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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 (9156)	11/23/1998 7:54:00 PM
From: Douglas Webb	Read Replies (1) \| Respond to of 14162

I'm guessing the bid may touch $6.50, then it's going to head back up. In the last cycle, BTGC closed just above the lower band, and the next day the low was right on the band, but the close was 5/8ths above the band. I think the same might happen tomorrow (though I don't know how much it may recover.) I'm long 10 Jan 7.5 puts (currently worthless) and short 1 Jan 7.5 call. I put in a stop limit order to buy the call back at $1.75, since I don't expect to get more out of it this cycle, and don't want to wait another month. I also have a stop limit order to sell the puts for 1/4, which I don't expect to be filled, even if I reduced it to 1/8. I've been developing a price predictor tool, based on historical volatility and some of McMillan's equations. According to my calculations, there's a 72% chance that BTGC will close between $6.52 and $6.80 tomorrow, and a 91% chance that it will close between $6.40 and $6.92. There's a lot more room above $6.50 in those ranges than below, which is why I think $6.50 is the bottom. For what it's worth, here's the prediction for the next 5 trading days: $6.30 - $7.03 : 75% $6.00 - $7.39 : 89% Doug.