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Call Updates

Avalonbay - AVB - close: 74.04 change: -0.36 stop: 72.95 *new*

AVB held up relatively well considering the market's decline today. The stock could easily pull back toward its simple 10-dma near $73.00 and stay within its narrow rising channel. We're still suggesting that more conservative traders exit early for a profit. Our target is the $75-76 range. We are raising our stop loss to $72.95.

Picked on April 24 at $ 70.05
Change since picked: + 3.99
Earnings Date 04/21/05 (confirmed)
Average Daily Volume = 345 thousand

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Caterpillar - CAT - close: 88.88 chg: -2.02 stop: 89.00

Ouch! The triple-digit Dow decline was tough on CAT. The stock lost more than 2.2 percent on strong volume. The MACD indicator is starting to look vulnerable too. This is a good reason why we're using a trigger on this play. We remain on the sidelines. Our entry point to buy calls is at $92.35, above its simple 100-dma. No change from our previous update on 05/11/05.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/20/05 (confirmed)
Average Daily Volume = 2.8 million

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Chubb Corp - CB - close: 81.96 chg: -0.91 stop: 79.99

Technicals are really starting to sour for CB. After today's market decline and the weakness in the IUX insurance sector it may be a good idea for more cautious traders to exit early. At this point we expect CB to trade back toward old resistance and what should be new support in the $81.00-80.00 range. We are not suggesting new bullish plays at this time.

Picked on May 01 at $ 81.78
Change since picked: + 0.18
Earnings Date 04/25/05 (confirmed)
Average Daily Volume = 1.2 million

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Coventry Hlth Care - CVH - close: 66.72 chg: -1.48 stop: 66.99

If you're long this stock or its calls today's decline should be flashing a big "red alert" to you. CVH actually broke down below technical support at its 50-dma today. The stock has also broken down below its multi-month trendline of support dating back to the October low. We remain on the sidelines with a trigger to go long at $70.51 but if CVH doesn't bounce back tomorrow we'll probably close this play unopened.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/03/05 (confirmed)
Average Daily Volume = 973 thousand

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Hovnanian - HOV - close: 52.20 chg: -1.78 stop: 49.99

Housing stocks got hammered today with a 3.2 percent decline in the DJUSHB home construction index. Shares of HOV paced the decline in the sector. The stock is still above its 50-dma and a hose of other moving averages in addition to what should be round-number, psychological support at the $50.00 level. We are not suggesting new bullish plays at this time.

Picked on May 06 at $ 54.26
Change since picked: - 2.06
Earnings Date 03/02/05 (confirmed)
Average Daily Volume = 1.2 million

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Invitrogen - IVGN - close: 77.12 change: +0.15 stop: 71.49

IVGN continues to show relative strength. Not only did shares close in the green amid a market-wide sell-off but IVGN hit another new relative high above $78.00 intraday. In the news IVGN announced it would be presenting at the Banc of America securities conference on May 17th. If IVGN does dip in the near future look for a bounce from the $75.00 level as a new bullish entry point.

Picked on May 03 at $ 75.51
Change since picked: + 1.61
Earnings Date 04/28/05 (confirmed)
Average Daily Volume = 888 thousand

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Eli Lilly - LLY - close: 59.19 change: +0.44 stop: 57.49

LLY displayed some relative strength today with a bounce from the $58.00 level as we expected. Yet we remain cautious. If the market is going to turn lower then LLY is likely to follow even though drug stocks are typically seen (or used to be seen) as "safe" havens stocks. We're not suggesting new bullish positions until LLY trades back above the $60.00 level. Keep in mind that the ASCO conference begins this weekend and there could be a number of headlines (good and bad) coming out of the conference that will influence drug and biotech equities next week.

Picked on May 04 at $ 60.15
Change since picked: - 0.96
Earnings Date 04/18/05 (confirmed)
Average Daily Volume = 4.7 million

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Reynolds American - RAI - cls: 79.00 chg: +0.18 stop: 77.95

Try as it might RAI could not breakout over the $80.00 level and its 50-dma today. We're surprised that there was not a more bullish reaction to the news out today. A Minnesota judge has dismissed a class-action suit against R.J.Reynolds regarding a claim that the company mislead consumers that its label for "lights" cigarettes were misleading. We're still in limbo here. RAI is oscillating around the $79 level. We are waiting for shares to trade at $81.31 before going long.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/27/05 (confirmed)
Average Daily Volume = 866 thousand

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Research In Motion - RIMM - cls: 69.05 chg: -2.09 stop: 66.85

It's time to go to yellow alert! Seeing some profit taking in RIMM is not a surprise since the stock has been showing relative strength the last few days. What worries us is the pattern during today's trading with what looks like a short-term top near its 40 and 100-dma's and a decline under its 50-dma and exponential 200-dma. We are not suggesting new bullish plays at this time. Remember this is a high-risk play. If any conservative players did jump in on this one you may want to consider exiting now to avoid further losses.

Picked on May 10 at $ 70.51
Change since picked: - 1.46
Earnings Date 04/05/05 (confirmed)
Average Daily Volume = 1.7 million
 

Put Updates

L-3 Comm. - LLL - close: 66.00 chg: -1.84 stop: 69.55 *new*

Thursday's market decline really helped accelerate LLL's weakness. The stock lost another 2.7 percent on volume about twice the average. Our target is the $63-62 range but don't be surprise to see some support near $65. We're lowering the stop loss to $69.55.

Picked on May 10 at $ 68.01
Change since picked: - 2.01
Earnings Date 04/26/05 (confirmed)
Average Daily Volume = 855 thousand

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Lehman Brothers - LEH - close: 87.85 chg: -1.15 stop: 92.80

Good news. The early strength in LEH failed near the $90.00 level and the stock closed near its lows for the session on very strong volume over twice the average. Our target is the $86-85 range.

Picked on April 29 at $ 89.45
Change since picked: - 1.60
Earnings Date 03/15/05 (confirmed)
Average Daily Volume = 2.3 million

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Marriot - MAR - close: 61.32 chg: -0.64 stop: 64.21

No change from our previous updates. MAR is nearing our target in the $60.00-58.00 range.

Picked on April 28 at $ 63.37
Change since picked: - 2.05
Earnings Date 04/21/05 (confirmed)
Average Daily Volume = 1.2 million

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Parker Hannifin - PH - close: 58.38 change: -1.15 stop: 62.01

No change from previous update on 05/08/05. Our target is the $55-54 range.

Picked on April 28 at $ 59.08
Change since picked: - 0.70
Earnings Date 04/18/05 (confirmed)
Average Daily Volume = 1.2 million
 

Dropped Calls

Golden West Fincl - GDW - close: 62.07 chg: -0.99 stop: 60.95

We have been cautious on the bank stocks and GDW for the last few days but we've been focusing on support in the $62 area. The stock remains above the $62 mark but today's candlestick produced a bearish engulfing pattern. We also see a new MACD sell signal. We're running for the exits before this gets any worse.


Picked on April 26 at $ 62.55
Change since picked: - 0.48
Earnings Date 04/20/05 (confirmed)
Average Daily Volume = 1.3 million
 

Dropped Puts

None

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