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Call Updates

Blackstone - BX - close: 19.70 chg: -0.69 stop: 17.24

BX was no exception to Tuesday's profit taking. The stock lost 3.3% and cracked round-number support at the $20.00 level. If shares continue lower the $19.00 mark should be support. More conservative traders will need to re-consider where their stop loss is. We have a very aggressive stop loss under the recent lows. Given the market's turmoil we would hesitate to jump into new bullish positions here. Our target is the $24.00-25.00 range. We do not want to hold over the February earnings report.

Picked on January 10 at $19.84
Change since picked: - 0.14
Earnings Date 02/11/08 (unconfirmed)
Average Daily Volume: 2.7 million

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Covance - CVD - cls: 96.13 change: +0.47 stop: 86.99

The strength in CVD is just amazing. Traders bought the dip at $94.50 and shares actually posted a gain. We're still not willing to chase it here. The stock looks short-term overbought and due for a correction. Our suggested entry point is the $90.50-90.00 zone. Our first conservative target is $94.50-95.00. Our second, more aggressive target is the $99.00-100.00 range. FYI: We are unfortunately, running low on time. We don't want to hold over earnings.

Picked on January xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 01/23/08 (unconfirmed)
Average Daily Volume = 395 thousand

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Genzyme - GENZ - close: 78.50 change: -0.18 stop: 74.95

Biotech shares of GENZ held up very well during today's weakness. The stock posted a fractional loss. We remain bullish but would hesitate to open new positions given the market's bearishness. As Jim is fond of saying, "even a helium balloon will go down if it's stuck in a descending elevator." Thus even the best stocks will struggle if the market is sinking. Meanwhile after the closing bell tonight GENZ had its credit rating upgraded by S&P, which is always a good thing. If you're worried about resistance at $80.00 then wait for a breakout before buying calls. Our target is the $84.00-85.00 range. The P&F chart looks very bullish with a $94 target. FYI: Any time we play a biotech company it is always a high-risk play due to headline risk. You never know what news might come out concerning an important FDA decision or clinical trial that could dramatically move the stock price and see shares gap one way or the other.

Picked on January 13 at $ 78.56
Change since picked: - 0.06
Earnings Date 02/13/08 (unconfirmed)
Average Daily Volume = 2.5 million

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Inverness Medical - IMA - cls: 60.11 chg: -0.35 stop: 57.45

IMA displayed relative strength today with a minor loss. Traders bought the intraday dip near $59.00 and its 10-dma. A bounce from here could be used as a new bullish entry point. More conservative traders may want to consider a stop closer to $58. Our target is the $64.00-65.00 range.

Picked on January 08 at $ 58.50 *triggered/gap open entry
Change since picked: + 1.61
Earnings Date 02/26/08 (unconfirmed)
Average Daily Volume = 857 thousand

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Joy Global - JOYG - cls: 61.01 chg: -1.20 stop: 57.49

JOYG was doing pretty well this morning with an intraday high of $63.92. Unfortunately, the stock failed to maintain those gains. Wait and watch for another bounce from support near $60 or its rising 50-dma as a new entry point. We have two targets. Our first target is $67.00. Our second target is $71.50. We do not want to hold over the late February earnings report.

Picked on January 09 at $ 60.19
Change since picked: + 0.82
Earnings Date 02/28/08 (unconfirmed)
Average Daily Volume = 1.7 million

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McDonalds - MCD - cls: 53.76 chg: -1.20 stop: 53.25

MCD bulls may end up as dinner if we're not careful. The stock rolled over and fell back toward technical support at its simple and exponential 200-dma. Readers need to double check your stop loss placement and make sure your happy with it. After hours tonight shares of MCD were trading down near $53.00. If the market, and MCD, doesn't rebound before the open tomorrow it looks like we'll be stopped out. If we get a surprise turnaround then a move over $54.50 could be used as a new entry point. Our very short-term target is the $57.90-58.00 range. More aggressive traders could aim higher (maybe $60-62). We do not want to hold over the late January earnings report.

Picked on January 13 at $ 54.32
Change since picked: + 0.64
Earnings Date 01/28/08 (confirmed)
Average Daily Volume = 8.6 million

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Zimmer Holdings - ZMH - cls: 67.68 chg: -1.11 stop: 67.49

ZMH inched lower following yesterday's bearish action. We are surprised that ZMH wasn't weaker. The S&P 500 lost 2.49%. ZMH only fell 1.6%. If the market doesn't bounce tomorrow morning then we would expect shares of ZMH to hit our stop loss at $67.49 pretty early on Wednesday. We're not suggesting new positions at this time.

Picked on January 14 at $ 70.64 *triggered/gap open higher
Change since picked: - 1.85
Earnings Date 01/29/08 (confirmed)
Average Daily Volume = 2.0 million
 

Put Updates

Liberty Media - LCAPA - cls: 106.70 chg: -2.34 stop: 111.15

Market weakness pushed LCAPA to a new nine-month low under recent support. The play is now open since shares hit our trigger at $107.49. Our target is the $100.25-100.00 range. The P&F chart is bearish with a $98 target. Warning: We cannot find an earnings report date for LCAPA but the company appears to have a history of reporting in February. Not knowing when they report is a risk since we don't want to hold over the event.

Picked on January 15 at $107.49 *triggered
Change since picked: - 0.79
Earnings Date 02/00/08 (unconfirmed)
Average Daily Volume = 653 thousand

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Priceline.com - PCLN - cls: 103.28 chg: +2.76 stop: 100.51

I am honestly surprised at PCLN's relative strength today. With concerns about the economy, about oil, and consumer spending PCLN doesn't sound like a great investment right here. Shares rallied to short-term technical resistance at the 10-dma. Nimble traders can look for alternative entry points with a failed rally near $105 or $110. Currently we're suggesting readers wait for a new relative low. Our suggested entry points to buy puts is at $93.99. If triggered we'll aim for the $82.50-80.00 range. More conservative traders will want to consider exiting near $85.00. Please note that PCLN can be a very volatile stock. Shares had a $10.00 range on Friday alone. Nimble traders could try and buy puts on a failed rally near $100 or $105. We do not want to hold over the mid February earnings report.

Picked on January xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 02/12/08 (unconfirmed)
Average Daily Volume = 1.6 million

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Precision Castparts - PCP - cls: 117.24 ch: -7.26 stop: 128.21*new*

It's nice to see the big point swings moving in our favor. Shares of PCP lost more than 5.8% and did so on big volume, which is bearish. The intraday low was $116.14. We have two targets. Our first target is near the recent low in the $115.50-115.00 range. Our second target is the $110-105 zone. We are adjusting the stop loss to $128.21. FYI: The P&F chart is bearish with an $88 target.

Picked on January 14 at $124.50
Change since picked: - 7.26
Earnings Date 01/22/08 (confirmed)
Average Daily Volume = 1.1 million

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Sears Holding - SHLD - cls: 86.02 chg: -5.36 stop: 102.05

SHLD is certainly moving the right direction but we're going to have a heck of a time trying to find a new entry point. Our bias is still very bearish for SHLD but we're not suggesting new put positions at these levels. We had two targets. One target was $91.00-90.00. The second target was $85.50-85.00. The P&F chart is bearish with a $78 target. SHLD has actually exceeded both of our targets but the stock has just not cooperated with an entry! With hindsight being 20/20 we should not have closed it as an open put play several days ago.

Picked on January 13 at $ 96.17 (gap down 86.43)
Change since picked: -10.15
Earnings Date 02/28/08 (unconfirmed)
Average Daily Volume = 3.3 million

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Shire Plc - SHPGY - close: 65.03 change: -1.71 stop: 70.05

SHPGY lost 2.5% and is testing round-number support at $65.00 again. A breakdown under support at $65 would look like a new entry point for puts. The stock has already hit our first target near $65. Our second target is the $62.00-60.00 zone.

Picked on December 13 at $ 68.07 *triggered/gap down entry
Change since picked: - 3.04
Earnings Date 02/21/08 (unconfirmed)
Average Daily Volume = 956 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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Biogen Idec - BIIB - cls: 59.31 chg: -0.67 stop: n/a

Now that's just cruel! BIIB did not perform for us on Monday following the FDA announce. Now the stock has failed to move on a huge market sell-off. Given that January option expiration is this Friday it would not surprise me to see the "market" peg BIIB to the $60 level the rest of the week. We were speculating with a high-risk strategy to use January options, which expire after this Friday. The options we suggested for our strangle were the January $65 call (IHD-AM) and the January $55 put (IDK-MK). Our estimated cost here is $1.05. We are adjusting our exit to anything in the $0.75-1.00 range.

Picked on January 10 at $ 59.18
Change since picked: + 0.13
Earnings Date 02/14/08 (unconfirmed)
Average Daily Volume = 4.4 million

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Encana - ECA - close: 65.72 chg: -2.22 stop: n/a

ECA lost 3.2% on big volume and shares are testing support near $65.00 and its 100-dma. A breakdown from here might just breathe new life into the put side of our strangle. We're not suggesting new strangle positions at this time. The options we listed for the strangle were the January $75 calls (ECA-AO) and the January $60 puts (ECA-ML). Our estimated cost is $0.65. We are adjusting our exit to anything in the $0.40-0.65 range.

Picked on December 20 at $ 67.52
Change since picked: - 1.80
Earnings Date 02/14/08 (unconfirmed)
Average Daily Volume = 2.7 million
 

Dropped Calls

Apple Inc. - AAPL - cls: 169.04 chg: -9.74 stop: 164.75

Ouch! The MacWorld Expo kicked off today and the big event was Steve Jobs keynote speech. AAPL's CEO announced some neat new products like the world's thinnest notebook computer and a new movie download service from iTunes. Unfortunately, the news did not live up to the hype. Shares of AAPL suffered a classic "sell the news" event. The stock plunged through support near $170 and its 100-dma to hit an intraday low of $164.66. That was just low enough to tag our stop loss at $164.75 and end the play. FYI: AAPL came within 8 cents yesterday of hitting our first target at $179.50. Sadly this turned out to be a loss.

Picked on January 11 at $171.00 *triggered
Change since picked: - 1.96
Earnings Date 01/22/08 (confirmed)
Average Daily Volume = 38 million

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BP Prudhoe - BPT - cls: 78.46 chg: -2.99 stop: 77.90

Oil stocks turned lower following a drop in crude oil. Oil prices slipped on concerns of rising inventories. Shares of BPT overreacted and the stock spiked to an intraday low of $77.12. The sharpness of this drop really does look overdone. The move today is just a combination of a drop in oil and a broad-based high-profile meltdown in the major indices. Traders wanted to sell their winners to lock in a profit. We've been stopped out at $77.90. We would keep BPT on our watch list as a potential candidate should shares bounce back above the $80.00 level again. If the market continues to sink then BPT, with its big dividend, is going to look like a safe haven.

Picked on January 14 at $ 80.50 *triggered
Change since picked: - 2.04
Earnings Date 00/00/08 (unconfirmed)
Average Daily Volume = 84 thousand

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Entergy - ETR - cls: 119.92 chg: -3.18 stop: 119.95

Trader beware! The numbers on ETR may not be all that they seem. Most quote services will tell you that ETR closed at $119.92, which also happens to be the intraday low. However, a quick look at the intraday chart and shares of ETR never traded under $120.06. Is this stock price manipulation from the market makers trying to hit some stop loss under $120.00? Maybe, but I'm not big on conspiracy theories. Bad ticks do occur and we have been playing them. Thus we have been stopped out at $119.95. The real sad news is that ETR is trading up near $123 in after hours trading tonight. We would keep an eye on ETR.

Picked on January 13 at $124.39
Change since picked: - 4.47
Earnings Date 01/29/08 (confirmed)
Average Daily Volume = 1.6 million

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Foster Wheeler - FWLT - cls: 132.06 chg: -9.11 stop: 137.85

Plenty of the high-dollar stocks just got hammered today with the market's widespread sell-off. Shares of FWLT slipped 6.4% and broke down to a new relative low. We would have been stopped out at $137.85. Recently we had been warning readers that the stock wasn't looking healthy and that more conservative traders may have wanted to exit early. FWLT has already hit our initial target in the $149.50-150.00 zone. Our second target was the $158.00-160.00 range. FYI: FWLT is due to split 2-for-1 on January 22nd.

Picked on January 09 at $142.90
Change since picked: -10.84
Earnings Date 02/27/08 (unconfirmed)
Average Daily Volume = 1.7 million

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Hess Corp. - HES - cls: 89.91 chg: -3.07 stop: 89.90

Oil stocks slid sharply lower on Tuesday. The OIX oil index plunged 3.4%. Shares of HES tried to keep pace and fell 3.3%. The stock broke support at the $90.00 level and hit our stop loss at $89.90.

Picked on January 07 at $ 92.00 *triggered
Change since picked: - 2.09
Earnings Date 01/30/08 (unconfirmed)
Average Daily Volume = 4.5 million

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Jacobs Engineering - JEC - cls: 82.13 chg: -7.31 stop: 84.45

JEC announced a new five-year $492 million contract with the U.S. Army but investors sold the stock anyway. Shares of JEC just got punished with an 8.17% decline. The stock fell to technical support at its 100-dma. The move today looks very overdone but over this decline has cast a very bearish shadow over JEC's upward trend. The stock hit our stop loss at $84.45.

Picked on January 09 at $ 86.31
Change since picked: - 4.18
Earnings Date 01/22/08 (unconfirmed)
Average Daily Volume = 1.4 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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