Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (27562)	3/2/2005 9:00:16 AM
From: russwinter	Respond to of 110194

Schaeffer's 2:26 PM (Tuesday) Semis Could Find Resistance Rick Pendergraft wrote a piece earlier today regarding the upgrades of the semiconductor sector, and I wanted to follow up with a little information regarding the investor sentiment in the wake of these brokerage upgrades. Option activity is telling us that people are quite optimistic on the prospects for the sector at this point, which is not all that surprising given the upgrades. Nevertheless, when a certain view of the market becomes crowded it is more difficult to make money by playing on that viewpoint. Today's option activity on the Semiconductor HOLDRs Trust (SMH: sentiment, chart, options) illustrates this one-sided type of viewpoint. Volume on the SMH March 35 call has reached 17,000 contracts, whereas the volume on the SMH March 35 put is one-fifth of that at less than 3,500 contracts. SMH traded as high as $34.86 earlier today before pulling back into a range. With such a huge amount of call activity at the 35 strike, this level could prove to be strong resistance for the index fund.