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This is the beginning of the month when stock prices usually are up. Let's wait another week, and see what happens. Even if stocks don't go down much, they're not going to go up much, either, until after mid-July. Since I invest in options, that's what I have to consider, and that's why I am waiting until mid-July. I can only profit with options when there will be a substantial change in price. It may or may not drop substantially in the next 2 weeks, but it's not going to go up much. A lot of stocks have already dropped a lot, so I don't expect them to drop much. Number 3 asked me about WDC, for instance. I don't think WDC is going to drop, but it's not going to go up much either until mid-July. If you buy call options now, you'll lose time premium while you're waiting for the market to move. That's why I told Number 3 that WDC will be an excellent buy in mid-July, because that's when I think WDC will start to move up considerably. But for now, it will just stay within its narrow trading range. Dell may do the same thing, but Dell has a better chance of dropping than WDC because of its high p/e. In either case, I wouldn't buy calls on them now, because neither is going to shoot up in the next 2 weeks. And remember, we are coming to the 2nd week of July when that BIG market drop occurs, either on a Tue or Wed, and THAT will be a buying opportunity! And, again, if you look at Dell last quarter, you will see that it reached 80 on 4/9, but then dropped to 69 a few days later, then it went all the way up to 92 in the next 2 weeks, and then to 110 after earnings were reported. It's this big increase in prices that I need to make money in options, and I don't think that will happen in the next 2 weeks. More earnings warnings will be reported, and this will have a depressing effect on the entire market. |
