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NEW DIRECTIONAL CALL PLAYS

Entergy Corp. - ETR - close: 68.70 change: +0.61 stop: 67.25

Why We Like It:
Instead of rolling over under resistance shares of ETR are consolidating sideways. The stock has built a sideways trading channel in the $66-69.50 zone. I think the stock has extra resistance near $70.00 and its 50-dma but you can see that volume is building as the stock bounces toward the top of its channel.

I am suggesting that readers use a trigger to buy calls at $70.25, which would be a new bullish breakout over several layers of resistance. If triggered our first target is $74.00. The $75.00 mark and the descending 100-dma might be overhead resistance. We do not want to hold over the April 28th earnings report.

Suggested Options:
While we do plan to exit in a couple of weeks I'm suggesting the May calls instead of April calls.

BUY CALL MAY 70.00 ETR-EN open interest= 153 current ask $3.20
BUY CALL MAY 75.00 ETR-EO open interest=   6 current ask $1.30

Annotated Chart:
ETR

Picked on    April xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           04/28/09 (unconfirmed)
Average Daily Volume =       1.7 million  
Listed on April 01, 2009         


NEW DIRECTIONAL PUT PLAYS

C.H.Robinson Worldwide- CHRW - close: 45.35 chg: -0.26 stop: 46.75

Why We Like It:
The transportation sector looks like it's about to roll over again and one way to play it is freight company CHRW. Shares have been churning sideways in a volatile fashion under resistance at the $48.00 level. Technicals are turning negative again. The P&F chart is bearish with a $26.00 target.

I am suggesting a trigger to buy puts at $43.85. More conservative traders might want to wait for a drop under the March 25th low of $43.16. If we are triggered at $43.85 our first target is $40.25. I am considering a second target near $38.00.

Suggested Options:
We are suggesting the March puts but we will plan to exit ahead of the April 21st earnings report.

BUY PUT MAY 45.00 CJQ-QI open interest=6142 current ask $3.30
BUY PUT MAY 40.00 CJQ-QH open interest=4399 current ask $1.45

Annotated Chart:
CHRW

Picked on    April xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           04/21/09 (confirmed)
Average Daily Volume =       3.3 million  
Listed on April 01, 2009         


NEW MARKET NEUTRAL STRANGLE PLAYS

iShares Financials - IYF - close: 33.50 change: +0.78 stop: n/a

Why We Like It:
Tomorrow (Thursday) brings the final vote on the proposed mark-to-market changes for the U.S. financial system. There has been a lot of confusion over how these changes might be implemented or whether or not they've already been put in place. Regardless investors will be watching the vote carefully and the financial stocks could see HUGE moves on the headlines.

Unfortunately the move could go either way. You could argue for an explosion higher or a big sell the news event. I am suggesting readers use a strangle, to be placed early in the morning, before the vote occurs. If the IYF gaps open on us then we can adjust our strikes. (Example: If the IYF gaps open $2.00 to $35.50 then we'll just move our strikes up $2.00).

I am going to list an very aggressive strangle with April options, which expire in less than 2 and 1/2 weeks. I'll also list a strangle with May strikes.

Suggested Options:
I strangle involves buying both an out of the money call and an out of the money put option. We are looking for a big directional move that pushes one side of our strategy into profitable territory after covering our initial investment.

Our estimated cost for the Aprils are $2.30 We want to sell if either option hits $3.50 or higher.

Our estimated cost for the Mays are $4.55 We want to sell if either option hits $7.50. or higher.

-Aggressive April Strangle-
BUY CALL APR 36.00 IYI-DJ open interest=1036 current ask $1.25
-and-
BUY PUT APR 30.00 IYI-PD open interest=5568 current ask $1.05

-Less Aggressive May Strangle-
BUY CALL MAY 36.00 IYI-EJ open interest= 960 current ask $2.45
-and-
BUY PUT MAY 30.00 IYI-QD open interest=5293 current ask $2.10

Annotated Chart:
IYF

Picked on    April 01 at $ 33.50
Change since picked:      + 0.00
Earnings Date           00/00/00
Average Daily Volume =      14.5 million  
Listed on April 01, 2009         


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