Option Investor
Play Updates

In Play Updates and Reviews

HAVING TROUBLE PRINTING?
Printer friendly version

Call Updates

Ambac Fincl. - ABK - close: 85.32 chg: -0.11 stop: 83.45

It was a rocky day for the markets and shares of ABK. The stock started higher along with the DJIA and then just as quickly turned lower. Fortunately, traders bought the dip near $84.75 but you'll notice that volume came in very low today. We don't have a lot of time left before ABK reports earnings on Oct. 25th so we're not suggesting new positions at this time. We do not want to hold over the announcement. Our target is the $88.00-90.00 range.

Picked on October 04 at $ 84.40
Change since picked: + 0.92
Earnings Date 10/25/06 (confirmed)
Average Daily Volume = 819 thousand

---

BP Prudhoe Bay - BPT - close: 72.05 chg: -0.45 stop: 72.45

BPT failed to make any progress today. The stock erased most of yesterday's gains and after Monday's decline the path of least resistance might be down. We're not giving up just yet and continue to suggest a trigger to buy calls at $75.05, which is above resistance at the $75 level and its 50-dma and 200-dma. If triggered our target is the $79.00-80.00 range. FYI: A move over $75 would produce a new Point & Figure chart buy signal.

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 421 thousand

---

Beazer Homes - BZH - close: 41.77 change: +0.03 stop: 39.85

We don't see any changes from our previous updates on BZH. The stock is still trading sideways. The sector failed to move on today's news that housing starts rose a strong 5.9% in September. Investors appeared to focus more on the 6.3% decline in building permits instead. We are still concerned about the lack of upward momentum in BZH. If you're not willing to endure a pull back toward support near $40 and its 50-dma then you may want to exit early right here. We'd watch for a bounce near $41.00 or $40.00 as the next 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.

Picked on October 11 at $ 42.75
Change since picked: - 0.98
Earnings Date 11/07/06 (confirmed)
Average Daily Volume = 1.3 million

---

Carpenter Tech. - CRS - cls: 109.58 chg: -4.01 stop: 104.95

Ouch! CRS just erased all of our unrealized gains with today's 3.5% decline. The stock arguably produced a failed rally under $115 this morning and then plunged under what should have been short-term support near its 10-dma and the $110 level. More conservative traders may want to strongly consider exiting early right here to cut their losses. We would expect a dip toward the $107-108 region. Meanwhile in the news CRS announced it was replacing its retiring CEO with Anne Stevens who would take on the CEO, President and Chairman positions effective Nov. 1st. Our target is the $118.00-120.00 range. Don't forget we plan to exit ahead of the October 26th earnings report.

Picked on October 11 at $110.51
Change since picked: - 0.93
Earnings Date 10/26/06 (confirmed)
Average Daily Volume = 754 thousand

---

Devon Energy - DVN - close: 66.43 chg: -0.07 stop: 60.95

Crude oil futures tried to bounce and then reversed sharply lower on Wednesday. This undermined any strength in the oil sectors, which followed the commodity lower. Fortunately, DVN managed to bounce from the $65.50 region midday. We see the bounce as a new bullish entry point to buy calls but the trading in oil has been pretty volatile lately and our readers might want to think twice about opening new positions right now. Our target is the $69.50-70.00 range. We do not want to hold over the November 1st earnings report. FYI: OPEC's emergency meeting is set to occur tomorrow in Qatar as the group talks about how to stop the decline in oil prices.

Picked on October 15 at $ 64.72
Change since picked: + 1.71
Earnings Date 11/01/06 (confirmed)
Average Daily Volume = 5.6 million

---

Emerson Electric - EMR - close: 85.19 chg: -0.65 stop: 82.99

We are urging new caution on EMR. The stock spiked higher this morning but like the DJIA shares of EMR quickly turned lower. The move today looks like a bearish reversal. As a matter of fact the trading today looks bad enough that more conservative traders may just want to exit early right here. We think the stock might find support near $84.00 so we're keeping the play open for now. We're not suggesting new positions. Our target is the $89.00-90.00 range.

Picked on October 05 at $ 85.15
Change since picked: + 0.04
Earnings Date 11/07/06 (confirmed)
Average Daily Volume = 1.5 million

---

EOG Resources - EOG - close: 66.06 chg: -0.14 stop: 63.95

Oil stocks were lower on Wednesday thanks to a bearish session for crude oil futures. The intraday bounce in EOG from $65.26 looks like a new entry point to buy calls but given the volatility in crude oil right now readers may want to think twice before opening new positions. OPEC's emergency meeting on stopping the slide in oil prices is tomorrow. Our short-term target is the $69.50-70.00 range. More aggressive traders may want to aim higher but watch out for the 200-dma. We do not want to hold over the October 31st earnings report.

Picked on October 16 at $ 66.05
Change since picked: + 0.01
Earnings Date 10/31/06 (confirmed)
Average Daily Volume = 3.6 million

---

Fortune Brands - FO - close: 75.44 chg: +0.04 stop: 73.99

There are no changes from our previous update on FO. The stock churned sideways in a 90-cent range on Wednesday. We're still concerned about Tuesday's bearish reversal. More conservative traders may want to cut their losses now. We're not suggesting new positions at this time. Wait for a new move over $76.25 or higher before considering new positions. Our target is the $79.90-80.00 range. We do not want to hold over the late October earnings report.

Picked on October 13 at $ 76.26
Change since picked: - 0.82
Earnings Date 10/26/06 (unconfirmed)
Average Daily Volume = 745 thousand

---

Frontier Oil - FTO - close: 28.99 change: +0.05 stop: 25.99

FTO displayed some strength this morning, probably due to the latest inventory report, but the decline in crude oil pulled the energy sectors lower this afternoon. Today's trading in FTO looks like another failed rally under the $30 level. We expect a dip back toward the $28.00 level and maybe the $27.50 region. We would wait for signs of a bounce to begin before considering new call positions. Our target is the $32.50-33.00 range. We do not want to hold over the early November earnings report. FYI: The P&F chart is still bearish for FTO.

Picked on October 15 at $ 28.90
Change since picked: + 0.09
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume = 3.2 million

---

NCI Building Sys. - NCS - cls: 60.91 chg: -0.59 stop: 57.99

NCS produced a bit of a failed rally today and the stock's weakness has produced a little bearish hook on some of the short-term technical indicators. Bulls stepped in to buy the bounce near $60.25 this afternoon but readers might want to wait for another move over $61.00 before considering new call positions. More conservative traders may want to tighten their stops toward $59. Our target is the $67.00-70.00 range.

Picked on October 16 at $ 61.26
Change since picked: - 0.35
Earnings Date 11/29/06 (unconfirmed)
Average Daily Volume = 386 thousand

---

Rockwell Automation - ROK - cls: 61.41 chg: +0.28 stop: 59.45

We see no change from our previous update on ROK. The stock spent the session trading sideways. If you're optimistic then the bounce from its rising 10-dma is a positive sign. We were suggesting a bounce from the 10-dma as a new entry point to buy calls. Our target is the $64.90-66.00 range. We do not want to hold over the early November earnings report. FYI: The P&F chart points to a $76 target.

Picked on October 12 at $ 60.86
Change since picked: + 0.55
Earnings Date 11/02/06 (unconfirmed)
Average Daily Volume = 1.5 million

---

Sepracor - SEPR - close: 50.87 chg: -1.45 stop: 49.90

Hmm... SEPR displayed some sharp relative weakness on Wednesday. The stock lost 2.77% on above average volume. This looks pretty bearish but we couldn't find any specific news to account for the loss. The stock did bounce above what should be support at the $50 level and it closed above its 200-dma but that doesn't mean the selling is over. The strength behind today's sell-off might be a good reason for more conservative traders to cut their losses right here and exit. Our target is the $55.50-56.00 range. Don't forget that we plan to exit ahead of the earnings report.

Picked on October 09 at $ 51.25
Change since picked: - 0.38
Earnings Date 10/26/06 (confirmed)
Average Daily Volume = 2.3 million

---

Unibanco - UBB - close: 80.62 change: +1.21 stop: 76.45

UBB produced a decent bounce on Wednesday. More importantly the U.S. traded ADR shares of the company failed to see any downside follow through on yesterday's bearish breakdown. There is still a decent chance that UBB will retrace back toward support in the $77-78 region so we're not suggesting new positions at this time. Our target is the $85.00-86.00 range. We do not want to hold over the earnings report.

Picked on October 08 at $ 79.12
Change since picked: + 1.85
Earnings Date 11/09/06 (unconfirmed)
Average Daily Volume = 796 thousand

---

Vimpel Comm. - VIP - close: 62.75 chg: +0.46 stop: 59.95

It looks like bulls were trying to buy the dip in VIP on Wednesday. The stock did struggle to make any headway past yesterday's high but the overall pattern remains bullish. Readers can choose to open new call positions here or try and catch a dip near $61.00. Our target is the $67.50-70.00 range. We do not want to hold over the mid-November earnings.

Picked on October 12 at $ 62.17
Change since picked: + 0.58
Earnings Date 11/17/06 (unconfirmed)
Average Daily Volume = 1.0 million

---

Vulcan Materials - VMC - cls: 82.74 chg: +0.47 stop: 79.85

VMC spiked higher this morning but the stock failed just over the $84 level for the second time in three days. The overall pattern is bullish but we we're not suggesting new positions especially with the stock struggling just under our target in the $84.50-85.00 range. If VMC trades over $84.00 again our readers might want to exit early to lock in a gain. We do not want to hold over the October 30th earnings report.

Picked on October 09 at $ 80.26
Change since picked: + 2.48
Earnings Date 10/30/06 (confirmed)
Average Daily Volume = 843 thousand
 

Put Updates

Medco Health Sol. - MHS - cls: 57.22 chg: +0.42 stop: 58.05

MHS is not cooperating with us and our put play. The stock is still bouncing and today's session managed a close over technical resistance at the 10-dma and the 200-dma. This move is reason enough for more conservative traders to exit early and cut their losses now. We are not suggesting new positions. We do not want to hold over the early November earnings report.

Picked on October 15 at $ 56.10
Change since picked: + 1.12
Earnings Date 11/03/06 (confirmed)
Average Daily Volume = 1.9 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.)

---

Boston Properties - BXP - close: 104.39 chg: -0.09 stop: n/a

Lack of movement is the worst thing that can happen for this strangle play and we're almost out of time. We need to exit before the closing bell on Friday or our options will expire worthless. 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 adjusting our target to $2.50 for either option.

Picked on October 01 at $103.34
Change since picked: + 1.05
Earnings Date 10/24/06 (confirmed)
Average Daily Volume = 694 thousand

---

ConocoPhillips - COP - close: 60.33 chg: -0.47 stop: n/a

Weakness in crude oil futures pulled COP back towards the $60 level again. The low today was $59.99, which would have been a good spot to consider opening new strangle positions. We do plan to hold over the October 26th earnings report. Our estimated cost is about $1.15. We are suggesting an exit if either option rise to $2.00 or more. Our suggested options were the November $65 call (COP-KM) and the November $55 put (COP-WK).

Picked on October 15 at $ 60.03
Change since picked: + 0.30
Earnings Date 10/26/06 (confirmed)
Average Daily Volume = 9.8 million

---

Google - GOOG - close: 419.31 chg: - 1.33 stop: n/a

GOOG continued to trade sideways on Wednesday as investors wait for the company's earnings report due out tomorrow after the closing bell. Wall Street expects the company to deliver earnings of $2.41 a share. We're not suggesting new strangle positions. 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: +17.41
Earnings Date 10/19/06 (confirmed)
Average Daily Volume = 5.6 million
 

Dropped Calls

Peabody Energy - BTU - close: 40.95 chg: -0.60 stop: 39.99

BTU suffered another session of profit taking and the stock lost 1.44% on below average volume. However, it looks like traders were starting to buy the dip near $40 this afternoon. Unfortunately, we're out of time. It was our plan to exit today at the closing bell to avoid holding over the company's earnings report tomorrow. Wall Street is looking for earnings of 44-cents a share.

Picked on October 11 at $ 40.05
Change since picked: + 0.90
Earnings Date 10/19/06 (confirmed)
Average Daily Volume = 5.8 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

Play Update Archives