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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (30310)	2/19/1998 1:43:00 AM
From: Marathon	Read Replies (2) \| Respond to of 176387

Great insight on how to play Dell tomorrow. This comes from a subscription to a split report newsletter. Looking forward to tomorrow how you trade depends on what you are holding. If you have the February calls, they will move quite sharply and expire on Friday. The last time DELL did the double, a split with an earnings surprise, it rose from 97.50 to 99.625 the day before they reported, then gapped open from 99.625 to 105.625 the next morning, sold off to 105, then rallied all the way up to 109.75 and closed at 106.75. Because DELL has had a strong run into earnings, a gap like it had last time is not as likely. However, the pattern will likely repeat. A gap open, then traders will sell the gap, it will dip, reverse, set a high and pull back. So, depending on how aggressive a trader you are, you can trade it like crazy, or be content to give it a little more leeway, with the intent of riding it up for a while. Either way or both ways should be profitable. One excellent tactic is to lock in profits on say half your position, and let the rest ride with a looser stop. It is a nice problem to have! For aggressive traders, if you want to hold DELL, you will likely be able to sell early and re-purchase later at a discount. Also, remember that the "herd" likes to buy options on split announcements, which tend to run up the premiums like crazy. Take advantage of this temporary, artificially inflated condition to play nice and sell yours to the nice fellow who is willing to pay you top dollar. The "Greater Fool Theory." Remember, if you really want to own those options, they will likely be available for far less money later in the day. Today there was a good degree of options speculation on DELL heading into the earnings report. Probably some joker started a rumor of a 3-for-1 split only added to the fray. Normally going into earnings announcements, options traders will speculate on how they feel earnings will play out. Today call volume was a bit larger than put volume. March 115 calls were very popular due in part to the expiration cycle of the series. The February 115's were also heavily traded.