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Non-Tech : Bernie Schaeffer's - Option program
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To: William H Huebl who wrote (138)6/16/1997 11:45:00 AM
From: Mike Fredericks   of 203
 
Bill (or anyone else)-

Last Tuesday, I purchased the 30-strike call that was mentioned in the Monday evening update.

After I purchased it, Bill mentioned that he held off on buying it because the stock was almost at the top of its Raff channel, and he didn't see the stock moving much higher than 33 in the next month or so. (He e-mailed me the chart, and I agreed with him).

I double-checked my charting and realized that I hadn't checked the stock against one of my indicators - 20day BB and RSI... my chart showed (and shows) the stock above its 20 day BB and with a 9-day RSI of 85. (I read 70 as overbought when combined with being at or above 20-day bb). Had I made this observation last Monday, I would not have purchased the call option on Tuesday.

So, what I did is change my exit target from a 100% gain as Bernie suggested to 4 (bought at 3 1/8). I have a limit order already placed for this level. I placed the limit order last Tuesday evening, after I saw Bill's information and double-checked it with my indicators.

My question, did I do the "right" thing? What would you all have done in a similar circumstance? I didn't want to sell right away at a loss - after all that's not how Bernie teaches us to take losses. As it turns out, option is up, currently with an ask of 3 1/2.

Anyone else holding this option have opinions on it that differ from mine?

Thanks,
-Mike
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