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Strategies & Market Trends : Tech Stock Options -- Ignore unavailable to you. Want to Upgrade?

To: Dom B. who wrote (29199)	11/22/1997 8:14:00 AM
From: donald sew	Respond to of 58727

INDEX UPDATE ------------------------- The overall market is overbought for the short-term (1-5) days, and there were many signals of a technical pullback, and evidence that it has already started in certain indexes. Not that I only use candlesticks, but we had plenty of SPINNING TOPS and DOJIS which are common signals of a reversal after a strong trend. Please keep in mind that we have rebounded 500+ DOW points in one week, beginning from the intraday low last week of approx 7340. Many/most of the NASDAQ indexes actually topped out and already started pulling back ever so slightly. I prefer not to predict how low this pullback will take us, but prefer to discuss such based on support lines which should hold if the market goes down. As many traders do such as Nemer's Red Dog, carefully watch as very tight support lines and resistance line are pierced. Here are the following supports I have calculated: DOW - 7650 SPX - 939 NAS - 1594-1600 I am not saying that the market will get to these levels at this time, I have no immediate evidence of that just yet. My technical analysis is just saying the the probability of a reversal here is very likely, and in a bad case senerio the support lines I calcualted above should hold. The overall longer trend is still up. Many non hi-tech indexes are setting new highs or very close to them, and at least most of the previous peaks have been broken (NON HITECH). Per my GUITAR calculations the HiTechs either have to start moving up soon or the NON HiTechs will be pulled down. Since the NON-HiTechs are so strong, the probability is that the HiTechs will start moving up quite soon, and my guess in December. As I indicated in my previous posts when the DOW was much lower, that we should see 7900-8000 range by XMAS. It is now obvious that I will stay with those levels since we are only a few points below 7900. My only open postion now are the TXN DEC 95's, which I just sold DEC 110 calls on Thursday to reduce my cost basis in light of this probable pullback. If the DEC 110's get below 2 quickly, I may buy them back, depending on how much time I have left before expiration. Happpy trading