PCP Blasting Higher

Book 26% in a Matter of Hours

By Bryan Bottarelli
Tuesday, February 20, 2007 1:50 PM EST
Tue, 20 Feb 2007 18:50:00 GMT

Dear Bottarelli Research Member,

Our play on Precision Castparts (PCP – NYSE) is moving exactly as we expected. As I write, the stock is up $2.37 and setting a new 52-week high at $97.13 per share. As a result of this up-move, your PCP April 100 Calls (PCP DT) have moved from our $2.60 entry price all the way up to $3.30, good for a quick 26% gainer in a matter of hours.

PCP

Like I mentioned earlier, I feel PCP will soon break $100 per share, but you cannot ignore an intra-day gain of 26%. Conservatively speaking, it may be wise to set a $3.30 sell price and lock in your gains. Let’s do this now:

PLAY: Sell your PCP April 100 Calls (PCP DT) at or above $3.30, good for the day.

Keeping with this same theme, let’s continue to follow the stock charts of both Allegheny Technologies (ATI – NYSE) and Titanium Metals (TIE – NYSE).As you can see below, ATI is primed and ready to break past its recent high at $105 per share, and TIE is making yet another very strong upside move north of the $36 level. If things continue to look good in these stock charts, I may establish another longer-dated call play in either company (or perhaps even both).

ATI

TIE

In the same breath, time is fast approaching to add longer-dated calls on Whole Foods Market (WFMI – NASDAQ). As you can see, the stock is trying very hard to maintain the 50-day moving average, which can hopefully serve as the next launch point. I’ll keep a close eye on this play for any immediate upside opportunities.

WFMI

Also looking good today is our earlier trade on NYSE Group (NYX – NYSE), as the stock is pushing $3.00 higher and the NYX March 90 Puts (NYX OR) that you entered for $3.70 are up to $4.10. Maintain these calls for more gains.

The one play not moving in our direction today is WebMD (WBMD – NASDAQ).

WBMD

In true speculative fashion, the stock is rallying in advance of tomorrow’s earnings reports — which could be a way of shaking out the weak-handed shorts. If you’re a true speculator, you’ll hold into tomorrow’s earnings — as most of the web-based tech stocks have been experiencing earnings-related sell-offs. Buy as it stands, I must adhere to our model portfolio and call the WBMD March 50 Puts (QWB OJ) closed.

Lock and load

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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