Option Investor
Play Updates

In Play Updates and Reviews

Printer friendly version

Call Updates

Dominion - D - close: 77.23 change: +0.73 stop: 74.49

The U.S. markets may not have seen any follow through on Wednesday's gains but shares of D did. The stock added another 0.95% but on below average volume. We remain bullish but if the major indices continue to be weak then we would expect D to likely pull back and retest broken resistance near $76.00 as new support. Traders can use a dip to or bounce from $76 as a new entry point. Our target is the $81.00-82.00 range although more conservative types may want to exit near $80.00. Please note that we do not want to hold over D's early August earnings report.

Picked on July 17 at $ 76.05
Change since picked: + 1.18
Earnings Date 08/03/06 (confirmed)
Average Daily Volume = 1.5 million


Fortune Brands - FO - close: 71.68 change: -0.42 stop: 69.74

There was no follow through in shares of FO today. The stock continues to struggle with short-term resistance near $73. We're starting to noticed that the MACD and the RSI on the daily chart might be hinting at a bearish roll over soon. We would expect shares of FO to pull back toward the $71 level tomorrow and possibly the $70 region. We're not suggesting new positions at this time and more conservative traders may want to exit early to minimize any losses. Our target is the $74.75 level but FO has to push past the 50-dma first.

Picked on July 06 at $ 71.30
Change since picked: + 0.38
Earnings Date 08/01/06 (confirmed)
Average Daily Volume = 674 thousand

Put Updates

Alcon Inc. - ACL - close: 93.50 chg: +0.26 stop: 97.65*new*

ACL managed a decent bounces from its lows near $91.80 this morning. The move looks like a short-term bullish reversal. We would expect ACL to try and rally back toward the simple 10-dma overhead near 96.00-96.25. A failed rally anywhere under $97.50 could be used as a new entry point to buy puts but unfortunately, we're quickly running out of time. We do not want to hold over the July 24th earnings report. At this time we're planning to exit on Monday afternoon to avoid the earnings report. Please note we're adjusting our stop loss to $97.65.

Picked on July 13 at $ 95.61
Change since picked: - 2.11
Earnings Date 07/24/06 (confirmed)
Average Daily Volume = 805 thousand


Air Products Chem. - APD - cls: 61.72 chg: -1.75 stop: 64.01*new*

APD experienced a somewhat dramatic bearish reversal today. The stock lost 2.75% that more than erased Wednesday's gains. The close back under $62.00 and its simple 200-dma looks like a new bearish entry point. However, before you open new positions keep in mind that our target is the $59.00-58.00 range and we do not want to hold over the July 26th earnings report next week. We are going to adjust our stop loss to $64.01.

Picked on July 09 at $ 62.95
Change since picked: - 1.23
Earnings Date 07/26/06 (confirmed)
Average Daily Volume = 1.2 million


Apollo Group - APOL - close: 46.63 chg: -2.68 stop: 50.05 *new*

APOL also experienced a sharp reversal today. The stock lost 5.4% on above average volume. Shares have now closed under the March 2006 lows and APOL looks poised to hit our target in the $45.50-45.00 range soon. The P&F chart's bearish target has moved from $40 to $38. We are adjusting our stop loss to $50.05.

Picked on July 09 at $ 49.92
Change since picked: - 3.29
Earnings Date 09/19/06 (unconfirmed)
Average Daily Volume = 1.4 million


IDEXX Labs - IDXX - close: 74.85 chg: -0.06 stop: 76.05

There are no changes from our previous updates on IDXX. We're not suggesting new plays and we're repeating our suggestion to exit early. Our conservative target at $75.25 has already been hit and we're aiming for the $72.00 level.

Picked on June 12 at $ 77.95
Change since picked: - 3.10
Earnings Date 07/28/06 (confirmed)
Average Daily Volume = 144 thousand


Jacobs Engineering - JEC - cls: 71.77 chg: -2.69 stop: 76.55

JEC witnessed zero follow through on yesterday's bounce. Today's decline produces a bearish failed rally under the stock's 200-dma and 10-dma. Our short-term target is the $69.00 level but traders may want to use today's move as a new entry point to buy puts and aim lower. Just remember that JEC is due to report earnings on July 25th and we do not want to hold over the report.

Picked on July 16 at $ 73.75
Change since picked: - 1.98
Earnings Date 07/25/06 (confirmed)
Average Daily Volume = 583 thousand


Panera Bread - PNRA - close: 58.25 chg: -1.76 stop: 62.01

PNRA is still sinking. The stock lost another 2.9% today on strong volume, which is definitely bearish, but it's worth noting that stock does look oversold. We remain negative and continue to target the $55.50-55.00 range. We do not want to hold over the July 25th earnings report.

Picked on July 18 at $ 59.49
Change since picked: - 1.24
Earnings Date 07/25/06 (confirmed)
Average Daily Volume = 494 thousand

Strangle Updates


Dropped Calls

EOG Resources - EOG - close: 67.99 change: +1.11 stop: 69.90

The oil sectors were unable to trade higher in spite of a bounce in the price of crude oil today. Shares of EOG failed to see any follow through as well and the stock posted a failed rally under its simple 10-dma. It was our plan to go long at $72.55 but EOG is quite a ways off from hitting our trigger so we're dropping the stock as a bullish candidate.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/01/06 (confirmed)
Average Daily Volume = 3.5 million


PetroChina - PTR - close: 108.86 chg: -1.74 stop: 107.49

Abandon ship! Our trigger to buy calls on PTR was at $111.55 and the spike higher this morning snagged our trigger before turning lower again. Thursday's failed rally has PTR headed for a drop toward the 50-dma and 100-dma near $106.50. A decline that low would stop us out at $107.49. Aggressive traders may want to widen their stops to give PTR enough room to bounce from the $106 region. The lack of follow through in the markets today and the oil stocks does not inspire any confidence in us and we do not want to widen our stop. Instead we're choosing to cut our losses and close the play early. We could re-enter later if PTR turns higher again or consider put plays if PTR trades under $106 or $105.

Picked on July 20 at $111.55
Change since picked: - 2.69
Earnings Date 08/16/06 (unconfirmed)
Average Daily Volume = 708 thousand


Reynolds American - RAI - close: 123.71 chg: +3.39 stop: 117.45

Target achieved. Investors may have ignored RAI during yesterday's big rally but they came back in a hurry today. The stock rallied to $124.60 this afternoon. Our target was the $124.50-125.00 range. Don't forget that RAI is due to report earnings on July 26th and due to split 2-for-1 on August 14th.

Picked on July 17 at $120.20
Change since picked: + 3.51
Earnings Date 07/26/06 (confirmed)
Average Daily Volume = 636 thousand

Dropped Puts

Caterpillar - CAT - close: 69.08 chg: -2.04 stop: 72.31

CAT's 2.8% decline on Thursday more than erased its gains from the big rally yesterday. The move today was fueled by above average volume and the stock looks poised to move lower. We're exiting per our plan to avoid holding over the company's earnings report, which is due out tomorrow. Wall Street's estimates are for $1.42 a share.

Picked on July 12 at $ 71.31
Change since picked: - 2.23
Earnings Date 07/21/06 (confirmed)
Average Daily Volume = 5.1 million

Dropped Strangles


Play Update Archives