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Strategies & Market Trends : Tech Stock Options

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To: ViperChick Secret Agent 006.9 who wrote (30688)12/9/1997 11:33:00 AM
From: Esteban  Read Replies (2) of 58727
 
Buenos dias senora,

According to the chart I'm looking at the PREM only got below .32 at the open, which often happens till the cash catches up to the earlier traded futures. FWIW, since around 10:00 we've been trading below fair value more than above it with the MA below fair value.

I'm losing enthusiasm for this indicator, other than as a way to track the futures prices without having futures quotes. It seems Patrick has certain times when he expects program selling to kick in, and uses these times along with the PREM value to get a better entry price for a position he's taking for other reasons. Correct me Patrick, if I'm off base. As for predictive value of index prices, it's value has been eluding me. PREM seems to be a good forecasting tool only for the arbitrage trading.

Esteban
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