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New Option Plays

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Call Options Plays
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Strangle Options Plays
MLM None None
PKX    

New Calls

Martin Marietta - MLM - cls: 118.15 chg: +2.10 stop: 114.95

Company Description:
Martin Marietta Materials is a leading producer of construction aggregates and a producer of magnesia-based chemicals and dolomitic lime. (source: company press release or website)

Why We Like It:
MLM broke through resistance at $115 a couple of weeks ago. The stock rallied to $125 and its late January 2008 high on the move. Now MLM has pulled back to retest broken resistance as new support. Today's bounce from support is a short-term entry point to buy calls. We're suggesting readers buy calls here with a target in the $123.50-124.00 zone. Our stop loss will be $114.95. This should be a quick, short-term move. If MLM doesn't continue to bounce in the next day or two we'll be quick to exit. FYI: The P&F chart is bullish with a $158 target.

Suggested Options:
We are suggesting the June or July calls. The June options expire in four weeks.

BUY CALL JUN 115 MLM-FC open interest=772 current ask $6.10
BUY CALL JUN 120 MLM-FD open interest=586 current ask $3.50

BUY CALL JUL 120 MLM-GD open interest=1657 current ask $6.00
BUY CALL JUL 125 MLM-GE open interest= 206 current ask $4.00

Picked on May 27 at $118.15
Change since picked: + 0.00
Earnings Date 05/06/08 (confirmed)
Average Daily Volume = 561 thousand

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POSCO - PKX - close: 133.26 change: +2.42 stop: 129.75

Company Description:
POSCO is a steel producer in South Korea.

Why We Like It:
We were successful in capturing the breakout in PKX a few weeks ago. Now after a $15 correction it might be time to buy calls again. Shares of PKX topped out near $145 and its 200-dma. Now after a multi-day sell-off we're seeing a bounce. Today's rebound has broken the short-term trendline of lower highs. We're suggesting readers buy calls now or on a dip near $130, which should be short-term support. Our target is the $143.00-145.00 range. This is an aggressive higher-risk play. PKX tends to gap open every morning as it adjusts to trade in Korea. Plus, the option spreads tend to be a little wide.

Suggested Options:
We are suggesting the June or July calls. The June options expire in four weeks.

BUY CALL JUN 130 PKX-FF open interest= 82 current ask $8.50
BUY CALL JUN 135 PKX-FG open interest=498 current ask $6.00
BUY CALL JUN 140 PKX-FH open interest=608 current ask $4.10

BUY CALL JUL 130 PKX-GF open interest= 11 current ask $11.00
BUY CALL JUL 135 PKX-GG open interest= 0 current ask $ 8.50
BUY CALL JUL 140 PKX-GH open interest= 52 current ask $ 6.40

Picked on May 27 at $133.26
Change since picked: + 0.00
Earnings Date 07/14/08 (unconfirmed)
Average Daily Volume = 733 thousand
 

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