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Technology Stocks : Applied Materials No-Politics Thread (AMAT)
AMAT 223.37-3.2%3:59 PM EST
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To: Jerome who wrote (106)10/28/2001 9:18:40 PM
From: Jerome  Read Replies (2) of 25522
 
The Plan for week.

Some things become obvious at the time it becomes almost too late to profit from them.

For the last 8 trading sessions the so called talking heads issued the balm...buy the dips...but for the most part the dips did not show up. This rally has got legs.

Using four stocks from this group AMAT, KLAC, NVLS, and LRCX here is how I intend to play them. There are only three possibilities. 1) go long the stock, 2) go long the option, 3) Short the stock with a covered call.

Amat...Buy under or at the 35 price, and hold until earnings are released. If AMAT drops below 35, buy some Nov. 35 options. If AMAT gets 41 write the 40's for Nov.

With LRCX use the same plan but use the $20.00 a share stock price. This seems to be the least stable of the semi stocks (it rises slower and falls faster than the others in the group)

NVLS... $35.00 is the magic number Use 35 as the price for option purchases, and use 40 for the covered calls.

KLAC.... Buy at 44 and immediately write the 45's. Good earnings report and a nice run up so far, If you do all four stocks take some profits immediately. In this manner if the market does turn south on a few minutes notice you will have locked in some profits.

Jerome
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