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: Johndee who wrote (9184)	11/27/1998 11:47:00 AM
From: Herm	Read Replies (2) of 14162

BTGC - Moving Down Nicely! I got up this morning and decided to take a look at BTGC and IFMX to see what it's like to view the markets from the California perspective. No doubt, "the early worm" around here is the only one that will catch the prize on the east coast 3 hours ahead. BTGC still shows a downward bias towards that lower BB at $6.25 - $6.50 with a confirming RSI of slightly below 48. The BB bands have narrowed significantly and may mean a new upside breakout when BTGC is done with this leg of a normal price cycle. As I write, BTGC has only traded 44,300 shares at 11:00 am eastern time. Here is something to notice folks. You can watch the volume to know which way the stock is moving for particular day. BTGC normally trades 359,000 shares per day. It is 11:00 am and BTGC is headed down slightly. Today, will be a down day for BTGC since there have not even been any block trades yet. A block trade is considered 10,000 shares or more. Sometimes, you will see the volume very light and yet the price for the stock is up. Don't get trapped in that situation and buy. If you have to buy put in a limit buy below the going price. The MMs will move the stock down just to pick up your bait. I learned a saying many years ago worth saying. "Volume precedes price!" Low volume, lower prices! On pivot days, when confirmed with a tag of the BB and the RSI you will always notice an increase in volume of more than 50% and usually in the opposite direction. So, BTGC may very well start with sharp drop and heavy volume and then reverse. 'm still holding my 7 JAN99 7.5s CC which are at 1/2 right now. My target is 3/16s to 1/4. askresearch.com

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