INTEL- Money Making Option Ideas for Small Investors Message Board

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Technology Stocks : INTEL- Money Making Option Ideas for Small Investors

INTC 41.34

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3:59 PM EDT

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To: Everard Taylor who wrote (176)	8/1/1997 2:01:00 AM
From: IQBAL LATIF	of 201

What happens tomorrow! 1st Aug, 1997. I have following scenerios; 1- S&P futures closed 959 and change, again unable to take out my 960. 2- S&P chart give it to a commodity trader ask him without any pre-conceived ideas where is this thing heading for? He will tell you that this is in a great uptrend, a chart which has not broken its 20 days moving average since April 12th. Only a fool is going to stand in front of this train on fundamentals alone. 3- SOXx is resisting my level of 367 and although I had written that SOXX will make an assault on 367-68 it could not take it out. 4- So where does it leaves us: S&P needs two closes above 960 to head for 978 where it will be equivalent of DOW at 80-100 points higher from here, now here I am in totally uncharted territory so I tried to take some cue from NEKKEI at 32000(blow out phase) the technical similarities of DOW and NEKKEI are disturbingly similar although I being a beleiver of' DOW at 8000 is steal of century' can make a clear distinction btw fundamentals and technical configuration. The T -configuration is dangerously ditto. Cavaet being fundamentals are not the same. Dow fate and NEKKEI fate will follow absolutely a different pattern. 5- I being an unashamed bull but a realistic one (Spain due to Matadors is out of bound for me) markets just don't keep going up and if they do then either our present science of technical reading has failed like -'old economics' where relationship btw employment and inflation is now suspect or market has decided to trade at 1998 multiples and in such case correcting to only 7800 and this may only come after testing 978 or 8400-500 on DOW on the up. 6- If my assumptions are correct that this market wants to trade on 1998 earnings multiples and will move up sharply 150 points tomorrow so I can have some new trend lines pointing to higher highs then stocks like INTC IBM MO CAT can provide enough tinder for that eventual long climb up. INTC at 105 from 92 IBM 115 from 106 and MO 55 from 46 add these $ sums and divert some purchasing in small caps and you have on your hands DOW at 8500, and this can be acheived without much run in GE's OR KO's. Overall INTC IBM are laggards of DOW specially on multiples if you closely study they do have an up side room. 7- My preference would be 'rotation' where money from overvalued stuff comes out in issues like IBM's or INTC's this rotation scenerio offers all of us a chance to go thru painful correction with ease. I have a problem hhere without this rotation new money pops up the laggards p/e's to same level of overvalued equities and we are left with no choice but a steep huge fall. 8- Tomorrow numbers will be decisive in pointing the direction of the new bull leg if numbers as come alright unemployment NAPM factory orders and yields drop on bonds we may see S&P higher but I expect later in the day we will see some profit taking. 9- If numbers point to inflationary undercurrents like strong personel income and unemployment lower then 4.8 you may see market opening 20- 25 points lower and S&P futures may test the key support of 935. I think chances of one of these many numbers sowing the seeds of uncertainities tomorrow are rather high and some common sense will return to this market. Strong earnings come on the back of strong numbers however this market will fail to recognise that- if it will sell it will for wrong reasons. We are adequately equipped for two scenerios towards the end of the session I loaded up on some nearly free calls like INTC 100 Aug which if this blow out phase is true will take me a long way but I hope that we may see start of some rational consolidation here. On the downside I have a put spread lets see what happens. I think those who have big stakes will think the way I am thinking and some thing will come out of it, commodity traders I wish may not have the last laugh. Commodity charts destroy destinies and I am hoping this wrath of commodities charts hanging like a 'sword of damocles' on our heads may be lifted tomorrow. Wishful thinking-DOW at 8000 is steal of the century.

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