To: AlienTech who wrote (6977 ) 4/14/1998 11:16:00 PM From: AlienTech Read Replies (1) | Respond to of 23519
ITS HAMMER TIME! Today's Action -- 4/14 Knack60 Apr 14 1998 8:49PM EDT Ok. I blew the call for an opening gapper, but the rest went pretty much as I expected. That the low did not get all the way down to 8 1/4 is good. (I had an order in at 8 5/16 which didn't get filled, so I called this one a little too close.) Bouncing before support is very bullish. From this point, we have enough compression for a meaningful bounce. The close was very near the high and there was buying right until the end, with large blocks (25K, 75K) on the buy going off near the close. We closed just shy of the technical level of 9 1/4, but we can easily gap thru that on the open. (Ok, so I must point out that if we fail to gap up, there is something wrong.) To answer the where to from here question, I ask myself, what would make the most people uncomfortable? Well, the longs have been uncomfortable for a long time. So who must become uncomfortable in order to satisfy the market's blood lust? Let's see... The put writers suffered along with the longs, so they're ok. There's those people who bought put options. They would be hurt real bad if those wonderful put options expired worthless. The $10 call writers would be driven insane if they got taken out at 10. The call buyers already panicked, so they've been taken care of. The shorts. Yes, they will be very nervous. Today the smart ones started covering. The more dense will get it on the opening gapper. The slow ones (and the ones who shorted at 9 1/2) will start panicking Thursday. So a very strong rally would create absolute pandemonium. The higher the bounce, the more smug people who are hurt. The most optimistic landing place for this Friday would be 13 5/8. This would have the added benefit of scaring the $#!^ out of the people who wrote the $12.50 calls too. If we got all the way here, I would be willing to consider the possibility that we wouldn't need to go test 8 1/4 again. I don't think we'll get all the way there without the help of some good news. So, this would be a good time for the FDA to make some sort of announcement! Somewhat optimistic, but more within the realm of possibility is a landing on Friday at around $12. Ending up there on 4/17 leaves open some technical possibilities which I like. Anything above 10 7/8 by Friday helps to reduce the effect of this nasty down-draft. Getting to only 10 1/2 or less would be fairly negative. Even though we have the possibility of drifting towards 11 3/8 by early May, this would not be a particularly good sign for the near term. We'll gather some data over the next day or two & see if one of these scenarios starts to come into focus.