Sina Corp. - SINA - cls: 56.56 change: +5.19 stop: 49.99
SINA recovered sharply from Thursday's swoon. A big move in BIDU and widespread strength in Asian markets not to mention strength in the U.S. markets helped SINA tack on a 10% gain. The stock shot past resistance at the $56 level and closed at a new high. Traders may want to consider adjusting their stops toward Thursday's low near $50.82. We remain bullish on SINA but would not want to chase a 10% move on Monday. Our target is the $59.50-60.00 range. SINA is due to report earnings somewhere in the October 29th-November 8th range. Hopefully the closer we get to the end of October we'll find a confirmed date since we do not want to hold over SINA's earnings report.
Picked on October 23 at $ 53.40
BEA Systems - BEAS - cls: 16.50 change: -1.03 stop: 18.05 *new*
Shares of BEAS sank 5.88% on Friday as the Sunday deadline to accept Oracle's $17/share bid draws near. All of the press this past week from BEAS told the markets that the Board of Directors would not accept ORCL's bid. Instead they want $21 a share. There is the chance that the Board changes their mind on Sunday but we're not expecting it. We're not suggesting new positions at this time. Instead we are adjusting our stop loss to $18.05. More conservative traders will want to consider taking some profits early but we suspect that BEAS will continue to plummet on Monday after ORCL's offer expires. Our target is the $15.25-14.75 range.
Picked on October 23 at $ 17.87
Tsakos Energy - TNP - cls: 69.91 change: +1.65 stop: 71.01*new*
Market strength on Friday helped TNP produce a 2.4% bounce. Volume was low but the stock managed to close over its 50-dma, which is a bullish sign. The rally stalled right at round-number resistance at $70.00. A failure right here would be bearish and readers could use it as a new bearish entry point to buy puts. We are going to try and reduce our risk by adjusting the stop loss to $71.01. More conservative traders may want to tighten their stops closer to the $70.00 level. We are planning to exit on Friday, November 2nd to avoid holding over the November 5th earnings report. TNP's P&F chart turned bearish this week and points to a $61 target.
Picked on October 22 at $ 67.67 *gap down
Sepracor Inc. - SEPR - cls: 23.09 change: +0.34 stop: 24.01*new*
Monday is our last day for the SEPR put play. The company is due to report earnings on Tuesday morning so we're planning to exit at Monday's close. The trend remains bearish but with earnings this close the stock might just trade sideways tomorrow as investors wait for the earnings news. We're adjusting our stop loss to $24.01. More conservative traders may just want to exit on Monday morning to cut their losses. We're not suggesting new positions at this time. Our target is the $20.25-20.00 zone.
Picked on October 21 at $ 22.91 *gap down
(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.)
Borg Warner - BWA - cls: 97.96 change: +3.31 stop: n/a
Friday morning BWA was upgraded to a "buy" and the stock responded with an early spike higher hitting $99.00. Shares closed up 3.5% but they also closed right at resistance near $98.00. If the market can keep the rally alive then BWA has a good chance of breaking out past the $100 level. The company's earnings report is behind it and we're not suggesting new strangles. However, a rally past $100 might make BWA a candidate for a directional call play. We have three weeks left for our November options. The options we suggested for a strangle were the November $100 calls (BWA-KT) and the November $90 puts (BWA-WR). Our estimated cost was $4.50. We want to sell if either option hits $7.25 or more.
Picked on October 23 at $ 95.67
Express Scripts - ESRX - cls: 61.37 chg: +0.43 stop: n/a
ESRX continued to inch higher following Thursday's post-earnings rally. The trend remains bullish and we'll focus on the call side of our strangle. We are no longer suggesting new strangle positions on ESRX. The options we suggested for a strangle were the November $65 calls (XTQ-KM) and the November $55 puts (XTQ-WK). Our estimated cost was $1.95. We want to sell if either option hits $3.50 or higher.
Picked on October 21 at $ 59.65
Intl. Bus. Mach. - IBM - cls: 113.73 chg: +0.92 stop: n/a
The sideways consolidation in IBM has formed a pennant-type of pattern with lower highs and higher lows. These are usually neutral and we should see a breakout relatively soon. We have three weeks left on our November options. We are not suggesting new strangle positions at this time. Our November strangle suggested the November $125 call (IBM-KE) and the November $110 put (IBM-WB). Our estimated cost was $3.00. We wanted to sell if either option hits $6.00.
Picked on October 15 at $118.03
Monster Worldwide - MNST - cls: 39.60 chg: +0.80 stop: n/a
MNST continues to rally following Thursday's post-earnings pop higher. The stock is now challenging resistance near $40 and its exponential 200-dma. There are three weeks left for the November strikes. We are no longer suggesting new positions. The options we suggested for our strangle were the November $40 calls (BSQ-KH) and the November $35 puts (BSQ-WG). Our estimated cost is $1.75. We want to sell if either option hits $2.95 or higher.
Picked on October 23 at $ 37.22
Microsoft - MSFT - cls: 35.03 change: +3.04 stop: n/a
Our strangle over MSFT's earnings was a big success, bigger than we expected. The company announced a huge surprise higher and the stock gapped open higher. MSFT hit $36.03 on Friday morning before paring its gains to close with a +9.5% move. We saw the after hours reaction on Thursday evening and adjusted our exit for the November $32.50 calls to $2.75. We were fortunate again. The November $32.50 calls (MSQ-KZ) gapped open higher at $3.50 and hit $3.55 before pulling back. We would have been taken out at the opening trade. Our estimated cost was $1.07.
Picked on October 23 at $ 30.90