Strictly Buy and Sell Set Ups Message Board

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Strategies & Market Trends : Strictly Buy and Sell Set Ups

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To: Ottrose who wrote (7206)	1/17/2006 11:21:44 AM
From: profile_14	of 13449

Good trade. In addition to buying 145 PBRPP at 3.20 I also bought 90 OIHSH, OIH JULY 140 PUTS for 9.40 about 15 minutes ago. I believe the OIH is ready for a nice pullback as its curve is accelerating to the upside. Today could be the day we have a double top with a gap. The weather continues to be weak in term of requiring massive energy consumption. The markets suck, and the OIH will not be excluded when the rotation comes around. I bought the July contracts because by then, that is the seasonally weakest part of the year for the sector. If the sector turns, these puts could be very profitable if held to close to expiry. Also, I like to give myself some time with options, unless of course we are talking about very volatile stocks like GOOG, where the holding period can be minutes to no more than 2 days in my case. GOOG is now up and not convincing me. I think that YHOO will release good numbers tonight with EBAY to follow suit. Analysts are estimating GOOGs advertising growth rate to be twice that of YHOO's. So good news for YHOO is better news for GOOG. Bad news for YHOO is good news for GOOG because GOOG is eating their lunch in a disproportionate manner. Hence I think it is best to sit this out until right before GOOG earnings, when I would like to go short again via puts. I think that the NYT article on GOOG over the weekend hits the nail on the head relative to valuation. Henry Blodget also had an article in the Seattle Times (I think) on GOOG this weekend and how he sees multiple compression taking the stock down to possibly $100. One thing is clear: this rate of growth is unsustainable although it could be much higher before the stock turns. Congrats on a good trade. Best regards,

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