This from a BULL on the Yahoo! Thread. The quote is a Play from OPTION INVESTOR. I am posting it for our information. I am long ISLD.
ISLD PUT Info
by: monsignor401 1/14/00 10:33 pm
Msg: 11717 of 11720
Here is the recommendation:
NEW PUT Play, Thursday, 01/13/2000
ISLD - Digital Island, Inc. $77.25 -5.38 (-16.38 this week)
Digital Island is a provider of network services to enable locally relevant customer experiences. Digital
Island's services include global content delivery and hosting, unique application services, and a reliable
Intelligent Network, all of which deliver the right content to the right customer, in the right market, at the
right time. The Company has regional Data Centers in New York, Santa Clara, Honolulu, Hong Kong,
and London, connecting directly into 21 countries, with Local Content Managers in 11 markets
worldwide.
Every bubble must pop, and that is exactly what has been happening to ISLD since December 10th,
when ISLD traded up to an all-time high of nearly $157. Let us revisit the past for a moment and take a
look at the news that fueled a one-day $45 gain for ISLD. On Tuesday, December 7th, Digital Island,
Sun Microsystems (SUNW) and Inktomi (INKT) announced plans to form a strategic alliance. SUNW
and INKT declared that they would be taking a minority stake in ISLD as part of a plan to advance ISLD's
e-business network. ISLD announced plans to purchase several thousand of Sun Microsystems' servers
and deploy its software onto them. As measured by the number of servers, this deal gave ISLD the
largest network. Once all of the news was out and the excitement began to die down, ISLD began its
descent back down to earth. On December 21st, ISLD closed below its 10-dma, which was at $135 and
by the 28th, had traded its way back down to $100. This week, ISLD has exhausted the support of its
50-dma (currently at $86) which has held since the end of October. Because ISLD made such a huge
gap up in an extremely short period of time, it has quite a gap to fill. This makes it somewhat difficult to
pinpoint any kind of real support before $50 and therefore, we could be cleared for a healthy fall. ISLD
continued to pullback today despite the strong market and closed toward the low end of its day. Going
forward, we have plenty of resistance to hold ISLD down. ISLD found some resistance overhead at $80
throughout today's session. Further resistance looks to be at $86 and $90. Keep your stops tight on this
one as ISLD is known for big moves in a short period of time.
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