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Call Updates

The Andersons - ANDE - close: 41.59 chg: +0.58 stop: 37.49

The rebound in ANDE continues. The stock looks bullish given its bounce from technical support near its 200-dma a couple of weeks ago. This also coincided with a big bounce from rising support on its P&F chart. In the last two weeks shares of ANDE have broken out above is three-month trendline of resistance (lower highs) and its 50-dma. Last week's breakout over the $40 level has produced a new P&F chart buy signal that now points to a $56 target. We would still consider new bullish positions right here although buying a dip closer to $40.00 would be a more attractive entry point. More conservative traders might want to tighten their stops. Our target is the $44.50-45.00 range.

Suggested Options:
We are suggesting the October calls. You, the individual trader, should decide what month and strike price best suits your trading style and risk.

BUY CALL OCT 40.00 AQA-JH open interest=226 current ask $4.00
BUY CALL OCT 45.00 AQA-JI open interest= 11 current ask $1.55



Picked on August 28 at $ 40.26
Change since picked: + 1.33
Earnings Date 10/27/06 (unconfirmed)
Average Daily Volume = 900 thousand

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AstraZeneca - AZN - close: 65.43 change: +0.29 stop: 59.95

The DRG drug index is hitting new two-year highs and at the front of the pack is AZN, which hit a string of new all-time highs this past week. The stock has displayed significant relative strength and volume improved significantly Tuesday through Thursday last week. We're not suggesting new positions at this time. AZN actually looks a little short-term overbought and due for a dip. More conservative traders might want to both lock in some profits and raise their stop loss. We're thinking about raising our stop towards $62, which should be short-term support. Our target is the $68.00-69.00 range.

Suggested Options:
We are not suggesting new positions at this time.



Picked on August 20 at $ 62.99
Change since picked: + 2.44
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Cameco - CCJ - close: 41.73 change: +0.78 stop: 38.75 *new*

It turned out to be a decent week for shares of CCJ. The stock climbed more than six percent and volume began to improve on the Thursday-Friday breakout. As we mentioned earlier the rally past the $40.00 and 40.50 levels was a new bullish entry point in our book. Friday's 1.9% gain also marks a breakout past the August highs. We are only aiming for a run into the $44.50-45.00 range so we're not suggesting new plays at this time but a dip or bounce near $40 could be used as a new entry point. Please note that we're raising our stop loss to $38.75, which is under last week's support. FYI: The P&F chart shows a triple-top breakout buy signal with a $55 target.

Suggested Options:
We are not suggesting new positions at this time.



Picked on August 22 at $ 40.33
Change since picked: + 1.40
Earnings Date 07/28/06 (confirmed)
Average Daily Volume = 1.9 million

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Cognizant Tech. - CTSH - close: 69.74 chg: -0.17 stop: 68.45

Unfortunately, we are still urging caution on CTSH. The stock's position really hasn't changed much from Thursday but CTSH's failure to rally with the market's generally widespread strength on Friday is a big clue that the next move in CTSH might be down. Bigger picture CTSH has a bullish pattern and the P&F chart is bullish with a $92 target. Yet short-term the technicals have deteriorated on us and the MACD (on its daily chart) has actually produced a new sell signal. More conservative traders might want to tighten their stops or exit altogether. You could always re-enter if CTSH reverses higher. Speaking of entry points we would now wait for a move past $72.00 before considering new call positions. The only reason we are keeping the stock on the play list is because CTSH might bounce from its six-week trendline of support, especially if the markets move higher this week. Our target is the$76.50-77.00 range. We are leaving the stop loss at $68.45, which is under support at the late August low near $68.50.

Suggested Options:
We are not suggesting new positions at this time.



Picked on August 29 at $ 71.55
Change since picked: - 1.81
Earnings Date 11/01/06 (unconfirmed)
Average Daily Volume = 1.4 million

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Cymer Inc. - CYMI - close: 40.91 chg: -0.24 stop: 39.95

We are still sitting on the sidelines with our play in CYMI. The semiconductor sector pulled back for the second day in a row on Friday. The industry was leading the market higher during the first three days of last week. It was the sector strength that helped CYMI breakout again over resistance near $40.00 and its 50-dma. However, CYMI was unable to push past its exponential 200-dma near $42.00. We are suggesting a trigger to buy calls at $42.55. Overall CYMI and the SOX still look poised to move higher and the Thursday-Friday dip was probably just normal consolidation. If triggered in CYMI at $42.55 our target is the $47.00-48.00 range.

Suggested Options:
We are suggesting the October calls. Our trigger is at $42.55.

BUY CALL OCT 40.00 CQG-JH open interest=850 current ask $3.40
BUY CALL OCT 45.00 CQG-JI open interest=218 current ask $1.25



Picked on August xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.0 million

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Freeport McMoran - FCX - close: 59.36 chg: +1.15 stop: 54.95 *new*

The rally in metal and mining stocks continued on Friday. Traders should note that the XAU gold & silver index has a bullish pattern of higher lows and the sector index looks poised to breakout over resistance near the 150 level. FCX also has a bullish pattern of higher lows. More recently the stock retested support at its 200-dma and late this past week FCX broke out from its short-term trading range. Friday's 1.9% gain was a nice follow through, especially after traders bought the dip Friday morning at its rising 10-dma. Readers can choose to buy calls now following the breakout over $58.00 or wait for a breakout over $60.00. We've been warnings readers that we expected $60 to act as resistance the first time FCX tests it. Another dip may be in the cards. Our target is the $62.50-63.00 range but more aggressive traders may want to aim higher. The P&F chart shows a significant breakout over resistance and a $76 target. Please note that we're raising our stop loss to $54.95.

Suggested Options:
We are suggesting the October calls.

BUY CALL OCT 55.00 FCX-JK open interest= 335 current ask $5.80
BUY CALL OCT 60.00 FCX-JL open interest=2424 current ask $2.95



Picked on August 23 at $ 57.51
Change since picked: + 1.85
Earnings Date 10/17/06 (unconfirmed)
Average Daily Volume = 5.1 million

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MicroStrategy - MSTR - close: 91.61 chg: +0.41 stop: 88.99

There isn't any change from our Thursday update on MSTR. We're still in a wait and see mode and we remain cautious given the deterioration in the technical patterns. The six-week trend is still up but MSTR remains stuck under technical resistance at its 200-dma (and 100-dma). At this point in time we would wait for a breakout over $93.00 before considering new call plays. Currently our target is the $98.75-99.00 range.

Suggested Options:
We are not suggesting new plays at this time but if MSTR trades over $93.00 we'd suggest the October calls.



Picked on August 16 at $ 92.05
Change since picked: - 0.44
Earnings Date 10/27/06 (unconfirmed)
Average Daily Volume = 431 thousand

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Southern Peru Copper - PCU - close: 93.10 chg: +0.78 stop: 88.99

PCU is a new bullish play from our Thursday night newsletter. We do not see any changes so we're reposting the play description here:

Copper miners are on the move Thursday. The price of copper itself was moving higher on news that a labor strike in Chile might be ending soon. Meanwhile news of a merger between gold miners GG and GLG also contributed to strength in the mining sector. Shares of PCU are in the process of breaking out from a three-week sideways consolidation pattern. The new relative high Thursday actually produced a new triple-top ascending buy signal on the P&F chart. We are suggesting new call positions in PCU with the stock above $91.00 although more conservative traders may want to wait for a new move over $93.10 (Thursday's high). Our target is the $98.00-100.00 range. Please note that we're also adding PD, another copper mining stock, to the play list. We would suggest you choose to play just one not both stocks in the same sector.

Suggested Options:
We are suggesting the October calls.

BUY CALL OCT 90.00 PCU-JR open interest=355 current ask $7.10
BUY CALL OCT 95.00 PCU-JS open interest=319 current ask $4.50



Picked on August 31 at $ 92.32
Change since picked: + 0.78
Earnings Date 07/26/06 (confirmed)
Average Daily Volume = 1.5 million

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Phelps Dodge - PD - close: 90.75 change: +1.25 stop: 86.75

Our new call play on PD has been opened. The stock pushed past round-number resistance at $90.00 and hit our trigger to buy calls at $90.55. We don't see any changes from our Thursday night new play description so we're reposting it here:

We are adding PD for the same reasons we're adding PCU (see play above). The stock is moving higher on a rise in the commodity, which is rallying on news that a labor strike in Chile may be ending soon. The M&A activity between two gold miners on Thursday also contributed to bullish sentiment. Technicals are improving with the bounce this past week but we want to see a breakout over $90.00 first before we open plays. We're suggesting that traders use a trigger to buy calls at $90.55. If triggered our target is the $97.50-100.00 range. Please note that we're also adding PCU, another copper mining stock, to the play list. We would suggest you choose to play just one not both stocks in the same sector.

Suggested Options:
We are suggesting the October calls. Just a reminder - you, the individual trader, should decide which month and strike price best suits your trading style and risk.

BUY CALL OCT 85.00 DPB-JQ open interest=17882 current ask $9.20
BUY CALL OCT 87.50 DBP-JY open interest= 6912 current ask $7.60
BUY CALL OCT 90.00 DBP-JR open interest=13873 current ask $6.00
BUY CALL OCT 95.00 DBP-JS open interest=12201 current ask $3.70



Picked on September 01 at $ 90.55
Change since picked: + 0.20
Earnings Date 10/25/06 (unconfirmed)
Average Daily Volume = 6.7 million

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Piper Jaffray - PJC - close: 59.02 change: +0.44 stop: 53.99

PJC is still marching higher although the momentum definitely seems to be slowing. The stock has now posted its sixth gain in a row so shares are looking a little short-term overbought. Traders are probably thinking about locking in profits as the stock nears resistance at $60.00 and its 100-dma. We agree. Our readers should also be ready to exit. The stock is approaching our target in the $59.90-60.00 range but more conservative traders may want to lock in profits earlier near $59.50. We are not suggesting new plays at this time.

Suggested Options:
We are not suggesting new plays at this time.



Picked on August 20 at $ 55.70
Change since picked: + 3.32
Earnings Date 10/18/06 (unconfirmed)
Average Daily Volume = 300 thousand

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FreightCar Amer. - RAIL - cls: 60.05 chg: +1.85 stop: 54.95

The transports and the railroad stocks, as a group, did not see much of a bounce on Friday in spite of a pull back in crude oil again. Yet shares of RAIL enjoyed a strong session. The stock added over 3% on Friday following Thursday's bullish breakout over the 200-dma. Friday's session was also a bullish breakout over round-number resistance at $60.00 and volume improved on the rally. We said that Thursday's move was a new entry point and we're still suggesting new positions today. Our target is the $64.50-65.00 range. FYI: Friday's move helped RAIL produce a new ascending triple-top breakout buy signal on the P&F chart that currently points to a $79 target.

Suggested Options:
We are suggesting the October calls.

BUY CALL OCT 55.00 RQN-JK open interest= 12 current ask $7.40
BUY CALL OCT 60.00 RQN-JL open interest= 31 current ask $4.30
BUY CALL OCT 65.00 RQN-JM open interest= 65 current ask $2.00



Picked on August 20 at $ 59.13
Change since picked: + 0.92
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 475 thousand

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Ryland Group - RYL - close: 42.38 change: -0.29 stop: 39.95

Homebuilding stocks, including RYL, are still trading sideways even through the most recent economic data suggests that we will have a soft landing. Furthermore this would suggest that the FOMC may indeed choose to pass on further rates hikes and now there is talk of potentially cutting rates next year. A halt in rate hikes would be good news for the builders and mortgage lenders. Yet there has been no bullish follow through higher on what appears to be a bottom in the homebuilders in July and August. We are going to keep RYL as a bullish candidate for now. We're trying to catch a breakout over resistance at $45.00 and we're suggesting a trigger to buy calls at $45.15. If triggered then our target is the $49.90-50.00 range.

Suggested Options:
We're not suggesting new plays at this time. Wait for RYL to hit our trigger at $45.15. We would suggest the October calls.



Picked on August xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/18/06 (unconfirmed)
Average Daily Volume = 1.7 million

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United Ind. - UIC - close: 54.28 change: +0.41 stop: 49.45

Target achieved! UIC hit our primary target in the $54.75-55.00 range on Friday afternoon. Volume came in very low on the move. It was our suggestion that readers sold half or more of their position at the first target and then the rest at our secondary target at $57.50. Both UIC and the defense-sector index have been showing relative strength lately but now UIC is starting to look short-term overbought (up three weeks in a row) and due for a dip. We are not suggesting new positions at this time. If you are looking for an entry point wait for a potential dip to the 10-dma or the $52 level. The P&F chart points to a $64 target.

Suggested Options:
We are not suggesting new call positions at this time.



Picked on August 27 at $ 51.77
Change since picked: + 2.51
Earnings Date 08/01/06 (confirmed)
Average Daily Volume = 198 thousand

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VF Corp. - VFC - close: 70.42 change: +0.53 stop: 68.45

Good news! VFC's failed rally and bearish reversal pattern from Wednesday has been reversed. The stock broke out over resistance at $70.00 on news that the company will form a joint venture to sell its products in India. We're a little surprised that the rally was not stronger since India is such a large and growing marketplace. We are suggesting new positions with the move past $70.00. Our target is the $74.00-75.00 range. The P&F chart, with its triple-top breakout buy signal, points to a $90.00 target.

Suggested Options:
We are suggesting the October calls.

BUY CALL OCT 65.00 VFC-JM open interest= 60 current ask $6.60
BUY CALL OCT 70.00 VFC-JN open interest= 10 current ask $3.20
BUY CALL OCT 75.00 VFC-JO open interest= 77 current ask $1.20



Picked on August 30 at $ 70.25
Change since picked: + 0.17
Earnings Date 10/18/06 (unconfirmed)
Average Daily Volume = 567 thousand
 

Put Updates

Boeing - BA - close: 75.43 change: +0.53 stop: 78.05

There were a lot of headlines for BA on Friday. The good news was that BA helped deliver the first successful test of the missile defense system. The bad news was that NASA chose rival LMT over BA to build the next space exploration vehicle. Although if you read some of the articles the analyst suggest that BA will still participate in NASA's new program with LMT just leading the way. Shares of BA managed to bounce +0.7% on Friday but the rally stalled under short-term resistance at the $76.00 level. The overall pattern in BA remains bearish but we're not going to suggest new put plays given the bullish attitude in the major indices. More conservative traders may want to tighten their stops or exit early since the DFI defense sector looks poised for a bullish breakout.

Suggested Options:
We are not suggesting new plays at this time.



Picked on August 10 at $ 75.75
Change since picked: - 0.32
Earnings Date 10/25/06 (unconfirmed)
Average Daily Volume = 4.2 million

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Chipotle Mex Grill - CMG - close: 50.69 chg: +1.35 stop: 52.55

Bulls came back strong on Friday in shares of CMG. The Wednesday-Thursday pattern looked like a failed rally/bearish reversal pattern and we said the drop under $50 looked like a new entry point to buy puts. Yet CMG failed to see any follow through lower. Friday's session produced a 2.7% gain for CMG and pushed shares back above round-number support/resistance at $50.00. The three-month pattern is still bearish with the trend of lower highs but we are not suggesting new plays with CMG above $50. Our target is the $45.50-45.00 range. The P&F chart is still bearish and points to a $39 target.

Suggested Options:
We are not suggesting new plays at this time.



Picked on August 09 at $ 50.28
Change since picked: + 0.41
Earnings Date 10/30/06 (unconfirmed)
Average Daily Volume = 414 thousand

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EOG Resources - EOG - close: 65.94 chg: +1.12 stop: 66.55

Oil stocks, especially oil service stocks, managed to bounce on Friday in spite of another decline in crude oil futures. We do not see any changes from our Thursday night new play description for EOG so we're reposting it here:

EOG is testing significant support. The end of the summer driving season, the technical breakdown in crude oil, is weighing on the oil sector. The recent weakness has pulled EOG down to a pivotal level. EOG has found support near $64.00 over the last two months, which coincidentally is now bolstered by a rising trendline of support on the stock's Point & Figure chart. Trading over the last several weeks has also produced a bearish head-and-shoulders pattern with the neckline at the $64.00 level. If EOG breaks under $64.00 it would also produce a triple-bottom breakdown sell signal on the P&F chart. We want to catch the breakdown so we're suggesting a trigger to buy puts at $63.85. Our target is the $57.50-55.00 range. The biggest risk we see with this play is the situation with Iran. The country has defied the U.N.'s demand to stop enriching uranium. The next move by the U.N. is supposed to be sanctions. We do not know how the world, the markets, Iran and more importantly crude oil prices will react to sanctions actually being applied. The rhetoric that is sure to come from Iran if sanctions are used could push oil higher, which would be risky for a put play on any oil stock. Furthermore, if there is any military action against Iran (and probably coming out of Iran) then oil should significantly spike higher, which again would put this play in danger!

Suggested Options:
We are suggesting the October puts.

BUY PUT OCT 65.00 EOG-VM open interest=5070 current ask $3.20
BUY PUT OCT 60.00 EOG-VL open interest=7084 current ask $1.50



Picked on August xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 3.4 million

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Intuitive Surgical - ISRG - cls: 95.05 chg: +0.65 stop: 96.05

Traders are still undecided what direction they're going with ISRG. The six-week consolidation has been more sideways than down and the stock is coming close to breaking out past its short-term trendline of resistance. We're a little surprised that ISRG did not rally higher on Friday given the positive economic news and the market's reaction to the news. At this time we're not suggesting new put plays and given the market's recent strength it might be a good time to exit early. FYI: The P&F chart is still bearish and points to a $60 target.

Suggested Options:
We are not suggesting new plays at this time.



Picked on August 10 at $ 94.90
Change since picked: + 0.15
Earnings Date 10/25/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Johnson Controls - JCI - close: 72.65 chg: +0.72 stop: 75.51

Thursday's bullish reversal in JCI has been confirmed. We warned readers that JCI produced a bullish engulfing candlestick pattern and a bounce from round-number support at $70.00 on Thursday. We also stated our opinion that the stock would likely bounce back toward the $75 region before encountering resistance. Friday's gain proved to be a breakout past the simple 10-dma and the short-term technical indicators are definitely improving (if you're a bull). We are not suggesting new plays at this time. Wait for a failed rally under $75 before considering new put positions. FYI: The P&F chart, with its triple-bottom breakdown sell signal, points to a $61 target.

Suggested Options:
We are not suggesting new plays at this time.



Picked on August 22 at $ 72.96
Change since picked: - 0.31
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 1.3 million

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Radian Group - RDN - close: 60.53 chg: +0.65 stop: 61.51

We are still waiting on the sidelines with RDN. The stock has been a big winner from its 2005 lows. Yet over the last few months RDN has produced a big, bearish double-top pattern. Over the last few weeks the stock produced a bearish head-and-shoulders pattern. In late August the stock broke down under support at the neckline to the H&S pattern but failed to breakdown below technical support at its rising 200-dma. That's why we are suggesting readers wait for more confirmation of the breakdown below buying puts. Our preferred entry point is with a trigger at $58.99. If we are triggered our target is the $55.15-55.00 range.

Suggested Options:
We are suggesting the October puts if triggered.

BUY PUT OCT 65.00 RDN-UM open interest= 35 current ask $4.80
BUY PUT OCT 60.00 RDN-UL open interest=2534 current ask $0.95
BUY PUT OCT 55.00 RDN-UK open interest=1898 current ask $0.25



Picked on August xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/18/06 (unconfirmed)
Average Daily Volume = 722 thousand
 

Strangle Updates

None
 

Dropped Calls

None
 

Dropped Puts

Transocean Inc. - RIG - cls: 71.08 chg: +4.33 stop: 70.25

We have been stopped out of RIG at $70.25. Friday was a big day for RIG. The company announced two new contracts. Meanwhile news also hit the wires that RIG had won its patent infringement lawsuit. Bears panicked and the stock gapped open higher at $68.10 and then spiked over resistance near $70.00. This should only be a partial loss sine RIG has hit our initial target at $65.25 multiple times.



Picked on August 07 at $ 69.49
Change since picked: + 1.59
Earnings Date 08/03/06 (confirmed)
Average Daily Volume = 6.4 million
 

Dropped Strangles

None
 

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