Tech Poised To Rally?
face=”Arial, Helvetica”>Heads up! In case you forgot, June
options expire on Friday.
face=”Arial, Helvetica”>Vertex Pharmaceuticals
(
VRTX |
Quote |
Chart |
News |
PowerRating),
on the
From Highs List, is forming a big-picture cup-and-handle
and may present an opportunity for covered calls. You can
buy the stock for 84 3/8, and you can sell the July 90 calls
for 7 5/8. This represents approximately a 15% return (more
than 160% annualized, based on 35 days until expiration)
should the stock be called away.
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Biotech
(
$BTK.X |
Quote |
Chart |
News |
PowerRating) continues to consolidate after its rally
from major lows, and it still looks poised to break higher.
Look for buying opportunities in calls and call spreads
here.
Computer
technology
(
$XCI.X |
Quote |
Chart |
News |
PowerRating) (and other technology, for that
matter) is also consolidating after rallying from lows. Look
for buying opportunities in calls and call spreads here.
On
the short side, banks
(
$BKX.X |
Quote |
Chart |
News |
PowerRating) were hit hard on the
negative Wachovia
(
WB |
Quote |
Chart |
News |
PowerRating) news. It now appears that the
sector has formed a failed pullback. Look for buying
opportunities in puts and put spreads here, but wait to see
if there is additional follow-through to the downside on the
news.
Continuing
on the short side, retail
(
$RLX.X |
Quote |
Chart |
News |
PowerRating) appears to be
stalling out after rallying from lows. This suggests that
its choppy downtrend remains intact. Look for buying
opportunities in puts and put spreads here.
For
the OEX trader, the VIX is once again at its lowest level in
more than two months. This suggests that it is due to
increase as volatility reverts to its mean. Begin watching
for a buying opportunity in puts and put spreads here, but
wait for confirmation in price, as the index was up on
Thursday.
Best
of luck with your trading on Friday!
P.S. Reminder:
Protective stops on every trade!