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Call Updates

Ashland Inc. - ASH - close: 51.35 change: +0.34 stop: 48.95 *new*

It was another mild day for ASH. The stock continued to trade sideways and Tuesday marked the third time in the last few sessions that traders have bought the dip near $50.50. We are raising our stop loss to $48.95. More conservative traders may want to tighten their stops even further. There is potential resistance at its 200-dma in the $54 zone. Our target is the $57.00-58.00 range. We do not want to hold over the late April earnings report.

Picked on April 06 at $ 51.25
Change since picked: + 0.10
Earnings Date 04/23/08 (unconfirmed)
Average Daily Volume = 774 thousand

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Bunge Ltd - BG - close: 108.58 chg: -0.84 stop: 102.45

BG's rally ran out of steam at $111.77 this morning and shares pulled back a bit in profit taking following yesterday's gains. A dip near $106-105 can be used as a new entry point for calls. Our target will be $114.50-115.00. The Point & Figure chart is bullish with a $129 target. We do not want to hold over the April 24th (before the opening bell) earnings report.

Picked on April 14 at $105.25 *triggered
Change since picked: + 3.33
Earnings Date 04/24/08 (confirmed)
Average Daily Volume = 2.8 million

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Baker Hughes - BHI - close: 75.15 chg: +2.08 stop: 69.45

BHI displayed relative strength today with a 2.8% gain. Shares rallied to a new two and a half month highs and closed above the simple 100-dma for the first time in months. The P&F chart is bullish as the stock has broken through resistance and points to an $89 target. Our target is the $78.50-80.00 range. We do not want to hold over the April 22nd earnings report.

Picked on April 10 at $ 72.76
Change since picked: + 2.39
Earnings Date 04/22/08 (confirmed)
Average Daily Volume = 4.7 million

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CONSOL Energy - CNX - cls: 79.02 chg: -0.25 stop: 74.99 *new*

Rival coal producer Massey (MEE) was upgraded again this morning. MEE's upgrade fueled another burst higher for coal stocks. CNX opened at $80.33 and surged to $82.00 before paring its gains. Yesterday we had added a second breakout higher entry point to buy calls at $80.55 so the pl ay is now open. Our new stop loss is $74.99. Our target is the $88.00-90.00 zone. Remember, we do not want to hold over the late April earnings report, which does not give us much time left.

Picked on April 15 at $ 80.55
Change since picked: - 1.53
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 3.7 million

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Fluor - FLR - close: 149.90 chg: +1.60 stop: 144.45

FLR added 1% today and is acting like it's ready to rally again. We're sticking with our comments from yesterday and suggest waiting for a rally past $151.00 or $152.00 before launching new call positions. Our first target is the $159.00-160.00 zone. Our second target is the $168.00-170.00 zone. We do not want to hold over earnings in early May. FYI: The P&F chart is bullish with a $184 target.

Picked on April 01 at $146.50 *triggered
Change since picked: + 3.40
Earnings Date 05/07/08 (unconfirmed)
Average Daily Volume = 2.3 million

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CurrencyShares Euro - FXE - cls: 157.96 chg: -0.47 stop: 156.45

The U.S. dollar actually showed some strength today so it's natural that we see a dip in the FXE. The trend of higher lows (support) is still intact so readers can use this dip as a new entry point to buy calls. There is some resistance in the $159 region and more conservative traders may want to wait for a new high to launch positions. Our target is the $164.00-165.00 range. Our time frame is three to five weeks.

Picked on April 13 at $158.57
Change since picked: - 0.61
Earnings Date 00/00/00
Average Daily Volume = 307 thousand

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Hovnanian - HOV - close: 11.01 chg: +0.49 stop: 9.69

Investors bought the dip at $10.50 yesterday and they did it again today. We're starting to wonder if we should have left our buy the dip entry point at $10.50 instead of moving it down to $10.25-10.00. We're going to stick with our plan for now. More conservative traders may want to use a tighter stop loss if we do get triggered. If triggered at $10.25 our first target is the $12.75-13.00 range. Our second, more aggressive target will be the $14.50-15.00 zone.

Picked on April xx at $ xx.xx <-- see TRIGGER 10.25
Change since picked: + 0.00
Earnings Date 05/29/08 (unconfirmed)
Average Daily Volume = 4.1 million

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Joy Global - JOYG - close: 70.78 chg: +1.68 stop: 68.45

JOYG also displayed some relative strength today. Shares gapped open higher, rallied toward $72.00 and then caved in intraday but just low enough to fill the morning gap. Shares still look poised to rally through resistance in the $72.00-72.50 zone to hit new all-time highs. We're suggesting readers buy calls at $72.55. If triggered our target is the $79.50-80.00 range. The P&F chart is already bullish with an $88 target.

Picked on April xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/29/08 (unconfirmed)
Average Daily Volume = 2.3 million

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Lincoln Elec. - LECO - cls: 69.88 chg: +0.21 stop: 68.74 *new*

This is the sixth day in a row that LECO has been stuck trading sideways and oscillating on either side of the 200-dma. The last three sessions have seen a $69.00-70.50 trading range. Readers could buy LECO now but we would suggest a tight stop. As a matter of fact we are raising our stop loss to $68.74. However, readers might want to wait for some sort of breakout like a move over $70.50 or $71.35 before launching positions. Our first target is the $74.85-75.00 range. Our second target is the $78.00-80.00 zone. The Point & Figure chart is bullish with a $91 target. We do not want to hold over the late April earnings report.

Picked on April 07 at $ 73.73 *triggered/gap higher
Change since picked: - 3.85
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 233 thousand

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Arcelor Mittal - MT - close: 84.95 chg: +1.54 stop: 79.45

MT could be poised to run. Shares were upgraded to a "buy" this morning, which sparked the gap open higher at $84.79. The stock retraced this gain and essentially "filled the gap" from this morning before rebounding higher into the closing bell. This is good news for the bulls. Our target is the $89.00-90.00 zone. The P&F chart is very bullish and just saw its price target jump from $101 to $113 this past week.

Picked on March 31 at $ 82.03 *triggered/gap open
Change since picked: + 2.92
Earnings Date 05/15/08 (unconfirmed)
Average Daily Volume = 4.1 million

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Potash Corp. - POT - close: 184.41 chg: +2.51 stop: 159.90

The taunting continues. POT posted another gain and another new all-time high. We love the relative strength in this group but nothing goes up in a straight line for very long. We're sticking to our plan for now. Right now we're suggesting readers buy calls in the $170.50-167.50 zone. Honestly, if the market really sees a sell-off we'd rather buy bullish positions in POT near $160 and its 50-dma. We have a very wide stop because the stock and this group has been so volatile. If triggered near $170 we have two targets. Our first target is the $184.00-185.00 range. Our second target is the $194.00-200.00 zone. FYI: The P&F chart is bullish with a $218 target. POT is due to report earnings in the last half of April and we do not want to hold over the report, which doesn't give us a lot of time so don't count on hitting that second target.

Picked on April 03 at $ xx.xx <--see TRIGGER
Change since picked: + 0.00
Earnings Date 04/24/08 (confirmed)
Average Daily Volume = 7.7 million

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Ultra Petrol. - UPL - close: 83.85 chg: +0.50 stop: 78.95 *new*

UPL is also setting new highs. Traders bought the intraday dip. We are raising our stop loss to $78.95. Our target is the $89.50-90.00 zone. The P&F chart has broken through resistance and points to a $95 target.

Picked on April 10 at $ 81.50
Change since picked: + 2.35
Earnings Date 05/01/08 (unconfirmed)
Average Daily Volume = 1.4 million

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United States Oil - USO - close: 91.44 chg: +1.80 stop: 86.49*new*

Crude oil futures surged to a new record at $114 a barrel. This helped push the USO past psychological resistance at the $90.00 mark. The USO also closed at a new record higher. The situation looks set for USO to hit our first target at $92.50 soon. We are raising our stop loss to $86.49. Our second, more aggressive target is the $97.50-100.00 zone.

Picked on April 07 at $ 86.49 *triggered/gap higher
Change since picked: + 4.95
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 5.4 million
 

Put Updates

Ambac Fincl. - ABK - cls: 5.05 change: -0.01 stop: n/a

ABK hit new three-month lows at $4.75 today. Shares were approaching their January 2008 low of $4.50. ABK did manage a bounce but still closed in the red. ABK is due to report earnings on April 23rd. If ABK does not see a steep sell-off this week or in reaction to its earnings report on the 23rd we're going to want to exit since we are down to the last five weeks of May options. Option price premiums see their decay speed up as we enter the last 30 days to expiration. We don't have a stop loss on this play because the stock has been so volatile in the past. However, we're considering a stop loss at $6.51 to close the play on any unexpected strength. We are not suggesting new bearish positions in ABK. This remains a very speculative play. We will definitely hold over the April earnings if we get the chance. Previously we had been suggesting the May out-of-the money puts ($5.00 and $2.50 strikes).

Picked on January 27 at $ 11.54
Change since picked: - 6.49
Earnings Date 04/23/08 (confirmed)
Average Daily Volume = 10.9 million

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Capital One - COF - close: 45.97 chg: -1.15 stop: 52.55

COF witnessed an early morning spike to $48.80 but it quickly reversed course and shares posted another 2.4% decline. Investors are naturally worried about the company's upcoming earnings report. Normally we never want to hold over a company's earnings report but we're strongly considering an exception with COF. The company reports on April 17th after the closing bell. Our target is the $41.50-40.00 zone. The Point & Figure chart is bearish with a $38 target.

Picked on April 13 at $ 48.30
Change since picked: - 2.33
Earnings Date 04/17/08 (confirmed)
Average Daily Volume = 9.0 million

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eBay Inc. - EBAY - close: 31.58 chg: +0.21 stop: 32.26

EBAY tried to rally again this morning but stalled under the $32.00 level. Tomorrow is earnings day and we wouldn't expect to see a lot of movement in EBAY until after the report, which comes after the closing bell tomorrow. Wall Street is looking for a profit of 39 cents a share for the first quarter. Normally we do not hold over an earnings report. This is an exception to that rule and we're betting on a post-earnings sell-off. This does raise our risk since an earnings surprise could obviously send shares higher. Because of this unknown risk variable (earnings, whisper number, etc) we're labeling this an aggressive play. EBAY reports earnings on April 16th after the closing bell. Our initial target is the $26.00 mark.

Picked on April 13 at $ 30.87
Change since picked: + 0.71
Earnings Date 04/16/08 (confirmed)
Average Daily Volume = 14.9 million

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Fannie Mae - FNM - close: 25.95 chg: +0.61 stop: 30.26

After several days of declines we're finally seeing an oversold bounce in shares of FNM. Readers can watch for the bounce to continue but look for a failed rally in the $27.50-29.00 zone as a new entry point for shorts. FNM has already exceeded our target at the $25.25 mark. Our second target is the $21.00-20.00 zone.

Picked on April 08 at $ 29.00 /1st target exceeded 25.25
Change since picked: - 3.05
Earnings Date 05/27/08 (unconfirmed)
Average Daily Volume = 26.5 million

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Humana Inc - HUM - cls: 42.86 chg: +0.44 stop: 45.76

HUM tagged another new five-week low this morning but quickly reversed higher. Shares ended with a 1% gain although we did note that volume was very low today. This is probably nothing more than an oversold bounce. Our target is the $40.50-40.00 zone. More aggressive traders may want to aim lower. Currently the P&F chart is so bearish it points to a target of zero ($0.00).

Picked on March 30 at $ 45.20
Change since picked: - 2.34
Earnings Date 04/28/08 (confirmed)
Average Daily Volume = 4.4 million

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iShares Financial - IYF - close: 81.47 chg: +0.79 stop: 85.55

The IYF bounced near the $80.00 level. This looks like a short-term oversold bounce. Watch for a failed rally in the $83-85 zone as a new entry point for shorts. Our target is the $76.00-75.00. We're adding a second target in the $71.50-70.00 zone.

Picked on April 13 at $ 82.51
Change since picked: - 1.04
Earnings Date 00/00/00
Average Daily Volume = 3.6 million

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iShares Fincl.Servcs. - IYG - cls: 85.49 chg: +0.99 stop: 92.26

It's the same story here with the IYG. The financial services iShares bounced from its intraday lows but it doesn't look serious. A failed rally under $90.00 can be used as a new entry point for puts. We have two targets. Our first target is the $82.00-80.00 zone. Our second, more aggressive target is the $76.00-75.00 zone.

Picked on April 13 at $ 87.26
Change since picked: - 1.77
Earnings Date 00/00/00
Average Daily Volume = 344 thousand

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Juniper Networks - JNPR - cls: 22.73 chg: -0.38 stop: 24.55

The picture doesn't look good for JNPR. Today's move looks like both a failed rally under the 10-dma and a bearish engulfing candlestick (reversal) pattern. Volume was below average. The move under $23.00 has reversed the P&F chart into a new sell signal with a $16.00 target. We do not want to hold over the late April earnings report. Our target is the $20.15-20.00 zone.

Picked on April 09 at $ 22.95 triggered
Change since picked: - 0.22
Earnings Date 04/24/08 (unconfirmed)
Average Daily Volume = 11.5 million

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MBIA Inc. - MBI - close: 11.53 change: -0.19 stop: n/a

Shares of MBI still seem to be fading lower. We are not suggesting new bearish positions at this time. We had been suggesting the out-of-the-money May puts (7.50, 5.00 and 2.50 strikes).

Picked on January 27 at $ 14.20
Change since picked: - 2.67
Earnings Date 05/13/08 (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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Goldman Sachs - GS - cls: 164.20 chg: +0.61 stop: n/a

The broker stocks saw a bounce today as the Lehman Brothers CEO was quoted as saying the "worst is behind us" for the credit crisis. We've heard that cry before so we are not convinced very easily. Shares of GS dipped to $161.68 and then began to bounce, very slowly. The stock was arguably short-term oversold. We are not suggesting new strangles at this time. The options we suggested for this strangle were the May $190 calls (GPY-ER) and the May $160 puts (GPY-QL). Our estimated cost was $8.70. We want to sell if either option trades at $14.50 or higher. FYI: The May $160 puts hit a high of $7.70 today.

Picked on April 06 at $175.40
Change since picked: -11.20
Earnings Date 06/12/08 (unconfirmed)
Average Daily Volume = 14.5 million
 

Dropped Calls

None
 

Dropped Puts

None
 

Dropped Strangles

None
 

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