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New Calls

None today.
 

New Puts

Overseas Shipping - OSG - cls: 48.10 chg: -0.81 stop: 50.01

Company Description:
Overseas Shipholding Group, Inc. is one of the largest publicly traded tanker companies in the world with an owned, operated and newbuild fleet of 113 vessels, aggregating 12.7 million dwt and 864,800 cbm. As a market leader in global energy transportation services for crude oil and petroleum products in the U.S. and International Flag markets, the Company is committed to setting high standards of excellence for its quality, safety and environmental programs. OSG is recognized as one of the world's most customer-focused marine transportation companies, with offices in New York, Athens, London, Manila, Newcastle and Singapore. (source: company press release or website)

Why We Like It:
The share prices for the oil tanker stocks have totally disconnected from the rising price of oil. They have been under performing oil, the rest of the oil sector, and the general market. It now looks like OSG's five-month consolidation is about to blossom into a new leg lower. This month (April) the stock tried to produce an oversold bounce but it failed at the $50.00 mark. Currently the P&F chart for OSG points to a $43 target. We are going to suggest put positions with OSG under the $50 level and its 50-dma. Our target will be the $43.00-42.50 range. Please note there is some support near $47.50 and again at $46.00 and we do anticipate a bounce there but the prevailing pattern is bearish. We do not want to hold over the early May earnings report.

Suggested Options:
We are suggesting the May puts although we plan to exit ahead of the May earnings report.

BUY PUT MAY 50.00 OSG-QJ open interest=44 current ask $3.10
BUY PUT MAY 45.00 OSG-QI open interest=39 current ask $0.80

Picked on April 11 at $ 48.10
Change since picked: + 0.00
Earnings Date 05/02/06 (unconfirmed)
Average Daily Volume = 469 thousand

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Texas Ind. - TXI - close: 58.34 chg: -1.08 stop: 61.11

Company Description:
TXI is the largest producer of cement in Texas and a major cement producer in California. TXI is also a major supplier of construction aggregates, ready-mix concrete and concrete products. (source: company press release or website)

Why We Like It:
We are going to try again with TXI. We recently tried a bearish play on the stock but we were stopped out on the oversold bounce a couple of days ago. The bounce has reversed course and the stock is trading back under $60 and its 50-dma. We are going to suggest put positions with TXI under $60.00 but more conservative traders may want to wait for a move under $57.90 before initiating plays. Our target will be the simple 200-dma in the $54.00-53.50 range. A move under $57.00 would produce a new P&F chart sell signal.

Suggested Options:
We are suggesting the May puts.

BUY PUT MAY 60.00 TXI-QL open interest=622 current ask $3.50
BUY PUT MAY 55.00 TXI-QK open interest=569 current ask $1.35

Picked on April 11 at $ 58.34
Change since picked: + 0.00
Earnings Date 06/29/06 (unconfirmed)
Average Daily Volume = 423 thousand
 

New Strangles

None today.
 

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