Providing Independent "Buy Side" Research

Sterling Weekly for September 4th, 2003

Sign up to receive our FREE weekly newsletter.


In last week's edition of the Sterling Weekly I said that I was expecting a Fall Rally into the Holiday season. Based upon Tuesday's trading activity it appears that we may actually get the expected rally. This week I have raised my target levels on the major market indices that I track on a regular basis with the biggest news being my new intermediate target on the NASDAQ 100 (NDX) of 1,846.96

As part of an ongoing series of articles I have been writing about 11 "Rules for Trading" that I have developed. I recently covered the Third Rule for Trading in the August 12th edition of the Sterling Weekly, and this week I would like to discuss my Fourth Rule for Trading, "Do not be afraid to sell at an early profit and have the opportunity to buy back at a lower price."

The logic and thinking behind the Fourth Rule for Trading is very simple and builds upon on the 1st Three Rules for Trading which focus upon protecting your profits, but also starts to deal with the psychological mind set of trading. Many investors and traders will have an initial price target when they enter a position, and let's be honest even for the best of us not all of our stocks will reach those price levels. When a stock starts to back off or move against us, many investors/traders will become fixated on their initial price target and violate the 1st Three Rules for Trading resulting in their holding a position at a loss. Meanwhile if they had been willing to take their profits or let their stops trigger a sale, then they would at least have the opportunity to re-enter the position the position and possibly participate in another profit generating move. It does not always work out that way, but at least they are not letting profitable positions turn into loosing positions. This is key to being a profitable investor/trader, because unfortunately over the years I have seen many people with unprofitable accounts simply because they would not sell profitable stocks when they had the chance.

Economic Calendar for the week of September 3rd, 2003.
DATE Est. Time Release For Actual Consensus Prior Revised From
Sep. 02 12:00pm Auto Sales Aug   5.9 Million 5.9 Million 5.8M  
Sep 02 12:00pm Truck Sales Aug   8.0 Million 8.1 M 8.1M  
Sep 02 10:00am ISM Index Aug.   54.0 54.0 51.8  
Sep 03 10:00am Construction Spending Jul   0.2% 0.5% 0.3%  
Sep 03 2:00pm Fed. Beige Book            
Sep 04 8:30am Productivity - Rev. Q2   6.4% 6.4% 5.7%  
Sep 04 8:30am Initial Claims 8/30  


393K 394K  
Sep 04 10:00am ISM Services Aug   62.0 62.0 65.1  
Sep 04 10:00am Factory Orders Jul   1.0% 0.8% 1.5%  
Sep 05 8:30am Nonfarm Payrolls Aug   25k 18k -44k  
Sep 05 8:30am Unemployment Rate Aug   6.2% 6.2% 6.2%  
Sep 05 8:30am Hourly Earnings Aug   0.3% 0.3% 0.3%  
Sep 05 8:30am Average Work Week Aug   33.5 33.37 33.6  

Prime Update:

Sterling Investment Services is an investment research and money management firm publishing the Prime Stock Newsletter. The Prime Stock Newsletter is a daily comprehensive newsletter that is useful for investors and traders alike. Whether you are looking for short term trading opportunities ranging from day trading to a couple of weeks or if you looking to acquire a long term portfolio at smart entry points. Subscriptions a $30/month. a 3 DAY TRAIL SUBSCRIPTION IS ONLY $4.95 (more).

Last week was a more active week from a trading standpoint. It was definitely one that saw the market treat our recommendations favorably.

Highlights from Recent editions of the Prime Stock Newsletter
Recommendation Date Entry Point Recent Close or Exit Price Profit* Note
Qualcomm 'QCOM' Aug 27th $39.47/share $41.59/share Aug. 29th $2.12  
Neflix, Inc. 'NFLX' Aug 21st $28.25 $34.69 $6.44  
Lowe's Companies 'LOW' Aug 18th $51.00/share $3.26/share Aug. 20th $3.26  
* The per share PROFIT is a theoretical calculation based upon the opening price the day the recommendation is published and the intra day high (or low for short sales) on the exit day.

The Dow Jones Industrial Average:

Today's Opinion: Closed @ 9,568.46 Current Expectations: Called higher on August 29th with the close of 9,374.21 In last week's edition of the Sterling Weekly I was expecting a minor pullback to the 9,323.02 level, which was achieved on August 25th, the Dow did not move towards our lower short term target of 9,284.57 but turned back higher instead. I am now expecting the Dow to move higher again and test 9,660.60 our target level first published in the Sterling Weekly for August 18th.

The S&P 500:

Today's Opinion: Closed @ 1,026.27 While the S&P 500 did not move lower as I expected it would when I published last week's Sterling Weekly as the Dow Jones at least reached our initial target level, the S&P 500 actually demonstrated greater strength than the Dow Jones Industrial Average. After giving it a day or two to move as expected, I reversed my opinion and returned to the short term bullish expectations on the S&P 500, for the record I am bullish over the intermediate and long term on the S&P 500. Current Expections: Called higher with the close of 996.73 on August 26th. The S&P 500 should move higher and test 1.057.86

The NASDAQ 100 (NDX)

Current Opinion: Closed @ 1,360.19 Current Expectations: Called higher on August 9th with a close of 1,223.14. The NDX should move higher and test 1,385.01 and then 1,55.11 on a closing basis. On Thursday of last week the NASDAQ 100 closed above 1,325.80 and in the process completed a "cup pattern" with a measured move to 1,846.96 For better or worse, 1,846.96 is now our intermediate term target on the NASDAQ 100 Index.

If you would like to be permanently removed from our databases, please simply click on the link Simply click here to be removed from our database. We will make every attempt remove your name from our database.

Disclaimer: The Sterling Investments series of newsletters is produced by Sterling Investment Services, Inc. All information used in the production has been obtained from sources believed to be reliable and accurate. Sterling Investment Services does not warrant or assume any liability for inaccuracy of the information used to produce our publications. To receive further information on these services please visit our web page at: If you would like to contact us our fax # is (404)-816-8830 Email address is: Sterling Investment Services may hold positions in the securities recommended or may be providing consulting services to the companies mentioned within this report.
Copyright 1992-2003 Sterling Investment Services, Inc.
P.O.  Box 191767, Atlanta, GA. 31119-1767
Fax 404-816-8830


| Home Prime Stock Newsletter Weekly Letter Affiliate Program Subscriber Login Contact Us |