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Call Updates

Allegheny Tech - ATI - cls: 113.55 chg: -0.73 stop: 109.99

It might be time to worry about ATI. The stock failed to participate in the market's widespread rally on Wednesday. Traders did buy the dip near $111.60, which is close to where they bought the dip on May 10th. Technically the afternoon bounce could be used as a new entry point but we would wait for a rise past $115.50 before initiating new positions. More conservative traders may want to tighten their stops toward $111.50. 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: + 0.10
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume = 2.4 million

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Baidu.com - BIDU - cls: 129.88 chg: +0.85 stop: 124.95

The INX Internet index produced a strong bounce from support near the 260 level. The move might be seen as a bullish entry point for the sector. BIDU, which had been out performing its peers, managed a bounce from its rising 10-dma. Traders can use the intraday rebound in BIDU as a new entry point or wait for a rise past today's high (basically above $130) before initiating positions. This is an aggressive, higher-risk play. More conservative traders, if you decided to pursue BIDU, may want to tighten their stops. Our target is the $139.50-140.00 range. The P&F chart is bullish with a $203 target.

Picked on May 14 at $130.51
Change since picked: - 0.63
Earnings Date 07/26/07 (unconfirmed)
Average Daily Volume = 2.2 million

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Peabody Energy - BTU - cls: 50.31 change: -0.10 stop: 47.99

The coal stocks were mixed on Wednesday but BTU under performed the market with a 0.19% loss. The overall bullish trend of higher lows is still intact for now. Traders can choose to buy this dip or wait for a rally past today's high (50.90) as a new entry point. 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. FYI: BTU announced this afternoon that it plans to spin off its Kentucky and West Virginia coal mining divisions into a new company called Patriot Coal Co. (source: AP).

Picked on May 09 at $ 50.70
Change since picked: - 0.39
Earnings Date 07/19/07 (unconfirmed)
Average Daily Volume = 5.3 million

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General Dynamics - GD - cls: 81.36 chg: +0.41 stop: 78.85

The DFI defense index is trading sideways but near new all-time highs. Meanwhile shares of GD are inching higher. We remain bullish on the stock. 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: + 1.09
Earnings Date 04/25/07 (confirmed)
Average Daily Volume = 1.4 million

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Goldman Sachs - GS - cls: 227.11 chg: +2.73 stop: 222.45

Shares of GS produced a nice bounce today in spite of the under performance in the XBD index. The rebound in GS erased most of our losses and the stock has maintained its short-term trend of higher lows. We are suggesting bullish positions here but more conservative traders may want to wait for a breakout over the $230 level before initiating positions. Our target is the $238.00-240.00 range.

Picked on May 13 at $227.50
Change since picked: - 0.39
Earnings Date 06/12/07 (unconfirmed)
Average Daily Volume = 7.4 million

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Precision Castparts - PCP - cls: 115.04 chg: +2.23 stop: 109.85*new*

PCP has broken out to new all-time highs. The stock rose 1.9% and on above average volume, which tends to be a bullish sign. We're not suggesting new positions at this level. We are going to raise the stop loss to $109.85. More conservative traders may want to consider a little bit of profit taking here. Our target is the $118.00-120.00 range.

Picked on May 13 at $110.91
Change since picked: + 4.13
Earnings Date 05/09/07 (confirmed)
Average Daily Volume = 1.0 million

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Marathon Oil - MRO - cls: 111.76 chg: +0.30 stop: 104.99

We don't see any changes from our previous comments on MRO. The stock hit our first target yesterday in the $109.85-110.00 range. Traders bought the dip midday at $109.83. Volume continues to come in strong. We're not suggesting new positions at this time. Our aggressive target is the $114.00-115.00 range. If you failed to take some money off the table we would definitely reconsider as MRO is looking a little short-term overbought. 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 $104.99.


Picked on May 08 at $105.55
Change since picked: + 6.21
Earnings Date 07/31/07 (unconfirmed)
Average Daily Volume = 3.8 million

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Sears Holding - SHLD - cls: 178.48 chg: +1.48 stop: 174.74

SHLD has finally turned positive for us. The stock spiked to $181.16 earlier today but eventually closed up with a 0.8% gain albeit still under potential resistance at its 10-dma, 100-dma and the $180 level. Overall SHLD still looks bullish with its attempted bounce from the trendline of support. Readers may want to consider buying calls here. Our target is the $184.00-185.00 range.

Picked on May 13 at $177.96
Change since picked: + 0.52
Earnings Date 05/31/07 (unconfirmed)
Average Daily Volume = 1.7 million

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Terex - TEX - cls: 80.00 change: -1.66 stop: 77.95

Warning! TEX under performed the markets on Wednesday. Shares lost 2% and closed under short-term technical support at its 10-dma. Short-term technical indicators suggest TEX wants to move lower but there is still a decent chance that TEX will bounce from here. More conservative traders may want to tighten their stop toward $79.00 or $79.50. We would watch for a bounce back above $81.00 before considering new positions. 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: - 1.16
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume = 1.2 million

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Vangard Emergy Mkts ETF -VWO- cls: 86.67 chg: +1.37 stop: 83.45

The VWO broke out over resistance at the $86.00 level today. Volume also picked up on the rally, which is bullish. Our suggested trigger to buy calls was at $86.15 so the play is now open. 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 16 at $ 86.15
Change since picked: + 0.52
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 416 thousand

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WATSCO - WSO - cls: 55.58 change: -0.12 stop: 54.85

WSO under performed the markets on Wednesday but this may prove to be a new entry point. Shares dipped toward broken resistance and what should be new support at the $55.00 level. Traders bought that dip at $54.98 (close enough). We are suggesting new positions right here. Our target is the $59.50-60.00 range.

Picked on May 06 at $ 55.73
Change since picked: - 0.15
Earnings Date 07/19/07 (unconfirmed)
Average Daily Volume = 382 thousand
 

Put Updates

Equinix - EQIX - cls: 78.26 chg: +0.05 stop: 83.55

EQIX slipped to another new relative low early this morning (76.64) but the market's strength inspire a rebound in the stock. At this point we would expect another bounce tomorrow. Watch for potential resistance at $80.00 and again near $82.00. More conservative traders may want to inch their stop down toward $82.50. 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. Please note that we're adjusting the stop to $83.55.

Picked on May 06 at $ 82.83
Change since picked: - 4.57
Earnings Date 04/26/07 (confirmed)
Average Daily Volume = 515 thousand

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Essex Property - ESS - cls: 122.75 chg: -2.26 stop: 130.05

Our bearish play in ESS is finally open. The stock continued lower following Tuesday's bearish reversal/failed rally pattern. The breakdown under support near $125 is definitely bearish. Our suggested trigger to buy puts was at $124.65. There is potential support near $120 but our target is the $115.50-115.00 range. FYI: The P&F chart points to a $100 target.

Picked on May 16 at $124.65
Change since picked: - 1.90
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 281 million

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Itron - ITRI - cls: 67.92 change: +1.51 stop: 69.35

ITRI is not cooperating with our bearish plans for the stock. The market's widespread rally inspire a bounce in ITRI and shares rose 2.2%, which erased yesterday's decline. ITRI is in danger of breaking out over its short-term trend of lower highs. More conservative traders may want to reduce their risk by lowering their stop loss. We are not suggesting new plays here. Our target is the $60.50-60.00 range.

Picked on May 08 at $ 65.85
Change since picked: + 0.56
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 547 thousand

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Russell 2000 Ishares - IWM - cls: 81.41 chg: +0.43 stop: 83.55

We are still on the sidelines with the IWM. Today's big market bounce lifted the Russell from technical support near its 50-dma. Odds are growing shares will see another rally attempt toward resistance near $83.00. 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: 77.35 change: -0.62 stop: 85.01

LVS continues to under perform the market. The stock lost almost 0.8% on above average volume, which tends to be a bearish sign. We would be cautious about opening new positions given the market's strenght. 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: - 2.50
Earnings Date 05/02/07 (confirmed)
Average Daily Volume = 2.1 million

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Vital Images - VTAL - cls: 28.00 chg: -0.42 stop: 30.05

Some M&A activity in the software sector today helped the GSO index rise over 1%. Fortunately, VTAL continued to under perform its peers and the market with a 1.4% decline. The stock actually broke down under support at the $28.00 level on an intraday basis. Our trigger to buy puts was at $27.99 so the play is open. If shares bounce watch for resistance near $29 and again near $30.00. Our target is the $25.15-25.00 range.

Picked on May 16 at $ 27.99
Change since picked: + 0.01
Earnings Date 04/26/07 (confirmed)
Average Daily Volume = 191 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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Lockheed Martin - LMT - cls: 99.64 change: +0.13 stop: n/a

LMT is struggling to breakout over the $100 level, which is bad news for our strangle play. There are only two 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 are adjusting our target to breakeven at $1.50.

Picked on April 22 at $ 95.40
Change since picked: + 4.24
Earnings Date 04/24/07 (confirmed)
Average Daily Volume = 1.7 million
 

Dropped Calls

Ctrip.com - CTRP - cls: 72.21 chg: +0.72 stop: 69.99

Our time has run out for CTRP. Shares produced a 1% rebound ahead of tonight's earnings report. It was our plan to exit at the closing bell to avoid holding over earnings. The company did beat estimates by 4 cents and the guidance sounded positive but we didn't see any big after hours movement.

Picked on April 29 at $ 70.63
Change since picked: + 0.86
Earnings Date 05/16/07 (confirmed)
Average Daily Volume = 389 thousand
 

Dropped Puts

None
 

Dropped Strangles

None
 

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