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New Plays

New Option Plays

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Call Options Plays
Put Options Plays
Strangle Options Plays
BHI None None
INFY    
NIHD    
SU    

Play Editor's note: We are adding more oil stocks to the newsletter as bullish candidates. Instead of trying to trade all of the oil stocks presented we would only select the ones you feel most comfortable with.


New Calls

Baker Hughes - BHI - close: 76.90 change: +2.69 stop: 71.99

Company Description:
Baker Hughes is a leading provider of drilling, formation evaluation, completion and production products and services to the worldwide oil and gas industry. (source: company press release or website)

Why We Like It:
OPEC announced it would cut another 500 million barrels of production starting February 1st. This sparked a big rally in crude oil futures and that powered a rally in the energy sector. Shares of BHI broke out over significant resistance near $74.00, its 200-dma and the $75.00 level. Furthermore the rally in BHI was fueled by big volume, which is another bullish sign. We want to buy calls on this breakout. Traders can choose to open positions now or look for a dip back toward $75 or the 200-dma, both levels should now be short-term support. Our target is the $83.75-85.00 range. The P&F chart is bullish and points to an $81 target.

Suggested Options:
We are suggesting the January calls.

BUY CALL JAN 75.00 BHI-AO open interest=7732 current ask $4.10
BUY CALL JAN 80.00 BHI-AP open interest=8440 current ask $1.65

Picked on December 14 at $ 76.90
Change since picked: + 0.00
Earnings Date 02/09/07 (unconfirmed)
Average Daily Volume = 4.8 million

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Infosys - INFY - close: 55.20 change: +1.17 stop: 52.99

Company Description:
Infosys defines, designs and delivers IT-enabled business solutions that help Global 2000 companies win in a flat world. These solutions focus on providing strategic differentiation and operational superiority to clients. (source: company press release or website)

Why We Like It:
Shares of India-based INFY appear rested and ready to run. The stock has a relatively consistent bullish trend dating back to the June lows. After peaking in November INFY consolidated sideways while still maintaining above technical support at its rising 50-dma. The technical picture is improving and the P&F chart points to a $63 target. We are suggesting call positions now with the stock above $55.00. More conservative traders may want to wait for INFY to clear the December highs near $55.60 before initiating positions. Our target is the $59.00-60.00 range. FYI: In the news recently it was announced that INFY was being added to the NASDAQ-100 index effective December 18th.

Suggested Options:
We are suggesting the January calls.

BUY CALL JAN 50.00 IUN-AJ open interest=1750 current ask $6.10
BUY CALL JAN 55.00 IUN-AK open interest=4947 current ask $2.70
BUY CALL JAN 60.00 IUN-AL open interest=1375 current ask $0.90

Picked on December 14 at $ 55.20
Change since picked: + 0.00
Earnings Date 01/10/07 (unconfirmed)
Average Daily Volume = 1.4 million

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NII Holdings - NIHD - close: 68.95 chg: +1.61 stop: 66.99

Company Description:
NII Holdings, Inc., a publicly held company based in Reston, Va., is a leading provider of mobile communications for business customers in Latin America. (source: company press release or website)

Why We Like It:
The pattern in NIHD looks relatively close to a bullish cup-and-handle pattern. We have also noticed that the technical indicators are starting to turn bullish again and volume is beginning to rise. The Point & Figure chart has a very bullish pattern called a bullish triangle breakout and it points to a $110 target. More aggressive traders may want to open call positions here. We want to see a breakout past potential round-number resistance at $70 so we're suggesting a trigger to buy calls at $70.25. If triggered our target is the $74.50-75.00 range. Aggressive traders may want to aim higher.

Suggested Options:
We are suggesting the January calls although March calls could also work.

BUY CALL JAN 65.00 QHQ-AM open interest=1463 current ask $5.40
BUY CALL JAN 70.00 QHQ-AN open interest=2190 current ask $2.25
BUY CALL JAN 75.00 QHQ-AO open interest= 296 current ask $0.65

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/22/07 (unconfirmed)
Average Daily Volume = 1.6 million

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Suncor Energy - SU - close: 81.63 change: +1.93 stop: 77.69

Company Description:
Suncor Energy Inc. is an integrated energy company headquartered in Calgary, Alberta. Suncor's oil sands business, located near Fort McMurray, Alberta, extracts and upgrades oil sands and markets refinery feedstock and diesel fuel, while operations throughout western Canada produce natural gas. Suncor operates a refining and marketing business in Ontario with retail distribution under the Sunoco brand. U.S.A. downstream assets include pipeline and refining operations in Colorado and Wyoming and retail sales in the Denver area under the Phillips 66 brand. (source: company press release or website)

Why We Like It:
SU is another oil stock that is in rally mode thanks to the strength in crude oil and the OPEC news. Today's rally pushed the stock's technical indicators closer to a new buy signal and volume improved on the move. More conservative traders may want to use a trigger above today's high (82.08) before initiating positions. We are suggesting call positions now with the stock above $80.00. Our target is the April-May highs in the $89.00-90.00 range. The Point & Figure chart has produced a fresh triple-top breakout buy signal with a $92 target.

Suggested Options:
We are suggesting the January calls.

BUY CALL JAN 80.00 SU-AP open interest=6712 current ask $4.40
BUY CALL JAN 85.00 SU-AQ open interest=6516 current ask $1.95

Picked on December 14 at $ 81.63
Change since picked: + 0.00
Earnings Date 01/25/07 (unconfirmed)
Average Daily Volume = 3.0 million
 

New Puts

None today.
 

New Strangles

None today.
 

New Play Archives