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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: taxman who wrote (23096)	5/21/1999 8:29:00 PM
From: Maverick	Respond to of 74651

MSFT Unveiling New Defense: future high-speed Internet connections for consumers will undermine the government's case by threatening to reduce the industry's reliance on Windows. dailynews.yahoo.com

To: taxman who wrote (23096)	5/23/1999 6:58:00 PM
From: Teflon	Respond to of 74651

taxman, the very heavy writing of Calls this Q lends me to believe the Street did their best to cap the upside in MSFT's share price to protect their holdings. Just as MSFT sells put warrants to supplement their bottom line, the institutional players often write calls on their holdings as a way of lowering their bases in stocks and adding supplemental earnings to Q performance. If they can, and if Market conditions support it, the MMs will often move the trading in a stock they write calls on to levels below the options strike price so they can maintain their inventory past expiration date. Usually, they just avoid supporting the stock at key price levels which in turn breaks down support and thus the stock will drop or languish in a range. This goes on all the time. Sometimes it works and sometimes it doesn't. The MMs try to pick optimal trading patterns in the overall market for these plays, and the past two months have been just that for the high tech sector. Teflon