Option Investor
Watch List
Printer friendly version

Dropped Entries
FXI Shanghai ETF Drop stalled at $125 and rally began

New Watch List Entries
Peabody Energy
CHK Chesapeake Energy
USO United States Oil Fund

Current Watch List

CHK - Chesapeake Energy

CHK was stopped out as a play on the recent implosion in nat gas prices. $51 is a strong support level and a reentry point. The CEO stepped up to the plate on June 16th and bought another 750,000 shares at $57.

Company Info:

Chesapeake Energy Corporation is a producer of natural gas in the United States (first among independents). It owns interests in approximately 38,500 producing oil and natural gas wells that are producing approximately 2.2 billion cubic feet equivalent (bcfe), per day, 92% of which is natural gas. Its operations are located in the Mid-Continent region, which includes Oklahoma, Arkansas, southwestern Kansas and the Texas Panhandle; the Forth Worth Basin in north-central Texas; the Appalachian Basin, principally in West Virginia, eastern Kentucky, eastern Ohio and southern New York; the Permian and Delaware Basins of West Texas and eastern New Mexico; the Ark-La-Tex area of East Texas and northern Louisiana, and the South Texas and Texas Gulf Coast regions. In July 2007, the Company announced the acquisition of Kerr-McGee Tower from Anadarko Petroleum Corporation and subsequent sale of the tower to SandRidge Energy, Inc.

Breakdown trigger: $51

Buy 2010 $60 LEAP Call WZY-AL

Breakout trigger: $58

Buy 2010 $70 LEAP Call WZY-AN


BTU - Peabody Energy

Stopped out on the prior position due to the crash in Nat Gas prices. Coal and gas trade in tandem despite all 2008 production and most of 2009 coal production being presold. I believe this was way overdone and we should look to reenter.

Earnings July 23rd

Company Info:

Peabody Energy Corporation (Peabody) is a coal company. During the year ended December 31, 2007, the Company sold 237.8 million tons of coal. It sells coal to over 340 electricity generating and industrial plants in 19 countries. At December 31, 2007, the Company had 9.3 billion tons of proven and probable coal reserves. The Company owns majority interests in 31 coal operations located throughout all the United States coal producing regions and in Australia. In addition, it owns a minority interest in one Venezuelan mine, through a joint venture arrangement. Most of the production in the western United States is low-sulfur coal from the Powder River Basin. Peabody owns and operates six mines in Queensland, Australia, and five mines in New South Wales, Australia. During 2007, the Company generated 89% of its production from non-union mines. On October 31, 2007, Peabody spun-off portions of its Eastern United States Mining operations business segment to form Patriot Coal Corporation.

Breakout trigger: $68

Buy 2010 $80 LEAP Call LLW-AP

Breakdown trigger: $61

Buy 2010 $70 LEAP Call LLW-AN


USO - US Oil Fund

The oil sell off may be overdone and I believe we will move higher but not necessarily immediately.

Company Info:

United States Oil Fund, LP (USOF) is a commodity pool that issues limited partnership interests or units that may be purchased and sold on the American Stock Exchange (the AMEX). The Company invests in futures contracts for light, sweet crude oil and other types of crude oil, heating oil, gasoline, natural gas and other petroleum-based fuels that are traded on the New York Mercantile Exchange (NYMEX), International Currency Exchange (ICE) Futures or other United States and foreign exchanges (collectively, Oil Futures Contracts). It holds interests in other oil-related investments such as cash-settled options on Oil Futures Contracts, forward oil contracts, and oil-based over-the-counter transactions. As of December 31, 2007, USOF held 4,754 Oil Futures Contracts traded on the NYMEX and 300 Oil Futures Contracts traded on the ICE Futures. The Company operates under full management control of its sole General Partner, Victoria Bay Asset Management, LLC (the General Partner).

I am not using LEAPS because I view this as a short-term trade.

Breakdown trigger: $101

Buy OCT $110 Call IYS-JF

Leaps Trader Watch List Archives