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Call Updates

Cigna - CI - close: 127.26 change: +0.83 stop: 121.90

A positive market environment helped CI creep higher today. We don't see any changes from our previous updates. Our target is the $129.75-130.00 range so we're not suggesting new bullish positions at this time. The P&F chart points to a $166 target.

Picked on February 26 at $124.57
Change since picked: + 2.69
Earnings Date 02/08/06 (confirmed)
Average Daily Volume = 944 thousand

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Cummins Inc. - CMI - cls: 106.00 change: +1.40 stop: 102.49

CMI continued to dip this morning but traders bought the dip near $104.00 and the stock spent the rest of the session gaining ground. A market-wide rally helped fuel the 1.3% gain in CMI and the above average volume is a positive sign. Our short-term target is the $109.75-110.00 range.

Picked on March 13 at $105.25*gap higher*
Change since picked: + 0.75
Earnings Date 04/20/06 (unconfirmed)
Average Daily Volume = 867 thousand

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Garmin Ltd. - GRMN - cls: 75.18 change: +0.52 stop: 69.75

We are a little bit surprised that GRMN did not perform better during today's broad-based rally. We would urge traders to be cautious and we're not suggesting new bullish positions at this time. More conservative traders may want to tighten their stop losses. Our target is the $77.00-78.00 range. The Point & Figure chart points to an $85 target.

Picked on March 02 at $ 72.70
Change since picked: + 2.48
Earnings Date 02/22/06 (confirmed)
Average Daily Volume = 1.2 million

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Hartford Fin. Srv. - HIG - cls: 82.25 chg: +0.33 stop: 79.95

Shares of HIG are now three days into what looks like a minor oversold bounce. The short-term technical oscillators are improving. Volume seems to be improving as well but we remain cautious. We are not suggesting new bullish positions at this time.

Picked on February 14 at $ 82.12
Change since picked: + 0.13
Earnings Date 01/26/06 (confirmed)
Average Daily Volume = 1.1 million

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Hydril - HYDL - close: 72.33 change: +1.95 stop: 66.95

Tuesday was a strong day for oil stocks fueled in part by another surge in crude oil prices. HYDL added 2.77% and is challenging technical resistance at its 50-dma. Our only concern is that volume is declining on the rally, which is not a healthy sign. Our target is the $77.50-80.00 range.

Picked on March 12 at $ 70.23
Change since picked: + 2.10
Earnings Date 04/26/06 (unconfirmed)
Average Daily Volume = 289 thousand

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Altria Group - MO - close: 74.46 chg: +0.96 stop: 71.85

We have finally been triggered in shares of MO. The stock pushed past the $74.00 level and continues higher in a rally that has propelled the stock through technical resistance at its 50 and 100-dma's. Our trigger to buy calls was at $74.11. Our target is the $77.50-78.00 range but more aggressive traders may want to aim higher. The Point & Figure chart points to a $107 target.

Picked on March 14 at $ 74.11
Change since picked: + 0.35
Earnings Date 04/19/06 (unconfirmed)
Average Daily Volume = 8.1 million

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Toyota Motor Corp. - TM - close: 108.04 chg: +1.14 stop: 104.75

Shares of TM continue to rally and the technical indicators are certainly improving. The MACD is nearing a new buy signal. Volume is improving but remains low. Our target is the $112.50-115.00 range. Traders with a longer-term horizon may want to aim higher.

Picked on March 12 at $106.68
Change since picked: + 1.36
Earnings Date 02/07/06 (confirmed)
Average Daily Volume = 438 thousand

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Ultra Petrol. - UPL - close: 55.80 change: +1.56 stop: 51.95

We have been triggered in UPL. Another strong day for crude oil futures lifted the oil and oil services sector and UPL rallied 2.8%. The stock has broken out above the $55.00 level and its 21-dma. Our trigger to buy calls was at $55.05. Our target now is the $59.00-60.00 range.

Picked on March 14 at $ 55.05
Change since picked: + 0.75
Earnings Date 05/09/06 (unconfirmed)
Average Daily Volume = 1.7 million

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Valero Energy - VLO - close: 56.68 change: +1.03 stop: 53.49

Volume is improving as VLO rallies closer toward resistance in the $57.00-57.50 region. What is noteworthy is that the stock has closed over (broken out) its simple 50-dma. More aggressive traders may want to consider new bullish positions here. We are suggesting a trigger at $57.55. If triggered we'll target the $62.50-63.00 range. Keep an eye on shares of Sunoco (SUN). SUN is bouncing back toward the top of its trading range and resistance near its 100-dma (79.47) and the $80.00 level. We might consider bullish positions if SUN breaks out over $80.00.

Picked on March xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/02/06 (unconfirmed)
Average Daily Volume = million
 

Put Updates

KB Home - KBH - close: 66.45 chg: +3.11 stop: 68.05

Uh-oh! Today's rebound in KBH was pretty strong. A pull back in bond yields fueled a big rally in interest-rate sensitive stocks. The DJUSHB home construction index rallied 4.8% and KBH closed with a 4.9% gain. Volume came in above the daily average. Is this a one-day fluke or the beginning of a bullish reversal? More conservative traders may want to abandon ship right here given the breakout over the $65.00 level.

Picked on March 06 at $ 64.75
Change since picked: + 1.70
Earnings Date 03/22/06 (confirmed)
Average Daily Volume = 1.9 million

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Unibanco Brasilrs - UBB - close: 80.79 chg: +1.89 stop: 83.26

We need to be careful here with UBB due to the rebound in financial stocks today. We would not suggest new bearish positions with shares above the $80.00 mark.

Picked on March 09 at $ 77.44
Change since picked: + 3.35
Earnings Date 02/16/06 (confirmed)
Average Daily Volume = 755 thousand
 

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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Encana Corp. - ECA - close: 46.59 chg: +2.41 stop: n/a

ECA out performed its peers today after an analyst firm upgraded the stock to an "out perform" rating. Shares rallied to a 5.4% close on above average volume. Today's gain provided a bullish breakout over technical resistance at its 50-dma, 100-dma, and 200-dma. We are not suggesting new strangle positions. Our strangle 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: + 1.03
Earnings Date 02/15/06 (confirmed)
Average Daily Volume = 4.4 million

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Loews Corp. - LTR - close: 98.33 change: +2.11 stop: n/a

Time is running out for our speculative, high-risk strangle play in LTR. We have three days left before March options expire. We are not suggesting new strangle positions.

Picked on February 13 at $ 95.72
Change since picked: + 2.61
Earnings Date 02/16/06 (confirmed)
Average Daily Volume = 513 thousand

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Ryland Group - RYL - close: 68.42 change: +2.33 stop: n/a

Interest-rate sensitive homebuilders rallied strongly today. We are not suggesting new strangle positions at this time. 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: - 6.77
Earnings Date 01/24/06 (confirmed)
Average Daily Volume = 1.1 million
 

Dropped Calls

None
 

Dropped Puts

Amgen - AMGN - close: 75.01 change: +1.42 stop: 75.05

AMGN spiked higher this morning and shares broke out over round-number, psychological resistance at the $75.00 level and hit our stop loss at $75.05. Considering the broad-based rally today in the markets it's probably a good thing we've been stopped out now but we do note that AMGN remains under its trendline of lower highs.

Picked on March 09 at $ 73.58
Change since picked: + 1.43
Earnings Date 04/20/06 (unconfirmed)
Average Daily Volume = 10.1 million

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Phelps Dodge - PD - close: 71.46 change: +4.02 stop: 70.03

You can thank Goldman Sachs for the rally in PD today. The analyst firm upgraded the stock to an "out perform" this morning. Shares gapped higher to open at $68.83 and then proceeded to rally throughout the rest of the session. Shares broke out over technical resistance at the 100-dma and round-number resistance at the $70.00 mark. We would have been stopped out at $70.03.

Picked on March 09 at $ 66.45 *post split price
Change since picked: + 5.01
Earnings Date 04/27/06 (unconfirmed)
Average Daily Volume = 2.8 million
 

Dropped Strangles

None
 

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