TECHS LEAD LOW-VOLUME BOUNCE ON FRIDAY
John J. Murphy
MARKET GAINS, BUT ON LOWER VOLUME... The Dow bounced 143 points on Friday. But, as was the case with the rest of the market, volume was the lowest of the holiday-shortened week. As a result, we doubt that today's bounce has much staying power. The Nasdaq picked up 44 points -- but again on lower volume. Despite Friday's bounce, all the major average were down for the week. The two main catalysts in today's bounce were a stronger-than-expected employment report this morning -- and a "relief" rally in Intel (which was the biggest percentage gainer in the Dow). That gave the SOX a nice boost as well.

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INTEL BOUNCES... Intel bounced today in a relief rally after last night's report apparently wasn't as bad as expected. Although Intel did gap up today, the bounce wasn't all that impressive. First of all, daily volume was lighter than it was on Thursday's price decline. Secondly, prices closed below the opening price -- which isn't a positive sign. Finally, the stock closed down for the week -- and registered a 52-week low on Thursday. We'll need to see a lot more to convince us that Intel has bottomed.

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NEXTEL LEADS NASDAQ... Nextel was one of the best percentage gainers on the Nasdaq -- and made the most-actives list. That means it's moving up on volume. The stock recently cleared its 200-day moving average to reach a six-month high. It's volume pattern has also been positive. If you inspect the volume bars along the bottom of the chart, you'll see that most of the bigger volume bars since July are green. That means the volume was heavier on up days.

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CABLE AND MEDIA WINNERS... Cable and media stocks were among Friday's best gainers. The three charts below show short-term uptrends. All three have successfully retested their 50-day averages. Clear Channel and Viacom - Class B also saw good volume during today's bounce. While all three stocks are showing decent relative strength since July, we caution that their long-term charts aren't all that encouraging. Comcast and Clear Channel just recently hit multi-year lows. Chartwise, the strongest of the three is Viacom -- Class B. The reason for that is the weekly chart which shows that the stock is bouncing off the low formed last September.

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September 9, 2002

John J. Murphy, CNBC-TV's technical analyst for many years, and Greg Morris offer money managment and market services at MURPHYMORRIS.COM , email address orders@murphymorris.com.