NEW DIRECTIONAL CALL PLAYS
Oil Service Holders - OIH - close: 117.40 chg: +2.65 stop: 112.99
Why We Like It:
Traders are buying the dip in the oil service stocks. Instead of singling out one specific company (since we already have DO on the play list) I'm adding the OIH oil services HOLDRs. Buy calls now on the bounce with a tight stop under Friday's low. Our first target is $124.00.
Please note that this is a slightly aggressive play. The OIH will be strongly influenced by the price of crude oil. Last week oil broke down under a key trendline of support. Yet rising tensions with Iran could keep oil from seeing any significant declines.
I'm suggesting the October or November calls. Octobers expire in about three weeks. My preference is the November $125 strike.
BUY CALL OCT 120 OIH-JD open interest=8093 current ask $2.89
BUY CALL OCT 125 OIH-JE open interest=8165 current ask $1.28
BUY CALL NOV 120 OIH-KD open interest= 661 current ask $5.80
BUY CALL NOV 125*OIH-KE open interest= 371 current ask $3.80
Picked on September 28 at $117.40
Change since picked: + 0.00
Earnings Date 00/00/00
Average Daily Volume = 6.6 million
Listed on September 28, 2009