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Call Updates

AmerUS Group - AMH - close: 60.86 change: +0.01 stop: 59.88

The trading in shares of AMH today was very disappointing. The markets produce a broad-based rally and shares of AMH only add a penny? That's not the sort of relative strength we're looking for. Readers should be careful here. AMH may need to retest the $60 level as support again before moving higher. There is still a chance for a short-squeeze. Our short-term target will be the $64.00-65.00 range. Our time frame is four to five days.

Picked on January 25 at $ 60.85
Change since picked: + 0.01
Earnings Date 02/01/06 (unconfirmed)
Average Daily Volume = 325 thousand

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Carter's Inc. - CRI - close: 69.56 chg: +2.94 stop: 64.75

Our new play in CRI is off to a strong start. Shares surged at the opening bell and closed with a 4.4% gain near its highs for the session. Volume came in almost double the daily average and that's bullish for the stock. Our target is the $72.50-75.00 range.

Picked on January 25 at $ 66.62
Change since picked: + 2.94
Earnings Date 02/20/06 (unconfirmed)
Average Daily Volume = 313 thousand

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Freeport Mcmoran - FCX - cls: 61.80 chg: +1.33 stop: 55.79

FCX added more than 2% today fueled by another strong session for metal/mining stocks and a new broker upgrade for FCX. We don't see any changes from our previous updates. Our target is the $64.75-65.00 range. Please note that there is some headline risk involving rival Phelp Dodge's (PD) earnings report coming up on January 31st.

Picked on January 24 at $ 60.22
Change since picked: + 1.58
Earnings Date 01/17/06 (confirmed)
Average Daily Volume = 2.6 million

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SFBC Intl. - SFCC - close: 22.68 chg: +1.76 stop: 18.95

SFCC soared to an 8.4% gain on Thursday following yesterday's bullish breakout over the 50-dma. The stock has extremely high short interest (74%) so the bears should be in panic mode right now. Our target is the $24.90-25.00 range. FYI: the P&F chart points to a $35 target. We don't want to hold over the early February earnings report.

Picked on January 25 at $ 20.92
Change since picked: + 1.76
Earnings Date 02/02/06 (unconfirmed)
Average Daily Volume = 2.5 million

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Selective Ins. - SIGI - close: 58.00 chg: +1.54 stop: 54.65

The broad-market rally inspired a rebound in shares of SIGI. The stock added 2.7% and shares look poised to challenge the November highs. Our target is the $59.50-60.00 range. We do not want to hold over the late January earnings report. FYI: SIGI might announce a stock split with its earnings report. The company last split its stock in December 1997 in the $50-52 region.

Picked on January 19 at $ 56.05
Change since picked: + 1.95
Earnings Date 01/31/06 (confirmed)
Average Daily Volume = 163 thousand

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Wynn Resorts - WYNN - close: 60.08 change: +2.54 stop: 54.99

WYNN finally decided to join the market rally today after getting a little boost from a new broker upgrade. Morgan Stanley reiterated their "over weight" rating and raised their price target on WYNN to $75. The stock has some resistance at the November highs near $61.50. We would not be surprised by a dip back toward the 58.00-58.50 region to fill this morning's gap. We're going to target a rally into the 64.75-65.00 range. We do not want to hold over the February earnings report.

Picked on January 22 at $ 58.78
Change since picked: + 1.30
Earnings Date 02/09/06 (unconfirmed)
Average Daily Volume = 1.1 million
 

Put Updates

Biotech HOLDRs - BBH - close: 193.55 chg: -1.05 stop: 201.55

The biotech sector managed to overcome weakness in Amgen and the BTK index added 1.2% on Thursday. The BBH was not so lucky and fell over 0.5% following AMGN's decline. Investors were not happy with AMGN's inline earnings report and shares of AMGN broke down below support at its 200-dma. This is good news for our put position in the BBH. Our target is the $187.00-185.00 range above the 200-dma on the BBH.

Picked on January 20 at $195.78
Change since picked: - 2.23
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 539 thousand

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Express Scripts - ESRX - close: 89.22 chg: +0.98 stop: 90.01

We don't see any change from our previous updates on ESRX. We remain on the sidelines. Our trigger to buy puts is under the 50-dma at $84.95. If triggered we'll target a decline to the rising 100-dma (currently 74.87). We will be adjusting our target to account for the rising 100-dma. At the moment we'll use an exit zone of $77.00-75.00. Please note that ESRX is rebounding back toward resistance in the $90-91 region. If shares can breakout we'll consider buying calls instead.

Picked on January xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/22/06 (confirmed)
Average Daily Volume = 2.1 million

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Johnson Controls - JCI - close: 70.61 chg: +0.31 stop: 72.51

Considering the widespread market rally today we're surprised that JCI did not show more strength. We are not suggesting new bearish positions at this time. Keep a close eye on the 50-dma and the $72.00 level since they're both overhead resistance. Our target is the $65.50-65.00 range.

Picked on January 25 at $ 69.90
Change since picked: + 0.71
Earnings Date 01/20/06 (confirmed)
Average Daily Volume = 955 thousand

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Omnicare - OCR - close: 54.08 change: +1.12 stop: 56.25

OCR produced a bit of an oversold bounce today. The rally did stall under the $55.00 level but if the markets continue higher tomorrow we wouldn't be surprised to see OCR challenge the $56 level again. Our target is the $51.00-50.00 range before its February earnings report.

Picked on January 20 at $ 54.99
Change since picked: - 0.91
Earnings Date 02/23/06 (unconfirmed)
Average Daily Volume = 1.3 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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Building Materials - BMHC - cls: 78.31 chg: +3.06 stop: n/a

It was a somewhat volatile day for BMHC today and the rally was picking up steam late into the session. A breakout over the $80.00 level would certainly be bullish and a breakout over its four-month trendline of resistance. 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: - 2.74
Earnings Date 02/07/06 (unconfirmed)
Average Daily Volume = 527 thousand

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Encana Corp. - ECA - close: 46.48 chg: +0.33 stop: n/a

ECA bounced from the $45.00 level and managed to out perform many of its peers in the oil sector. We're not suggesting new positions. Our strategy involves the April $50 calls (ECA-DJ) and the April $40 puts (ECA-PH). Our estimated cost is $3.45. We are aiming for a rise to $5.95.

Picked on January 10 at $ 45.56
Change since picked: + 0.92
Earnings Date 02/15/06 (confirmed)
Average Daily Volume = 4.4 million

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Ryland Group - RYL - close: 71.81 change: +1.46 stop: n/a

Homebuilders rebounded from yesterday's losses but the trend in RYL remains bearish after Wednesday's sell-off. We are no longer suggesting new strangle positions. Our play involves the April $80 calls (RYL-DP) and the April $70 puts (RYL-PN). Our estimated cost is $7.00. Our target is $12.00.

Picked on January 22 at $ 75.19
Change since picked: - 3.38
Earnings Date 01/24/06 (confirmed)
Average Daily Volume = 1.1 million
 

Dropped Calls

Lehman Brothers - LEH - close: 139.10 chg: +4.54 stop: 131.05

Target achieved. Thursday was a very strong session for the brokers. The XBD index added 2.45% to close at a new record high. LEH did its part with a 3.38% rally to its own new record high. Our target to exit was the $138.50-140.00 range.

Picked on January 09 at $131.05
Change since picked: + 8.05
Earnings Date 03/14/06 (unconfirmed)
Average Daily Volume = 2.3 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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