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None CDWC None
  DIA  
  QQQQ  
  SMH  

New Calls

None today.
 

New Puts

CDW Corp. - CDWC - cls: 64.41 chg: -1.26 stop: 66.25

Company Description:
CDW's direct model offers customers one-on-one relationships with knowledgeable account managers and access to more than 600 on-staff engineers and advanced technology specialists who customize solutions for customers' complex technology needs. CDW also provides same-day product shipping and post-sales technical support. CDW was founded in 1984 and employs approximately 5,250 coworkers. In 2005, the company generated sales of $6.3 billion. (source: company press release or website)

Why We Like It:
CDWC's latest earnings report had the company beating estimates by 5 cents but the stock sold off anyway. Shares have been consolidating sideways since the report in mid October. Now shares look poised to breakdown. We're suggesting a trigger to catch a breakdown under support at the $64.00 level. Our suggested entry point will be $63.90. If triggered our target is the $60.50-60.00 range. Be advised that CDWC is hosting an analyst day on November 8th.

Suggested Options:
We are suggesting the December puts. Our trigger to open plays is at $63.90.

BUY PUT DEC 65.00 DWQ-XM open interest=118 current ask $2.45
BUY PUT DEC 60.00 DWQ-XL open interest= 28 current ask $0.75

Picked on November xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/18/06 (confirmed)
Average Daily Volume = 762 thousand

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DIAMONDS ETF - DIA - close: 120.26 chg: -0.47 stop: 121.16

Company Description:
The DIAMONDS Trust, Series 1, is an exchanged traded fund representing the Dow Jones Industrial Average.

Why We Like It:
The DJIA has been hitting new record highs but it looks like the bull run may be coming to an end or at least a rest. The DJIA index looks pretty overbought and way overdue for some consolidation. Normally November begins the best six months of the year for stocks but we suspect the markets could turn lower over the next couple of weeks. We're suggesting puts on the DJIA via the Diamonds (DIA). There is short-term support near $120 so we're suggesting a trigger to buy puts at $119.80. If triggered our target is the $118.00-117.00 range (near the rising 50-dma).

Suggested Options:
We are suggesting the December puts. Our entry point to open plays is at $119.80.

BUY PUT DEC 121.00 DAQ-XQ open interest= 4025 current ask $2.10
BUY PUT DEC 120.00 DAQ-XP open interest=21261 current ask $1.65
BUY PUT DEC 119.00 DAQ-XO open interest= 4942 current ask $1.30
BUY PUT DEC 118.00 DAQ-XN open interest= 5754 current ask $1.00

Picked on November xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 6.6 million

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NASDAQ-100 ETF - QQQQ - cls: 42.00 chg: -0.58 stop: 42.81

Company Description:
The NASDAQ 100 Trust shares, series 1, is an exchanged traded fund representing the NASDAQ 100 index.

Why We Like It:
The NASDAQ 100 has turned in a very impressive run from its July lows but now it looks like the index is ready for its way overdue consolidation. The stock has produced a failed rally near $42.80 twice in the last couple of days and today's session produced a bearish engulfing candlestick pattern. Technical indicators are already bearish. We're suggesting a trigger to buy puts at $41.75, under Wednesday's low. If triggered our target is the $40.25-40.00 range, which might be a little optimistic given potential support at its rising 50-dma. FYI: More aggressive traders may want to put their stop above the $43.00 mark!

Suggested Options:
We are suggesting the December puts. Our trigger to open plays is at $41.75.

BUY PUT DEC 43.00 QQQ-XQ open interest= 27161 current ask $1.45
BUY PUT DEC 42.00 QQQ-XP open interest=126814 current ask $0.95
BUY PUT DEC 41.00 QQQ-XO open interest=147248 current ask $0.60

Picked on November xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 106 million

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Semiconductor HOLDRs - SMH - cls: 33.28 chg: -0.72 stop: 34.15

Company Description:
The Semiconductor HOLDRs is an exchange traded fund representing 20 companies in the semiconductor sector.

Why We Like It:
If the NASDAQ is headed lower it will probably be lead by the semiconductors. The SOX semiconductor index has been struggling recently and the recent bounce on the KLAC upgrade a few days ago has failed. Now the group looks vulnerable to more selling pressure. We're suggesting plays on the SMH as a proxy for the SOX. More aggressive traders may want to jump into bearish plays with a drop under SMH's low today (33.24). We're going to suggest a trigger at $32.95 to open positions. More conservative traders may want to wait for a decline under $32.80, which is under the simple 100-dma. If you're watching the SOX the key levels are 440 and its 100-dma near 438.50. If we are triggered on the SMH at $32.95 our target is the $31.50-31.40 range.

Suggested Options:
We are suggesting the December puts. Our trigger to open positions is at $32.95.

BUY PUT DEC 35.00 SMH-XG open interest=5072 current ask $2.10
BUY PUT DEC 32.50 SMH-XZ open interest=1587 current ask $0.80

Picked on November xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 17.7 million
 

New Strangles

None today.
 

New Play Archives