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Phelps Dodge - PD - cls: 130.05 chg: +2.09 stop: 123.45

Company Description:
Phelps Dodge Corp. is one of the world's leading producers of copper and molybdenum, the largest producer of molybdenum-based chemicals and continuous-cast copper rod, and among the leading producers of magnet wire and carbon black. The company and its two divisions, Phelps Dodge Mining Co. and Phelps Dodge Industries, employ approximately 15,500 people worldwide. (source: company press release or website)

Why We Like It:
You know the old saying, "if at first you don't succeed, try, try again." Well, we're going to try again with PD. The metal stocks are moving and copper prices continue to march higher. This time we're going to alter our bullish strategy a bit with PD. We're going to suggest a trigger at $131.25. Only if PD trades at our trigger or higher will we suggest buying calls on the stock. We're also going to set our stop loss at $123.45, which is under the recent lows of this week. More aggressive traders might want to put their stop under the simple 50-dma at $123.00. Our target is the $139.90-140.00 range. The Point & Figure chart for PD points to a $150.00 target. More conservative traders may want to target the October high near $138.50.

Suggested Options:
We are suggesting the December or January options but our preference is the Januarys.

BUY CALL DEC 125 PD-LE open interest=1258 current ask $8.60
BUY CALL DEC 130 PD-LF open interest=1172 current ask $5.70
BUY CALL DEC 135 PD-LG open interest= 789 current ask $3.40

-or-

BUY CALL JAN 125 PD-AE open interest=2421 current ask $11.50
BUY CALL JAN 130 PD-AF open interest=6832 current ask $8.60
BUY CALL JAN 135 PD-AG open interest=1697 current ask $6.20

Picked on November xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 01/26/06 (unconfirmed)
Average Daily Volume = 2.7 million
 

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