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Strategies & Market Trends : Tech Stock Options -- Ignore unavailable to you. Want to Upgrade?

To: Stephen who wrote (56521)	10/27/1998 8:16:00 PM
From: donald sew	Respond to of 58727

Stephan, For the short-term, I do feel that we will head up, but playing options is different than playing stocks. So Im will probably stay in cash until I feel more comfortable, but again that does not mean it wont move up. As mentioned in my last post, there is a big divergence in my technicals between the NAZ and the DOW, and 3 things can happen: 1) the NAZ rebounds and heads up and since the DOW is a BUY, the NAZ will pull the DOW up 2) The NAZ sells off more, pushing the DOW down a little more 3) the NAZ drops and the DOW rises, meeting somewhere in the middle, but such action could minimize the drop in the DOW, but also minimize the rise in the DOW. From a logical standpoint, 2 of the 3 possibilities are not that favorable for playing options. If the rise in the DOW is minimized, that is not good for playing options - stocks are OK. I agree that the market internals have improved, but they have not improved dramatically. For example, if you go back to the crash of OCT last year, right after the dump the DOW rebounded 72% in 6 days and the new highs improved to over 150 immediately. Now, I realise that many will say that we are far from the highs so the new highs cannot improve that fast. However, if you check the new highs in Sept when the DOW was at 8000-8100 range the NEW HIGHS got to over 100. We are several hundred points above that range and this runup is over 2 weeks old and the NEW HIGHs have not hit 100 yet. If you also check the advance/decline, you will also notice that it is trailing the price swing to the upside. It may not mean anything, but again it may. I dont think this thread is that bearish. Few here are saying that we will retest the lows soon. Im not yet bullish to say that we are back in an uptrend, but my position has been one of a trading range. Even during the last test of 7500 I was in my trading range position watching the break of support lines. Many on this thread have gone long already. My feeling is that many feel that if you are not bullish you are bearish. What happened to being uncertain/neutral. Im right now neutral, which I feel is the best position to be in, since I will now play both sides. The only reason I may not play the immediate upswing is that my technicals are not lined up where I am comfortable with. Now if the NAZ was to pull back some and the DOW stays down, then thats a different story. Seeya