Schaeffer's Daily Market Blog Features RSA Security, Pixar Animation Studios, Jos. A. Bank Clothiers, Yahoo!, and Standard & Poor's Depositary Receipts.

CINCINNATI -- Among the stocks featured in the April 5 edition of Schaeffer's Market Blog are RSA Security (NASDAQ:RSAS), Pixar Animation Studios (NASDAQ:PIXR), Jos. A. Bank Clothiers (NASDAQ:JOSB), Yahoo! (NASDAQ:YHOO), and Standard & Poor's Depositary Receipts (AMEX:SPY). Schaeffer's Market Blog is just one of the many free market commentaries written everyday at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. For additional information about this report or to have it delivered to you free via email every day click on the following link.

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Schaeffer's Market Blog for Tuesday, April 5, 2005:

Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog.

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10:22 AM RSA Security Lowers Guidance

Information security software firm RSA Security (NASDAQ:RSAS) lowered its revenue guidance from a range of $81-$84 million to a range of $74-$76 million for the first quarter. In addition, the company lowered its earnings forecast from the 13 to 15 cents per share range to eight to 10 cents per share. Prior to this announcement, the sentiment toward RSAS had been turning more bullish. The Schaeffer's put/call open interest ratio (SOIR) trended lower over the last month, dropping from a reading of 0.99 to 0.54. The short-interest ratio sits at 5.41, but the number of shares sold short has declined in each of the past two months. RSAS shares are down more than 20 percent this morning.

11:07 AM Pixar Makes a Push at Psychologically Significant 100 Level

Last week, I wrote about Pixar Animation Studios (NASDAQ:PIXR) which broke out to new 52-week highs. Since that time, PIXR has continued to rally, and today the stock is making a run at the psychologically significant 100 level. For those unfamiliar with technical analysis, stocks many times tend to run into resistance at round numbers. If PIXR is able to close for several consecutive days above the 100 level, this may cause some of the abundant short sellers to capitulate and repurchase their bearish bets against the equity. This would put additional buying pressure on the shares. PIXR sports a short-interest ratio of 6.65 days, which accounts for more than 19 percent of its float. As I noted in my earlier posting, what drew my attention to the security was its pessimistic sentiment backdrop in the midst of a strong technical performance. At last check, PIXR was trading 90 cents higher to $100.10 today.

11:10 AM Jos. A. Bank Update

Yesterday we suggested that the rather grandly-titled Jos. A. Bank Clothiers (NASDAQ:JOSB) is a stock to watch. In trading so far this morning JOSB is up six percent. The difference between last Friday's lowest intraday price of 28.99 and today's high of 34.90 is an impressive 20.4 percent. The short-interest ratio is 17.6 days to cover and 51.11 percent of the float is currently sold short. Trading volumes have been higher than average during the past two days, a strong signal that JOSB could be seeing some short-covering activity. They have not been 17.6 times higher, though, so there's still an upside.

11:36 AM Time to Short YHOO?

One stock that I have been monitoring for a potential bearish trade set up is Yahoo! (NASDAQ:YHOO). Internet stocks as a group have demonstrated very weak relative strength versus the broad market (as measured by the S&P 500 Index). In fact, a look at a daily relative-strength chart of the Internet HOLDRS Trust (HHH) versus the S&P 500 Index (SPX) shows that, excluding the recent bounce, the HHH has been underperforming the broad market since early this year. YHOO has recently rallied up to the 35 level, which is the level of its declining 20-week moving average. Furthermore, this level also coincides with peak front-month call open interest, which should add another level of options-related resistance. In addition to its weak price action, YHOO drew my attention due to investors' high opinion of the stock. In fact, option players currently hold more calls relative to puts on the security than they have during 99 percent of all readings taken over the past year. Financial analysts also favor YHOO, with 17 "buy" ratings, three "hold" ratings, and one "sell" rating on the stock. From a contrarian perspective, optimism in the face of weak price action is a bearish indicator.

2:07 PM Spiders Crawling Higher Despite Pessimistic Activity

Standard & Poor's Depositary Receipts (AMEX:SPY) put options have been a popular choice today with volume eclipsing 60,000 contracts at the SPY April 117 put alone. Trades have come in the form of both small lots as well as large blocks. These expectations for a move lower in the broader market may be helping to provide the opposite effect. SPY is currently trading up 51 cents to $118.14.

The above are just a few of today's Daily Market Blog entries. Click here to read all of today's Daily Market Blog.

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About Schaeffer's Investment Research (www.SchaeffersResearch.com)

Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .