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New Calls

None today.
 

New Puts

Carpenter Tech. - CRS - close: 100.47 chg: -2.08 stop: 105.01

Company Description:
Carpenter Technology Corporation based in Wyomissing, PA, is a leading manufacturer and distributor of specialty alloys and engineered products. (source: company press release or website)

Why We Like It:
We have been bit by CRS' volatility in the past but we're going to try again. The metal, steel and mining stocks were hit hard today and we don't think the selling is over yet. Volume on today's decline was above average and shares almost produced a bearish engulfing candlestick pattern (bearish reversal). Shares of CRS are flirting with another breakdown below the $100 level and its 100-dma. We're going to suggest a trigger under today's low at $99.25. If triggered our target will be the $92.00-90.00 range, which is above potential support at $90.00 and its exponential 200-dma at $89. We do not want to hold over the late July earnings report. The P&F chart currently points to a $76 target.

Suggested Options:
We are suggesting the July and August puts. You choose which strike works best for you. We do not want to hold over the July earnings report.

BUY PUT JUL 105.00 CRS-SA open interest= 69 current ask $10.00
BUY PUT JUL 100.00 CRS-ST open interest= 75 current ask $ 7.20
BUY PUT JUL 95.00 CRS-SS open interest=204 current ask $ 4.90
BUY PUT JUL 90.00 CRS-SR open interest= 91 current ask $ 3.10


BUY PUT AUG 105.00 CRS-TA open interest= 0 current ask $12.20
BUY PUT AUG 100.00 CRS-TT open interest= 10 current ask $ 9.30
BUY PUT AUG 95.00 CRS-TS open interest= 0 current ask $ 7.00
BUY PUT AUG 90.00 CRS-TR open interest= 0 current ask $ 5.10

Picked on June xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/24/06 (unconfirmed)
Average Daily Volume = 651 thousand

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Nucor - NUE - close: 48.62 chg: -1.93 stop: 51.61

Company Description:
Nucor and affiliates are manufacturers of steel products, with operating facilities in seventeen states. Products produced are: carbon and alloy steel - in bars, beams, sheet and plate; steel joists and joist girders; steel deck; cold finished steel; steel fasteners; metal building systems; and light gauge steel framing. Nucor is the nation's largest recycler. (source: company press release or website)

Why We Like It:
NUE is another stock in the iron, steel and metals group that experienced some heavy selling pressure today. Not only did the stock produce a failed rally near the top of its bearish channel but it produced a bearish engulfing candlestick pattern (bearish reversal). Bulls do have their argument that the P&F chart is still positive and the MACD is trying to produce a new buy signal. However, we suspect that the next move will be lower. We're starting the play here under $50.00 with a stop loss above today's high. Our target will be in the $42.75-42.50 region near the bottom of NUE's channel (see chart). We do not want to hold over the July earnings report.

Suggested Options:
We are suggesting the July and August puts. You choose which strike best suits your strategy.

BUY PUT JUL 50.00 NUE-SJ open interest=5560 current ask $3.90
BUY PUT JUL 47.50 NUE-SW open interest=6557 current ask $2.55
BUY PUT JUL 45.00 NUE-SI open interest=6226 current ask $1.60

BUY PUT AUG 50.00 NUE-TJ open interest= 42 current ask $4.70
BUY PUT AUG 45.00 NUE-TI open interest= 22 current ask $2.40

Picked on June 19 at $ 48.62
Change since picked: + 0.00
Earnings Date 07/20/06 (unconfirmed)
Average Daily Volume = 5.9 million
 

New Strangles

None today.
 

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