We sold our

Dow Jones

holdings here because many of them are right against the strike. We don't think they will go through them because there is too much option pressure to burst through. Watch this: See if I am right.

If you are short

Wal-Mart

(WMT) - Get Report

you can buy the March 55 calls with one day left to be able to hedge a short on Wal-Mart.

You are stopped out right there. That means there is little pressure on the people who are short Wal-Mart to cover it. Much of the strength in the Dow names comes from position traders at major block houses (

Merrill

,

Goldman

) who have shorted merchandise to clients and they are feeling pain.

They cap that pain by buying these out-of-the-money calls. At least they know they won't have to take any more pain beyond that level. And that means no more upside for the Dow, as most stocks in the Dow are hugging the strikes. Again, that's why we want

NDX

and not Dow names here.

Random musings:

Here's a classic. We didn't get enough

Red Hots

(now the

TheStreet.com New Tech 30) in. We were too cautious. Isn't that what happens at bottoms? The buys we made won't do much vs. the losses we took the last two days. That's also obvious. Second-guessing the second-guessing of the second-guessers you could say.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long Merrill Lynch and Goldman Sachs. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

jjcletters@thestreet.com.