Option Investor
New Plays

New Option Plays

HAVING TROUBLE PRINTING?
Printer friendly version
Call Options Plays
Put Options Plays
None EXPD
  IWN

New Calls

None today.
 

New Puts

Expeditors Intl Was. - EXPD - cls: 49.31 chg: -0.81 stop: 52.51

Company Description:
Expeditors is a global logistics company. Headquartered in Seattle, Washington, the company employs trained professionals in 170 offices and 12 international service centers located on six continents linked into a seamless worldwide network through an integrated information management system. Services include air and ocean freight forwarding, vendor consolidation, customs clearance, marine insurance, distribution and other value added international logistics services. (source: company press release)

Why We Like It:
Disappointing retail sales have fanned the flames of investors' fears of an economic slow down. The transportation sector is getting hit hard since it is a big target for profit taking after its 2004 rally. The Dow Transports just broke down under its simple and exponential 200-dma on big volume. Meanwhile, EXPD, which had already broken below its 200-dma's a few days ago, is closing under the $50.00 level for the first time in months. The technical picture looks pretty sour and the P&F chart also shows a triple-bottom breakdown sell signal with a $42.00 target. However, it is worth noting that the P&F chart does show EXPD near support. Normally, this would persuade us from not playing the stock but considering the market weakness we are going to add EXPD anyway. Shares are somewhat oversold so be prepared for a possible bounce toward the $52.00 level before EXPD trades lower. We are starting the play with a stop loss at $52.51. Our target is the $46-45 region and we plan to exit before EXPD's earnings report which is only three weeks away.

Suggested Options:
We are suggesting the May puts because we plan to exit before the May earnings report.

BUY PUT MAY 50.00 URP-QJ OI=747 current ask $4.80
BUY PUT MAY 45.00 URP-QI OI= 91 current ask $0.60(?)

Picked on April 14 at $ 49.31
Change since picked: - 0.00
Earnings Date 05/04/05 (unconfirmed)
Average Daily Volume = 748 thousand

---

Ishares Russ 2000 Val - IWN - cls: 178.04 chg: -3.21 stop: 183.51

Company Description:
The Ishares Russell 2000 Value Index Fund represents a sampling of the Russell 2000 Value index and tries to perform according to the index.

Why We Like It:
Now that the major indices are breaking down left and right we wanted a way to play the "market". Unfortunately, the DIA Dow Diamonds and the NASDAQ 100 QQQQs don't seem to move fast enough for short-term directional option plays. That's why we're suggesting readers consider puts on the IWN or the Russell 2000 Value index Ishares. We like the IWM as well but the IWN appears to offer more movement, which is what we want in an option play. Looking at the chart of the IWN we see a technical breakdown below support at the 180 level and its simple and exponential 200-dma's in the 179 region. Volume was heavy on the sell-off today. Technical oscillators are naturally negative. The IWN's P&F chart shows a sell signal with a 162-price target. We are going to target a move to the 170 level over the next six to eight weeks.

Suggested Options:
We are suggesting the May puts. The next month available would be August puts.

BUY PUT MAY 185.00 IWN-QQ OI=128 current ask $8.50
BUY PUT MAY 180.00 IWN-QP OI=370 current ask $5.00
BUY PUT MAY 175.00 IWN-QO OI=280 current ask $2.75

Picked on April 14 at $178.04
Change since picked: - 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 324 thousand
 

New Play Archives