Option Investor
Play Updates

In Play Updates and Reviews

HAVING TROUBLE PRINTING?
Printer friendly version

Call Updates

Freeport-McMoran - FCX - cls: 72.06 change: -1.85 stop: 69.19

We cautioned readers over the weekend to keep an eye on the U.S. dollar and how it might affect commodities and thus shares of FCX. The dollar did surge higher and FCX dipped to $70.11 before bouncing. More conservative traders might want to raise their stop closer to the $70.00 mark. If the dollar continues to fly higher FCX could easily stop us out. We have two targets. Our first target is $79.75. Our second target is $84.00.

Picked on September 06 at $ 73.91
Change since picked: - 1.85
Earnings Date 10/23/08 (unconfirmed)
Average Daily Volume = 11.2 million

---

Jones Lang - JLL - close: 52.02 chg: 1.04 stop: 49.95 *new*

Target achieved. As expected almost anything related to financial stocks were strong this morning. JLL hit $55.08 before paring its gains. Our initial target was $54.95. Shares dipped back to $50.40 before bouncing higher this afternoon. We are raising our stop loss to $49.95. Our second target is $59.00. FYI: We would consider this a more aggressive play because option volume is light and the option spreads are wide.

Picked on September 06 at $ 50.98 /1st target hit 9/8/08
Change since picked: 1.04
Earnings Date 10/30/08 (unconfirmed)
Average Daily Volume = 705 thousand

---

Kohls - KSS - close: 53.86 change: 2.82 stop: 49.15

Retail stocks were some of the best performers today. KSS did gap higher at the open. After the midday pull back shares soared to their best levels. Closing at its highs for the day is normally a bullish sign for the next session. Our first target is $55.00. We're considering a second, higher target. The P&F chart is bullish with a $62 target. As expected the move over $53.00 has produced a new P&F chart buy signal.

Picked on September 06 at $ 51.04
Change since picked: 2.82
Earnings Date 11/13/08 (unconfirmed)
Average Daily Volume = 7.6 million

---

CBOE Volatility Index - VIX - close: 22.64 chg: -0.42 stop: n/a

The VIX moved lower given the optimism today. A lot of folks think this bounce in the market is going to be short-lived. Another bounce in the VIX might be an entry point to buy calls. Our target is the 29.75 mark but readers might want to consider scaling out of positions in the 28-29 region.

Picked on August 03 at $ 22.57
Change since picked: 0.07
Earnings Date 00/00/00
Average Daily Volume = x million
 

Put Updates

Air Products - APD - cls: 87.33 change: 0.12 stop: 90.55

There was a strong open for APD and shares spiked to $89.93 before failing. We cautioned readers over the weekend to expect a rally back toward $90. This move looks like another failed rally. We remain bearish. APD has already exceeded our $87.00 target. Our secondary target is $84.00. The Point & Figure chart is bearish with a $73 target.

Picked on August 31 at $ 91.85 *target hit 87.00 on 09/04/08
Change since picked: - 5.03
Earnings Date 10/22/08 (unconfirmed)
Average Daily Volume = 1.8 million

---

Jacobs Engineering - JEC - cls: 61.91 chg: -2.66 stop: 68.55*new*

JEC gapped open and spiked to $67.44 before immediately fading. The stock closed down about 4%. We are adjusting our stop loss to $68.55. Our target is $60.50. We are adding a secondary target of $56.50. Expect a bounce near $60.00 and be sure to take some money off the table at our first target. FYI: The Point & Figure chart is bearish with a $47 target.

Picked on September 04 at $ 66.90 *triggered
Change since picked: - 4.99
Earnings Date 11/05/08 (unconfirmed)
Average Daily Volume = 1.6 million

---

Millicom Intl. - MICC - cls: 75.28 chg: -0.58 stop: 80.51

The early morning rally in MICC quickly faded. This could be a new entry point for put positions. The MACD on the daily chart has produced a new sell signal. The P&F chart is bearish with a $63 target. Our target is $75.05. Our second target is $72.50.

Picked on August 28 at $ 78.58 *1st target hit 09/03/08
Change since picked: - 4.79
Earnings Date 10/23/08 (unconfirmed)
Average Daily Volume = 1.0 million

---

Roper Industries - ROP - cls: 58.04 chg: 1.82 stop: 60.05

Shares of ROP were upgraded to a "buy" this morning and that helped send shares to an intraday high of $60.00. Unfortunately for the bulls the rally quickly evaporated but the afternoon bounce lifted ROP to a 3% gain. Look for this bounce to fail again in the $59-60 zone and then use the failure as a new entry point for puts. Our target is $54.25. FYI: The Point & Figure chart is bearish with a $45 target but the P&F chart also shows some support near $53.00.

Picked on September 03 at $ 58.19
Change since picked: - 0.15
Earnings Date 10/23/08 (unconfirmed)
Average Daily Volume = 664 thousand

---

Unibanco - UBB - close: 109.57 chg: 0.91 stop: 115.05

The rally in financials lifted UBB to $114.91 and it immediately failed under resistance near $115 and its 10-dma. This looks like another bearish entry point to buy puts. However, readers should keep in mind that no one knows how long the strength in financials might last. We have two targets. Our first target is $100.50. Our second target is $92.50. The Point & Figure chart has produced a brand new triple-bottom breakdown sell signal with a $92.00 target - a target that will probably move lower. The stock can be volatile so readers should consider this a higher-risk play.

Picked on September 04 at $108.82
Change since picked: 0.75
Earnings Date 11/06/08 (unconfirmed)
Average Daily Volume = 1.5 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.)

---

Lehman Brothers - LEH - close: 14.15 chg: -2.05 stop: n/a

It was a tough day for LEH. The stock painted a big bearish engulfing candlestick and lost 12%. There was constant talk of how potential suitors and investors are pulling away from LEH. Plus, there was news today that some top executives were leaving the company. We are quickly running out of time. We have less than two weeks left before September options expire. LEH needs to do something quick. We need to see LEH significantly above $24.00 or under $10.00. The options we suggested were the September $24.00 calls (LYH-IR) and the September $10.00 puts (LYH-UB). Our estimated cost is $2.15. We want to sell if either option hits $3.50 or higher.

Picked on July 27 at $ 17.05
Change since picked: - 2.90
Earnings Date 09/18/08 (unconfirmed)
Average Daily Volume = 63 million
 

Dropped Calls

Cleveland Cliffs - CLF - close: 76.85 chg: -5.28 stop: 75.69

Another major gain in the U.S. dollar hit the commodity stocks hard. Shares of CLF dipped to $75.22 intraday hitting our stop loss at $75.69, which was just under Friday's low. Adding more turmoil to the mix was news that CLF is asking shareholders to vote against a proposal by its largest shareholder, Harbinger Capital Partners, who wants to raise their stake in CLF from 15.6% to 33.3%. Harbinger wants to vote against CLF's pending acquisition of Alpha Natural Resources (ANR).

Picked on September 06 at $ 82.13 /stopped out 75.69
Change since picked: 0.00
Earnings Date 10/30/08 (unconfirmed)
Average Daily Volume = 4.4 million

---

Prudential Fincl. - PRU - cls: 84.92 chg: 6.18 stop: 74.99

PRU looked poised to move higher but we weren't expecting shares to gap open higher at $84.44. This morning the stock was upgraded to an "out perform", which helped exacerbate the move higher. We were targeting a move to $84.75. PRU hit $87.21 intraday. We're not claiming a win given the gap open. We would still keep an eye on PRU as the $80 level should now be support.

Picked on September 06 at $ 78.74 gap open 84.44
Change since picked: 6.18
Earnings Date 10/29/08 (unconfirmed)
Average Daily Volume = 4.0 million
 

Dropped Puts

Deutsche Bank - DB - close: 86.13 change: 3.42 stop: 86.05

The FRE/FNM news came out after the bell on Friday. We knew that financials were going to act bullish on Monday but there wasn't much we could do. DB has some short-term resistance near $87.00 and the stock gapped open at $86.77 but then failed twice near $86.85. The opening trade was above our stop loss at $86.05 so the play is closed.

Picked on September 04 at $ 81.97 /stopped 86.77 gap higher exit
Change since picked: 4.16
Earnings Date 10/30/08 (unconfirmed)
Average Daily Volume = 995 thousand

---

L-3 Comm. - LLL - close: 105.23 chg: 2.59 stop: 105.05

Widespread market strength on Monday helped lift LLL to $105.60. Our stop loss was hit at $105.05. The last few sessions have seen a major whipsaw in shares of LLL. The stock rose more than 2.5% today but traders should note that volume was extremely low. LLL currently has resistance in the $106.00-107.00 zone.

Picked on September 04 at $102.00 *stopped $105.05
Change since picked: 3.23
Earnings Date 10/23/08 (unconfirmed)
Average Daily Volume = 1.0 million
 

Dropped Strangles

None
 

Play Update Archives