If You Can, Take HES Profits

Who Can Argue with 31.57% in One Day?

By Bryan Bottarelli
Tuesday, November 28, 2006 2:31 PM EST
Tue, 28 Nov 2006 19:31:00 GMT

Dear Bottarelli Research Member,

Although it was a fast mover, it’s been a banner day for our HES January 45 Calls (HES AI).After entering these calls this morning for $3.80, they quickly jumped all the way up to a high of $5.00 on a broad-based recovery in the oil sector. If you were fast enough to enter these calls, it’s time that we lock in our one-day gains!

HES

PLAY: Sell your HES January 45 Calls (HES AI) at or above $4.90, good for the day.

Quickly looking at our other positions, we’ve seen a nice intra-day reversal in Toll Brothers (TOL – NYSE), which is pushing your TOL March 30 Calls (TOL CF) above our $2.85 entry. Not to be outdone, ATK and MON have each come off their highs of the day, which point to further downside in each stock. Maintain your ATK January 75 Puts (ATK MO) and your MON January 50 Puts (MON MJ), as each position is trading slightly above our entry price.

The two positions that are a little weak today are the PEIX January 17.5 Calls (PFQ AW) and the Charles Schwab January 17.5 Calls (SHQ AW), which is to be expected when you have a 156-point sell-off. I noticed that the Schwab calls traded briefly at our stop loss price before bouncing higher, so I’ll continue to monitor the position as we move forward. PEIX remains a bullish candidate, as their new ethanol factory combined with their first quarter of profitability points to further PEIX upside. And of course, maintain your protective DIA December 120 Puts (DAW XP) as yesterday is a prime example of just how quickly the markets can turn south. You definitely want to be protected against more days like that. As always…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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