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NEW DIRECTIONAL CALL PLAYS

Priceline.com - PCLN - close: 86.83 change: -2.29 stop: 77.75

Why We Like It:
I've had my eye on PCLN for a while. The stock has a strong up trend and shares broke through significant resistance in the last week. If this market is going to continue higher we can expect PCLN to out perform.

Stocks look like they might pull back a bit as investors react to first quarter earnings. I am suggesting we buy a dip in PCLN. Our entry point will be a dip in the $82.00-80.00 zone. I'm suggesting a stop loss at $77.75 but more conservative traders might want to consider a stop closer to $80. If we are triggered at $82.00 our first target is $88.00. Our second target is $93.00. Our third target is $98.00. Why three targets? If a stock is in a strong up trend and it breaks higher through $90 momentum tends to carry it toward $100. FYI: Currently the Point & Figure chart is bullish with a $112 target.

Suggested Options:
I am suggesting the May calls. It is always up to the individual trader to decide which month and which strike price best suits your trading style and risk profile.

BUY CALL MAY 80.00 PUZ-EP open interest= 415 current ask $11.30
BUY CALL MAY 85.00 PUZ-EQ open interest= 968 current ask $ 8.20
BUY CALL MAY 90.00 PUZ-ER open interest=1796 current ask $ 6.00

Annotated Chart:
PCLN

Picked on    April xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           05/07/09 (unconfirmed)
Average Daily Volume =       1.5 million  
Listed on April 07, 2009         


V F Corp. - VFC - close: 61.47 change: -1.79 stop: 56.45

Why We Like It:
VFC makes clothing and I suspect that retailers and VFC might trade lower come this Thursday when retailers announce their March same-store sales figures. We want to be ready to buy the dip in VFC. Currently the stock is holding support at $60.00 but I suspect it will temporarily break it.

The plan is to buy calls on VFC on a dip in the $59.00-58.00 zone. We're starting with a stop loss at $56.45. If triggered our first target is $64.00. Our second target is $67.45. FYI: The Point & Figure chart is bullish with an $84 target.

Suggested Options:
I am suggesting the May calls but we will plan to exit ahead of the late April earnings report.

BUY CALL MAY 60.00 VFC-EL open interest= 736 current ask $5.10
BUY CALL MAY 65.00 VFC-EM open interest= 658 current ask $2.55

Annotated Chart:
VFC

Picked on    April xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           04/28/09 (unconfirmed)
Average Daily Volume =       1.3 million  
Listed on April 07, 2009         


NEW DIRECTIONAL PUT PLAYS

Chevron Corp. - CVX - close: 68.40 change: -1.49 stop: 71.35

Why We Like It:
I know that oil and oil stocks should be poised to ramp up into summer as demand for gasoline grows. However, the charts are not that bullish. CVX has been struggling with resistance near $70.00 for days and has been unable to breakout past its overhead trendline of lower highs. Technical indicators in CVX are rolling over in conjunction with oil and natural gas futures. It looks like CVX is poised to correct before trying to break higher again.

I am suggesting put positions now with a stop loss above the April highs (71.29). Our first target is $64.25. Our second target is $61.75. We do not want to hold over the early May earnings.

Suggested Options:
I am suggesting the May puts.

BUY PUT MAY 70.00 CVX-QN open interest=1733 current ask $5.00
BUY PUT MAY 65.00 CVX-QM open interest=3575 current ask $2.60

Annotated Chart:
CVX

Picked on    April 07 at $ 68.40
Change since picked:      + 0.00
Earnings Date           05/01/09 (unconfirmed)
Average Daily Volume =        16 million  
Listed on April 07, 2009         


Volatility Index - VIX - close: 40.39 change: -0.54 stop: n/a

Why We Like It:
The Volatility index (VIX) has been flirting with a breakdown under 40.00 for months. Given the trend of lower highs the charts are suggesting that the next move will be a break lower, which would be bullish for stocks. Potentially acting as a catalyst for just such a move might be the re-introduction of the up-tick rule to short stocks. Without the up-tick rule it's been easier for traders to short stocks and some investors and analysts argue that this has made the market more volatile and this has led to a higher reading on the VIX. I don't necessarily buy that reasoning but there is a good chance that if the SEC does re-instate the up-tick rule that the VIX will react by moving lower.

The May options on the VIX look cheap. These are cash settled options. We don't have to worry about being called out or put the underlying equity. The May 2009 vix options are set to expire on Wednesday, May 20th.

These options look pretty cheap. I am suggesting that we buy a few just as a speculative bet without using any stop loss. My first target to take some money off the table is $35.00. My second target is $31.00. We do NOT want to open positions if the VIX gaps open lower under $38.00 tomorrow (Wednesday, April 8th).

Suggested Options:
I am suggesting the May puts.

BUY PUT MAY 37.50 VIX-QU open interest=10925 current ask $1.15
BUY PUT MAY 35.00 VIX-QI open interest=38567 current ask $0.50
BUY PUT MAY 32.50 VIX-QZ open interest=46962 current ask $0.15

Annotated Chart:
VIX

Picked on    April 07 at $ 40.39
Change since picked:      + 0.00
Earnings Date           00/00/00
Average Daily Volume =         x 
Listed on April 07, 2009         


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