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Call Updates

Ambac Fincl. - ABK - close: 84.81 chg: +0.20 stop: 81.99

Monday proved to be a mild session if you were outside the tech sectors. Shares of ABK dipped this morning but traders bought the bounce above short-term support at the $84 level. We would use today's bounce as another entry point to buy calls. Our target is the $88.00-90.00 range. We do not want to hold over the October 25th earnings report.

Picked on October 04 at $ 84.40
Change since picked: + 0.41
Earnings Date 10/25/06 (confirmed)
Average Daily Volume = 819 thousand

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Amgen Inc. - AMGN - close: 73.92 change: -0.09 stop: 69.99

The BTK biotech index continued to inch higher on Monday but shares of AMGN, one of the BTK's biggest components, traded sideways and closed with a minor loss. Traders can choose to buy the bounce from the $73.50 level (third bounce in two days) - or traders can wait for a potential dip back towards the rising 10-dma as a new entry point to buy calls. Our target is the $79.00-80.00 range. We do not want to hold over the October 23rd earnings. FYI: More conservative traders might want to adjust their stop loss closer to the $72 level.

Picked on October 04 at $ 72.97
Change since picked: + 0.95
Earnings Date 10/23/06 (confirmed)
Average Daily Volume = 7.8 million

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Deere & Co. - DE - close: 88.00 change: +2.71 stop: 82.99

Shares of DE turned in a strong session on Monday. The stock almost hit our target with today's intraday high of $89.09. A similar rally was also seen in shares of rival CAT. While today's +3.1% gain is certainly bullish the intraday chart had DE moving lower into the close. More conservative traders may want to take some profits here. We're not suggesting new positions. Our target is the $89.50-90.00 range. We do not want to hold over the November earnings report. FYI: The P&F chart points to a $108 target.

Picked on October 04 at $ 85.39
Change since picked: + 2.61
Earnings Date 11/14/06 (unconfirmed)
Average Daily Volume = 2.7 million

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Emerson Electric - EMR - close: 85.06 chg: +0.29 stop: 82.99

Traders bought the dip near EMR's 10-dma (around the $84 level) around lunchtime and the stock's rebound took it over resistance near $85.00. We recently suggested that readers use a move over $85.25 as a new entry point to buy calls and this level was hit today. The weekly chart and the P&F chart both look pretty bullish. Our target is the $89.00-90.00 range. We do not want to hold over the late October earnings report.

Picked on October 05 at $ 85.15
Change since picked: - 0.09
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 1.5 million

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Entergy - ETR - close: 80.68 change: +0.05 stop: 77.99

Traders continue to buy ETR's dips near the $80.00 level. We don't see any changes from our weekend update. Everything appears to be pointing higher for ETR. We would continue to open new plays at current levels. Our short-term target is the $84.00 level. We do not want to hold over the late October earnings report.

Picked on October 03 at $ 80.33
Change since picked: + 0.35
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Greenbrier - GBX - close: 29.95 change: -0.05 stop: 27.99

GBX's close under the $30.00 level is a little bit discouraging since the $30 level should have acted as round-number support. However, we remain optimistic. The stock did bounce from today's lows near the 10-dma and 100-dma. We would still consider new call positions at this time or readers can wait for a move over today's high at $30.18. Our target is the $33.00-34.00 range. We do not want to hold over the early November earnings report. FYI: The P&F chart is still bearish but it's seeing a strong bounce near support. More conservative traders could always tighten their stops - we'd consider moving ours toward the $29 level.

Picked on October 05 at $ 30.05
Change since picked: - 0.10
Earnings Date 11/01/06 (unconfirmed)
Average Daily Volume = 310 thousand

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Mettler Toledo - MTD - close: 66.37 chg: +0.18 stop: 64.95

There is no change from our previous update on MTD. We're still not suggesting new positions and more conservative traders may want to lock in a gain now. Many of the technical indicators are suggesting that the next move will be lower. 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: + 2.71
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 169 thousand

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Omnicom - OMC - close: 94.02 chg: -0.63 stop: 92.95

Monday's session failed to see any upward follow through on OMC's Friday rally. This no-show for the rally is discouraging and some of the technical indicators are still suggesting that the upward momentum has died and the next move will be lower. We are not suggesting new positions at this time. More conservative traders may want to think about locking in a profit right here or at least taking some money off the table. Our target is the $96.00-97.00 range. We do not want to hold over the late October earnings. FYI: The P&F chart points to a $131 target.

Picked on September 10 at $ 90.97
Change since picked: + 3.05
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Sepracor - SEPR - close: 50.79 chg: +0.59 stop: 47.95

Shares of SEPR were strong this morning. The stock gapped open higher and traded to an intraday high of $51.75 before paring its gains. SEPR's morning strength was fueled by news that the FDA had approved the company's Brovana drug for chronic obstructive pulmonary disease, which is said to affect approximately 12 million adults in the U.S. We had listed a trigger to buy calls on SEPR at $51.25 in an effort to catch a breakout over resistance at the $51.00 level. The play is now open. However, we would not suggest new positions until SEPR traded back above $51.00 or even our trigger again at $51.25. The stock's failure to hold its early gains actually looks a little bearish! Our target is the $55.50-56.00 range. We do not want to hold over the late October earnings report. We'll leave the stop loss at $47.95 for now. FYI: The latest (September) data put short interest at more than 13% of SEPR's 108 million-share float. That's a relatively high amount of short interest.

Picked on October 09 at $ 51.25
Change since picked: - 0.46
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 2.3 million

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Unibanco - UBB - close: 79.71 change: +0.59 stop: 74.95

The financial sector indices continued to show strength on Monday and shares of UBB inch up another 0.7% to challenge potential resistance at the $80.00 level. We don't see any changes from our weekend comments on UBB. Readers can choose to go long call options here, wait for a dip towards $77.00-77.50 or wait for a breakout over $80.00. Our target is the $85.00-86.00 range. We do not want to hold over the early November earnings report.

Picked on October 08 at $ 79.12
Change since picked: + 0.59
Earnings Date 11/09/06 (unconfirmed)
Average Daily Volume = 796 thousand

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Vulcan Materials - VMC - close: 80.05 chg: -0.13 stop: 76.95

Warning! We may be the victim of a false start here. Shares of VMC bounced strongly from its rising 10-dma this morning but the rally failed this afternoon. VMC was sinking back towards the $80 level at the closing bell and it looks like shares will continue to trade lower tomorrow. We had suggested a trigger to buy calls at $80.26 so the play is now open given the rise to $80.76 today. However, we would wait for a new move back above $80.25 or even $80.50 before considering new positions. More aggressive traders might consider opening plays on another bounce from the 10-dma. Our target is the $84.50-85.00 range. We do not want to hold over the late October earnings report.

Picked on October 09 at $ 80.26
Change since picked: - 0.21
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 843 thousand
 

Put Updates

Maxim Integrated - MXIM - cls: 28.53 chg: +0.25 stop: 29.05

The SOX semiconductor index was strong on Monday thanks to an upgrade for AMD and a big rise in NVDA on persistent rumors that INTC might try and acquire NVDA. Shares of MXIM did post a gain today but the stock remains under resistance at the $29 level. We don't see any real changes from our weekend comments on MXIM. We would wait for a new decline under $27.50 before considering new put positions. Please note we're adjusting our stop loss to $29.05. Our target is the $24.00 level.

Picked on September 25 at $ 27.90
Change since picked: + 0.63
Earnings Date 11/03/06 (unconfirmed)
Average Daily Volume = 5.4 million

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FreightCar Amer. - RAIL - cls: 52.09 chg: +0.51 stop: 54.55

RAIL was looking short-term oversold and due for a bounce so today's 0.9% gain was not too surprising. The stock actually produced a minor failed rally at its descending 10-dma this afternoon, which is normally a bearish move. We're not suggesting new positions at this time. Currently we have two targets on RAIL since the stock 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: - 2.92
Earnings Date 10/26/06 (confirmed)
Average Daily Volume = 353 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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Boston Properties - BXP - close: 105.23 chg: +1.00 stop: n/a

BXP bounced from its trendline of support (higher lows) again. The stock added almost 1% and looks poised to challenge potential resistance near the $106 level. We're not suggesting new strangle positions at this time. The play was labeled as aggressive and higher risk due to our short three-week time frame. We need to exit before October options expire on October 21st. Our suggested options were 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.

Picked on October 01 at $103.34
Change since picked: + 1.89
Earnings Date 10/24/06 (confirmed)
Average Daily Volume = 694 thousand

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Google - GOOG - close: 429.00 chg: + 8.50 stop: n/a

Monday proved to be a big day for GOOG. The stock soared another 2% following last week's strong showing. Driving the price of GOOG higher were positive analysts comments on the company's earnings potential and any potential acquisition of YouTube.com. The company also announced a deal with Warner Music Group to let Google Video users access to WMG's music video content. Of course rumors last week were rampant that GOOG would buy YouTube.com for $1.65 billion. That rumor was confirmed today. Shortly after the closing bell on Monday GOOG announced that it had agreed to buy YouTube for $1.65 billion in an all-stock deal. Shares of GOOG were trading up over $430 in after hours. We're not suggesting new strangle plays at this time. The options in our strangle strategy are 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. FYI: The November $440 call is already trading at $17.40ask/$17.00bid.

Picked on October 01 at $401.90
Change since picked: +27.10
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 5.6 million

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Legg Mason - LM - close: 102.08 change: +0.83 stop: n/a

After Friday's decline shares of LM looked poised to move lower but the stock bounced on Monday for a 0.8% gain. We're not suggesting new strangle positions at this time but a dip back near the $100 mark could be used as an entry point. The options in our strangle strategy are the November $105 calls (LM-KA) and the November $95.00 put (LM-WS). Our estimated cost is $5.15. We're suggesting an exit if either options rises to $7.25.

Picked on October 03 at $ 99.72
Change since picked: + 2.36
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.4 million
 

Dropped Calls

None
 

Dropped Puts

None
 

Dropped Strangles

None
 

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