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Call Updates

Bucyrus - BUCY - close: 73.83 change: -2.22 stop: 71.65

The widespread market weakness was enough to push BUCY to $72.70 intraday. The late afternoon bounce might be an entry point but we would wait to see if there is any follow through on Monday. Since the market might continue lower on Monday as retail traders read their weekend papers and react to the weekly sell-off we would not be surprised to see BUCY dip to $72.00-71.75 before bouncing. We're going to leave our stop loss at $71.65 but more aggressive traders may want to consider adjusting their stop loss to just under $71.50. Remember, wait for the bounce before considering new bullish positions. 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.

Suggested Options:
If BUCY provides a new entry point we would suggest the July or October calls.

Picked on June 15 at $ 75.41
Change since picked: - 1.58
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 2.4 million

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Research In Motion - RIMM - cls: 144.56 chg: -2.99 stop: 137.40

It was a very strong week for RIMM. The stock rallied from the $133 level to over $148 on Thursday. Our first target was the $144.00 mark. Friday's minor 2% pull back wasn't that bad considering the stock's rally. We remain bullish on RIMM but we're not suggesting new positions at this time. Our second target is $154.50. Remember, we do not want to hold over RIMM's earnings next Wednesday. With only three days left until earnings we strongly suggest readers take some profits here.

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

Picked on June 16 at $136.05 *1st target exceeded $144
Change since picked: + 8.51
Earnings Date 06/25/08 (confirmed)
Average Daily Volume = 16.7 million
 

Put Updates

Caterpillar - CAT - close: 79.08 change: -0.40 stop: 82.75

We have to issue a warning here. The markets sold off sharply on Friday and yet shares of CAT did not. The stock held on to its mid June lows. This is short-term bullish even though the larger bullish pattern has been broken. We would expect a bounce back to the $81.00-82.00 zone. Keep an eye on the 50-dma near $81.50. Wait for a clear failed rally under its trendline of lower highs before considering new puts. Our target is the $75.25 mark. The stock "should" see some technical support at its 200-dma near $75.00.

Suggested Options:
If CAT provides a new entry point we would use the July or August puts.

Picked on June 11 at $ 79.45 *triggered
Change since picked: - 0.37
Earnings Date 07/18/08 (unconfirmed)
Average Daily Volume = 6.2 million

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Capital One - COF - close: 40.90 change: -0.98 stop: 46.05

Readers may want to do some profit taking in COF. We have been aiming for the $40.25 mark as our first target. Yet for two days in a row COF has bounced near $40.50. While the trend is very bearish COF could be setting up for an oversold bounce. Readers may also want to tighten their stops. The $45.00 level or $44.25 region could be alternative stops. We're leaving our stop at $46.05 for now. If COF does bounce look for a rebound toward $44.00 at which point it will have "filled the gap" from the 18th of June. We do have a secondary, more aggressive target at $37.75. The Point & Figure chart has a $36 target.

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

Picked on June 17 at $ 43.87
Change since picked: - 2.97
Earnings Date 07/17/08 (unconfirmed)
Average Daily Volume = 8.3 million

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Deere & Co. - DE - close: 76.37 change: -1.31 stop: 82.55

The trend is definitely getting worse for DE. The stock closed under its March double-bottom lows near $76.50. However, while DE looks bearish if the market bounces next week we do expect DE to participate. Wait for another failed rally near $80.00 before considering new put positions. More conservative traders may want to tighten their stops. Our target is the $70.50 mark. The Point & Figure chart is forecasting a $72 target.

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

Picked on June 12 at $ 78.49 *triggered
Change since picked: - 2.12
Earnings Date 08/13/08 (unconfirmed)
Average Daily Volume = 5.4 million

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Electronic Arts - ERTS - close: 46.94 chg: -1.50 stop: 48.55*new*

ERTS' rally from Thursday was completely erased on Friday. The stock lost more than 3% producing a very clear bearish reversal. Thursday's move now looks like a bull trap with the break above short-term resistance at $48.00. We are going to lower our stop loss to $48.55. Our target is the February lows near $44.50-44.00. FYI: Don't forget that trading in ERTS is at risk for headlines regarding its attempted acquisition of TTWO. Depending on the news the stock could go either way.

Suggested Options:
We would use the July puts.

Picked on June 06 at $ 47.75 *triggered
Change since picked: - 0.81
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 3.7 million

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E*Trade - ETFC - close: 3.59 change: -0.10 stop: 3.91

The trend in ETFC still looks bearish following last week's failed rally under its 50-dma and its trendline of broken support. We remain negative here and would still consider new put positions but bear in mind this is an aggressive trade. Readers should also consider that the financials remain very oversold and due for a bounce. Plus, the bulls could argue that while the market is testing or breaking its June lows shares of ETRC are not and that could be considered relative strength. The options we suggested were the July $4.00 and $3.00 puts. We have two targets. Our first target is $3.25. Our second target is $3.05.

Suggested Options:
We are suggesting the July puts.

Picked on June 17 at $ 3.68
Change since picked: - 0.09
Earnings Date 07/23/08 (unconfirmed)
Average Daily Volume = 20.8 million

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3M Co. - MMM - close: 73.02 chg: -1.10 stop: 76.26 *new*

Good news! Not only is MMM breaking down to new relative lows but it has also broken through the bottom of what appeared to be a bullish wedge pattern. Volume was pretty strong on Friday's sell-off. Shares do look a little oversold. Wait for a failed rally near $75.00 before considering new positions. We are adjusting the stop loss to $76.26. 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.

Suggested Options:
We're not suggesting new positions at this time. Wait for another entry point.

Picked on June 06 at $ 74.95 *triggered
Change since picked: - 1.93
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 4.0 million

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PowerShares QQQ - QQQQ - close: 47.42 change: -1.32 stop: 49.26

Tech stocks completely reversed their gains from Thursday. The NDX just collapsed on Friday morning and the QQQQ closed the session with a 2.7% loss right on its exponential 200-dma. The overall pattern is one of a broken bullish trend but the market could still see a short-term oversold bounce. Our target is $46.10. The $46.00 level and its 100-dma might be support.

Suggested Options:
We were suggesting the July puts. Strikes are available at $1.00 increments.

Picked on June 17 at $ 48.54
Change since picked: - 1.12
Earnings Date 00/00/00
Average Daily Volume = 133 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: 45.17 chg: +0.31 stop: n/a

AMGN displayed some relative strength on Friday but as expected it didn't stray far from the $45.00 level. Our June strangle has expired but traders should have been able to recoup part of our initial investment. The best bid for the day on the June $45 calls was about 29 cents. We are now down to four weeks left with the July options. We are not suggesting new positions at this time. 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.

Suggested Options:
We are not suggesting new strangles in AMGN at this time.

Picked on May 22 at $ 42.77
Change since picked: + 2.40
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 6.7 million

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Alpha Nat. Res. - ANR - close: 94.80 chg: +0.48 stop: n/a

ANR has rallied from $22 on January 22nd, 2008 to over $104.00 this past Thursday. There is definitely room for some profit taking. Thursday's session produced a huge bearish engulfing (reversal) pattern and the MACD has produced a new sell signal on the daily chart. While the trend is still up this volatile stock will eventually correct. If you want to speculate with us we would try and open positions in the $94.50-95.50 zone. 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.

Suggested Options:
To open the same July strangle mentioned above it would only cost about $7.70 versus our initial estimated cost of $9.40.

Picked on June 15 at $ 94.25
Change since picked: + 0.55
Earnings Date 08/05/08 (unconfirmed)
Average Daily Volume = 3.7 million

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Fording Cand. Coal - FDG - close: 88.50 chg: -0.14 stop: n/a

FDG initially produced a bounce following Thursday's reversal but by Friday afternoon the stock had rolled over again. This definitely looks like a short-term top but FDG has left a massive trail of dead bears along the six-month rally. Instead of shorting it or buying puts we suggested a strangle a few days ago. We're not suggesting new strangle positions at this time. The options we suggested were 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.

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

Picked on June 15 at $ 82.91
Change since picked: + 5.59
Earnings Date 07/21/08 (unconfirmed)
Average Daily Volume = 1.7 million

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Garmin Ltd. - GRMN - close: 43.49 chg: -0.98 stop: n/a

GRMN continues to drift lower. We're not suggesting new positions at this time. 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.

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

Picked on June 15 at $ 44.91
Change since picked: - 1.42
Earnings Date 07/30/08 (unconfirmed)
Average Daily Volume = 4.1 million

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Holly Corp. - HOC - close: 39.73 chg: -0.37 stop: n/a

Oil prices spent last week bouncing sideways, albeit in a volatile range. HOC wasn't that volatile and continued it's own sideways consolidation. Shares will break one way or the other eventually. We would consider new strangle positions in the $39.50-40.50 zone. 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.

Suggested Options:
If you bought the same strangle above today it would only cost about $1.45. July options expire in four weeks.

Picked on June 15 at $ 41.25
Change since picked: - 1.52
Earnings Date 08/07/08 (unconfirmed)
Average Daily Volume = 1.1 million

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Tyco Intl. - TYC - close: 43.18 change: -0.59 stop: n/a

It already looks like TYC's bounce from Thursday is failing. We're not suggesting new strangle positions 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).

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

Picked on June 03 at $ 44.89
Change since picked: - 1.71
Earnings Date 08/05/08 (unconfirmed)
Average Daily Volume = 2.9 million

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Valero - VLO - close: 42.51 change: -1.66 stop: n/a

VLO is breaking down from its sideways consolidation. The stock lost more than 3.7% on Friday and closed at new multi-year lows. However, if crude oil reverses sharply lower then VLO could just as easily reverse higher since lower oil prices should improve this refiner's margins. At this time we're not suggesting new positions. 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.

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

Picked on June 15 at $ 44.84
Change since picked: - 2.33
Earnings Date 07/29/08 (unconfirmed)
Average Daily Volume = 10.8 million
 

Dropped Calls

None
 

Dropped Puts

Emerging Markets 50 ADR - ADRE - cls: 50.43 chg: -1.65 stop: 55.01

Target achieved. The ADRE just plunged on Friday morning breaking down through its exponential 200-dma. It eventually closed with a 3.1% loss. Our target was the $51.00-50.00 zone. While the play is closed we could keep an eye on it. Nimble traders might be able to capture a bounce. The $50.00 level could be round-number support, which happens to coincide with its trendline of higher lows dating back to the January 2008 low.

Picked on June 03 at $ 54.69 *target achieved 51.00
Change since picked: - 4.26
Earnings Date 00/00/00
Average Daily Volume = 448 thousand

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DaVita Inc. - DVA - close: 51.75 chg: +0.71 stop: 52.01

We are suggesting an early exit in DVA. It's been two days and we still can't find what is driving the rebound in this stock. Shares just took off on Thursday and the rally continued into Friday in spite of the widespread market weakness. We do not want to hold onto puts with DVA showing this kind of relative strength.

Picked on June 17 at $ 50.26 *exiting early
Change since picked: + 1.49
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 606 thousand

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S&P 500 SPDR - SPY - close: 131.58 change: -2.17 stop: 137.26

Target exceeded. The S&P 500 sold off sharply on Friday and the SPY slipped to an intraday low of $131.22. Our target was the $132.40 mark. We strongly suggest readers take profits if you have not done so already. The SPY is near its trendline of lower lows and is due for another oversold bounce.

Picked on June 17 at $135.57 *target exceeded (131.22 low)
Change since picked: - 3.99
Earnings Date 00/00/00
Average Daily Volume = 197 million
 

Dropped Strangles

McDonald's - MCD - close: 57.40 chg: -1.19 stop: n/a

Two weeks ago we were in pretty good shape with MCD's drop on June 6th. The very next trading day the stock exploded on better than expected May same-store sales growth. The bounce eventually failed but our strangle was doomed. The June strangle has expired. Our estimated cost was $1.10.

Picked on May 18 at $ 60.53
Change since picked: - 3.13
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 7.5 million
 

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