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New Option Plays
Call Options Plays
Put Options Plays
Strangle Options Plays
None ASH None
  BOL  
  CME  
  HAR  

New Calls

None today.
 

New Puts

Ashland Inc. - ASH - cls: 65.82 chg: -1.19 stop: 68.25

Company Description:
Ashland Inc., a diversified, global chemical company, provides quality products, services and solutions to customers in more than 100 countries. (source: company press release or website)

Why We Like It:
ASH has spent the last two months consolidating sideways with a bearish trend of lower highs. Shares spent a week failing to breakout over $70, which was followed by a week failing to breakout over $69. Now last week's market weakness has fueled a bearish breakdown under support near $66.00. Meanwhile the weekly chart shows ASH failing to breakout against its trendline of lower highs (see below). The P&F chart is still bullish but ASH could see a sharp pull back and still maintain a bullish P&F chart pattern. We are suggesting put positions with ASH under $67.00. Readers can choose between opening positions now or trying to catch a failed rally on any oversold bounce under its 10-dma. Our target is the $60.50-60.00 range. FYI: More conservative traders may want to consider a tighter stop in the $67.00 or $67.50 region.

Suggested Options:
We are suggesting the April puts. With all of our suggested plays it is up to the reader to choose which month and strike price best suits their trading style and risk.

BUY PUT APR 70.00 ASH-PN open interest=567 current ask $5.70
BUY PUT APR 65.00 ASH-PM open interest=296 current ask $2.25
BUY PUT APR 60.00 ASH-PL open interest=384 current ask $0.65

Picked on March 04 at $ 65.82
Change since picked: + 0.00
Earnings Date 04/25/07 (unconfirmed)
Average Daily Volume = 770 thousand

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Bausch Lomb - BOL - cls: 50.63 change: -0.68 stop: 52.51

Company Description:
Bausch & Lomb is the eye health company, dedicated to perfecting vision and enhancing life for consumers around the world. Its core businesses include soft and rigid gas permeable contact lenses and lens care products, and ophthalmic surgical and pharmaceutical products. The Bausch & Lomb name is one of the best known and most respected healthcare brands in the world. (source: company press release or website)

Why We Like It:
BOL's pattern of higher lows and higher highs over the last several months may not be quite as bullish as it looks. The stock has created a bearish wedge-shaped consolidation pattern. The recent sell-off has brought shares of BOL precariously close to breakdown down through the bottom of this pattern in addition to round-number support at $50.00 and technical support at its 200-dma. We are suggesting that readers wait for the breakdown to occur before considering new positions. We are suggesting a trigger to buy puts at $49.49. More aggressive traders may want to jump in early with a drop under $50 while more conservative traders may want to wait for a decline under $49.00 to lessen the risk that we'll be triggered on an intraday spike lower. If we are triggered at $49.49 our target will be the $44.00-42.50 range. FYI: BOL has been extremely late on its SEC filings and recently announced it will file its 2006 10-K on April 30th, 2007. BOL also plans to release news about its preliminary 2006 results in mid-March. This last comment raises the risk level for us since we do not know what's in the announcement or when they will announce it. One might presume that any earnings comments will be negative as the company tries to recover from its eye-infection fiasco last year.

Suggested Options:
If triggered at $49.49 we are suggesting the April puts.

BUY PUT APR 50.00 BOL-PJ open interest=5527 current ask $1.80
BUY PUT APR 45.00 BOL-PI open interest=1747 current ask $0.50

Picked on March xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/07 (unconfirmed)
Average Daily Volume = 678 thousand

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Chicago Merc. Exch. - CME - cls: 540.25 chg: -4.98 stop: 554.25

Company Description:
Chicago Mercantile Exchange Holdings Inc. became the first publicly traded U.S. financial exchange on Dec. 6, 2002. The company was added to the Russell 1000 Index on July 1, 2003, and to the S&P 500 Index on Aug. 10, 2006. It is the parent company of Chicago Mercantile Exchange Inc., the world's largest and most diverse financial exchange. (source: company press release or website)

Why We Like It:
Before we begin we have to warn readers that CME can be a very volatile stock and traders should consider this a high-risk, aggressive play. The stock peaked under the $600 level over a month ago and has spent the last few weeks consolidating early January gains. The recent sell-off has pulled CME under support near $550, its 50-dma and couple of supporting trendlines. The oversold bounce on Wednesday and Thursday got a boost after CME announced that February volumes soared nearly 27% over a year ago. The exchange witnessed some record-setting volume last month and probably early this month. Yet the news on record volumes (which means higher profits for CME) was not enough for the stock to breakout over broken support near $550. The Thursday-Friday trading has produced a failed rally under what now appears to be resistance at $550. We are suggesting put positions with the stock under its simple 10-dma (currently $548). Our target is the $511.00-500.00 range with the upper end of our target range placed near last week's lows. FYI: shareholders are expected to vote in early April on CME's proposed $8 billion acquisition of rival CBOT. The merger is still awaiting government agency approval.

Suggested Options:
We are suggesting the April puts.

BUY PUT APR 550 CNM-PJ open interest=225 current ask $29.20
BUY PUT APR 540 CNM-PH open interest=389 current ask $23.90
BUY PUT APR 530 CNM-PF open interest=291 current ask $19.50

Picked on March 04 at $540.25
Change since picked: + 0.00
Earnings Date 05/01/07 (unconfirmed)
Average Daily Volume = 631 thousand

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Harman Intl - HAR - close: 97.49 change: -1.97 stop: 102.01

Company Description:
Harman International Industries, Incorporated is a leading manufacturer of high-quality, high-fidelity audio products and electronic systems for the automotive, consumer and professional markets. (source: company press release or website)

Why We Like It:
It might seem like we're late adding HAR as a put play now with shares down seven out of the last eight sessions. Odds for an oversold bounce are pretty good. However, short-term the stock has just produced two failed rallies near the $100 level, both under its 50-dma and 100-dma and shares closed near their lows on Friday, which is bearish for Monday's open. Plus, the weekly chart shows HAR reversing under its longer-term trendline of resistance (see chart). While we would consider new put positions here more conservative traders may want to wait for a bounce and watch it fail before initiating positions. Should share rebound we would watch for a failed rally under the 10-dma (currently near $101.90). Our target is the $92.50-90.00 range near its simple 200-dma. FYI: The P&F chart points to a very bearish $80 target.

Suggested Options:
We are suggesting the April puts.

BUY PUT APR 100 HAR-PY open interest=2328 current ask $4.70
BUY PUT APR 95 HAR-PS open interest= 690 current ask $2.30

Picked on March 04 at $ 97.49
Change since picked: + 0.00
Earnings Date 04/26/07 (unconfirmed)
Average Daily Volume = 614 thousand
 

New Strangles

None today.
 

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