How To Write Covered Calls - An Ongoing Real Case Study! Message Board

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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!

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To: Leroy who wrote (4069)	8/21/1997 7:54:00 PM
From: Herm	of 14162

I don't want to sound like a know it all! But, I was fairly comfortable with the ROST decline recently. I just kept my eyes on the charts set to Bollinger Bands 20-day moving average. Look at the chart and you will notice the exact signal was triggered when ROST touched the 20-day moving average THREE TIMES in the past few months. When I recommended ROST it was a split 2-1 from a $48 pre-split, down to a $24 post-split. ROST never looked back until it pulled back to the $27 recently. stocksmart.com This is one of the major reasons I rarely get called out unless I allow it to happen. I aggressively lower my net cost basis and use the Bollinger Bands as my timing to make my buy/sell decisions. And of course, I pluck the figures into the Excel Spreadsheet to get a profit/reward outlook! Our CC game covers what to do when the stock is climbing. Look at the chart, news, earnings dates and set the strike price based on the best info. The price is dropping, Why? No news? Then use the moving 20-day average as your bottom. If it drops below that, there is potential trouble developing. Get some long PUTS just in case and be ready to unload them when the stock hits the 50- day average. If the stock drops below the 50-day. DUMP THE STOCK or short against the box to freeze dry the damage.

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