Dr. Bob, >If it struggles, as expected, you can keep selling
calls until you think it's ready to run, and then you already have the stock, at a lower basis than where you bought it, and you can buy back your calls, if necessary, to clear the road for the eventual runup.<
My problem is, I have seen many individuals get caught trying to time AMAT. It zigs when you think it will zag and zags when you think it will zig. That is why I am a long term investor with AMAT and let the DW sector percentile and statistics drive my selling. With the addition feedback we get from this and other sites at least we can come up hopeful better strategies.
For your information this past week we just broke through the Bull Resistance line which was at $31 when it hit $30. The downturn also broke a double bottom, a bad sign. IMO, I expect the stock to continue to go down. Using DW estimation technique off the recent high of $37 I estimate a low of $25. Then, again it could go lower. Since the highs of $39 in April and May we have had lower highs and now have broke out lower.
But we all have been wrong in the past.
Naturally, the above is only my opinions and the data which I have reviewed from the Dorsey Wright site. Readers are reminded the old saving, "caveat emptor (buyer/reader beware)."
Paul V. |
