Alliant Tech - ATK - close: 105.09 change: -0.44 stop: 102.95
Tuesday proved to be a very volatile day for ATK. The stock plunged this morning on no news. Shares slipped to $103.43 before bouncing from its trendline of higher lows. ATK rebounded sharply paring its losses. Unfortunately, the wider market began to accelerate its losses into the closing bell and ATK's bounce began to roll over late in the day. A rally from here (over $105.50) can be used as a new entry point for calls. Otherwise wait and watch for another dip or bounce in the $103.50-104.00 region. We have two targets. The 200-dma is near $109.00. We're setting the first target at $108.75. Our second target is the $111.00 mark.
Picked on June 12 at $105.28
Peabody Energy - BTU - close: 78.97 change: +1.67 stop: 74.90
Energy stocks, including the coal stocks, were strong today. BTU climbed back to the $80 level. Volume was a little light on the day but it is summer, which means we should expect low volume. We're still suggesting that readers tread cautiously here. The group as a whole continues to grow more overbought. This stock has exceeded our target near $80 several times. Our secondary target is the $84.00-85.00 zone.
Picked on June 01 at $ 73.92 /1st target exceeded 79.75
Bucyrus - BUCY - close: 78.44 change: +0.89 stop: 71.65
BUCY almost hit our first target today. The stock spiked to $79.50 this morning but after the initial burst the stock merely traded sideways. The $80 level could be round-number resistance so we would expect a dip soon. If you're looking for a new entry point wait for another pull back near $75.00. More conservative traders may want to tighten their stop loss. We have two targets. Our first target is $79.85. Our second target is $83.50. The Point & Figure chart is bullish with a $92 target.
Picked on June 15 at $ 75.41
Research In Motion - RIMM - cls: 142.16 chg: +1.18 stop: 132.49
Target exceeded! RIMM rallied to $145.94 this morning but eventually settled with a 0.8% gain. The stock exceeded our first target at $144.00. Shares look short-term overbought and today's action looks like a top. Readers should expect some profit taking in RIMM. A bounce in the $137-135 region might be a new entry point for bullish plays. Our second target is $154.50.
Picked on June 16 at $136.05 *1st target exceeded $144
United States Oil - USO - close: 108.68 chg: -0.31 stop: 105.95
Crude oil has been acting somewhat erratically. Monday saw a big intraday range and today it was quiet. Investors could be waiting for tomorrow's oil inventory numbers. Honestly, we were expecting more short covering ahead of tonight's option expiration for crude oil. Futures expiration is Friday so oil could see some short covering between now and then. Remember, we are only playing this week and plan to exit on Friday if we're not stopped out or at our target by then. Our first target is the $114.90 mark. Our second target is $118.00. We strongly suggest you take some profits at the first target.
Picked on June 12 at $111.27
Emerging Markets 50 ADR - ADRE - cls: 53.12 chg: +0.51 stop: 55.01
ADRE's oversold bounce is nearing what should be resistance at its trendline of lower highs. This stock should see a reversal soon. More conservative traders may want to tighten their stops. Our target is the $51.00-50.00 zone.
Picked on June 03 at $ 54.69
Caterpillar - CAT - close: 80.69 change: -0.22 stop: 83.55
This looks like a new entry point to buy puts on CAT. The broader market indices are rolling over and CAT is setting another lower higher. More conservative traders could use a tighter stop loss and you might still want to wait for a decline under $80.00 before initiating positions. Our target is the $75.25 mark. The stock "should" see some technical support at its 200-dma near $75.00.
Picked on June 11 at $ 79.45 *triggered
Deere & Co. - DE - close: 79.20 change: -1.40 stop: 82.55
The rebound in DE has failed at its trendline of lower highs. This looks like a new bearish entry point to buy puts. Our target is the $70.50 mark. The Point & Figure chart is forecasting a $72 target.
Picked on June 12 at $ 78.49 *triggered
DaVita Inc. - DVA - close: 50.06 chg: -0.20 stop: 52.01 *new*
It doesn't look like DVA is going to bounce high enough to hit our trigger at $51.00. We are adjusting our entry strategy and suggesting readers buy puts now or on a dip under $49.50. We're also adjusting our stop loss to $52.01. 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 17 at $ 50.26
Electronic Arts - ERTS - close: 46.76 chg: -0.30 stop: 49.05
The bounce in ERTS is also growing weaker. The next move looks like it's going to be lower. More conservative traders might want to tighten their stop closer to the $48 level. Our target is the February lows near $44.50-44.00.
Picked on June 06 at $ 47.75 *triggered
3M Co. - MMM - close: 74.97 chg: -0.23 stop: 77.05
MMM looks poised to take its next step lower. Shares closed under round-number support at $75.00. Yesterday's update suggested waiting for a new move under $74.75 to buy puts. That strategy still works. 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
(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.)
We are down to three days left before June options expire. 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.
Picked on May 22 at $ 42.77
Alpha Nat. Res. - ANR - close: 96.13 chg: +1.71 stop: n/a
ANR hit $98.63 before paring its gains. The $100 level should be round-number, psychological resistance. We would suggest strangle positions in the $94-96 zone. The closer to $95.00 the better. This is a higher-risk strangle play with the options so expensive. The options we suggested were the July $105 calls (ANR-GA) and the July $85 puts (ANR-SQ). Our estimated cost was $9.40. We want to sell if either option hits $14.50.
Picked on June 15 at $ 94.25
Fording Cand. Coal - FDG - close: 87.00 chg: +1.26 stop: n/a
Coal stocks continue to hit new highs. We're not suggesting new strangle positions at this time. We were suggesting the July $90 calls (FDG-GR) and the July $75 puts (FDG-SO). Our estimated cost was $5.45. We want to sell if either option hits $ 8.00 or higher.
Picked on June 15 at $ 82.91
Garmin Ltd. - GRMN - close: 43.48 chg: -2.37 stop: n/a
It looks like GRMN is breaking down from its sideways consolidation. If you did not open positions yet we suggest waiting for a bounce back into the $44.50-45.00 zone. The options we listed were the July $50 calls (GQR-GJ) and the July $40 puts (GQR-SH). Our estimated cost was $2.55 We want to sell if either option hits $ 4.75 or higher.
Picked on June 15 at $ 44.91
Holly Corp. - HOC - close: 40.60 chg: +0.75 stop: n/a
There was no follow through on HOC's bearish candlestick from Monday. Investors are probably waiting to see how oil reacts to Wednesday's inventory report. We would try and use the $41.00-39.00 zone as your entry range. The options we listed were the July $45 calls (HOC-GI) and the July $35 puts (HOC-SG). Our estimated cost was $2.00. We want to sell if either option hits $ 3.00 or higher.
Picked on June 15 at $ 41.25
McDonald's - MCD - close: 59.21 chg: -0.73 stop: n/a
We are almost out of time. June options expire in three days. MCD looks like it just produced a bearish reversal with today's candlestick. 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.
Picked on May 18 at $ 60.53
Tyco Intl. - TYC - close: 43.40 change: +0.12 stop: n/a
There is no change from our previous comments. 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
Valero - VLO - close: 45.02 change: +0.90 stop: n/a
VLO bounced this morning and ended the day with a 2% gain. We would still open new strangles in the $44.50-45.50 zone. The options we suggested were the July $50 calls (VLO-GJ) and the July $40 puts (VLO-SH). Our estimated cost is $1.89. We want to sell if either option hits $2.75 or higher.
Picked on June 15 at $ 44.84
Diamonds - DIA - close: 121.93 change: -0.73 stop: 120.85
Warning! The DIA has produced a short-term bearish reversal with today's bearish engulfing candlestick pattern. We were trying to capture a short-term pop to the $124.50 level but that may not happen any time soon. We're suggesting an early exit now to avoid or minimize any losses.
Picked on June 12 at $121.63
Monsanto - MON - close: 142.69 change: +6.77 stop: 140.55
We have been stopped out of our aggressive, higher-risk put play in MON. The fertilizer stocks continue to show relative strength and almost the whole sector hit new all-time highs today. MON broke through resistance near $140 and broke through its trendline of higher highs.
Picked on June 11 at $133.40 *stopped out 140.55