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Call Updates

Cummins Inc. - CMI - cls: 108.06 change: -0.11 stop: 102.49

CMI almost hit our target this morning but the stock pared its gains and closed just under the flat line. Should the market pull back tomorrow we'd expect CMI to see some short-term support near $106. We're not suggesting new bullish positions at this time. Our short-term target is the $109.75-110.00 range. The $110 level looks like short-term resistance but more aggressive traders might want to aim higher.

Picked on March 13 at $105.25*gap higher*
Change since picked: + 2.81
Earnings Date 04/20/06 (unconfirmed)
Average Daily Volume = 867 thousand

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Hartford Fin. Srv. - HIG - cls: 83.16 chg: +0.17 stop: 79.95

HIG rallied toward the $84 level and its simple 50-dma but could not breakout above this technical resistance. Today's session looks like a failed rally and HIG looks ready to pull back again toward $82.50. We're not suggesting new bullish plays at this time. Our target is the $87.50-90.00 range.

Picked on February 14 at $ 82.12
Change since picked: + 1.04
Earnings Date 01/26/06 (confirmed)
Average Daily Volume = 1.1 million

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Hydril - HYDL - close: 75.39 change: +2.48 stop: 69.49 *new stop

After a little bit of a slow start shares of HYDL are beginning to soar higher again. A 2% rally in crude oil prices lifted the oil sector and HYDL took advantage of a positive market environment. Shares of HYDL closed over round-number resistance at the $75.00 mark and posted a 3.4% gain. Our target is the $77.50-80.00 range but more conservative traders may want to exit right here to lock in a gain. We are raising our stop loss to $69.49.

Picked on March 12 at $ 70.23
Change since picked: + 5.16
Earnings Date 04/26/06 (unconfirmed)
Average Daily Volume = 289 thousand

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ITT Industries - ITT - close: 54.74 change: +0.90 stop: 51.69

Our new bullish play in ITT is off to a good start. Shares added 1.6% and closed over potential resistance at the $54.00 level. We don't see any changes from our new play description from Wednesday. Our target is the $57.00-58.00 range.

Picked on March 15 at $ 53.84
Change since picked: + 0.90
Earnings Date 04/28/06 (unconfirmed)
Average Daily Volume = 1.4 million

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Macerich Co. - MAC - close: 73.82 change: +0.71 stop: 69.95

MAC has hit our trigger to buy calls but not in the way we had planned. The stock gapped higher to open at $73.90 and then rallied to $74.68 before reversing course. We cannot find any news or catalyst to explain the gap higher this morning. Readers should prepare for MAC to fill the gap and dip back toward the $73.00 region. A bounce from $73.00 could be used as a new bullish entry point. Our target is the $79.00-80.00 range.

Picked on March 16 at $ 74.05
Change since picked: - 0.23
Earnings Date 05/16/06 (unconfirmed)
Average Daily Volume = 371 thousand

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Altria Group - MO - close: 73.87 chg: -0.59 stop: 71.85

MO issued some news today but the market failed to take notice. The company raised its earnings guidance but the improvement comes on an approximately $1 billion tax adjustment. We don't see any changes from our previous updates. If the markets consolidate tomorrow watch for MO to dip toward the $73.00-72.50 region. 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: - 0.24
Earnings Date 04/19/06 (unconfirmed)
Average Daily Volume = 8.1 million

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Silicon Labs - SLAB - close: 47.58 change: -2.61 stop: 45.95

Semiconductor company Kulicke and Soffa (KLIC) issued some negative comments today and it sparked a heavy 3.2% sell-off in the SOX semiconductor index. Shares of KLIC fell over 20%. SLAB dropped just over 5%. Fortunately, we're still on the sidelines. We're suggesting that readers use a trigger at $51.05 to buy calls. If triggered we will target a rally into the $54.90-55.00 range. More aggressive traders may want to target the $58.00-60.00 range.

Picked on March xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/26/06 (unconfirmed)
Average Daily Volume = 1.2 million

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Sunoco Inc. - SUN - close: 81.37 change: +1.86 stop: 74.99

Rising geopolitical tensions with Iran, Nigeria, Venezuela, and now the new military offensive in Iraq weighed on the oil markets. The price of crude oil gained over 2% and oil stocks in general turned in a strong day. Shares of SUN posted a 2.3% gain on above average volume to breakout over resistance at its 100-dma and the $80.00 mark. Our trigger to buy calls was at $80.26 so the play is now open. The next hurdle for SUN is the 50-dma near $82. Our target is the $87.50-90.00 range. More conservative traders may want to plan an exit near $85.00, which could act as round-number resistance.

Picked on March 16 at $ 80.26
Change since picked: + 1.11
Earnings Date 04/27/06 (unconfirmed)
Average Daily Volume = 2.4 million

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Toyota Motor Corp. - TM - close: 107.93 chg: -0.46 stop: 104.75

We warned readers to expect a dip today and TM delivered. The $107.50-107.00 level looks like it might offer short-term support. 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: + 1.25
Earnings Date 02/07/06 (confirmed)
Average Daily Volume = 438 thousand

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Valero Energy - VLO - close: 58.52 change: +0.84 stop: 53.49

VLO continued to move higher given the strength in crude oil and the oil sectors. We don't see any change from our previous updates. Our target is the $62.50-63.00 range. Today's move over $58.00 has produced a new P&F chart buy signal that points to a $69 target.

Picked on March 15 at $ 57.55
Change since picked: + 0.97
Earnings Date 05/02/06 (unconfirmed)
Average Daily Volume = 10.7 million
 

Put Updates

KB Home - KBH - close: 66.74 chg: +1.62 stop: 68.05

The economic data out this morning sparked a rally in bonds and that pushed the yields lower. Lower yields push down on mortgage rates and the homebuilders rallied on the session. More conservative traders may just want to exit early in KBH before we get stopped out. We not suggesting new put plays.

Picked on March 06 at $ 64.75
Change since picked: + 1.99
Earnings Date 03/22/06 (confirmed)
Average Daily Volume = 1.9 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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Encana Corp. - ECA - close: 48.11 chg: +0.71 stop: n/a

Oil stocks continued to rally and ECA added another 1.49%. Chart readers will note that it looks like ECA has broken out above its trendline of lower highs. 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: + 2.55
Earnings Date 02/15/06 (confirmed)
Average Daily Volume = 4.4 million

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Loews Corp. - LTR - close: 99.96 change: +1.05 stop: n/a

This is it! It's come down to the wire with LTR. The stock has rallied right up to resistance at the $100 level and tomorrow is the last day before March options expire. Position holders should be ready to sell the call side of this speculative strangle on any strength tomorrow to recoup some of our losses.

Picked on February 13 at $ 95.72
Change since picked: + 4.24
Earnings Date 02/16/06 (confirmed)
Average Daily Volume = 513 thousand

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Ryland Group - RYL - close: 69.31 change: +1.90 stop: n/a

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: - 5.88
Earnings Date 01/24/06 (confirmed)
Average Daily Volume = 1.1 million
 

Dropped Calls

Ultra Petrol. - UPL - close: 59.48 change: +0.99 stop: 53.49

Target achieved. Another strong day for oil helped push UPL toward resistance near $60.00 and its 50-dma. Our target was the $59.50-60.00 range and UPL hit an intraday high of $59.99.

Picked on March 14 at $ 55.05
Change since picked: + 4.43
Earnings Date 05/09/06 (unconfirmed)
Average Daily Volume = 1.7 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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