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Call Updates

Cymer Inc. - CYMI - close: 43.84 chg: +0.53 stop: 41.95

Tech stocks erased a lot of their gains from Wednesday. The SOX index fell 1.7% and shares of CYMI slipped 1.2%. What worries us is that the technical indicators on the SOX are turning bearish. The SOX's MACD indicator has produced a new sell signal and the MACD for CYMI is nearing its own sell signal. More conservative traders may want to exit early right here to avoid or minimize any losses. However, we're choosing to keep the play open for now because the SOX has potential support at the 450 level just as CYMI has potential support at the $42.00 level. A breakdown in the SOX under 450 will likely pull CYMI under $42. We are not suggesting new plays at this time.

Picked on September 06 at $ 42.55
Change since picked: + 1.29
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.0 million

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Hartford Finc. - HIG - close: 85.60 chg: -1.25 stop: 84.95 *new*

Uh-oh! Reversal alert! Tuesday's intraday bounce and Wednesday's rally in HIG looked relatively bullish but today's reversal is a big warning flag. Considering our less than optimistic outlook on the markets for the next few weeks we are seriously suggesting that more conservative traders cut their losses right here and exit early! We are going to up our stop loss to $84.95 that means if HIG trades under Tuesday's low then odds are good we'll be stopped out. We're not suggesting new positions.

Picked on September 12 at $ 86.29
Change since picked: - 0.69
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume = 1.4 million

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Manpower - MAN - close: 60.47 chg: -0.32 stop: 59.45 *new*

Volume shrank to about one-third MAN's average volume as the stock consolidated in a narrowing sideways action on Thursday. We remain cautious. MAN has resistance at the 100-dma overhead and support at its 10-dma just below it. A breakout is coming and MAN will move through one of these levels soon. We're going to raise our stop loss again to $59.45, which is under Tuesday's low and the 10-dma.

Picked on September 12 at $ 60.28
Change since picked: + 0.19
Earnings Date 10/18/06 (unconfirmed)
Average Daily Volume = 900 thousand

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Mettler Toledo - MTD - close: 64.20 chg: -0.30 stop: 61.99

There is no change from our previous update on MTD. Yesterday we suggested that conservative traders exit early since it's our expectation that MTD will slip back toward what should be support in the $62.00-62.50 region. It is interesting to see how the stock bounced from its initial test of the rising 10-dma today. We're not suggesting new positions. Please note that we normally try to avoid playing stocks with average volume this low so traders may want to consider this a higher-risk play. We do not want to hold over the late October earnings report.

Picked on September 13 at $ 63.66
Change since picked: + 0.54
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 169 thousand

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Omnicom - OMC - close: 91.40 chg: +0.12 stop: 89.75

OMC produced some relative strength today but the stock is still struggling to breakout (again) past the 10-dma. We are not suggesting new positions at this time. A dip back toward what should be support near $90 is still a big possibility.

Picked on September 10 at $ 90.97
Change since picked: + 0.43
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.1 million
 

Put Updates

Caterpillar - CAT - close: 64.54 chg: -1.34 stop: 67.36

Ding! Our play in CAT is now open. The stock displayed relative weakness on yesterday and today saw more selling pressure with a breakdown under support near $65.00. We had a suggested trigger to buy puts at $64.59 so the play is now open. Volume on today's 2% decline was above average and a good sign for the bears. Our initial target is the $60.25-60.00 range.

Picked on September 21 at $ 64.59
Change since picked: - 0.05
Earnings Date 10/20/06 (unconfirmed)
Average Daily Volume = 5.2 million

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EOG Resources - EOG - close: 62.50 chg: +1.51 stop: 64.15

Crude oil futures have been pretty oversold recently and today oil produced an oversold bounce. This ignited some buying/short covering in the oil stocks. Shares of EOG added 2.4% on strong volume. That's not good news for the bears. Chart readers will note that the rally stalled at resistance near $64.00 but the technical picture is starting to turn more bullish for EOG. We are not suggesting new positions at this time! If oil bounces again tomorrow we may be stopped out.

Picked on September 06 at $ 63.85
Change since picked: - 1.35
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 3.3 million

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Express Scripts - ESRX - close: 81.03 chg: -2.91 stop: 82.51

Wal-Mart (WMT) created some excitement (or fear) in the retail drug market today. WMT, the retail titan that it is, announced it was starting something of a pilot program to provide 300 generic drugs for only $4 a prescription on a normal 30-day supply. The company plans to widen this program to several states next year. The retail drug store stocks were hit hard today (LDG, RAD, CVS, WAG) with CVS and WAG getting crushed. Shares of pharmacy benefit managers like ESRX also traded down in sympathy this morning. Shares of ESRX plunged at the open from $83.42 to $78.50 before bouncing back. We had a suggested trigger to buy puts at $79.85 so the play is now open. However, we have to urge caution. The breakdown was only intraday and the bounce back above support near $80 and its 50-dma is bad news for the bears (and put holders). The overall pattern looks bearish after a multi-week trading range but we would not suggest new positions until ESRX traded back below the $80 level again. Our target is the $75.50-75.00 range.

Picked on September 21 at $ 79.85
Change since picked: + 1.18
Earnings Date 10/25/06 (unconfirmed)
Average Daily Volume = 1.6 million

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Johnson Controls - JCI - close: 69.19 chg: -2.12 stop: 74.16

The market weakness helped JCI continue lower. Shares lost 2.9% and broke down (again) under round-number support at the $70.00 level. Shares are nearing our target in the $68.50-67.50 range but more aggressive traders may want to aim lower (maybe $66-65).

Picked on August 22 at $ 72.96
Change since picked: - 3.77
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 1.3 million

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Jacobs Engineering - JEC - cls: 73.26 chg: -2.28 stop: 80.15

JEC continues to plummet. The stock is now down six days in a row and volume came in very strong on today's 3% loss. JEC has lost almost 8% since we picked it as a put play and traders may want to seriously consider locking in a gain right here. Our target is the $72.50-70.00 range.

Picked on September 18 at $ 79.45
Change since picked: - 6.19
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume = 416 thousand

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Joy Global - JOYG - close: 33.00 change: -1.81 stop: 37.01*new*

JOYG has been showing relative weakness the last couple of days. Yesterday the stock broke support and hit our trigger to open plays at $34.95. Today saw another 5.19% decline on strong volume. We are inching our stop loss down toward the 10-dma at $37.01. Our target is the $30.50-30.00 range.

Picked on September 20 at $ 34.95
Change since picked: - 1.95
Earnings Date 11/30/06 (unconfirmed)
Average Daily Volume = 2.6 million

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Las Vegas Sands - LVS - close: 66.41 change: +1.15 stop: 70.05

LVS got a bit of a bounce this morning but the rally ran out of steam near $68 region and its 10-dma. This could be a new entry point to buy puts although more conservative traders may want to wait for a new move under $65.50 before opening positions. Our target is the $60.50-60.00 range. We do not want to hold over the early November earnings report.

Picked on September 19 at $ 65.99
Change since picked: + 0.42
Earnings Date 11/01/06 (unconfirmed)
Average Daily Volume = 2.2 million

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Nucor - NUE - close: 47.67 change: -1.07 stop: 50.01

The oversold bounce in NUE also seems to be running out of gas. More aggressive traders may want to consider positions now or on a move under today's low (46.81). We're still suggesting that readers wait for a drop under support near $46.00. Our trigger to open put plays is at $45.95. If triggered our target is the $40.50-40.00 range. We do not want to hold over the mid October earnings report.

Picked on September xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 4.2 million

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Steel Dynamics - STLD - close: 49.97 chg: -1.50 stop: 52.05

On your mark! Get set! Shares of STLD look like they are in the runner's crouch set to spring into a new leg lower. The stock dipped toward support near $49.50 this morning but failed to hit our trigger to open plays at $49.40. If triggered our target is the $45.15-45.00 range. We do not want to hold over the mid October earnings report.

Picked on September xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 1.5 million
 

Strangle Updates

None
 

Dropped Calls

Beazer Homes - BZH - close: 38.74 change: -0.91 stop: 38.49

The market pull back on Thursday encouraged more profit taking in the homebuilders. The DJUSHB home construction index lost 2% and shares of BZH under performed its peers with a 2.29% loss. The stock actually closed under its simple 10-dma and shares look poised to drop toward recent support near $36.00. We are going to exit early right here to cut our losses. We would keep an eye on the $36.00 level and the $41.00 level. A breakout move past either might be considered an entry point (puts on a breakdown, calls on a breakout higher).

Picked on September 18 at $ 40.75
Change since picked: - 2.01
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume = 1.2 million

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United Ind. - UIC - close: 53.04 change: -1.57 stop: 51.77

We are throwing in the towel on UIC. Today's trading action was pretty bearish with a failed rally and a bearish engulfing candlestick pattern (normally viewed as a bearish reversal). Today's decline also broke a few levels of technical support. Odds are very good that UIC will consolidate back down toward what should be support near $50.00 and its 200-dma. Please note that UIC had already hit our initial target in the $54.75-55.00 range more than once.

Picked on August 27 at $ 51.77
Change since picked: + 1.27
Earnings Date 08/01/06 (confirmed)
Average Daily Volume = 198 thousand
 

Dropped Puts

None
 

Dropped Strangles

None
 

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