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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: Herm who wrote (12347)	2/13/2000 4:26:00 PM
From: Herm	Read Replies (1) \| Respond to of 14162

Hi Everyone! I hope none of you got caught with the whipsawed last week. What a roller coaster ride! Here is one I would like some opinions on. It's got me wondering! I'm missing something here! DOX I had 5 CCs on the stock ITDS which was acquired just last month by DOX. It was an odd ball purchase which gave me only 185 shares of DOX for my 500 shares of ITDS. I covered my CCs and went long on DOX. DOX continued to run up and I was getting more equity. I figured DOX had run the course from $32 before the merger to the current $64 with a sky high RSI and OBV. Well, on the last peak just before a 6 point pull back I shorted against the box before the pull back with 100 more DOX shares shorted than my long position. I cashed out my long DOX shares at nice $63 5/8s expecting DOX to decline on profit taking. I'm now short on 300 shares of DOX and on Friday this sucker had a trading imbalance in the morning and resumed trading up another +4 1/2 points but closed down from the new 52-week high at 63 7/32 up + 2 19/32s. I don't know what is keeping this overpriced viper up when the technicals read a solid pull back and consolidation is just around the corner. I have a nice profit and I would like to ride DOX down with the shorted shares. From this point, DOX could hand me my head. I can't believe there is more upside risk. I'm debating if I should establish the DOX long position using three April 60 calls @ 10 3/4 until DOX either peaks out and I can cash out the long position and short position later or both. Comments? siliconinvestor.com siliconinvestor.com NYSE: (DOX : $63 7/32)$13,042 million Market Cap at February 11, 2000 Trades at a Premium PE Multiple of 90.5 X, vs. the 33.5 X average multiple at which the Data processing SubIndustry is priced. Data Processing SubIndustry down < 1.09%> / Services Industry down < 1.17>.