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Call Updates

Allegheny Tech - ATI - cls: 114.14 chg: -1.04 stop: 109.99

ATI struggled to building on Friday's rebound but today's pull back actually looks like another entry point to buy calls on the stock. More conservative types may want to watch for a move over $115 before initiating positions. Our target is the $119.00-120.00 range. FYI: The Point & Figure chart forecasts a $122 target.

Picked on May 08 at $113.45
Change since picked: + 0.69
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume = 2.4 million

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Baidu.com - BIDU - cls: 131.99 chg: +3.87 stop: 124.95

BIDU displayed relative strength on Monday with a 3% rally and a bullish breakout over short-term resistance. The rally today was fueled by strong volume, which is normally a bullish signal. We were suggesting a trigger to buy calls at $130.51. Now that the play is open our target is the $139.50-140.00 range. The P&F chart is bullish with a $203 target. FYI: Due to BIDU's volatility we would consider this a more aggressive, higher-risk play.

Picked on May 14 at $130.51
Change since picked: + 1.48
Earnings Date 07/26/07 (unconfirmed)
Average Daily Volume = 2.2 million

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Bear Stearns - BSC - cls: 153.85 chg: -2.55 stop: 154.75

The back and forth volatility in BSC continues as the stock whipsawed lower again on Monday. Broker-dealers were weak in general on Monday. BSC may have had added pressure after announcing it would buy the rest of Bear Wagner, a stock specialist firm, which BSC already had an interest in. We are waiting for a breakout over $160 to buy calls. Our suggested trigger is at $160.25. More nimble traders may want to consider buying puts on a breakdown under $152 or $150.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/27/07 (unconfirmed)
Average Daily Volume = 2.7 million

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Peabody Energy - BTU - cls: 50.70 change: +0.17 stop: 47.99

Coal stocks inched higher on Monday. BTU tagged another new relative high before dipping. We did see traders buying that dip this afternoon so this looks like another entry point to buy calls. Our target is the $54.50-55.00 range. The P&F chart is very bullish with a $69 target. Our biggest concern with calls on BTU is M&A news. The risk is that BTU might announce it is acquiring one of its smaller rivals and normally shares of the acquirer go down on the announcement.

Picked on May 09 at $ 50.70
Change since picked: - 0.00
Earnings Date 07/19/07 (unconfirmed)
Average Daily Volume = 5.3 million

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Ctrip.com - CTRP - cls: 72.10 chg: -0.50 stop: 69.99

CTRP managed to hit a new three-month high this morning (73.46) but eventually closed lower. We're not suggesting new positions at this time. The company is due to report earnings on May 16th after the closing bell. We plan to exit on Wednesday at the close to avoid holding over earnings - unless the stock hits our target first, which is the $74.50-75.00 range.

Picked on April 29 at $ 70.63
Change since picked: + 1.47
Earnings Date 05/16/07 (confirmed)
Average Daily Volume = 389 thousand

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General Dynamics - GD - cls: 80.36 chg: +0.21 stop: 77.75

It was a quiet session for GD but the intraday moves make Monday's session look like another entry point to buy calls. More conservative traders may want to wait for a new rally past $81.00 or to a new high over $81.55 before starting new call positions. We have two targets. Our conservative target will be the $84.75-85.00 range. Our aggressive target will be the $89.00-90.00 range. The P&F chart has produced a triple-top breakout buy signal with a $96 target.

Picked on April 29 at $ 80.27
Change since picked: + 0.09
Earnings Date 04/25/07 (confirmed)
Average Daily Volume = 1.4 million

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Goldman Sachs - GS - cls: 226.18 chg: -1.32 stop: 222.45

Another day of M&A news failed to rally the broker-dealers. The XBD lost 1.3%. Shares of GS managed to out perform its peers but still lost 0.5%. We would not be surprised to see a dip towards $225-224 so patient traders may want to wait for the dip or signs of a bounce first. We're going to try and keep our risk to a minimum with a stop loss under Thursday's low. More conservative traders may want to wait for a rally past $230 before initiating plays. Our target is the $238.00-240.00 range. The P&F chart currently points to a $246 target. We do not want to hold over the mid June earnings report.

Picked on May 13 at $227.50
Change since picked: - 1.32
Earnings Date 06/12/07 (unconfirmed)
Average Daily Volume = 7.4 million

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Precision Castparts - PCP - cls: 111.13 chg: +0.22 stop: 105.75

PCP is still inching higher. We don't see any changes from our weekend comments. We're suggesting new call positions after Friday's rally. We're setting our stop loss at $105.75. More conservative traders may want to put their stop closer to the 10-dma. Our target is the $118.00-120.00 range.

Picked on May 13 at $110.91
Change since picked: + 0.22
Earnings Date 05/09/07 (confirmed)
Average Daily Volume = 1.0 million

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Marathon Oil - MRO - cls: 108.92 chg: +2.01 stop: 101.95

MRO continues to show relative strength. The stock rose 1.88% on above average volume and closed at a new high. We have two targets. Our conservative target is the $109.85-110.00 range. Our aggressive target will be the $114.00-115.00 range. FYI: The P&F chart points to $110 and MRO has a 2-for-1 split coming up on June 19th. Please note that we're raising the stop loss to $101.95.

Picked on May 08 at $105.55
Change since picked: + 3.85
Earnings Date 07/31/07 (unconfirmed)
Average Daily Volume = 3.8 million

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Sears Holding - SHLD - cls: 176.77 chg: -1.19 stop: 174.74

Warning! SHLD's lack of follow through on Friday's bounce is bearish. We would hesitate to open new call positions until SHLD traded above $178.50 or $178.75 first. Many of the technical indicators are negative and SHLD has been showing relative weakness so this should be considered an aggressive, speculative play. We'll try and limit our risk with a stop under last week's low. Our target is the $184.00-185.00 range.

Picked on May 13 at $177.96
Change since picked: - 1.19
Earnings Date 05/31/07 (unconfirmed)
Average Daily Volume = 1.7 million

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Terex - TEX - cls: 82.91 change: +0.57 stop: 77.95

TEX hits another new high on Monday. The stock spiked to $84.50 this morning before paring its gains. We remain bullish here and readers can choose to open positions now or wait for another dip in the $81-80 range. Our target is the $87.00-90.00 range. The P&F chart points to a $105 target.

Picked on May 09 at $ 81.16
Change since picked: + 1.75
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume = 1.2 million

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Vangard Emergy Mkts ETF -VWO- cls: 85.26 chg: -0.54 stop: 83.45

We do not see any changes from our weekend comments on VWO. Currently shares are trading near the top of its recent trading range. We want to buy calls on a breakout over $86.00. Therefore we are suggesting a trigger at $86.15. If triggered our target is the $89.85-90.00 range. More aggressive traders may want to aim higher since the P&F chart points to $113.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 416 thousand

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WATSCO - WSO - cls: 56.47 change: -0.28 stop: 53.95

The rally in WSO took a breather on Monday. Overall we don't see any significant changes. If you're looking for a new entry point on WSO watch for a dip into the $55.50-55.00 zone near its rising 10-dma. Our target is the $59.50-60.00 range.

Picked on May 06 at $ 55.73
Change since picked: + 0.74
Earnings Date 07/19/07 (unconfirmed)
Average Daily Volume = 382 thousand
 

Put Updates

AvalonBay - AVB - cls: 124.31 chg: +0.47 stop: 125.26

Shares of AVB ticked over the $125 level this morning and we're surprised that the stock did not hit our stop loss at $125.26. While a failed rally from here could be used as a new entry point we would hesitate to open new positions. More conservative traders may want to cut their losses now.

Picked on April 30 at $124.45
Change since picked: - 0.14
Earnings Date 04/26/07 (confirmed)
Average Daily Volume = 770 thousand

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Equinix - EQIX - cls: 81.51 chg: -1.02 stop: 86.05

EQIX sank over 1.2% on Monday but the bounce may not be over yet. We're not suggesting new positions at this time but a failed rally under the 50-dma (around $85) could be a new entry point. It's worth noting that EQIX is presenting at a couple of investor conferences this week on the 15th and 17th. Our target is the $75.25-75.00 range. Aggressive traders may want to aim closer to $70 but be aware that the 200-dma might offer new technical support. FYI: The P&F chart points to a $70 target.

Picked on May 06 at $ 82.83
Change since picked: - 1.32
Earnings Date 04/26/07 (confirmed)
Average Daily Volume = 515 thousand

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Essex Property - ESS - cls: 127.67 chg: +0.09 stop: 130.05

Today's trading in ESS looks like a bearish failed rally under $129.00 and its 200-dma. More aggressive traders will want to seriously consider buying puts on today's move. We are still waiting for a breakdown under support at $125.00. Our suggested trigger to actually buy puts is at $124.65, which is under the March 2007 low. There is potential support near $120 but if triggered our target is the $115.50-115.00 range. FYI: The P&F chart points to a $100 target.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 281 million

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Itron - ITRI - cls: 67.43 change: -0.46 stop: 70.01

ITRI got a boost this morning after an analyst firm started coverage on it with an $80 target. Shares spiked to $69.30 before rolling over. This looks like a bearish failed rally type of move. Aggressive traders might want to consider new put positions here. We would wait for a new decline under $66.00. Our target is the $60.50-60.00 range.

Picked on May 08 at $ 65.85
Change since picked: + 1.58
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 547 thousand

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Russell 2000 Ishares - IWM - cls: 81.62 chg: -0.68 stop: 83.55

Hmm... is the IWM going to roll over without another rally attempt near $83.00? Overall we don't see any changes from our weekend comments on IWM. Here's the plan. The IWM has been bouncing and will probably retest resistance near $83 soon. We're suggesting a trigger to buy puts at $82.90. We'll try and limit our risk with a tight stop at $83.55. More aggressive traders may want to put their stop just above $84.00. If we are triggered at $82.90 then we will have two targets. Our conservative target is $80.25-80.00. Our aggressive target is the $78.25-78.00 range.

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 58.4 million

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Las Vegas - LVS - cls: 78.26 change: -1.25 stop: 85.01

LVS turned in another bearish session with a failed rally near $80 this morning. Shares closed down 1.5%. This could be a new entry point to buy puts. Our target is the $71.50-70.00 range. Currently the P&F chart sports a triple-bottom breakdown sell signal with a $75 target.

Picked on May 07 at $ 79.85
Change since picked: - 1.59
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 2.1 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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Lockheed Martin - LMT - cls: 99.20 change: +0.36 stop: n/a

Only four trading days left for our strangle play on LMT. May options expire after the 18th. At this point we need to see LMT trade to $101.50 or 88.50 just to breakeven. We're not suggesting new strangle plays at this time. The suggested options we had listed were the May $100 calls (LMT-ET) and the May $90 puts (LMT-QR). Our estimated cost was $1.50. We want to sell if either option rises to $2.00 or more (note the change in target price).

Picked on April 22 at $ 95.40
Change since picked: + 3.80
Earnings Date 04/24/07 (confirmed)
Average Daily Volume = 1.7 million
 

Dropped Calls

Lehman Brothers - LEH - cls: 74.40 chg: -0.95 stop: 74.85

We would have been stopped out of LEH at $74.85 today. LEH was definitely a laggard on Monday with a 1.2% decline, a failed rally at the 10-dma, and a dip under what should have been technical support at its 200-dma. If shares trade under the May 1st low (73.59) then more nimble traders may want to consider bearish positions.

Picked on May 06 at $ 77.30
Change since picked: - 2.90
Earnings Date 07/18/07 (unconfirmed)
Average Daily Volume = 5.9 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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