All: Most everything still looks okay on the scochastics, trends, etc. although Intel, many other tech stocks, and the indexes sold off of their highs. On the other hand, it's always possible that today will have ended up as the turning point on at least some of the above. Much of the technicals are very mixed in here right now and I wouldn't bet my life on either direction for tomorrow until I see how things open and trade. As for Intel, whether we saw a minor top today or not will depend on tomorrow. If Intel goes to higher high, then obviously we are still in an uptrend despite today's 3 point selloff. If it doesn't go to higher high but to lower low than we had today, than trend is obviously down. The gap technique did not hold for today, but in the event things are down tomorrow, it did its job by giving some early warning. As I have said many times I don't worry about much of anything except REAL money. As such, I sold about half of my calls in Intel this morning on the way up and the rest of them when Intel violated by 1/8 point the previous day's low and thereafter bounced up that point at least that I have mentioned before that it tends to do at times. That allowed me to take good profits and gave me a perfect day as all positions cleared with profits - although I've made more before. I still have warrants in Intel(longer term) and nothing yet that worries me there. I often buy the Intel warrants for my wife's IRA account and periodically sell them and reenter later - as I go on to something else that catches my eye. I still have longer term MSFT call options which I'll hold until sometime in the future to sell unless it starts messing up also. Highs today in some of the indexes but not the S&P. When clearer trend in everything is noted by me - whether tomorrow or soon thereafter - I'll be picking up put positions.
BTW, the Intel warrants are as good as the stock at this level - pretty much keeping up dollar for dollar and will for some time down before they start separating again in value. Much cheaper and more bang for the buck. But the downside is when they go down, you lose more percentagewise and they do expire in 1998. But, as long as you believe we won't have a bear market and that Intel is going to be way up here in price - that should be no problem.
Note that in this note I indicated that I sold all my Intel Jan calls only because although it didn't go down that 1/4 point at that time, I felt that it was weakening and sold it anyway. I don't like getting too close to expiration time holding that month's calls. Too many games can be played. Khang asked about the puts. Well, that's part of what I just said - games being played now as the market makers will pull out the premium on most anything now including even some of the later expirations - but especially current Jan calls and puts. Reasons for Feb put prices: Feb 140 puts fell less because they are in the money currently while the Feb 135 puts fell more because they were out of the money and moved out even more today. The Feb 130s are being held up because they are cheap and many will buy and they tend to move less at this time percentagewise. All for this evening. Good trading. Jack |
