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Call Updates

General Dynamics - GD - close: 73.45 change: +1.78 stop: 69.94

Monday proved to be a strong day for GD. The stock added 2.48% thanks to some positive analyst comments. This is another new all-time high for GD. At this time we're still not suggesting new positions. We do need to make a correction from our weekend update, which said our target was the $75-75 range. That was supposed to read that our target was the $74.50-75.00 range. We do not want to hold over the mid October earnings report.

Picked on September 24 at $ 70.61
Change since picked: + 2.84
Earnings Date 10/18/06 (unconfirmed)
Average Daily Volume = 1.3 million

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Mettler Toledo - MTD - close: 66.01 chg: -0.14 stop: 63.45

Shares of MTD traded sideways on Monday. We do not see any changes from our weekend update. Currently our target is the $68-69 range. We do not want to hold over the late October earnings report.

Picked on September 13 at $ 63.66
Change since picked: + 2.35
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 169 thousand

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Omnicom - OMC - close: 93.36 chg: -0.24 stop: 89.89

We do not see any changes from our weekend update. Another bounce from $92.00 still looks like the next entry point to consider bullish positions. Our target is the $96.00-97.00 range. We do not want to hold over the late October earnings.

Picked on September 10 at $ 90.97
Change since picked: + 2.39
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.1 million
 

Put Updates

Caterpillar - CAT - close: 65.36 chg: -0.44 stop: 67.36

Momentum in shares of CAT is rolling over and bears appear to be gaining the upper hand again. The intraday chart for CAT shows a mini-head-and-shoulders pattern, which is bearish. We are still suggesting that readers wait for a new decline under $65.00 before considering new put option positions. Our target is the $60.25-60.00 range but more aggressive traders may want to aim lower. We do not want to hold over the late October earnings report.

Picked on September 21 at $ 64.59
Change since picked: + 0.77
Earnings Date 10/20/06 (unconfirmed)
Average Daily Volume = 5.2 million

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Chipotle - CMG - close: 49.00 change: -0.67 stop: 52.61

Weakness in CMG continued into the first day of the fourth quarter. The stock failed to breakout over the $50 level again and lost 1.3% by the close. Our target is the $45.50-45.00 range. We do not want to hold over the late October earnings report.

Picked on September 28 at $ 49.45
Change since picked: - 0.45
Earnings Date 10/30/06 (unconfirmed)
Average Daily Volume = 459 thousand

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Monster - MNST - close: 37.16 change: +0.97 stop: 37.55

Positive analyst comments on MNST fueled a surge to $38.30 by midday but the stock failed to hold a good portion of its gains. The move looks like a failed rally but we're going to stick to our plan. We are suggesting a trigger to buy puts at $34.65, which is under the June 2006 low. If triggered our target is the $30.50-30.00 range. If you study the weekly chart you'll notice a long-term trendline of support stretching out just above the $30 level. More conservative traders might want to exit earlier near $31.00. We do not want to hold over the late October earnings report.

Picked on September xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/25/06 (unconfirmed)
Average Daily Volume = 1.6 million

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Maxim Integrated - MXIM - close: 27.77 chg: -0.31 stop: 30.05

The SOX semiconductor index is creeping closer to a bearish breakdown from its rising bullish channel. Meanwhile MXIM is also showing relative weakness with a 1.1% decline and another close under the $28.00 level. This looks like another entry point to buy puts on MXIM but keep a sharp eye on the SOX. If the SOX bounces over 465 it might be time to exit early in MXIM. Our target for MXIM is the $24.00 level.

Picked on September 25 at $ 27.90
Change since picked: - 0.13
Earnings Date 11/03/06 (unconfirmed)
Average Daily Volume = 5.4 million

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FreightCar Amer. - RAIL - close: 52.50 chg: -0.50 stop: 56.32

The rally in transports and railroads continued to struggle and shares of RAIL lost another 0.9%. We do not see any changes from our weekend update on RAIL. Right now we're suggesting two targets because RAIL appears to have some support near $50.00. We suggest selling half or more of your position at our first target in the $50.25-50.00 range. Sell the rest at our second target in the $46.00-45.00 range. The P&F chart points to a $42 target.

Picked on September 21 at $ 54.50
Change since picked: - 2.00
Earnings Date 10/26/06 (confirmed)
Average Daily Volume = 353 thousand

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Sears Holding - SHLD - close: 157.39 chg: -0.70 stop: 162.05

SHLD attempted a midday rally but the stock reversed course after peaking at $160.64. This relative weakness is a good sign for the bears. The stock is already under performing its peers in the RLX over the last several days and there was talk today that rise in retail stocks has already accounted for a strong September. Thus the same-store sales numbers that come out on Wednesday-Thursday this week might be anti-climactic (but we should still expect some volatility in the group). We continue to suggest puts at this level. More conservative traders might want to use a trigger under $157 to open positions. SHLD may be volatile but we are going to try and limit our risk with a stop loss at $162.05. If you're feeling more cautious then consider tightening yours toward $161 instead. We believe that SHLD can trade near the $150 level but we're going to use a target in the $152.50-150.00 range. We do not want to hold over the mid November earnings report.

Picked on October 01 at $158.09
Change since picked: - 0.70
Earnings Date 11/16/06 (unconfirmed)
Average Daily Volume = 1.8 million

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SanDisk - SNDK - close: 53.20 chg: -0.34 stop: 56.06

SNDK produced some strength this morning but it quickly ran out of momentum and shares faded back toward the $53 level and its converging 50-dma, 100-dma and exponential 200-dma. We remain bearish. Our target is the $52.00-51.00 range. More aggressive traders may want to aim lower since the P&F chart points to a $45 target. Be advised that the $50 level has proven to be support in the past.

Picked on September 22 at $ 56.69
Change since picked: - 3.49
Earnings Date 10/19/06 (confirmed)
Average Daily Volume = 9.9 million

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U.S.Steel - X - close: 57.31 chg: -0.37 stop: 60.05

It was a quiet day for X. The stock traded sideways inside a $1.00 range. We do not see any changes from our weekend update. The larger pattern is still bearish with a steady trend of lower highs and technical resistance at the 50-dma overhead. Aggressive traders may want to consider new positions here. We would prefer to wait for a new decline under $56.00 before opening new plays. Cautious traders may want to tighten their stop loss a point or two. Our target is the $50.25-50.00 range.

Picked on September 22 at $ 55.95
Change since picked: + 1.42
Earnings Date 10/31/06 (confirmed)
Average Daily Volume = 4.4 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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Boston Properties - BXP - close: 103.23 chg: -0.11 stop: n/a

There are no changes from our weekend play description for BXP. The stock is still inside our suggested entry range for strangle positions. We are suggesting $102.00-103.50 entry range to begin strangle positions. Our suggested options are the October $105 call (BXP-JA) and the October $100 put (BXP-VT). Our estimated cost is about $1.90. We're suggesting an exit if either option rises to $3.80 or higher. Remember, this is an aggressive play due to our three-week time frame. October options expire in three weeks.

Picked on October 01 at $103.34
Change since picked: - 0.11
Earnings Date 10/24/06 (confirmed)
Average Daily Volume = 694 thousand

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Google - GOOG - close: 401.44 chg: -0.46 stop: n/a

Monday proved to be rather quiet for GOOG, whose shares displayed a real lack of volatility. We don't see any changes from our new play description from the weekend. GOOG is still trading inside our suggested entry range of $395.00-405.00 but the closer to $400 the better. The company is now expected to report earnings on Oct. 31st. We do plan to hold over that report. We're suggesting the November $440 call (GOP-KH) and the November $360 put (GGD-WL). Our estimated cost for this position is about $13.00. Our suggested exit is at $24.00 or higher.

Picked on October 01 at $401.90
Change since picked: - 0.46
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 5.6 million
 

Dropped Calls

Cymer Inc. - CYMI - close: 43.32 chg: -0.59 stop: 41.95

We were cautious in our weekend update and have been for the last few days. Our major concern is the SOX semiconductor index, which is inching closer and closer to a breakdown from its two-month rising channel. Shares of CYMI look poised to follow it lower. It doesn't help that the stock appears to have produced a bearish wedge pattern. Today's decline in CYMI has finally produced a new MACD sell signal on its daily chart. There is still a chance that the stock will bounce near $42.00 and its exponential 200-dma. We don't want to take that chance so we're suggesting an early exit immediately. We might turn bullish again down the road if we see a rally past $46.00

Picked on September 06 at $ 42.55
Change since picked: + 0.77
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.0 million

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GlobalSantaFe - GSF - close: 47.74 change: -2.25 stop: 47.64

Crude oil futures and oil stocks experienced a sharp reversal on Monday. Oil futures slid about 3% and the OIX followed with a 1.1% decline while the OSX oil services index fell 2.5%. Shares of GSF under performed them all with a 4.5% loss. The group had looked promising with a bullish bounce from what looked like a short-term bottom. Today's weakness looks like a bearish reversal, especially in shares of GSF. Traders would be better off buying puts given today's action and targeting $45.00 or its trendline of lower lows. It was our plan to buy calls on a breakout higher with a trigger at $50.51. That trigger was not hit today so we're dropping GSF as a bullish candidate.

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 11/01/06 (unconfirmed)
Average Daily Volume = 3.1 million

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Oil Service HOLDRs - OIH - close: 126.15 chg: -3.70 stop: 124.99

Crude oil experienced a sharp reversal on Monday falling about 3%. The OIH oil service holders followed with a 2.8% decline. This looks like another failed rally under resistance. The path of least resistance now appears to be down and traders may have better luck betting on a dip towards $120. It was our strategy to buy calls on a breakout over $131 with a trigger at $131.05. OIH has not hit our trigger so we're dropping it as a candidate.

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 10.7 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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