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Aracruz Celulose - ARA - cls: 78.93 chg: +0.75 stop: 74.75

Company Description:
Aracruz Celulose is a Brazilian company, the world's leading producer of bleached eucalyptus pulp. It is responsible 24% of the global supply of the product, used to manufacture printing and writing, tissue, and high value added specialty papers. (source: company press release or website)

Why We Like It:
ARA is another Brazilian company who's stock is near all-time highs. Shares actually rallied in spite of the recent lackluster earnings report in early April. The stock is poised to breakout over resistance at $80.00. We're suggesting a trigger to buy calls at $80.25. The stock has been somewhat volatile this past week so we're using a wide, aggressive stop loss at $74.75 and more conservative traders may want to use a stop near $77 instead. If triggered at $80.25 we have two targets. Our first target is the $84.50-85.00 range. Our second target is the $88.50-90.00 zone. Currently the Point & Figure chart is bearish but a new rise over $80.00 would produce a brand new triple-top breakout buy signal.

Suggested Options:
We are suggesting the June or July calls. July's have more open interest.

BUY CALL JUN 75.00 ARA-FO open interest= 0 current ask $6.70
BUY CALL JUN 80.00 ARA-FP open interest=30 current ask $4.10
BUY CALL JUN 85.00 ARA-FQ open interest= 0 current ask $2.40

BUY CALL JUL 80.00 ARA-GP open interest=44 current ask $5.40
BUY CALL JUL 85.00 ARA-GQ open interest=217 current ask $3.60

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/07/08 (confirmed)
Average Daily Volume = 481 thousand
 

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