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Technology Stocks : Network Associates (NET) -- Ignore unavailable to you. Want to Upgrade?

To: AlienTech who wrote (2328)	4/6/1998 1:50:00 PM
From: Chuzzlewit	Read Replies (3) \| Respond to of 6021

Alien, there are two possible reasons for today's rise: (1) dailynews.yahoo.com and (2) You didn't want it to go up as per your last message. <VBG> Regards, Paul

To: AlienTech who wrote (2328)	4/7/1998 2:38:00 AM
From: ahhaha	Respond to of 6021

You may have something with the puts, but the right side hasn't formed yet. Just like on the upside you want to buy after a base is in place, on the downside you want to sell short when the top is in place and there's been a rally back up to the downtrend. No downtrend has been established yet. Puts get killed in this environment even if the stock starts down. The premium is rolled in. That is, the premiums stay fat as the stock edges higher because the market makers have to protect against a break. The more precarious the upside, the greater the potential break and the more the premiums hold. If the stock starts down Black Scholes dinker the premium. Say the stock makes a final one day short covering jump to 68. Even then you don't try to book in.Say the shares then start down hard and drop to 60. You have to assume they will rally back up to the downtrend established across several weeks Say the downtrend projects to 65 and the stock moves up to there. Then you take a position. You don't book in. You go market and pay up. If the stock won't rally back up with fundamental ceteris paribus, you don't play. Go find something else. You never play unless the market will do what you want it to. This is completely contrary to what others say. That is, if the market will set up the way you need it to, you'll play. Else, forget it.In this case if the stock proceeds above 70, you don't play because the downside move has been negated. From 70 to 72 is the MM and specialist's corner. Only the market can position you there by floor rule.