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Call Updates

Ambac Fincl. - ABK - close: 85.09 chg: +0.11 stop: 81.99

The DJIA managed to make a new all-time high on Thursday but shares of ABK definitely lagged behind. The stock spent most of the session in a 40-cent range. However, while ABK didn't make much progress the stock does look poised to move higher! The close over $85 looks like a new 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: + 0.69
Earnings Date 10/25/06 (confirmed)
Average Daily Volume = 819 thousand

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Amgen Inc. - AMGN - close: 74.09 change: +0.62 stop: 69.99

Biotech stocks did well with the BTK index adding 1.3% and rising to a new multi-month high. AMGN lagged behind the sector index a bit but still turned in a 0.85 gain. The bounce from its rising 10-dma and the close over $74.00 looks like 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: + 1.12
Earnings Date 10/23/06 (confirmed)
Average Daily Volume = 7.8 million

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Peabody Energy - BTU - close: 41.89 chg: +1.77 stop: 37.24

Coal stocks did well on Thursday. BTU added another 4.4% on strong volume and managed to breakout over its 50-dma. Our target is the $43.25-45.00 range. We have a low target for two reasons. We're short on time and the $43.30 level was support in the past so it will likely offer some resistance moving ahead. The time frame issue is also a challenge. We only have four trading days. BTU is due to report earnings on the morning of Oct. 19th and we do not want to hold over the report. So we must exit on the 18th. If you don't like the time frame issue check out these stocks in the sector: ACI, FDG, JRCC, FCL.

Picked on October 11 at $ 40.05
Change since picked: + 1.84
Earnings Date 10/19/06 (confirmed)
Average Daily Volume = 5.8 million

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Beazer Homes - BZH - close: 43.19 change: +1.29 stop: 39.85

Homebuilders enjoyed a big day. The DJUSHB home construction index rose 2.8% making it one of the market's best performers on Thursday. BZH helped lead the way with a 3% gain and a bullish breakout over technical resistance at its 100-dma. This looks like another entry point to buy calls. Our target is the $49.00-50.00 range. We do not want to hold over the early November earnings report. FYI: Today's rally in BZH over $43.00 has produced a new P&F chart buy signal with a $52 target.

Picked on October 11 at $ 42.75
Change since picked: + 0.44
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume = 1.3 million

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Carpenter Tech. - CRS - cls: 112.11 chg: +3.43 stop: 104.95

Steel and metal stocks were strong on Thursday and CRS produced a new entry point with its 3.1% rally. Yesterday we suggested readers wait for a bounce from $106 or a new move over $110.65 before opening call positions. Our target is the $118.00-120.00 range. Unfortunately, we don't have a lot of time. CRS is due to report earnings in just a couple of weeks. We do not want to hold over the report. FYI: We want to remind readers that CRS can be volatile so consider this an aggressive play.

Picked on October 11 at $110.51
Change since picked: + 1.60
Earnings Date 10/23/06 (unconfirmed)
Average Daily Volume = 754 thousand

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Emerson Electric - EMR - close: 85.04 chg: +1.24 stop: 82.99

Today's 1.4% gain in EMR following yesterday's intraday bounce looks bullish. Traders might want to open plays now but we're still suggesting that readers wait for a move over $85.25. It probably wasn't a coincidence that today's high was $85.24. 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: - 0.11
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 1.5 million

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Entergy - ETR - close: 81.39 change: +0.04 stop: 78.99

ETR continued to consolidate its gains. The stock's bounce back from its intraday lows is definitely positive. We don't see any changes from our previous updates. 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: + 1.06
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Greenbrier - GBX - close: 30.35 change: +0.93 stop: 27.99

Good news! It looks like the consolidation in GBX is over. The stock added 3.1% on rising volume and managed to breakout over its short-term resistance in the $3.20-3.25 region. This looks like a new entry point to buy calls (we recently suggested traders buy calls on a move over $3.30). 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.

Picked on October 05 at $ 30.05
Change since picked: + 0.30
Earnings Date 11/01/06 (unconfirmed)
Average Daily Volume = 310 thousand

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Mettler Toledo - MTD - close: 67.19 chg: +0.74 stop: 64.95

MTD is soaring towards our target with today's 1.1% gain. We're not suggesting new positions at this time. More conservative traders might want to take some money off the table since MTD has not yet cleared the October 5th high. 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: + 3.53
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 169 thousand

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Omnicom - OMC - close: 94.53 chg: +0.03 stop: 92.95

It looks like OMC has been forgotten as traders poured money into tech stocks on Thursday. OMC's intraday rebound from its lows today is positive but we're not suggesting new positions. 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: + 3.56
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 1.1 million

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Sepracor - SEPR - close: 52.20 chg: +0.01 stop: 49.90

We are a little disappointed that SEPR didn't turn in a strong performance today given the widespread market rally. However, the pattern remains bullish. Our target is the $55.50-56.00 range. We do not want to hold over the late October earnings report. In the news today SEPR came out with a press release on their LUNESTA drug and how its affects also help elderly patients with insomnia.

Picked on October 09 at $ 51.25
Change since picked: + 0.95
Earnings Date 10/24/06 (unconfirmed)
Average Daily Volume = 2.3 million

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Unibanco - UBB - close: 81.80 change: +0.95 stop: 76.45

UBB continues to bounce around the $80.00-82.00 range. If you're optimistic then it's a good sign that UBB is finding support at the $80.00 level. The larger pattern is still bullish and the short-term trend has a lot of momentum but UBB is looking a little overbought. 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: + 2.68
Earnings Date 11/09/06 (unconfirmed)
Average Daily Volume = 796 thousand

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Vulcan Materials - VMC - close: 83.32 chg: +1.98 stop: 76.95

The stock market's strength on Thursday helped VMC surge to new multi-month highs. The stock added 2.4% and is quickly approaching our target in 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: + 3.06
Earnings Date 10/31/06 (unconfirmed)
Average Daily Volume = 843 thousand
 

Put Updates

FreightCar Amer. - RAIL - cls: 52.86 chg: +0.41 stop: 54.05 *new*

RAIL continues to under perform the market and its peers. The stock added 0.78% and remains under short-term resistance at the $54.00 level. RAIL's relative weakness is very encouraging but this is a dangerous market to consider put plays. We're not suggesting new positions. Please note we're going to try and reduce our risk by adjusting the stop loss to $54.05. 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: - 1.64
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: 104.83 chg: +0.94 stop: n/a

Attention! It might be time to abandon ship with our strangle play on BXP. The stock's trend is still bullish but momentum has stalled. Bulls had a chance today to really push BXP past resistance near $106 and they failed. October options expire in just six trading days. Conservative traders might want to exit now to salvage any capital. We're going to ride it out and see what happens next week. 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: + 1.49
Earnings Date 10/24/06 (confirmed)
Average Daily Volume = 694 thousand

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Google - GOOG - close: 427.44 chg: + 0.94 stop: n/a

GOOG failed to participate in the market's rally on Thursday. Tech stocks lead the way but GOOG failed to get on the bus with the rest of the Internet-related equities. 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.

Picked on October 01 at $401.90
Change since picked: +25.54
Earnings Date 10/19/06 (unconfirmed)
Average Daily Volume = 5.6 million
 

Dropped Calls

Deere & Co. - DE - close: 90.17 change: +2.80 stop: 82.99

Target achieved. The market's broad-based rally helped fuel a big move in DE. The stock added 3.2% on strong volume to breakout over round-number resistance at the $90.00 level. Our target was the $89.50-90.00 range.

Picked on October 04 at $ 85.39
Change since picked: + 4.78
Earnings Date 11/14/06 (unconfirmed)
Average Daily Volume = 2.7 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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