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Call Updates

Peabody Energy - BTU - close: 81.40 change: +3.66 stop: 73.92

Monday was a pretty good day for BTU. The stock soared to a new high of $82.62 intraday. Shares did pare their gains this afternoon but bulls were buying the dip again by the closing bell and BTU set a new closing high too. The MACD has produced a new buy signal. We remain optimistic here and wouldn't be surprised to see BTU hit our secondary target in the $84.00-85.00 zone in the next day or two.

Picked on June 01 at $ 73.92 /1st target exceeded 79.75
Change since picked: + 7.48
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 5.8 million

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Molson-Coors Brewing - TAP - cls: 58.63 chg: +0.56 stop: 56.45

TAP bubbled up from its intraday lows to post a 0.9% gain. The trend is still bullish but the momentum in this stock is pretty slow. If you want to consider new positions make sure you buy enough time. Our target is the $64.00-65.00 range. FYI: The P&F chart is bullish with a $69 target.

Picked on May 23 at $ 58.51 *triggered
Change since picked: + 0.12
Earnings Date 08/07/08 (unconfirmed)
Average Daily Volume = 1.1 million
 

Put Updates

Emerging Markets 50 ADR - ADRE - cls: 53.82 chg: -0.25 stop: 56.85

ADRE is still sinking and the ETF for emerging markets closed under its 50-dma today. We don't see any changes from our weekend comments. Don't be surprised to see a short-term bounce near its 200-dma in the $52.75-52.50 zone. We are aiming for the $51.00-50.00 zone. FYI: The P&F chart is still bullish.

Picked on June 03 at $ 54.69
Change since picked: - 0.87
Earnings Date 00/00/00
Average Daily Volume = 448 thousand

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Caterpillar - CAT - close: 80.81 change: +0.82 stop: 84.05

CAT sank to $79.66 this morning before rebounding. The intraday high was $81.06 so we're still on the sidelines. We want to buy puts on a bounce but we are listing two entry points. Our preferred entry point is to buy puts on a bounce in the $81.50-82.00 zone. However, if CAT does not bounce then we're setting a secondary entry point at $79.45. If triggered our target is the $75.25 mark. CAT will probably find some support near $75.00 and its 200-dma. The P&F chart is bearish with a $74 target.

Picked on June xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/18/08 (unconfirmed)
Average Daily Volume = 6.2 million

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DaVita Inc. - DVA - close: 49.78 chg: -0.64 stop: 53.01

DVA's breakdown under $50.00 and its lack of a bounce is very bearish. We are very tempted to suggest new put positions right here. However, we're going to wait and stick to our plan, which is to buy puts on a bounce. However, instead of using a $51.50-52.00 entry zone we're adjusting it to $51.00-52.00. If triggered we have two targets. Our first target is 47.75-47.50. Our second target is the $45.15-45.00 zone. The P&F chart is bearish with a $45 target. FYI: Last month DVA announced a $250 million stock buy back program. At $50 a share that's about 5 million shares. DVA has about 104 million shares outstanding.

Picked on June xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 606 thousand

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Electronic Arts - ERTS - close: 46.93 chg: -0.62 stop: 49.75

ERTS is cooperating. The stock posted another decline following Friday's breakdown. If you don't want to open put positions here then wait for a bounce or failed rally near $48.00, which should be new overhead resistance. Our target is the February lows near $44.50-44.00.

Picked on June 06 at $ 47.75 *triggered
Change since picked: - 0.82
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 3.7 million

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3M Co. - MMM - close: 75.82 chg: +0.96 stop: 77.65

We were expecting a bounce in MMM but today's gain was a little bit stronger than we expected. Look for a failed rally pattern or a new relative low (under $74.85) before initiating new put positions. We have two targets. Our first target is the $70.25-70.00 zone. Our secondary target is the $67.00-65.00 range. The P&F chart is bearish with a $69 target. FYI: If you are aiming for the $67 target then you might want to consider the October puts.

Picked on June 06 at $ 74.95 *triggered
Change since picked: + 0.87
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 4.0 million

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Terex Corp. - TEX - close: 66.52 change: -0.85 stop: 72.05

Hmmm.. we were expecting an oversold rebound in TEX today and it failed to show up. Instead the stock sank toward technical support at its 100-dma before bouncing. We are sticking to our plan. We are suggesting readers buy puts on a bounce back into the $69.00-70.00 zone. Our suggested stop loss is $72.05. If triggered we have two targets. Our first target is $65.25. Our second target is $61.50. The P&F chart is bearish with a $61 target.

Picked on June xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/23/08 (unconfirmed)
Average Daily Volume = 1.7 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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Amgen Inc. - AMGN - close: 44.30 chg: +0.06 stop: n/a

We do not see any changes from our weekend comments on AMGN. If you have the June options you may want to consider an early exit to just cut your losses. We have less than two weeks left for June strikes before they expire and the erosion is going to pick up speed. We are not suggesting new positions at this time. We have suggested a July strangle and a more aggressive June strangle. The options in the July strangle are the July $45 calls (AMQ-GI) and the July $40 puts (AMQ-SH). Our estimated cost for the July strangle was $1.65. We want to sell if either option hits $3.50. The options in the June strangle are the June $45.00 calls (AMQ-FI) and the June $40.00 puts (AMQ-RH). Our estimated cost on the June strangle was $0.56. We want to sell if either option hits $1.10 or more.

Picked on May 22 at $ 42.77
Change since picked: + 1.53
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 6.7 million

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McDonald's - MCD - close: 59.31 chg: +2.36 stop: n/a

MCD was a big reason the Dow Jones Industrial Average finished higher today. The fast-food stock heated up the board with a 4.1% gain. The spike higher was fueled by better than expected May same-store sales growth. If MCD sees any follow through it could be bad news. We were close to hitting our target on the downside and now MCD is back in no man's land and we've got less than two weeks left. We are not suggesting new positions. The options we suggested were the June $62.50 calls (MCD-FZ) and the June $57.50 puts (MCD-RY). Our estimated cost was $1.10. We want to sell if either option hits $1.65 or higher. Keep in mind that June options expire in less than two weeks and will see their premium erode more quickly.

Picked on May 18 at $ 60.53
Change since picked: - 1.22
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 7.5 million

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Tyco Intl. - TYC - close: 43.37 change: -0.64 stop: n/a

TYC sinks again. This time the stock has closed under its exponential 200-dma. We are not suggesting new strangle positions in TYC at this time. The options we suggested were the July $47.50 calls (TYC-GW) and the July $42.50 puts (TYC-SV). Our estimated cost was $1.30. We want to sell if either option hits $1.95 (50% gain).

Picked on June 03 at $ 44.89
Change since picked: - 1.52
Earnings Date 08/05/08 (unconfirmed)
Average Daily Volume = 2.9 million
 

Dropped Calls

iShares Russ.2000 - IWM - cls: 73.68 chg: -0.24 stop: 72.95

The IWM ishares for the small cap index temporarily broke down under the $73.00 level and hit our stop loss at $72.95. The IWM did bounce from its lows, which also looks like a rebound from the bottom of its bullish channel. If the S&P 500 and DJIA didn't look so vulnerable we'd say this looks like a new entry point for bullish positions in IWM. The IWM hit a high of $76.23 on Thursday and we were aiming for the $77.00 level.

Picked on April 28 at $ 72.55 */stopped out 72.95
Change since picked: + 1.37
Earnings Date 00/00/00
Average Daily Volume = 84.6 million

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Priceline.com - PCLN - close: 126.55 chg: -5.93 stop: 129.90

By lunchtime it looked like PCLN was going to survive the day. Shares had dipped a bit but the $130 level was holding. Even a terrible performance by rival Oribtz (OWW), which was downgraded today, didn't push PCLN below support. The stock was actually starting to bounce. Then suddenly around 1:00 p.m. Eastern the stock just fell off a climb and lost more than $7.00 in the next 90 minutes. This swoosh lower occurred the same time the NASDAQ tripped lower around 1:00 p.m. Our stop loss was hit at $129.90. PCLN still has a bullish trend of higher lows but the next level of support looks like the 100-dma near $120. We had been aiming for the $139.50-140.00 zone. Last Thursday PCLN hit $139.16.

Picked on May 27 at $132.75 */stopped out 129.90
Change since picked: - 6.20
Earnings Date 05/08/08 (confirmed)
Average Daily Volume = 1.5 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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