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NEW DIRECTIONAL CALL PLAYS

Agnico Eagle Mines - AEM - close: 53.74 change: +1.70 stop: 49.49

Why We Like It:
Gold stocks were showing relative strength today thanks to another safe-haven rally in gold prices. AEM continues the bounce that began yesterday when it hit $49.50 and its exponential 200-dma. I am suggesting call positions now with AEM's close above its simple 200-dma.

I'm setting two targets. Our first target is $59.50. Our second target is $64.00. We do not want to hold over the mid February earnings report.

Suggested Options:
We are suggesting the March calls. Remember, it is up to the individual trader to decide which month and which strike price best suits your trading style and risk.

BUY CALL MAR 50.00 AEM-CJ open interest= 218 current ask $7.90
BUY CALL MAR 55.00 AEM-CK open interest=1338 current ask $5.30
BUY CALL MAR 60.00 AEM-CL open interest= 334 current ask $3.40

Annotated Chart:
AEM

Picked on January 29 at $ 53.74
Change since picked:     + 0.00
Earnings Date          02/18/09 (unconfirmed)
Average Daily Volume =      5.7 million  


NEW DIRECTIONAL PUT PLAYS

Alliant Tech - ATK - close: 79.10 change: -5.19 stop: 82.51

Why We Like It:
Defense contract company ATK reported earnings this morning that were better than expected but the company issued an earnings warning going forward. Shares lost more than 6% on the news and broke down from their sideways trading range. I think ATK is short-term oversold and might bounce before moving lower. I'm suggesting readers buy puts on a bounce into the $81.00-82.00 zone. If triggered we have two targets. Our first target is $76.00. Our second target is $71.50.

Suggested Options:
We are suggesting the March puts.

BUY PUT MAR 80.00 ATK-OP open interest= 21 current ask $4.80
BUY PUT MAR 75.00 ATK-OO open interest= 56 current ask $2.80

Annotated Chart:
ATK

Picked on January xx at $ xx.xx <-- see TRIGGER
Change since picked:     + 0.00
Earnings Date          01/29/09 (confirmed)
Average Daily Volume =      407 thousand 


Fedex - FDX - close: 54.53 change: -2.22 stop: 57.81

Why We Like It:
The oversold bounce in FDX stalled out at the 38.2% Fibonacci retracement (see chart). This looks like a new bearish entry point. However, we do NOT want to open new put positions if the GDP number on Friday morning comes in at -5% or better. Since a reading of -5% is already priced in a better reading could produce a market bounce. I have two targets for FDX. Our first target is $50.25. Our second target is $46.00.

Suggested Options:
We are suggesting the March puts.

BUY PUT MAR 55.00 FDX-OV open interest= 276 current ask $4.60
BUY PUT MAR 50.00 FDX-OW open interest= 511 current ask $2.50

Annotated Chart:
FDX

Picked on January 29 at $ 54.53
Change since picked:     + 0.00
Earnings Date          03/18/09 (unconfirmed)
Average Daily Volume =      2.7 million  


Fluor - FLR - close: 40.72 change: -2.13 stop: 42.10

Why We Like It:
FLR looks poised to make a run at its November lows but it needs to break support in the $40.00-39.50 zone first. I'm suggesting readers use a trigger at $39.40 to buy puts. If triggered our first target is $35.15. Our second target is $31.00. The P&F chart is bearish with a $30 target.

Suggested Options:
We are suggesting the March puts.

BUY PUT MAR 40.00 FLR-OH open interest=1556 current ask $4.30
BUY PUT MAR 35.00 FEM-OG open interest=   0 current ask $2.35

Annotated Chart:
FLR

Picked on January xx at $ xx.xx <-- see TRIGGER
Change since picked:     + 0.00
Earnings Date          02/25/09 (unconfirmed)
Average Daily Volume =      4.2 million  


Renaissance Holdings - RNR - close: 46.15 chg: -2.06 stop: 48.51

Why We Like It:
The recovering in insurance related stocks appears to be over. RNR has broken its bullish trend of higher lows and starting to look vulnerable. I am suggesting bearish positions now. However, we do NOT want to open put positions if the GDP number on Friday morning comes in at -5% or better. The report comes out before the market opens and will be all over the news so we'll know before hand. I will list an exception. If the GDP report is better than expected but RNR continues to fall then I would go ahead and buy puts but only if RNR breaks down under $45.00, in this case we'll use an entry point at 44.90.

Our first target is 40.50.

Suggested Options:
We are suggesting the April puts but we plan to exit ahead of the mid February earnings report.

BUY PUT APR 45.00 RNR-PI open interest= 541 current ask $3.90
BUY PUT APR 40.00 RNR-PH open interest=1110 current ask $2.15

Annotated Chart:
RNR

Picked on January 29 at $ 46.15
Change since picked:     + 0.00
Earnings Date          02/11/09 (unconfirmed)
Average Daily Volume =      681 thousand 


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