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Technology Stocks : America On-Line: will it survive ...?

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To: Sam Golden who wrote (4066)7/21/1997 2:44:00 PM
From: James F. Hopkins   of 13594
 
Sam; You got it right..and when it don't act the way you posted
it's best to pass..and wait for the next one. Her high has been
about 20% to 23% above the 50DMA, except this last time she out
did even that..how ever if one had played it at least two months
out they would have come into the money.
This 50dma is in an uptrend but it's very usefull both for puts/calls
Problem is now that too many people are playing her, and puts/calls
have a supply/demand side seperate from the stock price, as more
and more people play the options the demand goes up, the hidden
spread increases and the profit gets thin enough that you have
less room for any mistakes.
-------------------------------
The premiums on AOL are high now, both puts/calls ..keep in mind
calls can be and often are used as cover for shorting..so a lot
of calls may also be bearish. When ever you get an abundance of
Bears then a stock will go up, untill half of them get squeezed
out. That's the nature of things, with AOL as well as most others.
Jim
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