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In Play Updates and Reviews

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Energy Play Updates
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JEC $77.61 -0.29 Jacobs Engineering Group *** Stop Loss $70 ***

Nothing material in the news for JEC other than their analyst meeting that went off without a hitch. You can read the transcript at the link below. Still holding over support at $75.

Transcript of last week's analyst meeting

No LEAPS

Breakdown target: $80.00 Hit 11/12

Position: APR 2008 $90 Call JEC-DR @ $6.50

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VLO $65.96 -1.70 Valero Energy *** Stop Loss $64.00 **

Valero took a hit when its cat cracker failed at the Memphis refinery. It will be offline until Nov-29th for unplanned maintenance. They will lose 65,000 bpd of gasoline and 35,000 bpd of distillate production until it is repaired. We will likely be stopped out on any further weakness since the news hit took them to within 67 cents of the stop. They would need to get well really quick to stay as an active play.

Breakdown target: $67.50 Hit 11/12

Position: 2009 $75 LEAP Call VHB-AO @ $10.00

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COP $79.12 .19 Conoco Phillips *** Stop Loss $74.00 ***

The only news for Conoco was the cancellation of a sale of an Irish refinery that processes 71,000 bpd. They took it off the market saying they had decided it was worth more to continue to operate it than sell it. Major refiners have been liquidating European refineries where gasoline demand has stagnated in favor of Asian locations where demand is exploding.

Breakdown target: $80 hit 11/12

Position: 2009 $90 LEAP Call OJP-AR @ $8.60

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MRO $56.37 -1.14 Marathon Oil *** Stop Loss $53.50 ***

No material news for Marathon. It is stuck in the slump with all the refiners waiting for the crack spreads to widen.

Breakdown target: $57 Hit 11/13

Position: 2009 $65 LEAP Call VXM-AM @ $7.50

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CNQ $72.79 .06 Canadian Natural Resources

CNQ still holding support at the 100-day average and only about a buck under our entry point. So far, so good. No news.

Breakdown Trigger: $75.50 11/12 email alert

Position: 2009 $90 LEAP Call OKR-AR @ $9.10

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CLB $126.63 -5.88 Core Labs

The headline here looks really grim but Core is really only trading about $3.40 below our entry. Given its rock star status in the sector we are in good shape. No news.

Breakdown Trigger: $130 11/12

Position: 2009 $140 LEAP Call ZYM-AH @ $21.30

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FTI $55.76 1.22 FMC Technologies *** Stop Loss $49 ***

Only $1 below our entry and holding on support. No news and no change in play.

Breakdown Trigger: $57 hit 11/12

Position: APR $65 Call FTI-DM @ $4.75

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PBR $100.78 -4.99 Petrobras *** Stop Loss $87 ***

PBR continues to hold on support at $100 and above our entry point. They said production dipped slightly in October to 1.73 mbpd due to rig maintenance. PBR estimates production will increase by 7% annually through 2012. That is far better than any other major oil company trading today.

LEAPs Alert Entry 11/12 @ $95

Position: 2009 $90 LEAP Call VDW-AR @ $17.10

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SGR $58.95 -3.95 Shaw Group *** Stop Loss $55 ***

Still holding above support at the 100-day average of $58. No news and no change in play.

LEAPs Alert Entry 11/12 @ $61

Position: 2010 $70 LEAP Call YCW-AN @ $20.40

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FWLT $135.00 -5.50 - Foster Wheeler

Still holding over support at the 100-day average and exactly at our entry point of $135. Once the market quits selling the momentum stocks we should be in business. No news.

The board just approved a 2:1 split subject to shareholder approval around January 8th.

Breakdown trigger: $135 hit 11/06

Position: 2009 $150 LEAP Call ZHF-AW @ $29.10

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FXI $172.79 -6.08 FTSE/Xinhua China 25 *** Stopped $165 ***

The Asian markets continued to correct and the falling knife we caught at $190 continued to fall to stop us out at $165. This was a major hit and very painful.

Breakdown trigger: $190 hit 11/05

Position:
2009 $210 LEAP Call VHF-AA @ $32.50, exit @ $17.00 11/21

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PTR $184.80 -5.10 - PetroChina *** Stop Loss $170 ***

PTR is holding near our entry point of $190 and waiting for the Chinese markets to recover. Bear Stearns upgraded PTR from Sell to Hold on Friday saying the sell off had corrected the over valuation in price. No change in play.

Breakdown trigger $194.32 Entered on rebound from $190 on 11/08

Position: 2009 $220 LEAP Call ZJK-AZ @ $32.20

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XOM - $88.29 3.19 Exxon Mobil

Exxon benefited from an upgrade by UBS on Tuesday to a BUY. The analyst said the 10% sell off in Exxon provided investors with a buying opportunity on the worlds best oil company. XOM jumped 4 on the news.

Breakdown trigger: $88 Hit 11/01

Position: 2009 $100 LEAP Call ODU-AT @ $7.90

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CAM - $94.23 $4.90 Cameron International *** Stop Loss $83 ***

CAM has begun its rebound from the depths of despair see the prior week at $86. The support of the 100-day average at $86.50 held and was tested for about a week before buyers finally appeared. No news and no change in play.

Breakdown target: $95 Hit 10/30

Position: 2009 $100 LEAP Call OKA-AT @ $18

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SLB $94.11 .65 - Schlumberger

SLB appears to be edging higher with a peek over $94 on Friday. Maybe the gloom and doom is over here as well. SLB said it increased its stake in Framo Engineering to 52.75% from 47.75% giving it a majority ownership position. Framo is a Norwegian based company that makes pumps and metering systems. No other specific news.

Breakdown target: $95.00 hit Oct-22nd

Position: 2009 $100 LEAP Call VWY-AT @ $15.60

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CVX $86.67 .69 - Chevron

No news and no movement. Still holding at our entry point of $87. Still no stop.

Breakdown trigger: $87 hit Oct-22nd

Position: 2009 $100 LEAP Call VCH-AT @ $6.40

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OII $66.06 .05 Oceaneering International

No news and no movement. It did close at the high of the week where it is forming a wedge at $66 that could have the potential for a breakout.

Earnings Nov-1st: 40%

Breakdown trigger: $72 hit on Oct-22nd

Position: APR $80 Call OII-DP @ $5.40

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NOV $68.06 3.62 - National Oilwell Varco

No news but NOV is definitely on the recovery road. The resistance at $68 is being tested and any positive news from the sector could produce a breakout.

Breakout Trigger: $80, hit 10/11/07

Position: 2008 May $90 Call NON-ER @ $7.20

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MDR - $47.25 -2.76 McDermott Intl *** Stop Loss $45 ***

MDR is still sliding and fell to support at $47. Any further drops should take us out of the play. The services sector has been hammered but some of the stocks are starting to find buyers. Let's hope that happens to MDR next week.

Earnings: Nov 8th, 37%

Breakout trigger: $53, hit 9/20

Position: 2009 $60 LEAP Call OYZ-AL @ $9.00

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UPL $66.35 -0.35 - Ultra Petroleum *** Stop Loss $62 ***

Still consolidating and holding the high ground. Currently only $5 off its highs. No complaints. No news.

Breakdown target: $52.50 Hit 8/30

Position: Jan 2009 $60 LEAP Call OZH-AL @ $8.00

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CHK $38.13 -.05 Chesapeake Energy

CHK is still sliding but it is not going quietly. The consolidation appears to be easing but still no uptrend. No news.

Earnings: Nov 7th -34%, beat by 3 cents.

Position: 2010 $35 LEAP Call WZY-AG @ $6.60
10/28 Price update: Expired Oct Put 90 cents, $7.50

Insurance put:
Oct $30 Put CHK-VF @ 90 cents. Expired

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HP $34.83 .75 Helmerich & Payne *** Stop Loss $29.50 ***

HP continues to hold near 4-month highs after beating earnings the prior week. If we could get 3 days of positive oil movement I think the entire service sector would begin moving higher.

Earnings: Nov-15th, 18%, beat street by 6 cents at 93 cents

Position: Jan 2009 $35 LEAP Call ZQA-AG @ $4.50

Insurance put:
Position: Nov $30 HP-WF. @ .50, Stop $28.50

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HERO $26.36 -.36 Hercules Offshore ** Stop Loss $24.00 **

Insider buying in HERO keeping it over $25 on no news. Maintain the stop at $24.

Earnings Oct-30th. 63%

Position: 2008 April $30 Call HIQ-DF @ $3.00

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BHP - $72.82 -1.91 BHP Billiton ** Stop Loss $60.00 **

BHP may be starting to firm after the news appears to be suggesting it could be successful in its Rio Tinto offer. BHP is rumored to be considering a higher offer that Rio may be hinting they would accept assuming the management terms are to their liking. The combined companies would be huge with a market cap larger than Microsoft. With mines around the world the management would be a real challenge but so would be their footprint in mining circles. There would be real savings and real profits. Analysts are beginning to warm to the idea and that could be the first step towards the finish line.

Breakdown target: $55 hit 8/15/07

Position: 2010 $70 LEAP Call LPH-AN @ $9.00

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CCJ - $40.95 -1.33 Cameco ** Stopped @ $40 **

The unexplained decline in CCJ continued to stop us out at $40.

Earnings: Oct-31st

Breakdown target: $35 Hit 8/16/07

Position:
2010 $50 LEAP Call LTA-AJ @ $7.20, exit $8.80, 11/21


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Non-Energy Positions
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CSCO $28.69 -1.25 Cisco Systems *** Stop Loss $27 ***

Lots of news but nothing material. Even HPQ's good news could not break Cisco out of its rut. Maintain the stop and hope big cap techs come back into favor.

Alert entry 11/12 @ $29.111

PPosition: 2009 $30 LEAP Call VYC-AF @ $5.00


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Covered LEAP Calls
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RIMM $113.85 6.28 Research in Motion *** Covered Call ***

RIMM is showing bullish signs again and resistance at $115 looks like it is about to be broken. Blackberry phones were said to be flying off shelves on black Friday and I see nothing to change this trend.

Alert entry 11/12 @ $29

Covered LEAP Call:

LONG RIMM currently $102.60
SHORT 2009 $150 LEAP Call XTB-AJ @ $18.50

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LVS - $111.13 -7.46 Las Vegas Sands

The Sands fell sharply on Monday after Barrons did another of their famous hatchet jobs on WYNN and LVS. The analyst quoted in the story says he did not say the negative things Barrons printed. Barrons says they stand by the story and will print o retraction. Basically Barrons said to "Fold Em" when referring to holdig LVS and WYNN in your portfolio. Reportedly the analyst said the Macau casinos could be in trouble after the Olympics passes. The analyst claims he did not say that and still maintains a hold rating on both stocks. This will blow over. Barrons is famous for printing biased viewpoints based on half-truths. Evidently they believe that bad news still sells papers. No change in play.

Covered LEAP Call

LONG: 100 Shares LVS currently $117
SHORT: 2009 $140 LEAP Call ZAU-AY @ $20.00 No Stop
 

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