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Call Updates

CNOOC - CEO - cls: 173.86 chg: +3.13 stop: 159.49

Shares of CEO continued to climb even though crude oil futures pulled back from the $102 high this morning. We do not see any changes from our Tuesday night comments on CEO. This continues to look like a bullish entry point or readers could wait for a pull back near $170 or the $168-165 zone. We are listing two targets. Our first target is the $188.00-190.00 zone. Our second target is the $208-210 zone. We would expect some resistance and a pull back on CEO's initial test of the $185 region and the $200 region. Our $208 price target is pretty aggressive given our three to four week time frame. We do not want to hold over earnings. Plan on exiting the majority of the position at the first target.

Picked on February 26 at $170.73
Change since picked: + 3.13
Earnings Date 03/19/08 (unconfirmed)
Average Daily Volume = 509 thousand

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CF Industries - CF - close: 124.88 change: -3.48 stop: 117.45

Shares of CF encountered more profit taking today but traders were buying dips near $122. The trend is still bullish but if you're feeling conservative then consider a tighter stop near $120. Our target is the $138.00-140.00 zone. The Point & Figure chart is bullish with an updated $143 target. FYI: The most recent data puts short interest at 6.8% of the 53.4 million-share float.

Picked on February 19 at $121.03 *triggered/gap higher
Change since picked: + 3.85
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 2.8 million

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Monsanto - MON - cls: 119.27 change: -1.49 stop: 113.99

MON also pulled back today. Short-term support at the 10-dma held but we wouldn't be surprised to see a dip closer to the $116-115 zone. We would consider buying calls on a bounce above $115 or a new rally above $121. We have two targets. Our first target is the $127.00 level. Our second target is the $137.00-140.00 range. We are adjusting our stop loss to $113.99. The fertilizer and agriculture stocks have been very volatile so readers should consider them aggressive, higher-risk plays.

Picked on February 12 at $118.09 *gap higher entry
Change since picked: + 1.18
Earnings Date 04/03/08 (unconfirmed)
Average Daily Volume = 7.1 million

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Petroleo Brasileiro - PBR - cls: 125.01 chg: +3.26 stop: 114.90

PBR continues to rally following yesterday's breakout over $120. Volume was above average on today's gain, which is a good sign. Tomorrow is our last day for this play. PBR is due to report after the closing bell on Thursday. Therefore we plan to exit at the close on Thursday to avoid holding over the announcement. Our target is the $128.00-130.00 range.

Picked on February 12 at $116.00 *triggered
Change since picked: + 9.01
Earnings Date 02/12/08 (unconfirmed)
Average Daily Volume = 7.6 million

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Potash - POT - close: 159.60 change: -1.93 stop: 147.75

POT experienced a second day of profit taking but maintained the short-term up trend (inside its longer-term up trend). We remain bullish. We are not suggesting new positions at this time but will be looking at any dips near the 10-dma as a potential entry. The stock has already hit our first target in the $158-160 zone. Our second, more aggressive target is the $168.00-170.00 zone. More aggressive traders may want to aim significantly higher. The Point & Figure chart is forecasting a $222 target. Again, this is a very volatile stock. Readers should consider it an aggressive, higher-risk trade.

Picked on February 12 at $147.50 *triggered
Change since picked: +12.10
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 5.9 million

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Shaw Group - SGR - close: 67.70 change: +0.90 stop: 59.85 *new*

All we needed was another 25 cents. SGR hit an intraday high of $69.25. Our first target is the $69.50-70.00 range. Volume was strong on today's rally so SGR could see some follow through tomorrow. In spite of this more conservative traders may want to consider a little profit taking here. We have two targets. Our second, more aggressive target is the $74.00-75.00 zone. The Point & Figure chart is very bullish with an $81 target. Please note that we are adjusting the stop loss to $59.85.

Picked on February 24 at $ 64.53
Change since picked: + 3.17
Earnings Date 04/08/08 (unconfirmed)
Average Daily Volume = 1.8 million

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Smith Intl - SII - close: 64.92 change: -0.95 stop: 59.90

After yesterday's strong gains SII corrected a bit today. We remain bullish but we're not suggesting new positions at this time. The stock has already hit our first target in the $64 zone. Our second target is the $68.00-70.00 zone. The P&F chart for SII is very bullish with an $80 target (it was a $77 target last week).

Picked on February 17 at $ 60.52
Change since picked: + 4.40
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 3.5 million

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MEMC Electr. - WFR - cls: 80.00 chg: -1.79 stop: 77.45

Our bullish call play on WFR is not looking well. The solar energy group was hit with downgrades today. WFR was not downgraded but traded down in sympathy with those that were. A Banc of America analyst cautioned investors that the solar industry's profit margins could be hurt by rising silicon prices and weaker demand. Shares of WFR slipped to an intraday low of $78.28. We would wait for a bounce from here before considering new call positions. We have two targets. Our first target is the $89.00-90.00 range and we suggest readers close out the majority of their position here. Our second, more aggressive target is the $94.00-95.00 range near its December highs.

Picked on February 26 at $ 82.55 *triggered
Change since picked: - 2.55
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 5.9 million

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Yahoo! Inc. - YHOO - close: 28.37 change: +0.15 stop: n/a

Shares of YHOO produced a meager bounce today. We have less than four weeks before March options expire. Right now we're speculating that MSFT will raise its bid before expiration. This remains a very risky, aggressive bet.

Picked on February 17 at $ 29.66
Change since picked: - 1.29
Earnings Date 04/17/08 (unconfirmed)
Average Daily Volume = 54 million
 

Put Updates

Ambac Fincl. - ABK - cls: 12.07 change: -0.12 stop: n/a

The market is still waiting on the details and approval of a bailout plan for ABK. Until then the stock will probably continue this sideways chop. We are not suggesting new positions at this time. Previously we had been suggesting the May out-of-the money puts and a speculative out-of-the money March ($20) call as a hedge should a bailout plan come to pass.

Picked on January 27 at $ 11.54
Change since picked: + 0.53
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 10.9 million

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MBIA Inc. - MBI - close: 14.85 change: -0.43 stop: n/a

MBI is also trading sideways as the street waits for further developments on this bond insurer debacle. We're not suggesting new positions at this time. We had been suggesting the out-of-the-money May puts and a March $22.50 (or $20.00) call as a hedge in case a bailout plan for the bond insurers does get done.

Picked on January 27 at $ 14.20
Change since picked: + 0.65
Earnings Date 01/31/08 (confirmed)
Average Daily Volume = 15.2 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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CROCS Inc. - CROX - close: 24.75 chg: +0.22 stop: n/a

CROX just produced its first up day in the last seven trading days. We warned readers yesterday it was overdue for a bounce but we were looking for more than 1%. We want to repeat that normally at this time in a post-earnings volatility play it's probably been too long and we need to consider an exit. However, with more than three weeks left to go we're going to stick with CROX for now. More conservative traders may want to bail out early. We are not suggesting new strangles at this time. The options we had suggested were the March $40 calls (CQJ-CH) and the March $25 puts (CQJ-OE). Our estimated cost was $2.50 and we wanted to sell if either option hits $4.25 or higher.

Picked on February 17 at $ 33.43
Change since picked: - 8.68
Earnings Date 02/19/08 (confirmed)
Average Daily Volume = 5.2 million

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Genentech - DNA - close: 76.66 change: -0.84 stop: n/a

More profit taking in DNA is not helping our strangle! Our only consolidation was the pull back in volume to normal levels. It's been three trading days since the FDA decision. More conservative traders need to start thinking about an early exit. We are not yet ready to jump ship. We are not suggesting new positions. The options we had suggested were the March $75 calls (DWN-CO) and the March $70 puts (DWN-ON). Our estimated cost was $2.80. We want to sell if either option hits $5.00 or higher.

Picked on February 20 at $ 72.37
Change since picked: + 4.29
Earnings Date 04/10/08 (unconfirmed)
Average Daily Volume = 3.5 million
 

Dropped Calls

None
 

Dropped Puts

None
 

Dropped Strangles

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