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To: J F Allen who wrote (1361)	1/16/2001 4:31:42 PM
From: lurqer	Read Replies (2) of 104154

Hi Neighbor. do you think Max-Pain analysis has any validity? Looking into the way Max Pain is calculated "a while back", there was a problem with some of its assumptions as I recall. I believe the problem stemmed from whether the OI might in a particular case be skewed by an unusually dominate customer buy or sell OI. On a more practical level, I use it as another "straw in the wind". Assuming the post you referenced was the one I made to GM on the Porch, from the Max Pain on variety of tech stocks I concluded that this week may be "full of sound and fury, signifying nothing". So far, so good, but the week is still young. OTOH there is CREE, moving away from its Max Pain value. It has special problems - no 3 inch wafer and a passel of shorts. In general, since Max Pain implies manipulation I consider if there might be some countervailing manipulation - e.g. ARBA has a much higher Max Pain than its current value. Its recent positive earnings was greeted with five downgrades. That raises a flag for me. Hope all this rambin' helps. lurqer

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