Option Investor
New Plays

New Option Plays

HAVING TROUBLE PRINTING?
Printer friendly version
Call Options Plays
Put Options Plays
Strangle Options Plays
None IYF None
  MYGN  
  SPG  
  SU  

Play Editor's Note: Several stocks that look like potential bearish candidates are...AMZN, BSC, PCU, AVB, UTX, SHLD and the RTH. Same store sales figures come out tomorrow and odds are they won't be very strong.


New Calls

None today.
 

New Puts

iShares DJ Financial - IYF - cls: 88.62 chg: -1.12 stop: 93.01

Company Description:
The IFY is the iShares Dow Jones US Financial Sector ETF (exchange traded fund).

Why We Like It:
Investors are still worried about the financials even though the Fed has been extremely helpful with its recent rate cuts. The IYF has taken a turn for the worse and the breakdown under $90.00 is bearish. We're aiming for a test of the $80.00 region. Our official target is the $81.00-80.00 zone.

Suggested Options:
We are suggesting the March puts. Sadly the spreads on these options are horrendous. You can try limit orders or splitting the bid/ask spread.

BUY PUT MAR 90.00 IYF-OR open interest= 0 current ask $6.20
BUY PUT MAR 85.00 IYF-OQ open interest= 2 current ask $4.00

Picked on February 06 at $ 88.62
Change since picked: + 0.00
Earnings Date 00/00/00
Average Daily Volume = 1.1 million

---

Myriad Genetics - MYGN - cls: 40.04 chg: -1.56 stop: 43.01

Company Description:
Myriad Genetics, Inc. is a biopharmaceutical company focused on the development of novel healthcare products. (source: company press release or website)

Why We Like It:
MYGN recently reported earnings and actually beat estimates and beat the revenue numbers yet the stock sold off anyway. The chart pattern is very bearish with the breakdown in mid January and the recent failed rally near $44 and its 200-dma. The stock settled just above round-number support at $40.00. We are suggesting a trigger to buy puts at $39.75. If triggered our target is the $36.00-35.00 range. The Point & Figure chart is bearish with a $34 target. FYI: We always consider a biotech stocks to be a more aggressive, higher risk play because you never know when an FDA decision will be released or some clinical trial info will come out that could send the stock moving sharply either direction.

Suggested Options:
If triggered at $39.75 we are suggesting the March puts.

BUY PUT MAR 40.00 GSQ-OH open interest=301 current ask $2.45
BUY PUT MAR 35.00 GSQ-OG open interest= 61 current ask $0.60

Picked on February xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/05/08 (confirmed)
Average Daily Volume = 801 thousand

---

Simon Properties - SPG - cls: 86.09 chg: -2.81 stop: 90.61

Company Description:
Simon Property Group, Inc. is an S&P 500 company and the largest public U.S. real estate company. Simon is a fully integrated real estate company which operates from five retail real estate platforms: regional malls, Premium Outlet Centers, The Mills, community/lifestyle centers and international properties. (source: company press release or website)

Why We Like It:
A number of the REIT stocks have taken a drastic turn for the worse. SPG's bullish breakout on February 1st failed under its 200-dma and its trendline of lower highs. Now shares are back to testing support near $85.00. A breakdown here could lead to a test of its January lows or worse. The stock can be very volatile and that means we are using some wide stop losses. Right now we're suggesting readers buy puts at $84.39, which would be a new relative (two-week) low. If triggered our target is the $76.00-
75.00 range.

FYI: Two more REIT stocks that look vulnerable are AVB and MAC.

Suggested Options:
If triggered at $84.39 we are suggesting the March puts.

BUY PUT MAR 85.00 SPG-OQ open interest=179 current ask $5.80
BUY PUT MAR 80.00 SPG-OP open interest=256 current ask $3.80

Picked on February xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/01/08 (confirmed)
Average Daily Volume = 2.7 million

---

Suncor Energy - SU - cls: 91.26 chg: -1.20 stop: 95.01

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. (source: company press release or website)

Why We Like It:
Oil and energy stocks have turned lower and it looks like the oversold bounce from its January bottom is dead. Technicals on SU are turning bearish again but we want to see a breakdown under the $90.00 mark. We're suggesting readers buy puts at $89.75. If triggered we will have two targets. Our first target is the $85.50-85.00 range. Our second target is the $81.50-80.00 zone. This should be a two or three week play at which time we'll consider switching to bullish trades in oil and energy.

Suggested Options:
If triggered at $89.75 we are suggesting the March puts.

BUY PUT MAR 90.00 SU-OR open interest=4764 current ask $4.80
BUY PUT MAR 85.00 SU-OQ open interest=1654 current ask $2.80

Picked on February xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 01/22/08 (confirmed)
Average Daily Volume = 2.4 million
 

New Strangles

None today.
 

New Play Archives