Pretty Doggone Close
We are looking pretty doggone
close to unchanged this morning in what will
be thin pre-holiday trade. The Argentine debt default and the terrorist
(or is he just a nut?) attack over the weekend seems to have had
limited impact.
The trading will be very subdued in this abbreviated
session. One thing to watch will
be the SOX index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), which took on some serious technical
water last week. The SOX stabilized Friday,
bouncing off of its 50-day moving
average. Should it slip below this level (509.58 this morning), it
could trigger further selling.
The DJI looks as though it may be coiling up to test the
upside this week. Its 61.8%
retracement level of the May to September sell-off comes
in at 10,094.10, and its 200-day moving average comes in at 10,104.2.
These levels should be tested this week.
Obviously, this week is going to be very slow, and the
“window dressers” will
be out in force to beautify their portfolios. As volatilities drop
and prices get stretched, we will be looking
to scoop up some straddles.
Updates:
Current Recommendations:
Continue Gamma scalping the
(
GENZ |
Quote |
Chart |
News |
PowerRating) straddle.
Rolls/Adjustments:
None
Recap of open trades:
Long-term
Airline calendar spreads
(
AMR |
Quote |
Chart |
News |
PowerRating) Jan./Oct. 25 call calendar @ .75 — Oct.’s went
out worthless, holding the Jan.
25 calls.
(
UAL |
Quote |
Chart |
News |
PowerRating) Jan./Oct. 25 call calendar @ .70 — Oct.’s went
out worthless, holding Jan. 25
calls, looking like rip-ups.
Reverse Collars
(
AWE |
Quote |
Chart |
News |
PowerRating) Jan. 12/15 reverse collar (long the Jan. 15
calls, short the Jan. 12.5 puts)
@ .05 average. Stop below.
(
TLAB |
Quote |
Chart |
News |
PowerRating) March 17.5/15 reverse collar (long the March
17.5 calls, short the March 15
puts) @ 1.50 credit average.
Buy-writes
*
(
AMZN |
Quote |
Chart |
News |
PowerRating) Jan. ’03 10 buy-write @ 5.15 (2 units) —
hold.
*
(
JDSU |
Quote |
Chart |
News |
PowerRating) Jan. 12.5 buy-write @ 9.60 — hold.
Proxy buy-writes
(
BA |
Quote |
Chart |
News |
PowerRating) Jan. ’03 35/Jan. ’02 40 call calendar @ 5.00 —
hold.
BA Jan. ’03 40/November ‘ 01 40 call calendar @ 3.00 —
hold.
Complex Strategies
(
JDSU |
Quote |
Chart |
News |
PowerRating) — Long 1 unit of the Jan. 10 calls and short
2 units of the Jan 7.5 puts @
$1.00 credit.
(
GENZ |
Quote |
Chart |
News |
PowerRating) — Long the Jan. 60 straddle at $6.50, (50%)
— hold.
Short-term
Call Positions
(
WCOM |
Quote |
Chart |
News |
PowerRating) Jan. 12.5 calls @ 2.40 — hold. Stop below.
Put Positions
(
TGT |
Quote |
Chart |
News |
PowerRating) — Long the Jan. 35 puts @ 1.15 (100%) — hold.
(
WMT |
Quote |
Chart |
News |
PowerRating) — Long the Jan. 55 puts @ 2.35 (50%) — hold.
Put Spread Positions
(
BAC |
Quote |
Chart |
News |
PowerRating) — Long the Dec. 55/60 1:2 ratio put spread at
.30 — hold.
(
AZO |
Quote |
Chart |
News |
PowerRating) — Long the March 55/65 put spread @ 2.125
(100%) — hold.
(
BBY |
Quote |
Chart |
News |
PowerRating) — Long the Jan. 60/70 put spread @ 3.00 (50%)
— hold.
STOPS
(
AWE |
Quote |
Chart |
News |
PowerRating): Stop @ 12.25 close only.
(
WCOM |
Quote |
Chart |
News |
PowerRating): Stop @ 13.95 close only.
(
TLAB |
Quote |
Chart |
News |
PowerRating): Stop @ 11.95 close only.
|
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*Supporting documentation for claims,
comparisons, recommendations, statistics or other
technical data will be furnished upon request. One or
more of the contributors to these commentaries may have
a position in one or more of the securities mentioned. It
is important to note that the options strategies discussed herein are not
suitable to all investors. Options are complex investment tools and involve
substantial risk. Moreover spreading strategies do not eliminate risk
and involve multiple commissions.
Note: All individuals must have read the
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