DIO, KAI, ALXA,
NFLD, OCLS, ZGEN, INMX, REP, ACEL, ANLY GENR, VQPH, CG, MNTA, RHEI, CRXX, IVPH,
HEPH, SGL, AIS, CYTO, GHDX, KAL,NVB at Biotechnology Industry Orgnization
Investor Forum; CIT at Argyle Executive Forum 2007 CEO Leadership Forum; GAS at
AGA Mini-Forum for the New York Financial Analyst Community; LUV at i2
Technologies Aerospace & Defense Industry Day; GORX at EdgeWater Research
Partners LLC Investor Conference; BRLC at DisplaySearch HDTV Conference 2007;
SPAR at Spartan Motors at Oppenheimer Hidden Gems Investor Conference...

Friday: HRL Analyst Meeting; Fed: Bernanke, Fisher, Yellen, Kohn
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The above is a compilation of some of the best minds we have to offer.
If you trade or invest this newsletter is a Tax write off
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... GOOD LUCK MARKETTRADERS


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