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Call Updates

Arch Cap. Grp. - ACGL - cls: 59.20 chg: -0.07 stop: 55.95

ACGL dipped this morning but shares were on the rebound by the closing bell. We don't see any changes from our previous updates. Our target is currently the $62.50-63.00 range but we plan to exit ahead of the April 27th earnings report. ACGL is announcing after the closing bell.

Picked on April 03 at $ 58.15
Change since picked: + 1.05
Earnings Date 04/27/06 (confirmed)
Average Daily Volume = 195 thousand

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Amerada Hess - AHC - close: 148.13 chg: -0.49 stop: 141.65

Thursday proved to be a somewhat volatile day for AHC. The stock saw some selling early on but managed a rebound from the $144.50 region. Unfortunately, shares remain under resistance at the $150 level. Our target is the $154.00-155.00 range. We do not want to hold over the April 26th earnings report.

Picked on April 05 at $146.51
Change since picked: + 1.62
Earnings Date 04/26/06 (confirmed)
Average Daily Volume = 1.5 million

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Cleveland Cliffs - CLF - close: 89.95 chg: -4.16 stop: 92.45

Whew! Thank goodness for triggers. In spite of strong earnings reports from two companies in the metals and steel sector investors decided to lock in gains and CLF was also hit by profit taking. We remain on the sidelines with a trigger to buy calls at $95.05. However, if CLF doesn't rebound soon we'll probably drop the stock as a bullish candidate.

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/26/06 (confirmed)
Average Daily Volume = 650 thousand

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Cummins - CMI - close; 109.99 chg: -1.78 stop: 104.99

CMI also suffered some profit taking today and shares lost 1.59%. While the stock closed near previous resistance, now new support, at the $110 level we suspect that CMI will see a dip toward the $109.00-109.25 region before bouncing higher. Our target is the $112.00-112.50 range. More aggressive traders may want to aim higher (say $115.00) but keep in mind we do not want to hold over the earnings report next Friday, April 28th.

Picked on April 16 at $106.75
Change since picked: + 3.24
Earnings Date 04/28/06 (confirmed)
Average Daily Volume = 804 thousand

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Lehman Brothers - LEH - close: 155.26 change: -0.06 stop: 144.45

We see no change from our previous updates on LEH. More conservative traders may want to lock in gains right here. We are suggesting that readers consider selling half their positions at $153.00 and then sell the second half of their position at $159.00. Don't forget that LEH is due to split 2-for-1 on May 1st.

Picked on March 22 at $144.61
Change since picked: +10.65
Earnings Date 06/14/06 (unconfirmed)
Average Daily Volume = 2.0 million

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Acc. Home Lenders - LEND - cls: 55.40 chg: -1.17 stop: 51.99

LEND displayed some early weakness this morning after the stock was downgraded. However, traders were quick to buy the dip in the $53.50-54.00 region, which as broken resistance, is now acting as new support. We see the bounce from the $54 region as a new bullish entry point to buy calls. The H&S pattern points to a $61.00 target. We're going to aim for a rally into the $59.75-60.00 range. We do not want to hold over the May 2nd earnings report and that gives us about two weeks.

Picked on April 19 at $ 56.57
Change since picked: - 1.17
Earnings Date 05/02/06 (confirmed)
Average Daily Volume = 693 thousand

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Marvell Tech. - MRVL - close: 60.99 chg: +0.10 stop: 55.99

Momentum in the semiconductor sector stalled today since many investors and analyst firms seemed to be disappointed with Intel's earnings report last night. We are not suggesting new bullish positions in MRVL at the moment. Our target is the $65.50-66.00 range.

Picked on April 06 at $ 60.18
Change since picked: + 0.81
Earnings Date 05/25/06 (unconfirmed)
Average Daily Volume = 5.9 million
 

Put Updates

Overseas Shipping - OSG - cls: 48.73 chg: -0.26 stop: 50.01

OSG produced another failed rally under its descending 50-dma this morning. This might be a new bearish entry point but we are still suggesting that readers wait for a decline under $48.50 before considering new put positions. Our target is the $43.00-42.50 range. We do not want to hold over the early May earnings report.

Picked on April 11 at $ 48.10
Change since picked: + 0.63
Earnings Date 05/02/06 (unconfirmed)
Average Daily Volume = 469 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: 50.50 chg: -0.62 stop: n/a

Tomorrow is the last day before April options expire. It's our last chance to exit and hopefully recoup some of our trading capital. Our strangle strategy involves the April $50 calls (ECA-DJ) and the April $40 puts (ECA-PH). Our estimated cost is $3.45.

Picked on January 10 at $ 45.56
Change since picked: + 4.94
Earnings Date 02/15/06 (confirmed)
Average Daily Volume = 4.4 million

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Ryland Group - RYL - close: 69.37 change: +0.79 stop: n/a

As expected RYL reported earnings this morning. The company beat estimates by 12 cents but then issued a warning going forward. The warning prompted the stock to gap lower but shares rebounded pretty quickly. Nimble traders might have been able to sell on the dip lower today. We see the intraday rebound as the last nail into the coffin of a dead strangle play. Our play involves the April $80 calls (RYL-DP) and the April $70 puts (RYL-PN). April options expire this week.

Picked on January 22 at $ 75.19
Change since picked: - 5.82
Earnings Date 04/20/06 (confirmed)
Average Daily Volume = 1.1 million
 

Dropped Calls

None
 

Dropped Puts

Express Scripts - ESRX - close: 86.20 chg: +1.80 stop: 86.51

We have been stopped out at $86.51. Wednesday's afternoon bounce continued this morning and ESRX rallied to $87.64 past resistance at the $86.00 mark. Overall the two-month bearish trend remains in place and this might be a new bearish entry point but the technical indicators giving mixed signals. Considering the bullishness in the market right now we'd hesitate to consider new put positions.

Picked on April 09 at $ 85.39
Change since picked: + 0.81
Earnings Date 04/26/06 (confirmed)
Average Daily Volume = 1.6 million

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Reynolds American - RAI - cls: 106.84 chg: +1.19 stop: 106.75

Investors responded positively to Altria Group's (MO) earnings report and the sentiment carried over into RAI, which hit our stop loss at $106.75.

Picked on April 09 at $104.97
Change since picked: + 1.87
Earnings Date 04/26/06 (unconfirmed)
Average Daily Volume = 637 thousand
 

Dropped Strangles

None
 

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