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Call Updates

Bucyrus - BUCY - close: 77.70 change: 3.87 stop: 72.45 *new*

Coal stocks were on fire again today and because BUCY sells a lot of equipment for coal mining shares of BUCY rallied as well. BUCY surged 5.2% and looks poised to re-challenge the $80.00 level soon. We are raising the stop loss to $72.45. 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
Change since picked: 2.29
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 2.4 million

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Cephalon - CEPH - close: 70.92 change: -0.22 stop: 67.95

CEPH gave back half of Friday's gains. Overall the stock spent Monday churning sideways in a relatively tight range. Potentially contributing to any relative strength were some positive analyst comments this morning and a new price target at $86.00. We are looking for a dip. We're suggesting readers buy a dip into the $69.50-69.00 zone. If triggered our target is the $74.00-75.00 range. We do not want to hold over the late July earnings report. FYI: The P&F chart is bullish with an $83 target. The most recent data listed short interest at 18.6% of the 66.2 million-share float. That is a relatively high amount of short interest and raises the risk of a short squeeze, which would obviously be good for the bulls.

Picked on June xx at $ xx.xx <-- see TRIGGER
Change since picked: 0.00
Earnings Date 07/29/08 (unconfirmed)
Average Daily Volume = 1.4 million

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DIAMONDS - DIA - close: 118.33 chg: 0.09 stop: 116.99

The markets were generally weaker today but the DJIA managed to slide sideways without any real movement. That could change tomorrow. After the bell tonight UPS issued an earnings warning due to higher fuel costs. This should depress investor sentiment so we're expecting another market decline on Tuesday. We are suggesting that readers buy calls on a dip in the DIA in the $117.75-117.45 zone with a stop loss at $116.99. More conservative traders, instead of buying the dip, may want to wait for the bounce to begin first. If triggered our target is the $121.50-122.00 zone.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: 0.00
Earnings Date 00/00/00
Average Daily Volume: 13.1 million

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SPDRs - SPY - close: 131.45 chg: -0.13 stop: 129.19

We are still waiting for a dip. There is no change from our weekend comments on SPY. We're looking for a dip toward the $130 level early this week at which point the S&P should see an oversold bounce. Our suggested entry point is the $130.50-130.00 zone. We'll use a stop loss at $129.19. More conservative traders may want to use a tighter stop closer to $130.00. If triggered our target is the $134.00-134.50 zone.

Picked on June xx at $xx.xx <-- see TRIGGER
Change since picked: 0.000
Earnings Date 00/00/00
Average Daily Volume: 200 million
 

Put Updates

Apple Inc. - AAPL - close: 173.16 chg: -2.11 stop: 182.55

One might think that AAPL should be up today following news that Google's (GOOG) smart-phone, the Android, will be delayed until late 2008 or later. This pushes back competition for AAPL's iPhone, which is already expected to see another boom with the latest 3G model and lower price tag. Yet shares of AAPL lost more than 1% and the afternoon rebound failed under the $176 level, which doesn't bode well for tomorrow. It's possible that news out regarding competition for AAPL's iTunes store could be weighing on investor sentiment. Last week AAPL announced that they just sold their 5 billionth song on iTunes. At 99 cents a pop that's pretty amazing. Amazon.com has just launched a competing service called AmazonMP3 with DRM-free music (digital rights management) that you can play anywhere on any MP3 player. Here's a link:
http://www.amazon.com/MP3-Music-Download/b?ie=UTF8&node=163856011

We remain bearish on AAPL and don't see any changes from our weekend comments. This remains a very aggressive, speculative play since we're looking for a market bounce in the second half of this week. We're aiming for $166.00. More aggressive traders could aim for the 200-dma near $162.00. If AAPL were to test $160 we'd expect a bounce and consider buying calls for a short-term rebound.

Picked on June 22 at $175.27
Change since picked: - 2.11
Earnings Date 07/27/08 (unconfirmed)
Average Daily Volume = 34.2 million

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Caterpillar - CAT - close: 80.00 change: 0.92 stop: 82.75

CAT displayed some relative strength today. We warned readers over the weekend that things looked short-term bullish. We're still expecting 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.

Picked on June 11 at $ 79.45 *triggered
Change since picked: 0.55
Earnings Date 07/18/08 (unconfirmed)
Average Daily Volume = 6.2 million

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Deere & Co. - DE - close: 77.48 change: 1.11 stop: 82.55

DE displayed some relative strength today with a 1.4% bounce. The trend remains bearish. 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.

Picked on June 12 at $ 78.49 *triggered
Change since picked: - 1.01
Earnings Date 08/13/08 (unconfirmed)
Average Daily Volume = 5.4 million

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Electronic Arts - ERTS - close: 46.04 chg: -0.90 stop: 48.55

ERTS under performed the market on Monday with a 1.9% drop following Friday's bearish reversal. We don't see any real changes from our prior comments. The stock looks poised to make a run at its 2008 lows. 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.

Picked on June 06 at $ 47.75 *triggered
Change since picked: - 1.71
Earnings Date 07/31/08 (unconfirmed)
Average Daily Volume = 3.7 million

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E*Trade - ETFC - close: 3.51 change: -0.08 stop: 3.91

ETFC lost 2.2% today, which was a little better than the sell-off in financials and the brokers. The stock is nearing the June lows so it might see another bounce soon. You could wait for another failed rally near $3.70 before considering new positions. 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.

Picked on June 17 at $ 3.68
Change since picked: - 0.17
Earnings Date 07/23/08 (unconfirmed)
Average Daily Volume = 20.8 million

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3M Co. - MMM - close: 72.96 chg: -0.06 stop: 76.26

The DJIA, the S&P 500, and MMM all spent the day moving sideways. We don't see any changes from our weekend comments. 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.

Picked on June 06 at $ 74.95 *triggered
Change since picked: - 1.99
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 4.0 million

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PowerShares QQQ - QQQQ - close: 47.05 change: -0.37 stop: 49.26

The Qs broke down under their exponential 200-dma but it's also testing the June lows. This is where we should expect a bounce. Our target is $46.10. The $46.00 level and its 100-dma might be support.

Picked on June 17 at $ 48.54
Change since picked: - 1.49
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: 45.89 chg: 0.72 stop: n/a

Now that June options have expired AMGN is free to move from the $45.00 region. The stock soared this morning and out performed the market. 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.

Picked on May 22 at $ 42.77
Change since picked: 3.12
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 6.7 million

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Alpha Nat. Res. - ANR - close: 96.07 chg: 1.27 stop: n/a

Some of the coal stocks took off again, hitting new highs today. Shares of ANR did out perform the market but trading actually looks bearish with an intraday failed rally near $100. 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.

Picked on June 15 at $ 94.25
Change since picked: 1.82
Earnings Date 08/05/08 (unconfirmed)
Average Daily Volume = 3.7 million

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Fording Cand. Coal - FDG - close: 93.75 chg: 5.25 stop: n/a

FDG was one of the market's best performers today with a 5.9% gain. FDG is also one of the major coal stocks that surged toward new all-time highs today. The July $90 calls rallied to $5.90 intraday. 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.

Picked on June 15 at $ 82.91
Change since picked: 10.84
Earnings Date 07/21/08 (unconfirmed)
Average Daily Volume = 1.7 million

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Garmin Ltd. - GRMN - close: 42.62 chg: -0.87 stop: n/a

GRMN is still under performing. The stock lost 2% today. 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.

Picked on June 15 at $ 44.91
Change since picked: - 2.29
Earnings Date 07/30/08 (unconfirmed)
Average Daily Volume = 4.1 million

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Holly Corp. - HOC - close: 39.53 chg: -0.20 stop: n/a

HOC experienced some volatility this morning as investors reacted to oil prices. The rally quickly evaporated and HOC continues to hover around $40. 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.

Picked on June 15 at $ 41.25
Change since picked: - 1.72
Earnings Date 08/07/08 (unconfirmed)
Average Daily Volume = 1.1 million

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KLA-Tencor - KLAC - close: 39.80 chg: -0.27 stop:

KLAC didn't move much today and continues to offer an entry point to open new strangle positions. We would open positions in the $40.50-39.50 zone. The closer to $40.00 the better. We listed two different strangles on KLAC.

KLAC Strangle #1) The options we listed were the July $42.50 calls (KCQ-GV) and the July $37.50 puts (KCQ-SU). Our estimated cost is $1.65 We want to sell if either option hits $3.00.

KLAC Strangle #2) The options we listed were the July $45.00 calls (KCQ-GI) and the July $35.00 puts (KCQ-SG). Our estimated cost is $0.70. We want to sell if either option hits $1.50.

Picked on June 22 at $ 40.07
Change since picked: - 0.27
Earnings Date 07/24/08 (unconfirmed)
Average Daily Volume = 3.7 million

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Tyco Intl. - TYC - close: 42.90 change: -0.28 stop: n/a

There is no change from our weekend comments on TYC. We are 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).

Picked on June 03 at $ 44.89
Change since picked: - 1.99
Earnings Date 08/05/08 (unconfirmed)
Average Daily Volume = 2.9 million

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United States Oil - USO - cls: 110.92 chg: 1.78 stop: n/a

Everyone was expecting the Saudis to talk down the price of oil this past weekend. Naturally it didn't work and oil rallied again. We don't see any changes from our weekend comments. We are suggesting readers open positions in the $109.00-111.00 zone and the closer to $110.00 the better! We suggested two different strangles. The strangle with the wider strikes costs less but has higher risk.

USO Strangle #1) The options we listed were the July $115 calls (IYS-GK) and the July $105 puts (IYS-SA). Our estimated cost is $7.10 We want to sell if either option hits $9.75.

USO Strangle #2) The options we listed were the July $120 calls (QSO-GP) and the July $100 puts (IYS-SV). Our estimated cost is $4.10. We want to sell if either option hits $6.50.

Picked on June 22 at $109.14
Change since picked: 1.78
Earnings Date 00/00/00
Average Daily Volume = 12.5 million

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Valero - VLO - close: 43.44 change: 0.93 stop: n/a

VLO delivered a pretty good bounce today. Watch for resistance near $45.00. We don't see any changes from our weekend comments. At this time we're not suggesting new positions. However, if you are looking for a new entry point then consider option positions in the $44.75-45.25 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
Change since picked: - 1.40
Earnings Date 07/29/08 (unconfirmed)
Average Daily Volume = 10.8 million
 

Dropped Calls

Research In Motion - RIMM - cls: 143.06 chg: -1.50 stop: 137.40

Abandon ship! It was an ugly day for RIMM. The percentage move isn't that bad but the trading today looks like a clear failed rally and bearish reversal pattern. There are only two days left before RIMM reports earnings and we don't want to hold over the announcement anyway. We suggest readers exit immediately. The stock has already exceeded our early target at $144.00.

Picked on June 16 at $136.05 *1st target exceeded $144
Change since picked: 7.01
Earnings Date 06/25/08 (confirmed)
Average Daily Volume = 16.7 million
 

Dropped Puts

Capital One - COF - close: 39.52 change: -1.38 stop: 46.05

Target exceeded. COF followed the financials lower again on Monday. The stock slipped to $38.96 intraday. Our first target was the $40.25 mark. We do have an aggressive target at $37.75 and more aggressive traders may want to keep the play open and just let COF run as far as it can. We see today's action as a test of potential support at the bottom of its descending channel. The trend is very bearish but COF is oversold and due for a bounce. We'd rather exit now, lock in a gain, and just look for another entry point on a failed rally at the top of the channel.

Picked on June 17 at $ 43.87 *1st target exceeded
Change since picked: - 4.35
Earnings Date 07/17/08 (unconfirmed)
Average Daily Volume = 8.3 million
 

Dropped Strangles

None
 

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