Goldman Dropping Upgrade Bombs

The markets opened slightly
lower this morning, although the
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HWP |
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has lifted the futures in the last few minutes. Goldman is dropping upgrade
cluster bombs in the semi and semi-manufacturing sector.
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NVLS |
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TER |
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and
(
KLAC |
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Unfortunately, continuing concerns in the mumbo-jumbo
accounting department continues to weigh on overall sentiment, with
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AMZN |
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and once again
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TYC |
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Updates

With volatility back on the lows, we are going back on the
“buy puts on strength” program, but in the
(
QQQ |
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PowerRating)s only.

We are monitoring the “accounting fraud” sector
for possible initiation of proxy buy-writes.

Current Recommendations

Buy the
(
SLB |
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PowerRating) May 55/60 call spread (buy the 55 calls,
sell the 60 calls) for $1.50 (25%).

Traders may make scale purchases of puts in the QQQs on
strength, taking partial profits on sell-offs.

Technical Levels:

Rolls/Adjustments

None.

Recap of open trades

Long-term

Reverse Collars

(
TLAB |
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PowerRating) — March 17.5/15 reverse collar (long the
March 17.5 calls, short the March 15 puts) at $1.50 credit average (50%),
settled at $.80 credit.

(
AMD |
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Chart |
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PowerRating) — April 25/15 reverse collar (long the April 25
calls, short the April 15 puts) at $.05 credit (100%). Settled at $1.40 credit.

Buy-writes

None — volatility too low! Again, this is a general
recommendation. Specific opportunities always exist.

Proxy buy-writes

(
BA |
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PowerRating) Jan. ’03 35/May 45 call calendar @ $4.75 (100%).
Settled at $7.55.

BA Jan. ’03 40/May 45 call calendar @ $2.75 (100%).
Settled at $4.65.

Complex Strategies

(
GILD |
Quote |
Chart |
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PowerRating) — Long the GILD Feb. 70 straddle at $8.00
(50%). Settled at $5.00, but we have captured $5.50 in gamma scalping profits
already!

Short-term

Call Positions

None.

Call Spread Positions

(
DYN |
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PowerRating) — Long the March 30/40 1:2 call ratio spread @ $1.50.
Settled at $.55.

(
TLAB |
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PowerRating) — Long the March 17.5/22.5 call spread at $.80
credit average (50%). Settled at $.30. Note: This spread is a result of a
reverse collar roll.

Put Positions

(
QQQ |
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PowerRating) — Long the March 39 puts at $2.35 (25%). Settled at
$2.30. Stop below.

Put Spread Positions

(
AZO |
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PowerRating) — Long the March 55/65 put spread @ 2.125 (100%).
Settled at $2.20.

STOPS

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AMD |
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PowerRating): Stop @ 14.90, close only.

(
QQQ |
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PowerRating): Stop @ 39.50, two consecutive days close only.

(
TLAB |
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PowerRating): Stop @ 11.95, close only.