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New Calls

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New Puts

Affiliated Mangers - AMG - cls: 97.45 chg: -3.85 stop: 102.55

Company Description:
Affiliated Managers Group, Inc. is an asset management company with equity investments in a diverse group of growing, mid-sized investment management firms (its "Affiliates"). (source: company press release or website)

Why We Like It:
Almost anything investment-related is getting hammered today. The brokerage stocks and asset management stocks are all seeing significant profit taking. After months of gains they're due for some profit taking so we think today's breakdown in AMG might have a lot further to run. Shares of AMG had been consolidating mostly sideways for the last month but today shares fell through support at the $100.00 level and its simple 50-dma on above average volume. The move also produced a new P&F chart sell signal that points to an $88 target. We are going to suggest puts in AMG with the stock under $100 and we'll target a decline into the $92.00-90.00 range. Readers can choose to open positions here or look for a potential bounce and failed rally under $100 as a new entry point (since broken support at $100 should be new resistance). We do see two obstacles for the bears. The simple 100-dma, currently at 93.58, and the $95.00 level might offer some support. Conservative traders may want to exit near the 100-dma. We would expect a bounce near $95.

Suggested Options:
We are suggesting the June puts.

BUY PUT JUN 100.00 AMG-RT open interest= 431 current ask $4.90
BUY PUT JUN 95.00 AMG-RS open interest=2103 current ask $2.60

Picked on May 01 at $ 97.45
Change since picked: + 0.00
Earnings Date 04/26/06 (confirmed)
Average Daily Volume = 637 thousand


Atheros Comm. - ATHR - close: 23.77 chg: -1.62 stop: 26.51

Company Description:
Atheros Communications is a leading developer of semiconductor system solutions for wireless communications products. Atheros combines its wireless systems expertise with high-performance radio frequency (RF), mixed signal and digital semiconductor design skills to provide highly integrated chipsets that are manufacturable on low-cost, standard complementary metal-oxide semiconductor (CMOS) processes. Atheros technology is being used by a broad base of leading customers, including personal computer, networking equipment and handset manufacturers. (source: company press release or website)

Why We Like It:
The five-month bullish trend in ATHR has been broken. Shares have been struggling with upward momentum for the past few weeks and now they've finally broken down below support near $24.50-25.00 and its simple 50-dma. Volume on the post-earnings sell-off in late April was pretty high and volume was strong again on today's technical breakdown. The P&F chart points to a $19.00 target. We are suggesting put positions with ATHR under $25.00. Our target will be the $20.50-20.00 range and/or the rising 100-dma (currently at 19.72), whichever we hit first. FYI: we would watch for a potential bounce near $22.00.

Suggested Options:
We are suggesting the June puts.

BUY PUT JUN 25.00 QRA-RE open interest=459 current ask $2.35
BUY PUT JUN 22.50 QRA-RX open interest=724 current ask $1.05
BUY PUT JUN 20.00 QRA-RD open interest=434 current ask $0.40

Picked on May 01 at $ 23.77
Change since picked: + 0.00
Earnings Date 04/24/06 (confirmed)
Average Daily Volume = 1.6 million

New Strangles

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