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Call Updates

Biogen Idec - BIIB - close: 44.66 change: -0.52 stop: 43.45

Biotech stocks are still taking their lead from the market and that meant a last hour dive today. Shares of BIIB traded in a narrow range for most of the session but also turned lower toward the closing bell. We are not suggesting new bullish positions at this time. More conservative traders may want to tighten their stop loss toward the $44 level. We're going to leave ours at $43.45 for now. Wait for another move over $46.50 or Tuesday's high at $46.72 before considering new bullish positions. Currently our target is the $49.85-50.00 range. We do not want to hold over BIIB's late January earnings report.

Picked on December 27 at $ 46.11
Change since picked: - 1.71
Earnings Date 01/25/06 (unconfirmed)
Average Daily Volume = 3.2 million

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Cytec Ind. - CYT - close: 47.55 chg: -0.09 stop: 44.99

Shares of CYT traded in a very narrow range almost the entire session. We remain cautious with the stock under what is becoming resistance near $48 and the major market averages looking vulnerable. We are not suggesting new plays. The P&F chart points to a $65.00 target. Our target is a modest move into the $49.85-50.00 range.

Picked on December 22 at $ 47.01
Change since picked: 0.54
Earnings Date 01/19/06 (unconfirmed)
Average Daily Volume = 333 thousand

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Femsa Fomento - FMX - close: 72.55 chg: 0.80 stop: 67.75

FMX delivered a decent day for the bulls. The stock added 1.1% following yesterday's bearish reversal. Look for a dip back into the $70.50-71.00 region before considering new call positions. Our target is the $74.75-75.00 range.

Picked on December 19 at $ 70.65
Change since picked: 1.90
Earnings Date 02/23/06 (unconfirmed)
Average Daily Volume = 308 thousand

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Gilead Sciences - GILD - close: 52.84 chg: -0.60 stop: 49.99

Yet another down day for GILD. The stock is now down four days in a row and its technical picture is close to reversing. Short-term oscillators like the RSI and stochastics are already bearish. As expected volume has been very light during this holiday week but that doesn't excuse GILD's weakness. The stock may be headed toward the 50-dma near 51.50. Today's decline might be a signal for more conservative traders to exit early and cut their losses. We are not going to suggest new positions at this time. The P&F chart points to a $66 target. Our target is the $59.00-60.00 range. We do not want to hold over GILD's mid January earnings report.

Picked on December 22 at $ 54.51
Change since picked: - 1.71
Earnings Date 01/17/06 (unconfirmed)
Average Daily Volume = 4.3 million

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Ipsco Inc. - IPS - close: 82.98 change: 0.34 stop: 79.99

Metal and steel stocks were one of the few pockets of strength in the market today. IPS' gains were not very impressive and even it felt the afternoon tug lower. We remain on the sidelines. Our strategy involves a trigger to buy calls at $83.55. If triggered we'll target a run into the $89.00-90.00 range. We do not want to hold over the earnings report.

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked: 0.00
Earnings Date 01/24/06 (unconfirmed)
Average Daily Volume = 396 thousand

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Tractor Supply - TSCO - cls: 53.50 chg: -0.38 stop: 52.65

TSCO tried to bounce this afternoon but the rally failed at its three-week trend of lower highs. This is bearish and conservative traders may want to just exit early right here. We are not suggesting new bullish positions at this time. Our target is the $57.00-58.00 range. The Point & Figure chart still points to an $87 target.

Picked on November 30 at $ 52.75
Change since picked: 0.83
Earnings Date 01/18/06 (unconfirmed)
Average Daily Volume = 428 thousand

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United States Steel - X - close: 48.73 chg: 0.64 stop: 44.65

The steel sector displayed relative strength today and shares of X added 1.33%. The current bounce from the $45 level is now six days old so it may be time to look for a pull back. A dip into the 46.50-47.00 region might be a new bullish entry point. Our late January target is the $52.00-52.50 range. The Point & Figure chart for X points to an $86 target. We do not want to hold over the January earnings report.

Picked on December 23 at $ 47.05
Change since picked: 1.68
Earnings Date 01/24/06 (unconfirmed)
Average Daily Volume = 3.8 million

Put Updates

PACCAR Inc. - PCAR - close: 69.94 change: -0.00 stop: 72.51

There was no change in shares of PCAR today and we see no change from our previous updates. We did notice that most of today's volume in PCAR was during the late afternoon weakness. Our target is the $65.25-65.00 range.

Picked on December 20 at $ 69.49
Change since picked: 0.45
Earnings Date 01/24/06 (unconfirmed)
Average Daily Volume = 838 thousand

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Progressive Corp - PGR - cls: 118.62 chg: 0.07 stop: 121.25

PGR may be getting closer to a bearish breakdown. The stock has tried to rally three times in the last several days and each time the rally failed a bit lower (a.k.a. a trend of lower highs). Today's rally failed near the $120 level. This could be used as an aggressive trader's entry point to buy puts. We are suggesting a trigger to buy puts at $117.45, under short-term support. If triggered we'll target a decline into the $110.50-110.00 range. We do not want to hold over the January earnings report.

Picked on December xx at $ xx.xx <-- see Trigger
Change since picked: 0.00
Earnings Date 01/19/06 (unconfirmed)
Average Daily Volume = 836 thousand

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Stryker Corp. - SYK - close: 44.91 chg: -0.38 stop: 46.51

SYK has closed under round-number support at $45.00 for the first time this month. This could be an aggressive player's entry point to buy puts, especially with the apparent breakdown through the bottom of its channel. We are suggesting a trigger to buy puts at $44.29, which is under the simple 50-dma. If triggered we'll target a decline into the $40.25-40.00 range, near its October lows. We do not want to hold over the January earnings report. That gives us about three weeks, maybe less.

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked: 0.00
Earnings Date 01/17/06 (unconfirmed)
Average Daily Volume = 2.1 million

Strangle Updates

(What is a strangle? It's when a trader buys an out-of-the-money (OTM) call and an OTM put on the same stock. The strategy is neutral. You do not care what direction the stock moves as long as the move is big enough to make your investment profitable.)

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Amer. Eagle Out. - AEOS - cls: 23.12 chg: 0.17 stop: n/a

AEOS is still showing strength. We're not suggesting new plays. The current strangle has an estimated cost of $2.35 with the January $27.50 calls (AQU-AY) and the January $22.50 puts (AQU-MX). We are targeting a rise to $4.70.

Picked on November 13 at $ 25.47
Change since picked: - 2.23
Earnings Date 11/15/05 (confirmed)
Average Daily Volume = 3.6 million

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Abercrombie&Fitch - ANF - close: 65.35 chg: -0.19 stop: n/a

ANF is still bouncing from the $65.00 level but it didn't get very far with today's bounce. We are not suggesting new strangle positions at this time. The options in our strangle are the January $65 calls (ANF-AM) and the January $55 puts (ANF-MK). Our estimated cost was $5.15. We're looking for a rise to $8.50.

Picked on November 13 at $ 59.67
Change since picked: 5.68
Earnings Date 11/15/05 (confirmed)
Average Daily Volume = 2.7 million

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Blue Coat Sys. - BCSI - cls: 46.24 chg: -0.02 stop: n/a

BCSI's recent rally is struggling to breakout over resistance in the $46.50 region. At this time we are not suggesting new plays. FYI: currently the Point & Figure chart for BCSI is pretty bearish with a $27 target. Our current play involves the January $50 call and the January $40 put. Our estimated cost is $3.25. We're aiming for a rise to $5.50. Remember we have about four weeks left before January options expire.

Picked on December 04 at $ 45.43
Change since picked: 0.81
Earnings Date 02/14/06 (unconfirmed)
Average Daily Volume = 416 thousand

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Building Materials - BMHC - cls: 72.00 chg: -5.24 stop: n/a

BMHC is confirming the recent breakdown and breakout from its consolidation pattern. The stock lost another 6.7% on above average volume today. The selling stopped near the 200-dma but only because of the closing bell. We are not suggesting new strangle positions at this time. The options in our strangle play are the March $90 calls (BGU-CR) and the March $70 puts (BGU-ON). Our estimated cost is $8.20. Our target is $12.50 by March expiration.

Picked on December 18 at $ 80.95
Change since picked: - 8.95
Earnings Date 01/24/06 (unconfirmed)
Average Daily Volume = 527 thousand

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Chicago Merc. Exchg. - CME - cls: 368.01 chg: -5.98 stop: n/a

CME is showing some weakness today. The stock lost 1.59% and fell below the $370 level and its simple 50-dma. We are not suggesting new positions. Our current play involves the January $400 calls (CMJ-AK) and the January $350 puts (CMJ-MA). Our estimated cost was $26.70. We're aiming for a rise to $40.00 in the strangle before January options expire but at this point we'll probably adjusting our target lower in the next week.

Picked on November 20 at $375.90
Change since picked: - 7.89
Earnings Date 01/24/06 (unconfirmed)
Average Daily Volume = 879 thousand

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D.R.Horton - DHI - close: 36.21 chg: 0.06 stop: n/a

During a boring day the homebuilders offered a little bit of volatility but in the end shares of DHI didn't move much. The stock reacted to the negative existing home sales number this morning but the initial move was reversed higher only to see that rally fail late in the session. If DHI closes under $36 any time this week then more conservative traders may want to think about exiting early and trying to salvage what they can from this play. We only have four weeks left before January options expire. We are not suggesting new strangles in DHI at this time. Our current play involves the January $35 calls (DHI-AG) and the January $30 puts (DHI-MF). Our estimated cost was $3.15. We're aiming for a rise to $6.00.

Picked on November 13 at $ 32.56
Change since picked: 3.65
Earnings Date 02/15/06 (unconfirmed)
Average Daily Volume = 3.2 million

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Four Seasons - FS - close: 49.76 chg: 0.46 stop: n/a

We do not see any change from our previous updates on FS. We are not suggesting new strangles at this time. The options in our strangle were the January $60 calls (FS-AL) and the January $50 puts (FS-MJ). Our estimated cost was about $2.60. We're aiming for a rise to $5.00 or more.

Picked on November 08 at $ 55.37
Change since picked: - 5.56
Earnings Date 11/10/05 (confirmed)
Average Daily Volume = 319 thousand

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Lear Corp - LEA - close: 28.28 chg: 0.19 stop: n/a

We do not see any change from our weekend update on LEA. We are no longer suggesting new strangle positions. The options in our strangle are the January $35 calls (LEA-AG) and the January $25 puts (LEA-ME). Our estimated cost was $1.60. We are lowering our target to $1.60. We have about four weeks left before January options expire.

Picked on November 06 at $ 30.24
Change since picked: - 1.96
Earnings Date 01/25/06 (confirmed)
Average Daily Volume = 1.8 million

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Verifone Holdings - PAY - cls: 25.21 chg: 0.09 stop: n/a

It looks like new support at the $25.00 level might hold. Whether it does or not probably depends on where the major averages head next. We're not suggesting new positions. Our current strangle involves the January $22.50 calls (PAY-AX) and the January $17.50 puts (PAY-MW). Our estimated cost was $2.60 and we're aiming for a rise to $4.50 or more.

Picked on October 12 at $ 19.98
Change since picked: 5.23
Earnings Date 12/01/05 (confirmed)
Average Daily Volume = 259 thousand

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Questar Corp. - STR - close: 76.39 chg: -0.43 stop: n/a

Natural gas futures are oscillating in a somewhat volatile fashion on a regular basis now. This is not having much affect on STR and its three-week trend of declines. We do not see any changes from Tuesday's update. We are no longer suggesting strangle positions in the stock. Our strangle involves the January $80 calls (STR-AP) and the January $70 puts (STR-MN). Our estimated cost was $5.10 and we're aiming for a rise to $9.50 or more. We only have four weeks left before January options expire.

Picked on November 20 at $ 76.25
Change since picked: 0.14
Earnings Date 01/26/05 (unconfirmed)
Average Daily Volume = 716 thousand

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Texas Ind. - TXI - close: 49.56 chg: -0.14 stop: n/a

Unfortunately we have nothing new to report on for TXI. This has been a worst case scenario for a strangle play with the stock not moving out of its trading range. Hopefully the earnings report expected on January 5th will produce enough volatility for us to exit near breakeven or even score a potential gain. We are not suggesting new strangle positions. The options in our strangle are the January $55 calls (TXI-AK) and the January $45 puts (TXI-MI). Our estimated cost is $2.70. We're looking for a rise to $5.00 or more.

Picked on November 27 at $ 49.57
Change since picked: - 0.01
Earnings Date 01/05/06 (confirmed)
Average Daily Volume = 354 thousand

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Valero Energy - VLO - close: 51.60 chg: -0.27 stop: n/a

Oil stocks turned lower again today despite a bounce in crude futures. Shares of VLO tried to rally but failed under its new two-week trend of lower highs. More conservative traders may want to think about exiting early to cut their losses. We are not suggesting new strangle plays. Our current play involves the January $110 calls (VLO-AB) and the January $90 puts (VLO-MR). Our adjusted cost is $2.93. Our adjusted target is $4.75.

Picked on November 21 at $ 50.50
Change since picked: 1.10
Earnings Date 01/30/06 (unconfirmed)
Average Daily Volume = 10.7 million

Dropped Calls

Ryland Group - RYL - close: 72.74 change: 0.16 stop: 71.85

The homebuilding sector actually closed in the green on Thursday despite a decline in November existing home sales reported this morning. Shares of RYL did dip lower and fell to $71.65, above its 50-dma, before bouncing. We have been stopped out at $71.85. It may be worth noting that volume in RYL today was above average and a long stronger than it has seen in weeks. We would keep an eye on RYL for a move over $74.00 or $75.00 as a new bullish entry point. A drop under the 200-dma near $70 could be used as a bearish entry point.

Picked on December 13 at $ 73.96
Change since picked: - 1.22
Earnings Date 01/24/06 (unconfirmed)
Average Daily Volume = 1.3 million

Dropped Puts

None
 

Dropped Strangles

None
 

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