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Call Updates

Boeing - BA - close: 96.99 change: +0.97 stop: 94.85

BA actually spent most of the day trading sideways. That changed late this afternoon when the company announced a new $7 billion stock buy back program and a 35-cent quarter cash dividend. The stock shot higher and hit $97.60 intraday before paring its gains. Our suggested trigger to buy calls was at $97.25 so the play is now active. There is potential resistance at its 50-dma and the $100 level but if the markets make a fourth quarter run then BA could rally back toward the $105 region. Our target is the $104-105 zone. FYI: The P&F chart is still bearish from the October sell-off.

Picked on October 29 at $ 97.25
Change since picked: - 0.26
Earnings Date 10/24/07 (confirmed)
Average Daily Volume = 6.3 million

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Haynes Intl. - HAYN - cls: 87.37 change: +0.88 stop: 82.45

HAYN continued to rally but most of the gains came early this morning. The stock spent the rest of Monday's session consolidating sideways although we did note that the stock was rising higher into the closing bell. We remain bullish and would still consider new positions here. Tomorrow could see some volatility in steel and metal stocks. U.S. Steel (NYSE:X) is due to report earnings tomorrow morning and investor reaction to the news may influence trading in HAYN. If HAYN sees any profit taking we would watch for the $85 level to act as short-term support. A dip or a bounce near $85 could be used as a new bullish entry point for calls. Our conservative target is the $89.90-90.00 range. Our more aggressive target is the $94.50-95.00 range. The Point & Figure chart has broken through resistance and points to a $100 target.

Picked on October 28 at $ 86.49
Change since picked: + 0.88
Earnings Date 12/10/07 (unconfirmed)
Average Daily Volume = 166 thousand

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L-3 Comm. - LLL - cls: 107.97 chg: +0.99 stop: 103.90

LLL continued to rally on Monday and charged to new all-time highs before pulling back around 2:00 p.m. this afternoon. The stock hit $108.80 midday. Our suggested trigger to buy calls was at $108.10. The play is now open. Our target is the $114.00-115.00 range. The P&F chart is bullish with a $133 target. FYI: If the stock sees any profit taking watch for a bounce near $106 as an alternative entry point for calls.

Picked on October 29 at $108.10
Change since picked: - 0.13
Earnings Date 10/25/07 (confirmed)
Average Daily Volume = 627 thousand

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Siemens - SI - close: 135.95 change: +3.45 stop: 127.40

SI continued to rally. Unfortunately the stock gapped open higher. The opening trade was $135.54. We were suggesting a trigger to buy calls at $133.55. We'll have to take this morning's open. SI's relative strength today (+2.6%) is encouraging but more patient traders may want to consider waiting for a possible dip. The $133-132 zone should now be short-term support. Our primary target is the $139.85-140.00 range. More aggressive traders can aim higher. FYI: SI trades as an ADR here in the U.S. and will most likely gap open one way or the other every session as the ADR adjusts to trading in Europe.

Picked on October 29 at $135.54 *gap higher entry
Change since picked: + 0.41
Earnings Date 10/27/07 (unconfirmed)
Average Daily Volume = 582 thousand

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Sina Corp. - SINA - cls: 56.95 change: +0.39 stop: 49.99

SINA hit a new high on Monday at $58.19. The fact that shares closed in the green is a show of relative strength. After Friday's big move some profit taking would have been normal. Traders bought the dip near $56.00 this morning, which is another positive sign. 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. (Still no update on a confirmed earnings date)

Picked on October 23 at $ 53.40
Change since picked: + 3.55
Earnings Date 11/08/07 (unconfirmed)
Average Daily Volume = 1.0 million

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W-H Energy Services - WHQ - cls: 59.82 chg: -0.14 stop: 56.95

WHQ spiked higher this morning and hit $60.21. Our suggested trigger to buy calls was at $60.05 so the play is now open. If you missed this morning's move the afternoon rebound from $59.00 looks like another bullish entry point although you could wait again for another rally past $60.00. Normally we avoid holding over an earnings report. WHQ is an exception. All the bad news should be priced into the stock already. That gives WHQ a decent change to beat Wall Street's lowered expectations. WHQ is due to report earnings on Tuesday morning. Our target is the $66.50-67.50 zone. WHQ may have resistance at $65.00 and then again at the 100-dma and 50-dma overhead.

Picked on October 29 at $ 60.05
Change since picked: - 0.23
Earnings Date 10/30/07 (confirmed)
Average Daily Volume = 542 thousand
 

Put Updates

BEA Systems - BEAS - cls: 16.50 change: -0.00 stop: 18.05

BEAS let ORCL's $17/share bid for the company expire on Sunday. We are very surprised that the stock did not show more weakness today. Shares of BEAS tried to rally midday but failed near Friday's high. The stock closed unchanged on the session. We remain bearish but more conservative traders will want to seriously consider taking some early profits right here. We're not suggesting new positions at this time. Our target is the $15.25-14.75 range.

Picked on October 23 at $ 17.87
Change since picked: - 1.37
Earnings Date 10/27/07 (unconfirmed)
Average Daily Volume = 19.6 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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Borg Warner - BWA - cls: 102.92 change: +4.96 stop: n/a

Positive analyst comments on Monday helped lift BWA to another new relative high and a 5% gain. Shares of BWA hit an intraday high of $104.37 while the November $100 calls (BWA-KT) hit an intraday high of $5.50. The company's earnings report is behind it and we're not suggesting new strangles. 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
Change since picked: + 7.25
Earnings Date 10/25/07 (confirmed)
Average Daily Volume = 392 thousand

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Express Scripts - ESRX - cls: 61.87 chg: +0.50 stop: n/a

ESRX continues to inch higher. The stock added another 0.8% today. We do not see any changes from our previous comments. 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
Change since picked: + 2.22
Earnings Date 10/24/07 (confirmed)
Average Daily Volume = 2.1 million

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Intl. Bus. Mach. - IBM - cls: 114.80 chg: +1.07 stop: n/a

It looks like IBM is poised to make a bullish breakout attempt through resistance near $115 and its 50-dma soon. We've mentioned it before but the lack of directional movement in IBM is bad news for our strangle and readers may want to abandon ship. 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
Change since picked: - 3.23
Earnings Date 10/16/07 (confirmed)
Average Daily Volume = 7.5 million

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Monster Worldwide - MNST - cls: 39.32 chg: -0.28 stop: n/a

MNST is still struggling with resistance near $40.00. Readers may want to abandon ship since the post-earnings volatility was not enough to push our strangle into a profit. 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
Change since picked: + 2.10
Earnings Date 10/24/07 (confirmed)
Average Daily Volume = 2.0 million
 

Dropped Calls

None
 

Dropped Puts

Tsakos Energy - TNP - cls: 70.20 change: +0.29 stop: 71.01

We are suggesting an early exit in TNP. The stock sold off this morning but recovered and managed to crawl back above technical resistance at its 50-dma, 100-dma and the $70.00 mark. That's an impressive move. Plus, the sector leaders like EXM and DRYS look poised to breakout higher. We'd rather cut our losses now.

Picked on October 22 at $ 67.67 *gap down
Change since picked: + 2.53
Earnings Date 11/05/07 (confirmed)
Average Daily Volume = 114 thousand

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Sepracor Inc. - SEPR - cls: 23.02 change: -0.07 stop: 24.01

We have run out of time with SEPR as a put play. It was our plan to exit on Monday at the close to avoid holding over Tuesday's earnings report. We were unfortunate to have a bad entry with the October 22nd gap down below our suggested entry point.

Picked on October 21 at $ 22.91 *gap down
Change since picked: + 0.11
Earnings Date 10/30/07 (confirmed)
Average Daily Volume = 1.5 million
 

Dropped Strangles

None
 

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