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Call Updates

Amgen Inc. - AMGN - cls: 57.62 change: +0.54 stop: 54.90

The BTK biotech index rallied to a new high. Shares of AMGN paced the BTK's move higher but still could not breakout past resistance near $58.00. We are waiting on a bullish breakout and suggesting that readers use a trigger to buy calls at $58.01. We do see what could be additional resistance at its 200-dma near $59.40 and again at the $60.00 mark. However, if triggered our target is the $64.00-65.00 range, which might be a little too aggressive given our time frame. AMGN is due to report earnings around October 25th and we don't want to hold over the report. It's also worth noting that AMGN's P&F chart is still bearish and it will take a breakout over $60.00 to change it back into a bullish pattern.

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/25/07 (unconfirmed)
Average Daily Volume = 11.7 million

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Biogen Idec - BIIB - cls: 67.41 chg: +0.17 stop: 64.95

Surprisingly shares of BIIB under performed the biotech sector today. Yet we remain bullish on the stock. Traders bought the dip near $66.40 and BIIB looks like it's crouching to sprint higher. We would consider new positions at current levels. There is potential resistance near $70.00 but we're going to aim for the $72.40-72.50 range. The P&F chart points to an $86 target. Part of our challenge is time. We do not want to hold over the October 23rd earnings report.

Picked on October 07 at $ 67.63
Change since picked: - 0.22
Earnings Date 10/23/07 (confirmed)
Average Daily Volume = 4.4 million

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Burlington N.SantaFe- BNI - cls: 85.56 chg: -0.94 stop: 83.90

Railroad stocks suffered some profit taking on Wednesday and BNI lost just over 1%. Fortunately, bulls continued to defend the stock near support around $85.00. This looks like another bullish entry point. We're suggesting call positions now with BNI above $85.00. Our suggested stop loss is at $83.90 but more conservative traders might want to place their stop closer toward $84.60. We have two targets on BNI. Our first target is the $89.75-90.00 range. Our second target is the $92.50-94.00 range. We only have two weeks and plan to exit ahead of the October 23rd earnings report. FYI: The P&F chart is bullish with a $96 target.

Picked on October 09 at $ 86.50
Change since picked: + 0.00
Earnings Date 10/23/07 (confirmed)
Average Daily Volume = 4.3 million

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Citigroup - C - clos: 47.14 change: -0.48 stop: 45.79

Shares of Citigroup slipped again but traders bought the dip near $46.75 for the second day in a row. We remain cautious on the stock and more conservative traders may want to raise their stop loss. 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: + 0.50
Earnings Date 10/19/07 (confirmed)
Average Daily Volume = 40.7 million

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Cummins Inc. - CMI - cls: 139.04 change: -0.94 stop: 134.45

The broad market indices turned lower on Wednesday and the rally in CMI paused near $140.00. We do not see any changes from yesterday's comments. The stock has a bullish trend of higher lows and shares look poised to breakout over resistance near $140-141. We're suggesting a trigger to buy calls at $140.85, just above today's high. However, we'll also be watching for a dip and bounce in the $136-135 range as an alternative entry point. If CMI hits our trigger at $140.85 then our target is the $149.50-150.00 range. This is an aggressive play given CMI's volatility and our two-week time frame. We do not want to hold over earnings.

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

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Ceradyne - CRDN - cls: 77.90 change: -0.29 stop: 73.95

The sell-off in Boeing (BA) weighed on the defense stocks but CRDN held up relatively well. We don't see any changes from our Tuesday comments. The stock is relatively close to our target so we're not suggesting new positions at this time. More conservative traders may want to tighten their stop losses again. 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: + 3.25
Earnings Date 11/01/07 (unconfirmed)
Average Daily Volume = 653 thousand

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Deutsche Bank - DB - cls: 132.75 chg: -1.45 stop: 128.99

It was a negative session for DB. The stock gapped down at the open and shares produced a very clear failed rally near $134 late this afternoon. Currently the stock is clinging to support near $132 and its rising 10-dma. However, if the major averages continue to see more profit taking tomorrow we would expect DB to dip toward the $130 region. If you're looking for a new bullish entry point in DB then consider waiting for that dip and bounce near $130 as an entry point. 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: + 1.96
Earnings Date 10/31/07 (unconfirmed)
Average Daily Volume = 633 thousand

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Intl. Bus. Mach.- IBM - cls: 118.62 chg: +0.32 stop: 114.49

There is no change from our previous comments on IBM. If you think IBM can breakout over resistance in the $119-120 zone then this is a new entry point for calls. 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: + 5.38
Earnings Date 10/17/07 (unconfirmed)
Average Daily Volume = 9.5 million

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Kohl's - KSS - close: 61.11 change: +0.85 stop: 57.90

Retail companies are expected to report their September same-store sales numbers tomorrow. We would expect some volatility in the retail sector as investors react to the news. We're going to stick to our plan with KSS. That plan suggests readers use a trigger to open positions at $62.01. If we are triggered at $62.01 our target is the $67.00-68.00 range. Keep a wary eye on the 100-dma as potential overhead resistance. We do not want to hold over the November earnings report.

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 11/15/07 (unconfirmed)
Average Daily Volume = 5.9 million

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Lehman Brothers - LEH - close: 64.49 change: -0.10 stop: 61.99

LEH continues to churn sideways under resistance near $65.00. We do not see any changes from yesterday's comments. We're suggesting a trigger to buy calls on LEH at $65.25. If triggered our target is the $69.85-70.00 range. More aggressive traders may want to aim higher and shoot for the 200-dma.

Picked on October xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 12/13/07 (unconfirmed)
Average Daily Volume = 15.8 million

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Stryker - SYK - cls: 73.33 change: -0.14 stop: 68.49

Shares of SYK were downgraded to a "hold" this morning and the worst the bears could do was a 14-cent decline. That sounds like relative strength to us. However, while we are encouraged by SYK's strength the stock does look short-term overbought and if the major indices continue to slip we would expect a pull back in SYK. 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: + 2.68
Earnings Date 10/17/07 (confirmed)
Average Daily Volume = 1.4 million

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Terex - TEX - cls: 88.46 change: -1.27 stop: 83.75

TEX hit an intraday high of $90.75 before reversing lower. The move looks like a bearish failed rally pattern under $91.00. Readers might want to turn defensive here and adjust their stops. We're not suggesting new positions at this time. 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: + 1.96
Earnings Date 10/25/07 (unconfirmed)
Average Daily Volume = 1.8 million
 

Put Updates

None
 

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: 140.79 chg: -0.86 stop: n/a

We do not see any changes from our previous comments on DJX. 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: + 6.36
Earnings Date 00/00/00
Average Daily Volume = million
 

Dropped Calls

Martin Marietta - MLM - cls: 136.56 chg: -1.70 stop: 134.85

Shares of MLM continued to sell-off on Wednesday. The stock broke down under what should have been support near $137, $136 and its 200-dma. MLM hit our stop loss at $134.85 this morning.

Picked on October 02 at $141.31
Change since picked: - 4.75
Earnings Date 10/31/07 (unconfirmed)
Average Daily Volume = 1.0 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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