Semis Remain Constructive
Centillium Communications
(
CTLM |
Quote |
Chart |
News |
PowerRating), mentioned in my
Stock Outlook, may provide an opportunity for covered calls. You can buy the stock for
44 1/16 and sell the February 50 calls
for 4 7/8. This represents
approximately a 25% return should the stock be called
away.
The semis
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), mentioned recently,
appear to be forming the handle of a big picture low-level cup and handle
formation. Continue to watch for buying opportunities in calls and call spreads
here.
Telecom
(
$XTC.X |
Quote |
Chart |
News |
PowerRating) sold off earlier in the day but reversed to close well. This
action suggests that its uptrend from lows remains intact. Look for buying
opportunities in calls and call spreads here.
On the
short side, the drugs
(
$DRG.X |
Quote |
Chart |
News |
PowerRating) rallied earlier in the day (a) but failed
and closed poorly (b). This false move out of the consolidation suggests that
its downtrend remains intact. Look for buying opportunities in puts and put
spreads here.
Best of
luck with your trading on Monday!
P.S. Reminder:
Protective stops on every trade!