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

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To: Rodney Lockhart who wrote (4803)9/15/1997 9:36:00 PM
From: Herm   of 14162
 
Cycles! Stocks that go down do so in 1,3,5 or 7 days in a row. Once a stock trades lower on the close for 3 days, the odds of an up day are increased. Also here is something I just read about. Did you ever notice that stocks tend to reverse at round stock prices? Often, one of the reasons is that the number option contracts opened at that particular strike price acts as resistance or support. Once those round numbers are reached, traders tend to move in to play an expected reversal. For option traders aware of this fact, this could be very helpful in timing both entry and exit around those key option strike prices.
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