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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: Herm who wrote (8227)	8/16/1998 2:53:00 PM
From: Wayners	Respond to of 14162

Since Virgil hasn't answered, here's how I find short candidates for real quick plays. Find stocks on a downtrend. Be able to draw the downtrend line or monitor an appropriate moving average suitable for your particular timeframe. I just use 12 days as I'm not writing covered puts. Another method is to use linear regression and look for a downtrend on that. Next look at the bollinger bands on price. Bands should be narrow for next big drop. Look at stochastics next. The Stochastic, I like Stoch(5,3), needs to be dropping below its own moving average (I like 12 day moving average). Should be lower than average volume also. That's all there is too it.