Dow Off 300

Maintain PCP, JASO, & DO

By Bryan Bottarelli
Friday, February 29, 2008 2:54 PM EST
Fri, 29 Feb 2008 19:54:00 GMT

Dear Bottarelli Research Member,

The Dow just traded lower by 300 points. In one powerful down-stroke, all of the gains that the market tried so hard to achieve this week have been wiped off the board. As you can see from the chart below, the Dow is failing right at its 50-day moving average, and this looks like an indication that a re-test of the January lows needs to happen before the markets can extend upon any upside gains.

INDU

Now don’t get me wrong. Anything can happen between now and the close of trading. After all, don’t forget what happened last Friday, as the Dow revered course and turned a 140-point loss into a 100-point gain in the final 30 minutes of trading. (*was this late-day reversal manipulated by a higher power? I’ll let you be the judge of that, but you already know my thoughts).

As a result, we could still see some very volatile moves headed into next week. Therefore, I’d like to carry maintain our three open positions — and we’ll look to use any intra-day volatily to continue locking in quick gainers. Our PCP March 110 Puts (PCP OB), for example, have traded as high as $4.30 per contract today. If they move up to $4.50 by the close of trading, lock in this quick gainer. Also maintain your JASO April 15 Calls (QJP DC) and your DO March 130 Calls (DO CF).

DO

Considering the major selling pressure we’ve seen today, I think that both DO and JASO are holding up rather nicely. This should bode well for us going into next week, as we can use any market pop to lock in gains on both of these positions as well. Until then…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

© 2012 CSR Group, LLC. All rights reserved. Published in USA.

Information, opinion, research, and commentary contained herein is obtained from sources believed to be reliable; their reliability, however, cannot be guaranteed. The maxim of Caveat Emptor applies — let the buyer beware. Bottarelli Research does not provide individual investment advice, act as an investment advisor, or individually advocate the purchase or sale of any security or investment.

Investments recommended in this service should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Bottarelli Research reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscriber’s initials will be used unless express written permission has been granted to the contrary.

CSR Group, LLC expressly forbids its writers from having a financial interest in any security recommended to readers. Furthermore, all employees and agents of CSR Group, LLC and its affiliate companies must wait 24 hours before following a published recommendation.

Bottarelli Research alerts contain time-sensitive information, and are published and distributed to members with urgency. Because of this, not all published materials can be adequately proofread, and an occasional spelling or grammar error may exist.


Other Options Alerts From February 2008