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Call Updates

Broadcom - BRCM - cls: 36.60 change: +0.34 stop: 34.95

BRCM received some positive analysts comments today. One firm started coverage with an "out perform" while another firm upgraded the stock. Shares ended the day up 0.9% but that didn't stop the MACD on the daily chart from producing a new sell signal. The bullish trend of higher lows is still intact for now. However, we remain very defensive here since the momentum indicators are suggesting the rally is almost exhausted. The next leg will probably depend on how the markets interpret tomorrow's job number. More conservative traders could tighten their stops even further. We're not suggesting new positions at this time. Our BRCM target is the $39.85-40.00 range. The Point & Figure chart is bullish with a $49 target. We do not want to hold over the October 23rd earnings report.

Picked on September 12 at $ 35.85
Change since picked: + 0.75
Earnings Date 10/23/07 (confirmed)
Average Daily Volume = 11.0 million

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Citigroup - C - clos: 47.63 change: -0.26 stop: 45.79

Citigroup shares turned in a bearish session on Thursday. The stock produced a failed rally and a small but still bearish engulfing candlestick (reversal) pattern. At this time we would expect a dip back toward the $47.00 level and or its 10-dma or 50-dma. More conservative traders may want to tighten their stops toward $47.00. Watch for resistance near $49.00 and then again near $50.00. Our initial target is the $49.85-50.00 range. Please note that we do not want to hold over the October 19th earnings report.

Picked on September 16 at $ 46.64
Change since picked: + 0.99
Earnings Date 10/19/07 (confirmed)
Average Daily Volume = 40.7 million

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Ceradyne - CRDN - cls: 77.85 change: +1.53 stop: 72.45

Defensive stocks returned to their winning ways on Thursday. Shares of CRDN rallied 2% and closed near two-month highs. More conservative traders might want to consider a tighter stop loss. Our short-term target is the $79.50-80.00 range. The P&F chart is bullish with a $92 target.

Picked on September 25 at $ 74.61
Change since picked: + 3.24
Earnings Date 11/01/07 (unconfirmed)
Average Daily Volume = 653 thousand

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Deutsche Bank - DB - cls: 135.06 chg: +0.99 stop: 126.99

The markets, especially the financial stocks, were holding their breathe for tomorrow's jobs report number. Yet shares of DB still managed to out perform its peers with a 0.7% gain. More conservative traders might be tempted to take some money off the table right here or consider a tighter stop loss. There is potential resistance at the 200-dma near $138.70 so we're targeting a rally into the $138.00-140.00 range. The P&F chart is bullish with a $154 target.

Picked on October 01 at $130.79
Change since picked: + 4.27
Earnings Date 10/31/07 (unconfirmed)
Average Daily Volume = 633 thousand

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Intl. Bus. Mach.- IBM - cls: 115.69 chg: -0.71 stop: 113.90

The profit taking in IBM just reached its third session in a row. As expected the stock dipped again and traders bought the pull back near round-number support at $115.00. A rebound from here could be used as a new bullish entry point and readers may want to consider adjusting their stop closer to the $115 level. Bear in mind that we don't have much time left and IBM still has resistance in the $119-120 zone. The stock has already hit our first target in the $118-120 range. Our second, more-aggressive target is the $124.00-125.00 zone. FYI: The Point & Figure is very bullish with a $177 target. We do not want to hold over the mid October earnings report.

Picked on August 26 at $113.24
Change since picked: + 2.45
Earnings Date 10/17/07 (unconfirmed)
Average Daily Volume = 9.5 million

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L-3 Comm. - LLL - cls: 104.41 chg: +0.31 stop: 97.99

LLL managed to rebound with the rest of the defense sector. Yet shares remain under resistance at $105. We are not suggesting new positions at current levels. Our target is the $107.50-110.00 range. More aggressive traders may want to aim higher. The P&F chart points to a $115 target.

Picked on September 25 at $100.96
Change since picked: + 3.45
Earnings Date 10/25/07 (confirmed)
Average Daily Volume = 904 thousand

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Martin Marietta - MLM - cls: 141.18 chg: -0.32 stop: 134.85

On Wednesday we suggested that readers watch for a dip into the $137-138 zone. Shares dipped to $137.95 before bouncing back this afternoon. The move looks like a new bullish entry point to buy calls but MLM does still have technical resistance at its 100-dma near $144.50. The P&F chart now points to a $170 target. We have two targets. Our first target is the $149.00-150.00 range. Our second target is the $157.00-160.00 zone. We do not want to hold over the late October earnings report.

Picked on October 02 at $141.31
Change since picked: - 0.13
Earnings Date 10/31/07 (unconfirmed)
Average Daily Volume = 1.0 million

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Stryker - SYK - cls: 72.60 change: +0.81 stop: 66.49

The rally in SYK extended for another session. Today's 1.1% gain marked SYK's fifth gain in the last six sessions. Volume has returned to normal levels on the bullish breakout higher. Our target is the $74.90-75.00 range. It would be tempting to aim higher, maybe the $77.50-80.00 range, but we don't have much time. SYK is due to report earnings on October 17th and we do not want to hold over the report. FYI: The P&F chart is bullish with an $83 target.

Picked on October 02 at $ 70.65
Change since picked: + 1.95
Earnings Date 10/17/07 (confirmed)
Average Daily Volume = 1.4 million

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Terex - TEX - cls: 86.03 change: +0.75 stop: 82.49

The intraday bounce from its lows on Thursday looks like a new bullish entry point to buy calls on TEX. The P&F chart is very bullish with a $100 target. Our target is the $94-95 range although more conservative traders may want to exit near $91.00.

Picked on September 25 at $ 86.50
Change since picked: - 0.47
Earnings Date 10/25/07 (unconfirmed)
Average Daily Volume = 1.8 million

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Whole Foods - WFMI - cls: 51.08 change: +0.77 stop: 46.26 *new*

WFMI continues to show a lot of relative strength. Readers may want to seriously consider an early exit now to lock in a gain. We're not suggesting new positions. The stock does look a little short-term overbought. WFMI has already hit our initial target in the $49.75-50.00 range. Our second target is the $52.50-55.00 zone. We do not want to hold over the early November earnings report. Please note that our new stop loss is $46.26.

Picked on September 26 at $ 46.26
Change since picked: + 4.82
Earnings Date 11/01/07 (unconfirmed)
Average Daily Volume = 3.2 million
 

Put Updates

IDEXX Labs - IDXX - cls: 112.46 change: +2.06 stop: 113.85

The bears in IDXX are in trouble. This is a high-risk, aggressive play and IDXX continues to show a lot of volatility. Today the stock continued to bounce and broke through its 10-dma and the $112 level. Conservative traders, if you're in this play, might want to consider an early exit now! We're not suggesting new positions at this time. Our target is the $101.00-100.00 range. We do not want to hold over the late October earnings report.

Picked on September 30 at $109.59
Change since picked: + 2.96
Earnings Date 10/27/07 (unconfirmed)
Average Daily Volume = 210 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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Dow Jones Industrial Avg. - DJX - cls: 139.74 chg: +0.06 stop: n/a

We do not see any changes from our previous comments on the DJX strangle. We have less than three weeks left before October options expire. We are not suggesting new positions on the October version of our strangle. The options listed for our October strangle were the October $137 calls (DJY-JG) and the October $132 puts (DJW-VB) with an estimated cost of $4.75. We want to sell if either option hits $6.75.

Picked on September 16 at $134.43
Change since picked: + 5.31
Earnings Date 00/00/00
Average Daily Volume = million
 

Dropped Calls

None
 

Dropped Puts

None
 

Dropped Strangles

None
 

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