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Call Updates

Apple Inc. - AAPL - cls: 94.68 chg: +0.41 stop: 89.49

AAPL shares started Thursday's session in the red but traders bought the dip near $93.50. The stock began to gain some momentum late in the session and actually closed up 0.4%. The bullish trend of higher lows is still intact and most of the technical indicators remain bullish. The P&F chart points to a $123 target. Our target is more conservative. We're aiming for the $97.50-100.00 range and expect some resistance near the January 2007 highs (between $97.50-98.00). Nimble traders might want to consider new call positions now but if you do open new plays we'd use a tighter stop loss than our own at $89.49. More conservative traders might want to tighten their stops toward $92.00. We do not want to hold positions over the April 25th earnings report and plan to exit ahead of the announcement. More aggressive traders wanting to ride any pre-launch excitement for Apple's iPhone may want to break this rule and hold positions for several more weeks.

Suggested Options:
We are not suggesting new positions at this time.

Annotated chart:

Picked on March 19 at $ 91.01
Change since picked: + 3.67
Earnings Date 04/25/07 (confirmed)
Average Daily Volume = 35 million

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Allegheny Tech. - ATI - cls: 110.86 chg: +0.06 stop: 105.75

We are still suggesting new call positions on ATI. The stock garnered more positive analyst comments on Thursday but was unable to truly capitalize on it. Shares posted a meager gain but managed to bounce from the $110 level midday. Iron and steel stocks have been a pocket of strength in the market and ATI is hitting new all-time highs. The breakout over resistance near $110 looks like a new entry point. Our target is the $117.00-120.00 range. Chart readers will note a few concerns. The weekly chart's MACD looks tired and poised to turn lower. Meanwhile the RSI on the daily chart has a bearish pattern of lower highs. Plus, volume on the recent rally has not been very convincing. More conservative traders may want to use a tighter stop loss. FYI: The P&F chart points to a $123 target (this is not a typo, both AAPL and ATI's P&F chart point to $123). We do not want to hold over the late April earnings report.

Suggested Options:
We are suggesting the May calls. Our suggested entry point to open positions was at $110.26. FYI: Normally a May $110 call would have a -EB suffix so verify your symbol with your broker.

BUY CALL MAY 110 ATI-EX open interest=873 current ask $6.50
BUY CALL MAY 115 ATI-EC open interest=693 current ask $4.00

Annotated chart:

Picked on April 03 at $110.26
Change since picked: + 0.60
Earnings Date 04/25/07 (unconfirmed)
Average Daily Volume = 2.6 million

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Boston Properties - BXP - cls: 118.09 chg: -0.48 stop: 114.49

REIT stocks didn't do much on Thursday and shares of BXP continued to slip following Wednesday's failed rally under $120. Thus far shares aren't seeing a lot of selling pressure. The stock is still hugging its rising 100-dma and volume on Thursday was pretty low. At this time we remain on the sidelines. Our suggested strategy is to buy calls on a breakout from its current trading range ($113-120). Our suggested trigger to open positions is $120.75. More conservative traders may want to put their trigger above the 50-dma near $121.26. If triggered at $120.75 our target is the $127.00-130.00 range. Technical traders will note that most of the indicators are turning positive and BXP appears to have produced a potential double-bottom, which is bullish, with the two March lows. We do not want to hold over the April 24th earnings report.

Suggested Options:
We are suggesting the May calls. Our suggested trigger to open positions is at $120.75.

BUY CALL MAY 115 BXP-EC open interest= 0 current ask $6.40
BUY CALL MAY 120 BXP-ED open interest=13 current ask $3.40
BUY CALL MAY 125 BXP-EE open interest= 9 current ask $2.00

Annotated chart:

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/24/07 (confirmed)
Average Daily Volume = 1.3 million

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Caterpillar - CAT - cls: 67.63 chg: +0.15 stop: 65.45

CAT continues to show relative strength but at its current pace we'll run out of time and the options will wither away. Shares inched closer to a breakout over resistance near $68.00 on Thursday. We also want to see a rise past the February highs. That is why we are suggesting a trigger to buy calls at $68.55. If triggered at $68.55 our target is the $73.00-74.00 range under the August 2006 highs. Traders should keep in mind that we do not want to hold over CAT's earnings report, which has recently been confirmed as April 20th. That gives us less than two full weeks to see the play triggered and run toward our target. It is very possible but each passing day makes it less likely.

Suggested Options:
We are suggesting the May calls. Our trigger is at $68.55.

BUY CALL MAY 65.00 CAT-EM open interest=25211 current ask $3.80
BUY CALL MAY 67.50 CAT-EU open interest=12524 current ask $2.20
BUY CALL MAY 70.00 CAT-EN open interest=12792 current ask $1.15
BUY CALL MAY 72.50 CAT-EA open interest= 5994 current ask $0.53

Annotated chart:

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/20/07 (confirmed)
Average Daily Volume = 6.3 million

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Cigna - CI - close: 147.62 chg: +0.16 stop: 141.39

Our bullish call play on CI is now open. The stock continued to creep higher on Thursday and hit an intraday high of $148.16. Our suggested trigger to buy calls was at $147.75, above recent resistance near $147.50. Short-term technicals are turning positive again after the stock's five-day bounce. If shares do see any profit taking/consolidation we would watch for a bounce in the $145-144 region, which readers could use as a new entry point. Our target is the $154.50-155.00 range. We do expect some resistance near $150 but given the stock's momentum CI should be able to plow through it. We do not want to hold over the May 2nd earnings report.

Suggested Options:
We are suggesting the May calls. Our trigger was at $147.75.

BUY CALL MAY 145 CI-EI open interest=302 current ask $6.70
BUY CALL MAY 150 CI-EJ open interest=247 current ask $3.90

Annotated chart:

Picked on April 05 at $147.75
Change since picked: - 0.13
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 910 thousand

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ConocoPhillips - COP - cls: 67.96 chg: +0.22 stop: 64.85

Oil has pulled back from its recent highs thanks to Iran's release of 15 captured British forces. While the release reduced some of the risk premium, it's not gone, and crude still looks poised to move upward as it consolidates above the 200-dma. Crude doesn't appear to have any resistance until the $68-70 region. Shares of COP continued to bounce on Thursday following Wednesday's intraday rebound. We see the bounce as a new entry point but more conservative traders may want to wait for a breakout over the 10-dma near $68.66 or the $70 level. The stock's Point & Figure chart is bullish with an $81 target. We're aiming for the $74.00-75.00 range. We do not want to hold over the late April earnings report.

Suggested Options:
We are suggesting the May calls.

BUY CALL MAY 65.00 COP-EM open interest=38036 current ask $4.30
BUY CALL MAY 70.00 COP-EN open interest=44123 current ask $1.45

Annotated chart:

Picked on March 20 at $ 66.31
Change since picked: + 1.65
Earnings Date 04/25/07 (unconfirmed)
Average Daily Volume = 12.1 million

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Holly Corp. - HOC - cls: 60.76 chg: -0.44 stop: 57.45

HOC's lack of follow through on Wednesday's big rally is a little disappointing but understandable given the lackluster markets on Thursday. Traders bought the initial dip near $60 on Thursday morning, which is positive but the stock remain sunder last month's lows. Currently we have two targets. Our conservative target is the $62.00-62.50 range. Our aggressive target is the $64.75-65.00 range. The Point & Figure chart is bullish with a $74 target. Readers can choose whether they want to exit completely at the first target or just take a partial exit or whatever else suits their trading style.

Suggested Options:
If you want to buy a bounce from $60.00 we would suggest the May calls.

Annotated chart:

Picked on March 14 at $ 57.87
Change since picked: + 2.89
Earnings Date 05/07/07 (unconfirmed)
Average Daily Volume = 651 thousand

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Infosys - INFY - cls: 51.83 chg: -0.26 stop: 49.79

The Indian markets are struggling after a strong 2006 performance. We listed INFY as a speculative, higher-risk call play because shares were bouncing near round-number support at the $50 level, near technical support at its rising, simple 200-dma and near technical support at its 38.2% Fibonacci retracement level. We're placing the stop under the recent low and aiming for the $54.75-55.00 range, where we expect shares to encounter resistance with the 50-dma and 100-dma overhead. We plan to exit on Thursday, April 12th to avoid earnings on Friday the next day. Given our time frame you may not want to open new positions.

Suggested Options:
If you feel nimble enough to jump in and out before we exit on Thursday at the close, we'd suggest the May calls.

Annotated chart:

Picked on April 03 at $ 51.69
Change since picked: + 0.14
Earnings Date 04/13/07 (confirmed)
Average Daily Volume = 1.6 million

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Lockheed Martin - LMT - cls: 96.71 chg: -0.34 stop: 97.49

We have been watching LMT for several days now, waiting for a breakout over resistance at the $100 level. The current, short-term trend has the stock drifting toward support near $96.00 and most likely toward the $95.00 level and technical support at its rising 100-dma. We would seriously considering buying a bounce from the $95 region but for now we are sticking to our plan and waiting for a breakout over $100. Our suggested trigger to buy calls is at $100.25. Our target is the $104.85-105.00 range. More aggressive traders may want to aim higher since the P&F chart aims at a $128 target. We do not want to hold over the late April earnings report. FYI: Nimble traders might want to switch directions and buy puts on a breakdown under $95.00 and aim for support near $90 and its 200-dma.

Suggested Options:
If LMT provides an entry point we are suggesting the May calls.

Annotated chart:

Picked on March xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/26/07 (unconfirmed)
Average Daily Volume = 1.8 million
 

Put Updates

F5 Networks - FFIV - cls: 66.68 chg: +0.75 stop: 71.01

Bulls bought the dip near $65.00 on Thursday morning. FFIV managed a 1.1% rebound. Normally we wouldn't read too much into it since the stock had been somewhat oversold and due for a bounce. Unfortunately, volume came in above average on the bounce and that should make the bears (and put holders) cautious. If the stock breaks out past the 10-dma near $67.85 we'll really get concerned. Right now the trend remains bearish. A failed rally under the 10-dma can be used as a new entry point. Our target is the $60.50-60.00 range. We do not want to hold over the late April earnings report. FYI: FFIV can be volatile so expect a lot of up and downs in the option prices.

Suggested Options:
If FFIV produces another entry point we'd suggest the May puts.

Annotated chart:

Picked on April 01 at $ 66.68
Change since picked: - 0.00
Earnings Date 04/25/07 (unconfirmed)
Average Daily Volume = 1.0 million

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MDC Holdings - MDC - cls: 49.04 chg: +0.98 stop: 50.05

A better than expected earnings report and somewhat positive comments from homebuilder Ryland on Thursday helped fuel another round of short covering in the sector. The DJUSHB home construction index rose 1.6%. Shares of MDC managed a 2% rebound to erase Wednesday's losses. We are still on the sidelines waiting for a breakdown. We are suggesting a trigger to buy puts at $46.95. If triggered our target is the $41.00-40.00 range. Prepare for some support near $45.00. The P&F chart looks very bearish with a $35 target. We do not want to hold over the mid-April earnings report so our target might be a little optimistic. Then again, stocks tend to drop faster than they rise.

Suggested Options:
If MDC hits our trigger to buy puts at $46.95, we would suggest the May puts.

Annotated chart:

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/19/07 (unconfirmed)
Average Daily Volume = 870 thousand
 

Strangle Updates

None Today.

Dropped Calls

Celgene - CELG - close: 58.03 chg: +2.53 stop: 51.49

Target achieved. Biotech giant Amgen (AMGN) showed a lot of strength on Thursday and this helped fuel the biotech sector. Shares of CELG also showed leadership after one analyst firm reiterated their positive view and raised their price target to $68. CELG surged higher throughout Thursday's session and closed near its highs for the day with a 4.5% gain. Our target was the $57.50-60.00 range.

chart:

Picked on March 19 at $ 52.65
Change since picked: + 5.38
Earnings Date 04/26/07 (unconfirmed)
Average Daily Volume = 3.5 million

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Sunoco - SUN - close: 74.17 chg: +0.95 stop: 68.15

Target achieved. The oil refiners continued to rally on Thursday and SUN posted a 1.29% gain on above average volume. The intraday high was $74.50. Our target was the $74.00-75.00 range. The $75.00 level looks like potential resistance and we urge caution if you haven't exited yet. We will be watch for new opportunities to buy calls on SUN. A dip and bounce near $72 or $70 might be a good spot to look for an entry point.

chart:

Picked on March 20 at $ 68.15
Change since picked: + 6.02
Earnings Date 05/02/07 (unconfirmed)
Average Daily Volume = 2.8 million
 

Dropped Puts

None Today.

Dropped Strangles

None Today.

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