Higher (At Last)

After the close today, we have earnings reports from the likes of
(
AMD |
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IBM |
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IDPH |
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MCHP |
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(
SEBL |
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day of Greenspan testimony, in front of the House this time. The dollar is up
slightly against all major currencies, and the bonds are down about a half of a
point.

The thing to watch for today is that very rare item, follow through. If the
market can hold its opening levels for more than half of a day, we might see
some buyers actually take an interest in this thing. If the market stabilizes
here, volatility has a long way to drop.

Oh, and one last thing — this is still a bear market!

Volatility

The VIX gained 2.76, settling at 42.05, the VXN rose .10 to 67.94, and the QQV
fell .05 to 57.81. Volatility is very, very high — do not buy calls or puts
outright, use spreads instead.

Trade Updates (7/16/02)

(
QQQ |
Quote |
Chart |
News |
PowerRating) — We bought the August 26/28 1:2 ratio call spread (bought
one August 26 call, sold two August 28 calls) for $0.00 (25%). I have another
variation of this trade that we will look at tomorrow.

(
SMH |
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PowerRating) — We sold half of the SMH July/August 32.5 put calendar spread at
$1.50. We hold the balance.

(
TGT |
Quote |
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PowerRating) — We sold the January 30 puts at $2.00 against half of the January 35
puts that we are long. This leaves us long a portion of the January 30/35 put
spread (37.5%) and a portion of the January 35 puts outright (37.5%).

New Actions (New Recommendations)

(
QQQ |
Quote |
Chart |
News |
PowerRating) — Buy the August 26/28 1:2 ratio call spread (buy one August
26 call, sell two August 28 calls) for even ($0.00); or buy the August 26/28/30
"Christmas Tree" (Buy one August 26 call, sell one August 28 call, and
sell one August 30 call) for $.35. I will talk more about these strategies
later.

Working Orders (Old Recommendations)

(
IWM |
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PowerRating) — Sell the remaining November 80/90 put spreads at $7.00.

(
MMM |
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PowerRating) — Sell half of the October 110/120 put spreads at $5.50, hold the
balance.

(
CHIR |
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PowerRating) — Sell all CHIR July 50 calls at $1.00 to close. (These puppies are
dead meat unless there is an act of God by  Friday.)

Rolls/Adjustments

(
SEBL |
Quote |
Chart |
News |
PowerRating) — For those long the SEBL August 27.5 buy-write: Buy the
SEBL August 27.5 calls (to close) and sell the November 20 calls (to open) for
$2.00 credit. (Far away right now.)

Buy-writes

Proxy buy-writes

(
DYN |
Quote |
Chart |
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PowerRating) — Long the January 15 calls at $3.20 — left over from proxy
buy-write (50%).

Complex Strategies

(
AMGN |
Quote |
Chart |
News |
PowerRating) — Long the January 30/40 put spread at $3.00 (25%). Sold half
at $5.00 on 7/10/02.

(
CHIR |
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Chart |
News |
PowerRating) — Long the July 50 calls at $3.30 (50%) — DOA

Call Spread Positions

(
QQQ |
Quote |
Chart |
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PowerRating) — Long the August 26 / 28 1:2 call ratio spread for even money
(25%).

Put Positions

None.

Spread Positions

(
IWM |
Quote |
Chart |
News |
PowerRating) — Long the November 80/90 put spread at $3.00 (25%). Sold half at
$5.00 on 7/10/02.

(
MMM |
Quote |
Chart |
News |
PowerRating) — Long the October 110/120 put spread at $2.80 (100%).