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Call Updates

Avery Dennison - AVY - cls: 66.59 chg: -0.72 stop: 64.90

The market sell-off helped AVY produce its fourth or fifth failed rally under the $68.00 level today. Shares closed near their lows for the session and under short-term technical support at the 10-dma. Volume was above average on today's loss, which is not a good sign. More conservative traders may want to raise their stop loss toward the $66.00 level, which we suspect will be short-term support. We're not suggesting new positions at this time. Our target is the $69.75-70.00 range. We do not want to hold over the late July earnings report.

Picked on June 11 at $ 66.05
Change since picked: 0.54
Earnings Date 07/24/07 (unconfirmed)
Average Daily Volume = 728 thousand

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BP Plc. - BP - close: 73.62 change: -0.46 stop: 68.75

BP held up relatively well considering the widespread market weakness. We still feel that the stock is short-term overbought and due for more of a correction. We've been warning readers to look for a dip toward the 10-dma or the $72 region. We're not suggesting new positions at this time. Readers may want to consider an early exit right now to lock in a gain. The P&F chart points to a $90 target. Our target is the $74.85-75.00 range. More aggressive traders may want to aim higher.

Picked on June 22 at $ 70.25
Change since picked: 3.37
Earnings Date 07/24/07 (unconfirmed)
Average Daily Volume = 3.5 million

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Deere Co - DE - close: 123.88 change: -1.94 stop: 116.90

After hitting new all-time highs on Monday DE gave back just over 1.5% today. We would use a dip back toward the $120 level or the 50-dma as a new entry point to buy calls but we'd prefer to wait and watch for a bounce first before initiating positions. We have two targets. Our first target is the $129.50-130.00 range. Our second, more aggressive target is the $134.00-135.00 range.

Picked on June 20 at $123.55
Change since picked: 0.33
Earnings Date 08/15/07 (unconfirmed)
Average Daily Volume = 2.6 million

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GulfMark - GMRK - cls: 54.04 change: -1.35 stop: 52.45

Reversal alert! It was not a good day for GMRK. The stock failed to see any follow through on yesterday's bullish breakout. Instead the stock produced a bearish engulfing candlestick pattern, which is normally interpreted as a bearish reversal. We would look for a dip back toward the $53.00 level soon. More conservative traders may want to tighten their stops. Our target is the $59.50-60.00 range. This is somewhat aggressive because time is growing short. We don't want to hold over the late July earnings report.

Picked on July 09 at $ 55.05
Change since picked: - 1.01
Earnings Date 07/27/07 (unconfirmed)
Average Daily Volume = 284 thousand

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Russell 2000 iShares - IWM - cls: 83.33 chg: -2.53 stop: 81.35

The IWM has also produced a bearish reversal and failed rally pattern. The iShares for the Russell 2000 slipped sharply and is nearing technical support at the 50-dma. We're not suggesting new positions at this time. More conservative traders may want to exit early given the reversal today. Our target is the $86.50-87.50 range.

Picked on June 24 at $ 82.85
Change since picked: 0.48
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 71.6 million

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Joy Global - JOYG - cls: 61.25 chg: 0.31 stop: 57.99

JOYG displayed relative strength. Traders bought the dip near $60 and the stock closed up 0.5%. Volume came in above average on the gain, which is usually bullish. Aggressive traders may want to jump in now. We're still waiting for a breakout over resistance at $62.00. We're suggesting a trigger to buy calls at $62.05. If triggered our target is the $68.00-70.00 range. Our time frame is six to eight weeks. The Point & Figure chart is forecasting an $81 target.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: 0.00
Earnings Date 08/30/07 (unconfirmed)
Average Daily Volume = 1.9 million

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Manpower - MAN - cls: 92.30 change: -1.69 stop: 89.90

This doesn't look good for the bulls. The market pull back sparked a 1.79% drop in MAN and following the recent failed rally shares look poised to test the $90 level soon. MAN should have short-term support near $91 and again at $90. However, if the markets continue to show weakness we believe that MAN is a big target for profit taking and could easily break support. More conservative traders may just want to cut their losses right now!

Picked on June 20 at $ 94.15
Change since picked: - 1.85
Earnings Date 07/20/07 (unconfirmed)
Average Daily Volume = 829 thousand

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Pacific Ethanol - PEIX - cls: 14.60 chg: -0.26 stop: 11.90

PEIX did not escape the market-wide profit taking. Shares lost 1.7% but rebounded from its lows near $14.20. We're not suggesting new positions. More conservative traders may want to exit early to lock in a gain. Our target is the $15.40-15.60 range. FYI: We cannot find a future earnings date for PEIX but suspect it will be in August or September.

Picked on June 24 at $ 12.83
Change since picked: 1.77
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 892 thousand

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Penn National Gaming - PENN - cls: 60.66 chg: -0.14 stop: n/a

There is no change from our previous comments on PENN. We are suggesting high-risk, speculative call positions on the gamble that a new suitor does show up and offer more than the current buy-out price. Thus far there hasn't been any news and PENN has less than 30 days to find another bidder. Shares of PENN hit some profit taking but found support near $60.00.

Picked on June 17 at $ 62.12
Change since picked: - 1.42
Earnings Date 07/26/07 (unconfirmed)
Average Daily Volume = 1.0 million

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Toro Co. - TTC - cls: 58.38 change: -1.72 stop: 57.95

TTC suffered some heavy profit taking on Tuesday with a 2.8% drop. Fortunately, we are still on the sidelines waiting for a breakout over resistance. We are suggesting a trigger to buy calls at $60.75. If triggered our target is the $64.95-65.00 range. More aggressive traders may want to aim higher. The P&F chart points to a $77 target.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: 0.00
Earnings Date 08/23/07 (unconfirmed)
Average Daily Volume = 354 thousand
 

Put Updates

Gilead Sciences - GILD - cls: 39.86 chg: 0.49 stop: 40.15

Be careful here! GILD almost hit our stop loss today. The intraday high was $40.09. The stock garnered some additional positive analyst comments, which helped GILD buck the market's bearish trend today. At this point we would strongly consider an early exit to cut your losses now.

Picked on June 07 at $ 39.95 *split adjusted
Change since picked: - 0.09
Earnings Date 07/18/07 (unconfirmed)
Average Daily Volume = 4.1 million

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Mettler Toledo - MTD - cls: 96.95 chg: -1.26 stop: 99.11

MTD turned lower and has reversed back under its 50-dma. Given the market weakness today MTD's turnaround might be a new entry point for puts. However, just to be safe we'd wait for another drop under $96.00. The 100-dma is still a hazard for the bears.

Picked on June 19 at $ 96.75
Change since picked: 0.20
Earnings Date 07/26/07 (unconfirmed)
Average Daily Volume = 215 thousand

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QUALCOMM - QCOM - cls: 43.21 change: -0.38 stop: 44.05

The upward momentum in QCOM is starting to fade. Shares just might turn south but we would watch for short-term support near $43.00, its 100-dma also near $43.00 and then again near the $42.00 level. We're not suggesting new positions.

Picked on June 10 at $ 41.87
Change since picked: 1.34
Earnings Date 07/18/07 (unconfirmed)
Average Daily Volume = 18.0 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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Chaparral Steel - CHAP - cls: 75.69 chg: 1.18 stop: n/a

CHAP gave us another opportunity to launch strangle plays near $75.00 with today's bounce. Odds are decent that shares will trade sideways tomorrow as investors wait for the company's earnings report due out tomorrow after the closing bell. We would not launch new positions after the earnings report. We are suggesting positions in the $76.00-74.00 range and the closer to $75.00 the better. We're going to play the July options, which expire in two weeks, because we're looking for the quick post-earnings pop. Our suggested options were the July $80 calls (ZHQ-GP) and the July $70 puts (ZHQ-SN). Our estimated cost was $1.60. We will plan to sell if either option hits $3.20 or higher.

Picked on July 08 at $ 75.72
Change since picked: - 0.03
Earnings Date 07/11/07 (confirmed)
Average Daily Volume = 1.0 million

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Genentech - DNA - cls: 74.85 change: -0.91 stop: n/a

Shares of DNA also gave us an opportunity to start strangle positions near $75.00 today. The overall trend continues to look pretty bearish especially with today's failed rally. However, if DNA surprises tomorrow night after the closing bell shares could see a big reaction. We are suggesting positions in the $76-74 range. The closer to $75 the better. We would not launch new plays after the earnings report. We are suggesting the July $80 calls (DWN-GP) and the July $70 puts (DWN-SN). Our estimated cost is $0.45. We will plan to sell if either option hits $0.90 or higher.

Picked on July 08 at $ 75.10
Change since picked: - 0.25
Earnings Date 07/11/07 (confirmed)
Average Daily Volume = 3.5 million
 

Dropped Calls

SanDisk - SNDK - cls: 51.28 change: 0.04 stop: 47.45

SNDK displayed relative strength by closing in the green and with its big bounce from the dip near $50.00 today. However, the market's sharp pull back has us worried. We would rather exit early right now and lock in a gain than gamble on SNDK hitting our aggressive target in the $52.50-55.00 range. SNDK has already hit our conservative target in the $49.50-50.00 range. More aggressive traders may want to let it ride.

Picked on June 17 at $ 46.40
Change since picked: 4.88
Earnings Date 07/19/07 (unconfirmed)
Average Daily Volume = 7.6 million
 

Dropped Puts

Allegheny Tech - ATI - cls: 108.18 chg: 0.62 stop: 110.15

It was a volatile day for shares of ATI. The stock spiked lower at the open hitting $104.59 then suddenly shot higher to $111.45 before reversing course. Fueling the moves were rumors that German-based ThyssenKrupp was considering a takeover bid for ATI. The company denied the rumor but it was too late for our play and ATI hit our stop loss at $110.15. ATI had already hit our conservative target in the $100.50-100.00 range. We had been aiming for a deeper decline near the 200-dma.

Picked on June 12 at $106.70
Change since picked: 1.48
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume = 2.1 million
 

Dropped Strangles

None
 

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