MARKETS MAY HAVE FINISHED THEIR RECENT RUN

Well, this has been a nice run in the past few months and I think that the big boys are going to start taking in some profits on the runners. So here are the choices a stock trader is left with:
1. Sell everything off
2. Hold onto the stock
3. Sell covered calls
4. Buy Puts

I enjoy selling covered calls if I already own the stock. Or, if I am dabbling in options, I enjoy a technique call bear put spreads. Since I wish to keep this simple, go back to the October 22, 2006 posting and a covered call is explained.

One thing you will have to get used to is losing money. When the stock market falls, one way to temper the loss is to sell covered calls. You will still lose money in your overall portfolio, but you should be used to that problem by now. Remember - eliminate emotions from your trading and your trading will dramatically improve. I believe it is best to marry technical analysis and fundamental analysis, but let technical analysis be the decision maker in your stock trading.

Here are the stocks that I am going to sell covered calls on and why:

WCC - the MACD has crossed to the downside. Going to sell a December $65 call.
OVTI - the overall market is not making headway. Going to sell December $17.5 call
ICE - this stock has given a 33% rise since September, 2006 when I bought it for near $75. I really hate to sell a covered call on this one, but I have make a fair amount of $$ on this one. I am actually going to sell a "deep in the money" covered call. I plan on selling a December $90 call. This way I can get more money out of the deal than selling a covered call at $100.
PACR - decisions, decisions, decisions. Emotions say "do nothing". MACD says "do nothing." I am going to wait for this stock to declare it's next direction before making a move.
DXPE - watch this one as this one bucked the market trend and traded up today while the market tanked. Also had high trading volume in it meaning a big buyer came in. MACD is saying "buy".
LTM - this one said "sell a covered call" back on November 6th when the MACD crossed down. I lost a little bit of money on the covered call, but when I rolled it to December, this has held out and the covered call has been profitable.

Good luck trading. I will give more educational stuff in the future when I get a little more time.

JD