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Strategies & Market Trends : Waiting for the big Kahuna
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To: bobby beara who wrote (2524)7/15/1997 8:54:00 PM
From: Mike Fredericks   of 94695
 
"Must admit I'm becoming a tired bear also."

Add me to the list. No offense or anything, but I completely missed the run-up from April to now. I have lost quite a bit on puts. With so many companies making or exceeding estimates, I have to believe that the "Big K" will not hit until companies start to warn for 3Q or fail to meet 3Q expectations.

So what did I do?

I have orders in to sell my DGN Sep 25's (DGNUE). Those were treating me well until a couple of days ago (small loss) but then DGN broke out. Since I bought them based on technicals, I feel that selling them now is a good idea while there is still time premium to sell.

Also have orders in to sell my GE Sep 65's (GEUM). GE is overpriced as hell, but isn't going down any time soon. The street liked their earnings, although I don't see how 13% Earnings growth justifies a PE of 30+.

My GE Jul 65's will expire worthless in all likelihood. As will my C and GM Jul puts.

I will still buy puts to hedge my long position.

I am looking to (gasp) buy some tech stock calls.

Thinking about picking up some AOL puts... it got downgraded today, but I'm sure that the puts are too expensive for my taste.

Fortunately my long positions in the last couple weeks have made more than my put positions have lost...

-Mike

P.S. Please don't use me as a contrary indicator. I'm tired of always being wrong... <g>
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