December quadruple witching the Dow has been up 18 of the last 26 years, with strong gains a number of years. It's sad, but this is the only "fact" we have to go on this week, watching the market simply freeze in a trade range as it approaches former resistance at 10,550. With market moves as light as we are seeing, both in volume, and in the "trade range itself" it makes option trading nigh to impossible.
So, rather than lose money, we'll keep our open signals, for those that have entered, and simply wait the market out.
In the meantime, here's two tips worth your subscription. The first takes time to think about:
To catch a tiger you must understand the behavior of goats.
The second is a stock tip we've recently given to our Premium Blue Chip Option subscribers, who pre-bought AOL. Buying under the symbol AOLWI (when in) traders were able to pre-trade the actual split off of this stock.
As a tip, and because the option market is so lousy to trade, here is our suggestion:
*Buy AOL at market in a speculative account. Set a 25% trailing stop loss, and buy the position again anytime it loses 15%. Hold it a minimum of one year.
This is a bit of complicated trading as when you re-buy you must average your cost and set your trailing stop accordingly.
We believe AOL showed fair value at opening. At 26.00 or less the stock is worth it's price, and the atrocities that have been committed by both AOL and Time Warner can long be past.
To think, the original brand of the internet for sale. This stock will become a company, a true name, or will be bought up. We think AOL may become speculative, and will begin watching it for day trading, and highly recommend a buy to AOL.
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By 3 pm the market had only moved 50 actual points. The moves started a bit more at that time, but not enough for sell off.
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