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Call Updates

Allegheny Tech - ATI - cls: 105.72 change: +1.19 stop: 98.49

ATI, like most of the market, continued to rebound today. We are not suggesting positions at this time. We are going to stick to our plan for now. Our suggested entry range to buy calls is the $100.50-100.00 zone. If triggered at $100.50 our target is the $107.50-110.00 range.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/25/07 (unconfirmed)
Average Daily Volume = 2.0 million

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Celgene - CELG - cls: 60.42 change: +0.40 stop: 57.49

We expected more of a bounce in CELG following the 1.1% gain in the BTK biotech index. Shares of CELG did creep higher after traders stepped in to buy the dip again near its 10 and 50-dma this morning. If you're buying calls now you may want to use a tighter stop loss (maybe just under $59.00). Our target is the $66.50-67.00 range.

Picked on July 27 at $ 61.25
Change since picked: - 0.83
Earnings Date 07/26/07 (confirmed)
Average Daily Volume = 4.1 million

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Lam Research - LRCX - cls: 57.23 chg: -0.68 stop: 53.90

The trading in LRCX and the SOX was interesting. There was hardly any follow through higher after the SOX's big intraday bounce on Wednesday. This relative weakness may have influenced LRCX, which actually traded lower, losing 1.1% on Thursday. Currently our suggested entry point to buy calls is the $55.10-54.00 range but our comments last night suggested that readers might want to go back to our original plan which was to buy calls in the $56.10-55.00 range. At this point we're sticking with the lower range because many of LRCX's technical indicators have turned bearish and we are expecting a dip back toward more significant support. If triggered we have two targets. The first target is $59.75-60.00 and the second target is the $63.75-64.00 range. Don't forget we want to exit ahead of the late August earnings report in about three weeks.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/24/07 (confirmed)
Average Daily Volume = 2.9 million

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PACCAR - PCAR - cls: 83.75 change: +1.88 stop: 79.45

Buyers continue to step in and buy the dip in PCAR. Shares rose 2.2% today on relatively strong volume. PCAR is nearing potential short-term resistance near $85 and its 100-dma. Our target is the $89.50-90.00 range. Yes, given the volatility, we would qualify this as a higher-risk, more aggressive play. FYI: The P&F chart is very bearish and points to a $61 target.

Picked on July 26 at $ 82.87
Change since picked: + 0.88
Earnings Date 07/24/07 (confirmed)
Average Daily Volume = 1.8 million

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Penn National Gaming - PENN - cls: 57.18 chg: +0.07 stop: n/a

There is no change from our previous comments on PENN. PENN continues to drift lower and the future isn't looking good. The company's 45-day window to solicit a higher bid is over. Furthermore the fact that shares are trading at $57 instead of $67 is telling us the market doesn't believe this deal is going to get done. We're not suggesting new positions at this time.

Picked on June 17 at $ 62.12
Change since picked: - 4.94
Earnings Date 07/26/07 (unconfirmed)
Average Daily Volume = 1.0 million

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Sears Holding - SHLD - cls: 136.52 chg: -1.05 stop: 127.49

Lack of follow through on yesterday's bounce is definitely bearish. SHLD under performed the broader market today. We are sticking to our plan. We're still suggesting that SHLD will bounce near support around $130. We are suggesting that readers buy calls on a dip into the $133.00-130.00 zone, which is where we expect it will bounce. If triggered we'll target a rebound into the $139.50-140.00 range. Bear in mind that we don't want to hold over the mid August earnings report so we don't have much time left making this a more aggressive, higher-risk play. If you're feeling conservative here then consider narrowing the entry zone to something like $131.50-130.00 and raising your stop loss closer to the $130 level.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 08/16/07 (unconfirmed)
Average Daily Volume = 1.7 million

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Terex - TEX - cls: 86.46 change: -0.39 stop: 79.49

TEX churned sideways with investors buying dips near $85.00. We're not suggesting new positions at this time but nimble traders may want to consider new positions here. The $85 level was previous resistance so it's natural for it to act as support. More conservative traders may want to tighten their stops. An alternative entry for new positions could be a rise past $88.00 but if you launch new plays there we'd put the stop just under $85.00. The stock has already hit our first target in the $89.50-90.00 range. Our second target is the $94.00-95.00 range.

Picked on July 26 at $ 83.87
Change since picked: + 2.59
Earnings Date 07/25/07 (confirmed)
Average Daily Volume = 1.1 million
 

Put Updatess

Baker Hughes - BHI - cls: 78.06 change: -0.94 stop: 84.15

Oil and oil service stocks continued to see profit taking even though crude oil bounced after yesterday's decline. BHI produced another bearish failed rally pattern under its 10-dma. This looks like another entry point for bearish positions. Our target is the $75.25-74.00 range. The 200-dma near $74 is probably support.

Picked on July 29 at $ 79.43
Change since picked: - 1.24
Earnings Date 07/27/07 (unconfirmed)
Average Daily Volume = 4.6 million

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Harley Davidson - HOG - cls: 56.97 change: -0.84 stop: 60.26

Bears can breathe a little bit easier with HOG tonight but we're not out of the woods yet. The stock failed to rally past short-term resistance near $58.00 but bulls bought the dip near $56.00. It looks like HOG is trying to form a bottom. We're not suggesting new positions at this time. Our target is the $52.50-50.00 range. The P&F chart already points to $42.00.

Picked on July 23 at $ 57.75
Change since picked: - 0.78
Earnings Date 07/27/07 (unconfirmed)
Average Daily Volume = million

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Lubrizol - LZ - cls: 61.37 change: -1.24 stop: 65.26

Shares of LZ sank to a new three month low today. Technically this is a bearish breakdown under its rising 100-dma. Volume came in above average on today's 1.9% decline, which is normally a bearish signal. There could be some round-number support at $60.00 but overall the trend definitely looks weak. Our target is the $57.00-55.00 range. $57.00 is near the top of the April gap and $55.00 is near technical support at its 200-dma.

Picked on July 29 at $ 61.62
Change since picked: - 0.25
Earnings Date 07/27/07 (confirmed)
Average Daily Volume = 563 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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DaimlerChrysler - DCX - cls: 91.18 chg: +1.32 stop: n/a

DCX continues to bounce around the $88-92 range, which is not good news for our neutral strangle play. More conservative traders may want to abandon this play early. We are not suggesting new strangles on DCX at this time. The options in our suggested strangle were the August $95 calls (DCX-HS) and the August $85 puts (DCX-TQ). Our estimated cost was $3.70. We want to sell if either option rises to $6.45.

Picked on July 22 at $ 89.75
Change since picked: + 1.43
Earnings Date 07/25/07 (unconfirmed)
Average Daily Volume = 1.3 million

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Lexmark - LXK - cls: 39.93 change: +0.09 stop: n/a

We see LXK's failure to rebound today as a big display of relative weakness. While that's good news for the bears and the put side of our strangle the stock remains oversold and due for a bounce. More conservative traders may want to consider an early exit now to lock in a gain. Any bounce would kill the current premiums on the puts in this play. Plus we're going to be dealing with time erosion as we near expiration. We are not suggesting new strangle positions in LXK at this time. The options in our strangle were the August $50 calls (LXK-HJ) and the August $40 puts (LXK-TU). Our estimated cost was $0.75. We want to sell if either option rises to $1.50.

Picked on July 22 at $ 45.43
Change since picked: - 5.50
Earnings Date 07/24/07 (confirmed)
Average Daily Volume = 1.9 million
 

Dropped Calls

None
 

Dropped Puts

None
 

Dropped Strangles

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