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BHI $82.60 +0.40 - Baker Hughes

The bounce stalled as we await the year end and new year portfolio adjustments. The current support at $80 should be reasonably strong.

12/28
North American active rig count fell -139 to 2,052
www.bakerhughes.com/investor/rig/rig_na.htm

Earnings schedule: Jan 30th

Breakdown target: $80 Hit 12/17

Position: 2009 $90 LEAP Call VBH-AR @ $8.40

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DNR $30.11 +1.35 - Denbury Resources

Back to historic highs post split on no news. No complaints here.

Breakdown trigger: $53, post split $26.50 hit 12/17

Position: June $30 Call DNR-FF @ $2.25

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VLO $70.55 -.17 - Valero Energy

Holding its gains from the prior week on no news.

Position: $70 LEAP Call VHB-AN @ $9.20

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FLR $146.26 +1.46 - Fluor Corp

No news holding the rebound. I expect some tax selling on FLR next week. $135 support should hold.

Breakdown trigger: $145 Hit 12/13

Position: 2009 $160 LEAP Call XOB-AL @ $22.30

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RIG $146.02 +2.10 - Transocean Inc

BAC hit Transocean with an upgrade to a buy last week with a price target of $175. That implies a 33% move higher from here. Analysts think the new Petrobras discovery will keep 10 rigs working round the clock for the next 3-5 years each just to build out the initial discovery. A Bear Stearns analyst also went bullish on RIG saying they were still undervalued and would reap rewards from 2008-2010 on the upward pricing momentum and demand in the offshore drilling market.

Breakdown trigger: Hit 12/4 @ $130

Position: 2009 $140 LEAP Call VOI-AH @ $15.80

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JEC $98.08 +1.75 Jacobs Engineering Group

Still holding the high ground at a new high. I expect some tax selling in JEC next week. Hopefully support at $90 will hold. No news.

No LEAPS

Breakdown target: $80.00 Hit 11/12

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

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COP $89.13 +2.42 Conoco Phillips *** Stop Loss $81.00 ***

Conoco moved up to resistance at 3-month highs at $90 on no news. I believe this was window dressing markups and we could see some selling in early 2008. I raised the stop to $81.

Breakdown target: $80 hit 11/12

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

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CNQ $74.07 +3.18 Canadian Natural Resources

No news but another 4-week high. No complaints.

Entry 11/29: $66

Position 11/29: 2009 $90 LEAP Call OKR-AR @ $6.50

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CLB $123.95 +.90 Core Labs

No news, holding at two week highs.

Breakdown Trigger: $130 11/12

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

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PBR $117.62 +4.42 Petrobras *** Stop Loss $97 ***

Petrobras continues on a role garnering upgrades and positive comments from nearly every energy watcher. Holding right at historic higher at $120.

LEAPs Alert Entry 11/12 @ $95

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

Position: 2009 $110 LEAP Call XVQ-AB @ $10.00

Alert on 11/2 recommending an immediate entry into the $110 LEAP. The prior recommendation had been calling for an entry into the $90 LEAP on a dip to $80. The correct LEAP for the current position is the $110 LEAP.

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FWLT $156.27 -8.88 - Foster Wheeler

Another bounce off the historic highs led to profit taking late in the week. I believe this was tax selling and we could see some more next week. Nothing changed, just a cycle we have to endure. No news.

The board 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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PTR $175.90 -3.50 - PetroChina *** Stop Loss $170 ***

Still no momentum in PTR and no news. We need the Asian markets to recover soon. These stocks could see some end of year selling and I believe that, along with the Asian correction, is what has caused the pain.

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 - $95.00 +1.57 Exxon Mobil

No material news but Exxon continues to push higher. I believe this is end of year window dressing and we could see some selling next week.

Breakdown trigger: $88 Hit 11/01

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

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CAM - $98.33 +3.33 Cameron International *** Stop Loss $88 ***

Stock split 2:1 after the close and will trade at $49.17 when it opens on Monday. Our $100 LEAP will become (2) $50 LEAPS.

2:1 Stock split 12/28 to holders of record on 12/17

Earnings schedule: Jan-31st

Breakdown target: $95 Hit 10/30

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

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SLB $98.80 +4.16 - Schlumberger *** Stop Loss $87 ***

No specific news but a +$9 rebound off the 12/21 lows.

Earnings schedule: Jan-18th

Breakdown target: $95.00 hit Oct-22nd

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

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CVX $94.86 +.82 - Chevron

No specific news but Chevron holding at historic resistance highs. Probably end of year window dressing. Expect a decline next week.

Breakdown trigger: $87 hit Oct-22nd

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

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NOV $74.37 +1.59 - National Oilwell Varco

Still holding the post merger announcement gains but appears to have lost momentum. NOV was labeled one of Barron's best managed companies last week and they spoke highly of the merger.

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

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

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MDR - $59.44 +0.06 McDermott Intl *** Stop Loss $45 ***

No news for McDermott but it continues to hold at resistance at $60. A move higher here could trigger additional buying.

Earnings: Nov 8th, +37%

Breakout trigger: $53, hit 9/20

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

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CHK $39.09 +.44 Chesapeake Energy

A new two-month high on no news and cheap gas. Imagine what would happen if a cold winter appeared.

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 $39.01 +1.27 Helmerich & Payne *** Stop Loss $29.50 ***

Not much of a gain for the week but another new high on no news. This article is about companies using HP rigs to drill 20 wells per pad to cut down on costs.

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

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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BHP - $71.36 +.67 BHP Billiton ** Stop Loss $65.00 **

Rio Tinto again rejected the BHP offer and this time Britain's takeover regulator gave BHP only until Feb-6th to either formalize the offer so shareholders could vote or drop the attack. If it does not make the deadline it must wait another 6-months to make another offer.

Breakdown target: $55 hit 8/15/07

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


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Non-Energy Positions
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CSR $22.49 +0.33 - China Security & Surveillance Technology

No movement on CSR but it is still wedging up to resistance at $23. A breakout could be strong IF it ever comes.

Breakdown trigger: $21.00 hit 12/20

Position: Jun-08 $25.00 Call CSR-FE @ $3.00 (no leaps)


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Covered LEAP Calls
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RIMM $116.94 -1.69 Research in Motion *** Covered Call ***

Still holding its post earnings gains but I expect some selling next week as tax holdouts change positions in 2008.

Alert entry 11/12 @ $102.60

Covered LEAP Call:

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

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ETFC $3.54 -0.06 E*Trade Financial *** Covered Call ***

No news, no change.

LONG: ETFC @ $4.13
SHORT: Jan-2009 $5 LEAP Call OYN-AA @ $1.45

Profit if called: Premium 1.45 + appreciation .87 = $2.32
Cost of entry: $4.13 - 1.45 or $2.68
Profit = $2.32 / $2.68 or 86%
 

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