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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study! -- Ignore unavailable to you. Want to Upgrade?

To: dazzled who wrote (8011)	7/31/1998 8:41:00 AM
From: Herm	Read Replies (1) \| Respond to of 14162

Hey Dazzled, What a quick learner you are! A CC Cowboy. Very good.... You got a short leash on those CC this time around. Your new round of CCs is right on target. It looks like SMOD will pull back from the current price level until it cycles downward. I doubt you will be called out during this around. In fact, you may want to load up on some CHEAP PUTs. Say, 10 of SMOD 12 1/2 OCT @ 1/4 would be real sweet! You most like got over 2 points for your CCs each. Those cheap 1/4 points could appreciate to 3/4s to 7/8s as SMOD cycles back down to $12.00 from here. bigcharts.com NASDAQ: (SMOD : $18 3/4) $748 million Market Cap at July 30, 1998 Trades at a 38% Discount PE Multiple of 17.2 X, vs. the 27.6 X average multiple at which the Semiconductors SubIndustry is priced. Here are some clues: 1. The upper BB has been tagged and SMOD clearly pulls back on every occasion and RSI has peaked for this stock. Overbrought condition exist most likely because of covering of short position. Last month the short interest dropped by -5%. MMs are just taking money off the table. 2. Yesterday's volume of 1,045,400 was more than 25% (31% actual) which means the smart money was pulling out as people where jumping in. I would not be surprise to see a gap up this morning before the carpet is pulled from the novice. You PUTs will be dirt cheap this morning!!!!!! In fact, I may even buy some of the action. $250 to make $750 in a month. Hey, that beats a poke in the eye with a sharp stick! If no PUTs are being sold. Short the stock! 3. EPS predictions where reduced to $1.09 on 07/29/98 from $1.17 which was the last EPS est. set in May 1998. That one heck of a reduction. 4. Lawsuit announced and will drag on and reduce energy level and waste resources. Preception becomes reality! 5. Anybody have a golden parachute? Major CEOs cashing out? They sure have a habit of exercising cheap and cashing some out! 15-Jun-98 SHAH AJAY Exercised (M) 600,000 Common 5.02 - 15-Jun-98 PATEL MUKESH Exercised (M) 130,000 Common 1.65 - 15-Jun-98 KRISHNAN LATA Exercised (M) 300,000 (i) Common .02 - 11-Jun-98 PATEL MUKESH Exercised (M) 770,000 Common .02 - 1.65 - 8-Jun-98 MARTEN ALAN Exercised (M) 35,000 Common 1.50 - 3-Jun-98 MARTEN ALAN Exercised (M) 35,000 Common .02 - 6-Mar-98 MARTEN ALAN Sold (S) 5,000 Common 25.50 $127,500 5-Mar-98 MARTEN ALAN Sold (S) 13,000 Common 24.75 - 25.00 $323,750 5-Mar-98 MARTEN ALAN Exercised (M) 8,000 Common .02 - 5-Mar-98 MARTEN ALAN Planned Sale (144) 5,000 Common - $125,000 3-Mar-98 MARTEN ALAN Sold (S) 17,000 Common 25.81 - 26.75 $451,020 3-Mar-98 MARTEN ALAN Exercised (M) 7,000 Common .02 - 26-Feb-98 MARTEN ALAN Sold (S) 15,000 Common 28.50 - 28.81 $429,050 26-Feb-98 MARTEN ALAN Exercised (M) 5,000 Common .02 - 25-Feb-98 MARTEN ALAN Sold (S) 15,000 Common 27.19 - 27.31 $409,050 25-Feb-98 MARTEN ALAN Exercised (M) 5,000 Common .02 - 25-Feb-98 MARTEN ALAN Planned Sale (144) 20,000 Common - $540,000 2-Jan-98 MARTEN ALAN Sold (S) 5,000 Common 24.31 $121,550 2-Jan-98 MARTEN ALAN Exercised (M) 5,000 Common .02 - 31-Dec-97 MARTEN ALAN Sold (S) 25,000 Common 22.85 - 24.25 $589,800 31-Dec-97 MARTEN ALAN Exercised (M) 25,000 Common .02 - 6. The 20-day volatility for SMOD has reached a whopping 135.7% vs. a 96% for the past 6-months! WOW! Those option premies are hot! There is more negative SMOD news for the short term as compared to positive news. The BB and RSI are going to pan out again! Just my 2-cents worth.