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 : Tech Stock Options -- Ignore unavailable to you. Want to Upgrade?

To: Dwight E. Karlsen who wrote (34835)	2/9/1998 7:22:00 AM
From: donald sew	Read Replies (1) \| Respond to of 58727

Dwight, I just want to recap what I have stated in the past. I normally do not give price targets since my signals target time, in the sense of BUY-IN days. The BUY-IN days for the various indexes are MON, TUE, WED. I had also indicated that this week should be the top and that the reversal should start latest this Friday. By Feb expiration we should be in the 8000 range in the DOW if not lower. I normally do not like to give price targets. One major key to watch today on a technical basis to give a hint that we are topping out is if the volume remains strong but the DOW is relatively flat (plus or minus 30 DOW points is normally what I use as a rule of thumb. In the last 4 trading days the intraday highs were within 50 points, although it is the image that the DOW was up strongly 72 points on Friday. To understand the technicals a bit better, the mathematical calculations do strongly involve the highs and lows as well as the close and opens. If the volume decreases substantially(15-25%) and the price does not drop over a period of more than one day, that will not be a good sign for PUTS/SHORTS, although still not conclusive. On the other hand if it only is one day it could still be a topping out signal. This signal is hard to interpret at times. As of right now, the first major support for the upcoming pullback is around 7800. If and when we hit 8000 on the DOW, will then review the chances to go lower to the 7800 range. The next major support is at 7550, but as I indicated before it is too early to say right now per my short-term analysis. Psychologically, it is very hard to take trading action on anticipated reversals(before actually turning) since normally it would be a strong contrarian position as it is now. Also, most systems are predicated on support/resistance lines being broken to confirm reversal trends. Now here is another contrarian point of view - I would feel much better and will increase my PUT position if the DOW ran up 100-200 points today. During the strong runup in the summer of 97, the DOW always returned to its 10 day moving average, at least on a intraday basis, which is now at 8050, and did it on the average of 8 days after it left the the 10 day MA to the upside. The longest it ever took was 11 days. Today will be the 6th trading day since the DOW left the 10 day MA on FEB 2. On the other hand the 10 da MA will move up if the DOW moves up, but you can use as a rule of thumb that the 10 day MA will move up 10 points for every 100 DOW points. In light of this I am comfortable with stating the 8000 range by expiration. Frankly, if the DOW runs up 75-150 points today, I will be severely loading up with near or in the money FEB PUTS. Seeya