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Call Updates

AGCO Corp. - AG - close: 59.15 change: -0.30 stop: 57.75

AG is a new bullish candidate from our Thursday night newsletter. The stock traded sideways on Friday and we don't see any changes from our previous comments so we're reposting them here:

It has been a very volatile couple of weeks for AG. The stock has plunged from $70 to $55 and bounced back to $60 again. The sell-off followed its earnings report. The earnings were better than expected but management offered guidance that was below analysts' estimates. The stock is bouncing from support near $55 and its trendline of higher lows. We suspect the stock could bounce back toward $65 and maybe $70 if the agriculture stocks rally again. We're suggesting a trigger to buy calls at $60.40, which is just above last Wednesday's high. If triggered at $60.40 our short-term target is the $64.90-65.00 range. FYI: The P&F chart is bullish with a $71 target.

Suggested Options:
Our trigger to buy calls is at $60.40. We're suggesting the June calls.

BUY CALL JUN 60.00 AG-FL open interest=833 current ask $3.70
BUY CALL JUN 65.00 AG-FM open interest=195 current ask $1.80

Picked on May xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 04/28/08 (confirmed)
Average Daily Volume = 1.8 million

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Aracruz Celulose - ARA - cls: 81.51 chg: -0.52 stop: 79.45 *new*

As expected ARA found support near $80.00 and the afternoon bounce looks like a new entry point to buy calls. The Brazilian market had pulled back a bit from its recent highs but the Bovespa index was also rebounding higher into Friday's closing bell. We are raising our stop loss on ARA to $79.45. Shares of ARA have already hit our first target at $84.50. Our second target is the $88.50-90.00 zone. The recent rally over $80.00 did produce a new P&F chart buy signal, which currently points to a $94 target.

Suggested Options:
We would suggest the June or July calls.

Picked on April 28 at $ 80.25 *1st target hit $84.50
Change since picked: + 1.26
Earnings Date 04/07/08 (confirmed)
Average Daily Volume = 481 thousand

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CNOOC - CEO - close: 180.98 change: +0.31 stop: 174.75 *new*

We remain bullish on CEO. Four days ago the stock broke out from its pennant-shaped pattern, which followed a larger breakout higher from its six-month consolidation. While the stock has gone sideways since last week's "breakout" the trend of higher lows is still in place. We're upping our stop loss to $174.75. We would suggest new positions here or you could wait for a new move over $182 before initiating plays. Our target is the $199.00-200.00 range. FYI: We have to label this a more aggressive play because the option spreads are so wide!

Suggested Options:
We are suggesting the June calls

Picked on May 06 at $183.47
Change since picked: - 2.49
Earnings Date 04/28/08 (confirmed)
Average Daily Volume = 548 thousand

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CF Ind. - CF - close: 136.83 chg: -0.64 stop: 129.90 *new*

It was a relatively quiet day for CF. Of course this is a volatile group, the fertilizer stocks, and a quiet day for CF was a $5.00 trading range. We remain bullish but we're raising our stop loss to $129.90. More conservative traders might want to raise their stop toward $132 since last week's low was $132.35. While we are suggesting new positions here we could see waiting. The major market indices look a little vulnerable and if the market continues lower then CF will be a natural target for profit taking. One alternative entry point might be to wait for a rally over $140 again (or last week's high at $142.00). Our target is the $155.00-160.00 range. FYI: CF announced that its annual shareholder meeting will be held on Tuesday, May 13th.

Suggested Options:
We are suggesting the June calls.

Picked on May 05 at $137.50 *triggered
Change since picked: - 0.67
Earnings Date 04/27/08 (unconfirmed)
Average Daily Volume = 3.1 million

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Cytec Ind. - CYT - close: 60.44 change: -0.55 stop: 58.45 *new*

CYT out performed the markets last week with a 2% gain but volume was weak and was getting worse heading into the weekend. Investors continue to buy the dip, which makes Friday's rebound look like another entry point. We are adjusting our stop loss to $58.45. More conservative traders might want to tighten their stop closer to Friday's low. We're listing two targets. Our first target is the $64.75-65.00 range. Our second target is the $68.00-70.00 zone. We have to label this a more aggressive play because the spreads on the options are pretty wide. There isn't much we as traders can do about that except try to minimize its impact with good entry and exit strategy.

Suggested Options:
We would use the June calls.

Picked on April 27 at $ 60.64
Change since picked: - 0.20
Earnings Date 04/17/08 (confirmed)
Average Daily Volume = 556 thousand

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Deere & Co. - DE - close: 86.31 change: -0.51 stop: 84.40 *new*

We are running out of time for DE. The company reports earnings on Wednesday morning, May 14th, and as you know we don't want to hold over the announcement. Thus we're planning to exit on Tuesday at the closing bell. Given our time frame we're turning defensive with our stop loss and moving it higher to $84.40, just under Friday's low. The stock bounced twice near $84.50 last week so it should be short-term support. We're eliminating our aggressive target at $94 and just focusing on the short-term target at $89.95.

Suggested Options:
We are not suggesting new positions in DE at this time.

Picked on May 06 at $ 86.08
Change since picked: + 0.23
Earnings Date 05/14/08 (confirmed)
Average Daily Volume = 5.3 million

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Express Scipts - ESRX - close: 70.79 chg: -0.17 stop: 68.19

Traders continue to buy the dips in ESRX. They did it again on Friday at $69.41. The rebound looks like another entry point to buy calls. However, given the market's recent weakness our readers may want to wait for a rise past $71.50 before initiating new call positions. Overall we don't see any changes from our Thursday's night new play description. We do expect some resistance at $74.25 but our target is the $77.00-80.00 range. More conservative traders will want to consider taking some profits off the table near $75.00. The Point & Figure chart is bullish with a $81 target.

Suggested Options:
We're suggesting the June calls.

BUY CALL JUN 70.00 XTQ-FN open interest= 504 current ask $3.80
BUY CALL JUN 75.00 XTQ-FO open interest=2458 current ask $1.60

Picked on May 08 at $ 70.96
Change since picked: - 0.17
Earnings Date 04/29/08 (confirmed)
Average Daily Volume = 2.8 million

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Fortune Brands - FO - close: 68.96 change: -0.59 stop: 67.95

Nothing has changed in FO. The stock is still trading sideways in the $68.00-70.00 trading range. Shares hit our trigger to buy calls on an intraday blip above resistance at $70.00 last Wednesday. Our play is officially "open" but we're not suggesting new positions at this time. Instead wait for a dip or bounce near $68.00 or a new rally over $70.00 or 70.15 as an entry point to initiate positions. Our target is the $74.00-75.00 range. The 200-dma is technical resistance near $75.00. The P&F chart is bullish with a $95 target.

Suggested Options:
We are suggesting the June calls.

Picked on May 07 at $ 70.05 *triggered
Change since picked: - 1.09
Earnings Date 04/24/08 (confirmed)
Average Daily Volume = 971 thousand

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Gilead Sciences - GILD - close: 53.64 chg: -0.47 stop: 49.99

GILD is holding up pretty well. Shares hit new all-time highs on Thursday. We don't see any real changes from our prior comments. We've been suggesting that readers buy a dip in the $53.75-53.50 zone and before that it was buy dips in the $53.00-52.00 zone. A dip toward $53.00 still looks like a good bet and we wouldn't be surprised to see a correction in the $52.50-52.00 region. Our target is the $57.50-60.00 range. Don't forget that any time we play a biotech company it should be considered an aggressive, higher-risk trade. There is always risk of some FDA decision or clinical trial result surprising the market and sending the stock gapping one direction or the other. FYI: GILD is due to present at a conference on May 13th.

Suggested Options:
We are suggesting the June calls.

Picked on May 04 at $ 53.63
Change since picked: + 0.01
Earnings Date 04/16/08 (confirmed)
Average Daily Volume = 8.9 million

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Harsco - HSC - close: 60.92 change: -0.28 stop: 59.45

HSC is bouncing from support near $60.00. Friday's rebound looks like a new bullish entry point to buy calls. However, traders should be cautious here. Last week's high and the mid April high looks like a potential bearish double-top pattern. We're leaving our stop loss at $59.45 but more conservative traders might want to consider a stop closer to Friday's low (59.96). Our four-week target is the $64.50-65.00 range.

Suggested Options:
We are suggesting the June or July calls.

Picked on May 01 at $ 60.38
Change since picked: + 0.54
Earnings Date 04/22/08 (confirmed)
Average Daily Volume = 613 thousand

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Intl.Bus.Mach. - IBM - cls: 124.06 chg: -0.86 stop: 119.75

Last week was positive for IBM. The stock hit our first target in the $124.90-125.00 zone. Shares look like they are coiling for a bullish breakout through the $125 level. If you're looking for a new position then wait for a new relative high (125.20) and use a tighter stop loss than the one we have suggested. Our secondary target is the $128.00-130.00 range but if you're buying calls above $125 we'd probably aim for the $129.75-130.00 zone.

Suggested Options:
We're not suggesting new positions but if we were we'd suggest the June or July calls.

Picked on April 30 at $120.75 */1st target achieved 124.90
Change since picked: + 3.31
Earnings Date 04/16/08 (confirmed)
Average Daily Volume = 8.8 million

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iShares Russ.2000 - IWM - cls: 71.50 chg: -0.21 stop: 69.85

We don't see any changes from our prior comments on IWM. The small caps are holding up reasonably well. The six-week trend is still positive. We've been suggesting dips near $71.00 as an entry point and the IWM hit $71.04 on Friday. If you missed it then wait for a move over Friday's high around $72.15. More conservative traders might want to raise their stop loss closer to $71.00. Our multi-week target is the $77.50-80.00 zone. The P&F chart is bullish with an $87 target.

Suggested Options:
Strikes are available at $1.00 increments. We're suggesting the June calls.

Picked on April 28 at $ 72.55 *triggered
Change since picked: - 1.05
Earnings Date 00/00/00
Average Daily Volume = 84.6 million

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Joy Global - JOYG - close: 78.99 chg: +1.49 stop: 74.99 *new*

JOYG actually rallied to a new high on Friday. Shares hit $79.31 late in the day. The relative strength is encouraging but we're concerned that JOYG will turn lower with the market again and with it at all-time highs it's a big target for profit taking. Our first target is the $79.50-80.00 range. We are suggesting that readers take some profit off the table right now and only keep a small position open. Our secondary, more aggressive target is the $84.00-85.00 range. We're raising or stop loss to $74.99. We will plan to exit ahead of the late May earnings report. The P&F chart is already bullish with an $88 target.

Suggested Options:
We are not suggesting new positions at this time.

Picked on April 16 at $ 72.55 *triggered
Change since picked: + 6.44
Earnings Date 05/29/08 (confirmed)
Average Daily Volume = 2.3 million

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Mosaic - MOS - close: 126.42 change: -0.66 stop: 119.75 *new*

The fertilizer stocks spent Friday's session churning sideways. Of course this is a volatile group and that meant a $5.00 trading range for MOS. We remain bullish but we're raising our stop loss to $119.75. More aggressive traders will want to keep their stop loss under the 50-dma (115.71). More conservative traders could tighten their stop toward last week's low (121.15). Our first target is the $138.00-140.00 range. We are still suggesting bullish positions here but if you prefer to buy on momentum wait for a rise past $130.00.

Suggested Options:
We are suggesting the June calls.

Picked on May 05 at $126.75 *triggered/gap higher entry
Change since picked: - 0.33
Earnings Date 07/30/08 (unconfirmed)
Average Daily Volume = 7.4 million

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Arcelor Mittal - MT - close: 94.57 chg: -1.45 stop: 91.45*new*

Our time available to trade MT just got cut. The company has announced that it will report earnings on May 14th in the morning. That means we will exit on Tuesday at the closing bell. Considering this new time frame we're working with our new target is now $96.50 instead of $99.00. Our new stop loss is $91.45. We're not suggesting new positions.

Suggested Options:
We're not suggesting new positions at this time.

Picked on May 05 at $ 90.25 *triggered
Change since picked: + 4.32
Earnings Date 05/14/08 (confirmed)
Average Daily Volume = 3.7 million

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Nucor - NUE - close: 78.41 change: -3.46 stop: 75.95

Steel and metal-related stocks turned in a strong week. NUE soared to new highs and broke through resistance at $80.00 to hit 81.93. Our first target was the $79.50-80.00 zone. Our second target remains the $84.00-85.00 range but after Friday's big sell-off (-4.2%) we're not suggesting new positions at this time.

Suggested Options:
We are not suggesting new positions at this time.

Picked on April 22 at $ 74.63 /1st target exceeded 79.50
Change since picked: + 3.78
Earnings Date 04/17/08 (confirmed)
Average Daily Volume = 5.6 million

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POSCO - PKX - close: 127.59 change: -1.10 stop: 119.75

The trend is still bullish following PKX's breakout over its long-term trendline of resistance and over resistance near $125.00. We would still consider buying calls again on a dip near $125.00. The 100-dma around $131 and the exponential 200-dma near $133 might offer some overhead resistance. Our target is the $139.00-140.00 range. More conservative traders may want to raise their stop loss toward $122.25 under last week's low. NOTE: We would consider this a slightly more aggressive play for two reasons. First, PKX is prone to gap openings as the U.S. traded shares adjust to trading overseas the night before. Second, the spreads on the options are pretty wide and that immediately puts us, as option traders, at a disadvantage.

Suggested Options:
If PKX provides another entry point we would suggest the June calls.

Picked on May 05 at $125.55 *triggered
Change since picked: + 2.04
Earnings Date 07/16/08 (unconfirmed)
Average Daily Volume = 907 thousand
 

Put Updates

None
 

Strangle Updates

None
 

Dropped Calls

HSBC - HBC - close: 84.07 change: -1.99 stop: 84.90

We've been stopped out of HBC. Weakness in Europe combined with a downgrade for HBC before Friday's opening bell pushed shares to gap open lower at $83.91. This was below our stop loss at $84.90. Shares jumped past support near $85 and its 200-dma. For us the play has been closed but readers might want to keep an eye on HBC for a dip near $82.50 and its 50-dma. HBC is one bank that has been out performing many of its peers for weeks and a bounce from support with a tight stop might offer another opportunity.

Picked on April 28 at $ 86.19 *gap entry & exit/stopped 83.91
Change since picked: - 2.12
Earnings Date 03/08/08 (confirmed)
Average Daily Volume = 1.7 million

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iShares DJ Transports - IYT - cls: 92.07 chg: -1.35 stop: 91.48

Another record higher in crude oil is starting to weigh on the transports. The IYT dipped toward the $92.00 level multiple times on Friday. The intraday low you see at $91.28 is actually an after hours trade. The transports spiked lower after FedEx (FDX) issued an earnings warning due to higher fuel costs. You can check the time and sales. The trade at 91.28 happened at 16:09:28. That doesn't bode well for Monday and we would expect the IYT to trade down toward support near $90.00. IYT has already surpassed our first target in the $94.85-95.00 zone.

Picked on April 27 at $ 91.48 /1st target exceeded
Change since picked: + 0.59
Earnings Date 00/00/00
Average Daily Volume = 1.4 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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