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Harley,
Thanks for your thoughts. It's scary that we are agreeing, that means
we are either both wrong or both right <G>.
JimG
----- Original Message -----
From: Harley Meyer <meyer@xxxxxxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Sent: Sunday, May 09, 1999 11:48 PM
Subject: Re: Weekly Pick and alternative pick
> Comments below
>
> > I'll have to wait until they get close to the
> >bottom of the next longer term channels before I try again.
> > I thought that with all three of them failing to hold, the market
may
> >be in for some more bad times. However, the NASD OTC, OEX, and SPX
indices
> >are all near the bottom of their Intermediate Term Up Trend Channels
> >(ITUTCs). If those channels hold, we should see an upturn some time this
> >week. If they don't this could turn into a major correction
>
> Jim, I believe the PPI comes out on Thursday and the CPI on Friday. Since
> fuel prices have gone up this could be the first PPI that shows some signs
> of inflation. But the $2.27 question is how much inflation will the market
> movers think will be bad for stocks. Some (PIMCO) are betting heavily that
> inflation has begun to crawl in to the economy since they have been a
major
> seller of the 30 year bonds. So we could get some big fireworks this week
> towards the end of the week when the PPI and CPI come out.
>
>
> I too am long C but with the December call (CLP) at 5 /14. I picked it up
on
> Friday. I also have a spread on C with CLP and CUP for about two to three
> weeks now. 68 and below the value of the spread makes me money. I think 83
> and above the spread makes me money. I chose a delta neutral strategy.
i.e.,
> put and call had same deltas a purchase. Since the stock was near 68 and
it
> had broken through the bottom of the channel and the 30 year bond is
> oversold (from a technical point) I figure it was worth going in on the
long
> side. However my price target is 73, but if the PPI doesn't show that bad
of
> inflation C will move much higher.
>
> I am looking at C as a short term trading opportunity. My reasoning is
that
> if interest rates go up then banks get hurt. Watching C over the last few
> days tells me that somebody is watching the yield on the 30 year very
> closely. If the PPI and CPI numbers are pretty good the yield on the 30
year
> should drop and C would move up quite nicly. If you notice on the Friday
> bar. You will notice that C had a high of 71.38. That spike in price was
> because the 30 year Bond dropped in the morning. When the 30 year started
to
> sell off again it dropped like a rock.
>
> The other reason for entering is to protect those gains on the spread in
> case C moves higher.
>
> Just my two cents.
>
> Harley
>
> PS I think this is the only post that I have made that is not contrary to
> your position. Scarry <G>.
>
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