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New Plays

New Option Plays

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Call Options Plays
Put Options Plays
Strangle Options Plays
BPT None None
NXY    
OMC    
SLB    

New Calls

B P Prudhoe Bay - BPT - close: 74.70 chg: +0.15 stop: 72.45

Company Description:
BPT is a grantor trust for the Prudhoe Bay oil field in Alaska. (source: company press release or website)

Why We Like It:
BPT has always looked like a tempting long-term investment given its double-digit dividend yield (currently around 11%). Right now the shares look like a tempting call candidate. Shares have been consolidating sideways between $70-75 and look poised to breakout above resistance at $75 and make a run at resistance near $80.00. If crude oil continues to rise the breakout in BPT could happen soon. We're going to suggest a trigger to buy calls at $75.05. If triggered our target is the $79.75-80.00 range. The P&F chart points to a $100 target.

Suggested Options:
We are suggesting the June calls.

BUY CALL JUN 70.00 BPT-FN open interest=217 current ask $6.20
BUY CALL JUN 75.00 BPT-FO open interest=520 current ask $2.30
BUY CALL JUN 80.00 BPT-FP open interest=326 current ask $0.60

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 120 thousand

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Nexen - NXY - close: 61.00 chg: +0.01 stop: 56.75

Company Description:
Nexen Inc. is an independent, Canadian-based global energy company, listed on the Toronto and New York stock exchanges under the symbol NXY. We are uniquely positioned for growth in the North Sea, deep-water Gulf of Mexico, the Athabasca oil sands of Alberta, the Middle East and offshore West Africa. We add value for shareholders through successful full-cycle oil and gas exploration and development and leadership in ethics, integrity and environmental protection. (source: company press release or website)

Why We Like It:
The oil indices are nearing new highs again and crude oil rose about 2% to close at $72 a barrel. Investors are still worried about Iran, the upcoming summer driving season, and oil out put from Nigeria. We're going to start adding more exposure to the oil sector again. Aggressive traders might want to buy calls now with NXY above $60.00. We're going to suggest a trigger at $61.75 to open new positions. Our target will be the $67.00-68.00 range.

Suggested Options:
We are suggesting the June calls.

BUY CALL JUN 60.00 NXY-FL open interest=3624 current ask $3.70
BUY CALL JUN 65.00 NXY-FM open interest= 409 current ask $1.50

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/13/06 (unconfirmed)
Average Daily Volume = 500 thousand

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Omnicom - OMC - close: 91.45 chg: +1.00 stop: 89.99

Company Description:
Omnicom is a leading global marketing and corporate communications company. Omnicom's branded networks and numerous specialty firms provide advertising, strategic media planning and buying, direct and promotional marketing, public relations and other specialty communications services to over 5,000 clients in more than 100 countries. (source: company press release or website)

Why We Like It:
OMC has spent the last couple of weeks building a bullish consolidation of higher lows under resistance at the $92.00 level. Shares are now on the verge of breaking out to new four-year highs. We want to catch any upward breakout so we're suggesting a trigger to buy calls at $92.05. If triggered our target will be the $97.50-98.00 range. The P&F chart is very bullish with a $110 target.

Suggested Options:
We are suggesting the June or July calls. You pick which strike works best for you. Our trigger to buy calls is $92.05.

BUY CALL JUN 90.00 OMC-FR open interest=705 current ask $2.85
BUY CALL JUN 95.00 OMC-FS open interest=354 current ask $0.65

BUY CALL JUL 90.00 OMC-GR open interest=1742 current ask $3.90
BUY CALL JUL 95.00 OMC-GS open interest= 365 current ask $1.40

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/25/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Schlumberger - SLB - cls: 73.06 chg: +1.28 stop: 69.59

Company Description:
Schlumberger is the world's leading oilfield services company supplying technology, information solutions and integrated project management that optimize reservoir performance for customers working in the oil and gas industry. The company employs more than 64,000 people of over 140 nationalities working in more than 80 countries. Schlumberger supplies a wide range of products and services from seismic acquisition and processing; formation evaluation; well testing and directional drilling to well cementing and stimulation; artificial lift and well completions; and consulting, software and information management. In 2005, Schlumberger operating revenue was $14.31 billion. (source: company press release or website)

Why We Like It:
We are adding exposure to the oil sector and this time we're adding SLB to the list to catch any strength in the oil services sector. SLB is one of the biggest oil services company and is leading the industry higher. It would be easy to argue that SLB looks a bit over extended here but traders continue to buy the dips. We are suggesting calls with SLB above $70.00. Our target is the $78.50-80.00 range.

Suggested Options:
We are suggesting the June calls although August strikes are also available. We would not hold over the July earnings report.

BUY CALL JUN 70.00 SLB-FN open interest=5165 current ask $4.80
BUY CALL JUN 75.00 SLB-FO open interest=7059 current ask $2.20

Picked on May 10 at $ 73.06
Change since picked: + 0.00
Earnings Date 07/21/06 (unconfirmed)
Average Daily Volume = 11.2 million
 

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