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New Option Plays

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Call Options Plays
Put Options Plays
Strangle Options Plays
BSC None None
FDX    
GS    
KLAC    

New Calls

Bear Stearns - BSC - close: 151.89 chg: +1.70 stop: 144.99

Company Description:
Founded in 1923, Bear, Stearns & Co. Inc. is a leading investment banking and securities trading and brokerage firm, and the major subsidiary of The Bear Stearns Companies Inc. With approximately $61.9 billion in total capital, Bear Stearns serves governments, corporations, institutions and individuals worldwide. The company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales and trading, securities research, private client services, derivatives, foreign exchange and metals, and futures sales and trading, asset management and custody services. (source: company press release or website)

Why We Like It:
The XBD Broker-dealer index looks poised to breakout over resistance and complete a bullish cup and handle pattern. Shares of BSC have already broken out from its own bull flag pattern on above average volume. Short-term technical indicators have turned bullish and its P&F chart forecasts a $208 target. We're suggesting call positions now although more patient traders may want to consider waiting for a dip back towards $150.00. We do expect some resistance near $155 but our target is the $159.00-160.00 range. We do not want to hold over the mid December earnings report.

Suggested Options:
We are suggesting the December calls although January calls would also work well.

BUY CALL DEC 150 BSC-LJ open interest=510 current ask $6.10
BUY CALL DEC 155 BSC-LK open interest=581 current ask $3.40
BUY CALL DEC 160 BSC-LL open interest=1049 current ask $1.70

Picked on November 14 at $151.89
Change since picked: + 0.00
Earnings Date 12/14/06 (unconfirmed)
Average Daily Volume = 1.5 million

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FedEx - FDX - close: 115.50 chg: +0.09 stop: 113.90

Company Description:
FedEx Corp. provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $33 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brands. (source: company press release or website)

Why We Like It:
The transports under performed the broader market today but with crude oil slipping we suspect it's just a temporary decline. The consolidation in FDX over the past four weeks looks like it's nearing its end. Citigroup recently started coverage on FDX with a "buy" and the short-term technical indicators are bullish or they are about to turn bullish. Currently FDX has resistance at the $117 level and then again near $120. We're suggesting that readers use a trigger to buy calls at $117.15. We would expect a pull back at the stock's initial test of $120 and shares might bounce around the $117.50-120.00 range for a couple of days. However, our target is the $124.00-125.00 range. The P&F chart is more optimistic with a $153 target.

Suggested Options:
We are suggesting the December calls although Januarys would also work well.

BUY CALL DEC 110 FDX-LB open interest=345 current ask $7.00
BUY CALL DEC 115 FDX-LC open interest=797 current ask $3.60
BUY CALL DEC 120 FDX-LD open interest=967 current ask $1.40

Picked on November xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 12/21/06 (unconfirmed)
Average Daily Volume = 1.9 million

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Goldman Sachs - GS - cls: 190.36 chg: +2.63 stop: 184.99

Company Description:
Goldman Sachs is a leading global investment banking, securities and investment management firm, which provides a wide range of services worldwide to a substantial and diversified client base that includes corporations, financial institutions, governments and high net worth individuals. Founded in 1869, it is one of the oldest and largest investment banking firms. The firm is headquartered in New York and maintains offices in London, Frankfurt, Tokyo, Hong Kong and other major financial centers around the world. (source: company press release or website)

Why We Like It:
GS is another broker-dealer that we think looks poised to hit new highs. We mentioned in the BSC play that the XBD index looks poised to breakout over resistance and complete a bullish cup-and-handle pattern. GS has been a leader in the group so far and with today's breakout back above the $190 level shares are prepared to lead again. Our target is the $199.00-200.00 range. We do not want to hold over the December earnings report.

Suggested Options:
We are suggesting the December calls although Januarys would also work well.

BUY CALL DEC 185 GPY-LQ open interest=1635 current ask $9.90
BUY CALL DEC 190 GPY-LR open interest=1870 current ask $6.80
BUY CALL DEC 195 GPY-LS open interest=2577 current ask $4.50
BUY CALL DEC 200 GPY-LT open interest=7040 current ask $2.75

Picked on November 14 at $190.36
Change since picked: + 0.00
Earnings Date 12/12/06 (unconfirmed)
Average Daily Volume = 4.8 million

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KLA-Tencor - KLAC - close: 50.81 chg: +1.44 stop: 47.65

Company Description:
KLA-Tencor is the world leader in yield management and process control solutions for semiconductor manufacturing and related industries. Headquartered in San Jose, California, the Company has sales and service offices around the world. (source: company press release or website)

Why We Like It:
Semiconductor titan Intel (INTC) helped lead the industry higher on Tuesday after announcing the release of its quad-processors. The chip stocks followed INTC's rise and the SOX semiconductor index rose 2.8% and broke out over resistance at its 200-dma while closing at a new five-month high. We like KLAC as a play on the semiconductor strength. The stock has been consolidating under resistance in the 50.00-50.25 range but with a bullish trend of higher lows. That pattern finally produced a buy signal today with the breakout over resistance on above average volume. Technicals are turning positive again and the P&F chart points to a $70 target. We're suggesting calls with KLAC above $50. Our target is the $54.50-55.00 range. The stock appears to have solid resistance at $55.00.

Suggested Options:
We are suggesting the December or January calls.

BUY CALL DEC 47.50 KCQ-LT open interest=1557 current ask $4.30
BUY CALL DEC 50.00 KCQ-LJ open interest=9108 current ask $2.50
BUY CALL DEC 52.50 KCQ-LX open interest=1480 current ask $1.25

BUY CALL JAN 50.00 KCQ-AJ open interest=8972 current ask $3.40
BUY CALL JAN 55.00 KCQ-AK open interest=4045 current ask $1.15

Picked on November 14 at $ 50.81
Change since picked: + 0.00
Earnings Date 01/00/07 (unconfirmed)
Average Daily Volume = 3.9 million
 

New Puts

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New Strangles

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