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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: t2 who wrote (40643)	3/13/2002 8:19:15 PM
From: mishedlo	Read Replies (1) \| Respond to of 99280

Mish, How do you see max pain working this expiration. It appears some stocks are far enough from the target with only 2 days left. MSFT 60; INTC 32.5; DELL 25; ORCL 15; QCOM 40; CSCO 15; AMGN 55 QQQ 37. Do you know how well some of these stocks trend towards max pain? I recall you said MSFT usually does not hit the target. I am looking to trade a few towards max pain direction. thanks. NV INTC tracks pain very well In anticipation (and as it turns out I bought a few INTC calls just as Zeev was deploying), but when it printed a new low, I took my dime hit. As it turns out (I would be even if I held). Note: I earlier had INTC puts and sold them far far too early for a nice profit as I expected a bounce off 32 1/2. That bounce did occur but I failed to re-enter at 33. What you must realize is the major move is over by Wed of expiry. So although MSFT appears to be above max pain, yes Max Pain is 60 but realize that there are far more puts than calls at 60 so the error would be to the 60+ side. Also note that the nature of those puts or calls at 60 (were some short vs long) can change things another point easily. Thus looking at MSFT one should assume right now, that regardless of what it might look like that MSFT COULD indeed at TRUE pain right now. As for INTC, it is most assuredly below pain. This one could be accounted for by delta hedging or shorting when it was in the 33-34 range and letting it go on its merry way (down). Remember my success rule for max pain. If the stock hits it by Wed of expiry week, I call it a success. A fall from INTC from 34 to 31 (passing right thru pain on the way down) is a classic example. The time was sucked out of all the options, then delta hedging took us down at the last moment. I would not be surprised to see INTC rise back up to 32 1/2 or keep sinking at this point. It is very hard to say. People might call this a miss if INTC keeps falling but I say now way (they jammed it up so far above pain and shorted the hell out of it so that it does not matter to them what happens). I did not realize QCOM pain was at 40, but if the naz keeps dropping (or even goes sideways), I might expect that to hit. Now you are playing for that last point. Why not a few points ago? CSCO is interesting and it pisses me off totally. For some reason I was thinking pain was at 17 1/2. Even a 1+ point move in CSCO is enough to make out pretty well with options. It was above 17 1/2 just a couple days ago. QQQ. Here we are on the nose. Can they keep it propped up for another 2 days? I do not know. The QQQ 41 March puts I recommended (and I took my own advice this time) were 2.40 at the time and my target was $4. They hit $4 today. Unfortunately 1) I did not have enough of them 2) I cashed out at prices from 3.2 to 3.6 All that said, Thursday of expiry week is far to late to be thinking about max pain plays. Last Friday and even Monday, there were some great chances. M