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Technology Stocks : Echelon Corporation (ELON) -- Ignore unavailable to you. Want to Upgrade?

To: Silver Clay Art who wrote (2320)	6/14/2000 1:26:00 PM
From: IngotWeTrust	Read Replies (2) \| Respond to of 3076

Max Pain equals the theoretical price point where the maximum pain is inflicted upon losing option write-[calls] money, and meets the maximum pain inflicted on losing option write [puts] money. That point of maximum money loss to each side DOES converge and is approximately where the stock price will close on Option Expiry Friday each cycle month. It can be calculated in advance and has a pretty high predictability correlation, periodically, in historical instances...save for wildly volatile stocks. I have used its predictability repeatedly to write covered and naked options for income. That is my experience with Max Pain.

To: Silver Clay Art who wrote (2320)	6/14/2000 1:27:00 PM
From: plow guy	Read Replies (1) \| Respond to of 3076

"max pain"? I was refering to options. It is the point in which the largest number of calls expire worthless (puts are also a factor). This is options expirations week and often stocks trade below max pain by friday. Elon max pain appears to be 70 with 500+ outstanding calls (150 puts). These numbers are small but relatively they may be enough to keep stock under 70 until monday. rosebud i am still learning about options but i think above is close. audie