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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: James C. Mc Gowan who wrote (7498)	5/16/2001 6:16:19 AM
From: catman	Respond to of 52237

James C Mc Gowan...... As far as a long straddle goes, at the moment I don't see it as a viable strategy. My reasoning is that I don't see any dramatic moves in the market one way or another for a while. I will tell you that I don't get involved in options but I do study them as well as the different strategies (for my series 7)....the idea of a long straddle is to profit from a dramatic move in the market, but when you're not sure which direction it will move. Obviously the move must be greater than the premiums. I don't see any near term catalysts to make the market move dramatically one way or the other. With a short straddle the idea is the market stays flat and you earn a double premium....but with a short straddle you take on twice the risk (upside and downside)...Please understand these are merely my opinions....

To: James C. Mc Gowan who wrote (7498)	5/16/2001 6:26:55 AM
From: donald sew	Read Replies (2) \| Respond to of 52237

MAY 16 INDEX UPDATE -------------------------- Short-term technical readings: DOW - midrange SPX - lower midrange OEX - lower midrange, borderline oversold NAZ - oversold region NDX - oversold region VIX - lower midrange 5-DAY TRIN - 6.05 Per my short-term technicals the overall market is in the lower midrange and no major change from Monday's readings. If the NAZ/NDX continues down I would get CLASS BUY signals in 1-2 days, and for the SPX/OEX in 2-3 days. The 5-DAY TRIN has been over 6.0 for the last 3 days. Readings over 6.00 imply that a short-term bottom is nearing. If I recall correctly, the most number of days over 6.0 is around 4-5 before a short-term reversal starts. This is expiration week, and right now the QQQ is right at the MAX-PAIN point; therefore I do not expect a huge move in either direction for the rest of this week. I normally use a buffer of +/-5 QQQ points, which would equate to about 200 NDX points. The week after expiration(next week) is commonly a weaker period, so such is not lining up with the forthcoming CLASS buy signals if the market continues down this week.