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New Option Plays

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Call Options Plays
Put Options Plays
Strangle Options Plays
BA None None
HAYN    
LLL    
SI    
WHQ    

New Calls

Boeing - BA - close: 96.02 change: +0.02 stop: 94.85

Company Description:
Boeing is the world's leading aerospace company and the largest manufacturer of commercial jetliners and military aircraft combined. Additionally, Boeing designs and manufactures rotorcraft, electronic and defense systems, missiles, satellites, launch vehicles and advanced information and communication systems. (source: company press release or website)

Why We Like It:
Defense stocks, as a group, have been able to hit new all-time highs in spite of BA's big sell-off in October. The company recently reported earnings and the stock didn't see any further selling. We suspect that all the "bad" news is out. Shares have been consolidating sideways the last couple of weeks and the stock has bounced multiple times near support around $92.50. We are suggesting a trigger to buy calls at $97.25. There is potential resistance at its 50-dma and the $100 level but if the markets make a fourth quarter run then BA could rally back toward the $105 region. If triggered at $97.25 our target is the $104-105 zone. FYI: The P&F chart is still bearish from the October sell-off.

Suggested Options:
We are suggesting the December calls. Our suggested trigger to open positions is at $97.25.

BUY CALL DEC 95.00 BA-LS open interest=1470 current ask $4.60
BUY CALL DEC 100.0 BA-LT open interest= 916 current ask $2.30
BUY CALL DEC 105.0 BA-LA open interest= 559 current ask $1.00

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/24/07 (confirmed)
Average Daily Volume = 6.3 million

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Haynes Intl. - HAYN - cls: 86.49 change: +2.33 stop: 82.45

Company Description:
Haynes International, Inc. is a leading developer, manufacturer and marketer of technologically advanced, high-performance alloys, primarily for use in the aerospace, land-based gas turbine and chemical processing markets. (source: company press release or website)

Why We Like It:
Many of the steel and metal stocks are on the rebound and HAYN just broke through short-term resistance in the $85-86 zone. Looking at the chart you can see the pattern of higher lows. Meanwhile both the daily and weekly technical indicators are improving. We are suggesting call positions now with HAYN above $85.00. There is clear resistance at $90.00 but if the market makes a fourth quarter run we suspect that HAYN can hit new relative highs. We'll set a conservative target at $89.90-90.00 and an aggressive target in the $94.50-95.00 range. The Point & Figure chart has broken through resistance and points to a $100 target. FYI: There are a couple of big names in the steel and iron sector (like U.S.Steel) that will report earnings this week. Their results could influence shares of HAYN.

Suggested Options:
We are suggesting the December calls. November calls could work but they expire in three weeks. We do not see any $95 strikes available yet.

BUY CALL DEC 85.00 HQR-LQ open interest= 5 current ask $8.10
BUY CALL DEC 90.00 HQR-LR open interest=13 current ask $5.80

Picked on October 28 at $ 86.49
Change since picked: + 0.00
Earnings Date 12/10/07 (unconfirmed)
Average Daily Volume = 166 thousand

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L-3 Comm. - LLL - cls: 106.98 chg: +0.27 stop: 103.90

Company Description:
Headquartered in New York City, L-3 Communications employs over 63,000 people worldwide and is a prime system contractor in aircraft modernization and maintenance, C3ISR (Command, Control, Communications, Intelligence, Surveillance and Reconnaissance) systems and government services. L-3 is also a leading provider of high technology products, systems and subsystems. The company reported 2006 sales of $12.5 billion. (source: company press release or website)

Why We Like It:
LLL recently reported earnings that were better than expected. Shares did not move much on the news but the overall trend remains bullish. We are suggesting that readers buy a breakout over resistance at $108. Our suggested trigger to open positions is at $108.10. You might want to wait for a new relative high over $108.30 (the Oct. 11th high). If triggered our target is the $114.00-115.00 range. The P&F chart is bullish with a $133 target.

Suggested Options:
We are suggesting the December calls although Novembers would also work. November options expire in three weeks. Our suggested trigger to open positions is at $108.10.

BUY CALL DEC 105 LLL-LA open interest= 26 current ask $5.40
BUY CALL DEC 110 LLL-LB open interest= 76 current ask $2.80
BUY CALL DEC 115 LLL-LC open interest=204 current ask $1.25

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/25/07 (confirmed)
Average Daily Volume = 627 thousand

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Siemens - SI - close: 132.50 change: +1.55 stop: 127.40

Company Description:
Siemens (Berlin and Munich) is a global powerhouse in electrical engineering and electronics. The company has around 475,000 employees (incl. discontinued operations) working to develop and manufacture products, design and install complex systems and projects, and tailor a wide range of services for individual requirements. Siemens provides innovative technologies and comprehensive know-how to benefit customers in over 190 countries. (source: company press release or website)

Why We Like It:
It looks like both shares of SI and the German stock market have turned around. Both put in some bullish performances last week. The U.S. ADR shares of SI bounced twice in the $126-127 region. Now SI looks poised to breakout from its two-week consolidation. We are suggesting a trigger to buy calls on SI at $133.55. More conservative traders may want to wait for a rally past $135 before initiating positions. Our primary target is the $139.85-140.00 range. More aggressive traders can aim higher.

Suggested Options:
We are suggesting the December calls. Our suggested trigger is at $133.55.

BUY CALL DEC 130 SI-LF open interest= 50 current ask $8.60
BUY CALL DEC 135 SI-LG open interest= 0 current ask $6.10
BUY CALL DEC 140 SI-LH open interest= 0 current ask $4.20

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/27/07 (unconfirmed)
Average Daily Volume = 582 thousand

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W-H Energy Services - WHQ - cls: 59.96 chg: +1.03 stop: 56.95

Company Description:
W-H Energy is a diversified oilfield service company that provides products and services used in connection with the drilling and completion of oil and natural gas wells and the production of oil and natural gas. The Company has operations in North America and select areas internationally. (source: company press release or website)

Why We Like It:
A couple of weeks ago WHQ issued a third quarter earnings warning. The stock was crushed with a drop from $72 to almost $55 in a few days. Shares have rebounded sharply from its test of support near $55.00. Normally we avoid holding over an earnings report. WHQ is an exception. All the bad news should be priced into the stock already. That gives WHQ a decent change to beat Wall Street's lowered expectations. More aggressive traders may want to jump in now. We're suggesting a trigger at $60.05 to open plays. WHQ is due to report earnings on Tuesday morning. If triggered our target is the $66.50-67.50 zone. WHQ may have resistance at $65.00 and then again at the 100-dma and 50-dma overhead.

Suggested Options:
We are suggesting the December calls. Our suggested trigger to open positions is at $60.05.

BUY CALL DEC 55 WHQ-LK open interest= 4 current ask $7.30
BUY CALL DEC 60 WHQ-LL open interest= 2 current ask $4.20
BUY CALL DEC 65 WHQ-LM open interest=20 current ask $2.10

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/30/07 (confirmed)
Average Daily Volume = 542 thousand
 

New Puts

None today.
 

New Strangles

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