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CLF None None
LEND    

New Calls

Cleveland Cliffs - CLF - close: 94.11 chg: +1.41 stop: 92.45

Company Description:
Cleveland-Cliffs Inc, headquartered in Cleveland, Ohio, is the largest producer of iron ore pellets in North America and sells the majority of its pellets to integrated steel companies in the United States and Canada. Cleveland-Cliffs Inc operates a total of six iron ore mines located in Michigan, Minnesota and Eastern Canada. The Company is majority owner of Portman Limited, the third-largest iron ore mining company in Australia, serving the Asian iron ore markets with direct-shipping fines and lump ore. (source: company press release or website)

Why We Like It:
We found a lot of bullish candidates but many of the stocks we are interested in the companies are expected to report earnings in the next couple of days. Even with CLF we are facing a time crunch. Our time frame is just five trading days and that includes waiting for CLF to hit our trigger to open the play. Metal and mining-related stocks have been relatively strong and we suspect that shares of CLF are on the verge of breaking out over resistance at the $95.00 mark. Volume has been strong on the stock's two-day rebound and the P&F chart is on the verge of a new buy signal. We are going to suggest a trigger at $95.05 to buy calls. If triggered then we'll target a quick rally into the $99.85-100.00 range. We plan to exit near the closing bell on Wednesday, April 26th to avoid the company's earnings report later that day after the close. More aggressive traders may want to open positions now or on a dip back toward $92.00.

Suggested Options:
We are suggesting the May calls.

BUY CALL MAY 90.00 CLF-ER open interest= 561 current ask $7.50
BUY CALL MAY 95.00 CLF-ES open interest=2879 current ask $4.70
BUY CALL MAY100.00 CLF-ET open interest= 393 current ask $2.80

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/26/06 (confirmed)
Average Daily Volume = 650 thousand

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Acc. Home Lenders - LEND - cls: 56.57 chg: +3.38 stop: 51.99

Company Description:
Accredited Home Lenders Holding Co. is a mortgage company operating throughout the U.S. and in Canada. Accredited originates, finances, securitizes, services, and sells non-prime mortgage loans secured by residential real estate. Founded in 1990, the company is headquartered in San Diego. (source: company press release or website)

Why We Like It:
LEND has produced a big bullish technical breakout over significant resistance at the $54.00 (and $55.00) level. Shares have been consolidating sideways under resistance for months but the recent bounce from its 100-dma has been fueled by above average volume. Today's volume was more than double the daily average. The move has also produced a quadruple top breakout buy signal on the P&F chart, which now points to a $72 target. We also like LEND's breakout today because it's a push through the neckline to an inverse or bullish head-and-shoulders pattern. The H&S pattern points to a $61.00 target. We're going to aim for a rally into the $59.75-60.00 range. Traders have a choice. You can open positions here (chase it) or wait (hope) for a pull back toward the $55.00 or $54.00 levels. We do not want to hold over the May 2nd earnings report and that gives us about two weeks.

Suggested Options:
We are suggesting the May calls.

BUY CALL MAY 55.00 QFW-EK open interest=413 current ask $4.40
BUY CALL MAY 60.00 QFW-EL open interest= 68 current ask $1.60

Picked on April 19 at $ 56.57
Change since picked: + 0.00
Earnings Date 05/02/06 (confirmed)
Average Daily Volume = 693 thousand
 

New Puts

None today.
 

New Strangles

None today.
 

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