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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: JamesT who wrote (5798)	11/7/1997 4:03:00 PM
From: Herm	Read Replies (1) \| Respond to of 14162

James, I've done something I have never attempted. That is, I'm still long with a 1,000 shares. It's costing me a bundle and taking one massive risk with VVUS. I'm confident that I can climb out of this and still make a good profit for my troubles. I have been doing alot of defensive CCing to capture what I can as it drops. A few hundred here and there helps some. I sold 10 CCs for the Nov. 22s today and will most likely cover when I have 5/8s to 3/4s points under the belt. That should not be so hard since the time erosion will start to kick in next week and the price swings are wide during the trading day. The VVUS open interest on the PUTs is pretty high. The November 22 1/2 PUTs had 240+ contracts traded today and the November 20s PUTs 310+ contracts. This stock is being battered by the shorts and it will most likely test the $18-$20 range before we see a pull out and reversal. The $22 was my predicted support bottom. That was smashed today. The VVUS chart is replicating the last decline almost exactly. It is my opinion that the PUTs are sold by the instituions. Yes, maybe Vinik and company in order to pick up the stock dirt cheap (when it is put to them) and then start the whole process over again. Yes, Vinik may pump up VVUS between late November and December. It may very well peak in January and start to hit a new high of $45. All he has to do is to start a buying spree with a few major blocks to trigger the short squeeze. This is a lesson I won't forget! I'm very concern but I'm not losing sleep like a few years ago. I know I can make money again and most likely with VVUS. I don't need access to the money so I can wait it out and stay for the come back! MUSE IT!