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Dow Sell-off: Capitulation Low — buy these options now!

Posted November 26, 2007

“The U.S. market is poised for a bounce. Buy the Dow Diamonds January $132. (symbol: DAWAB).” — Christian DeHaemer

by Christian DeHaemer, TFN

Baltimore — (TFN): The Dow Industrial Average has sold off more than 1,000 points in the past five weeks. It has been down for the past six trading days. This is too much, too fast. Trends average three to five periods. The U.S. market is poised for a bounce.

Furthermore, the Heng Seng was up 4.09% overnight. The way to play the Dow Jones Industrial Average is to buy calls on the Dow Diamonds, an Exchange Traded Fund (ETF) which tracks the index.

Buy the Dow Diamonds January $132. (symbol: DAWAB). These are currently trading at $3.35 with 23,102 contracts outstanding.

Look to sell over the next few days.

***Don’t forget to watch this weekend’s Smart Trading Action Alert: Smart Trading Action Alert: Given the beating some blue chips have taken in recent weeks, select small-cap stocks now provide opportunities for safe profits. Ian Cooper explains.

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Posted by Christian DeHaemer · Filed Under US Stocks and Markets 

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