Take PCU Profits

Add JOYG Calls

By Bryan Bottarelli
Tuesday, June 12, 2007 2:29 PM EDT
Tue, 12 Jun 2007 18:29:00 GMT

Dear Bottarelli Research Member,

In a stunning intra-day reversal, the Dow has now turned a 95-point loss into a slight gain. Thanks to this reversal, our IMO July 45 Calls (IMO GI) and our SII July 60 Calls (SIK GL) continue to inch towards profitability — but the really nice move comes in the form of our PCU July 90 Calls (PCU GR).We entered these calls yesterday for $4.80 and they just traded for $6.00. That’s good for a nice 25% gainer, so go ahead and lock in those gains now!

PCU

PLAY: Sell your PCU July 90 Calls (PCU GR) at or above $5.70, good for the day.

At the same time, continue to hold your downside positions in both the CELG July 60 Puts (LQH SL) and the BDK July 90 Puts (BDK SR) for another morning sell-off tomorrow. But let’s replace the PCU calls with a new upside call position on Joy Global (JOYG – NASDAQ).

JOYG

As you can see from the chart, the major coal mining equipment maker has been setting a series of new 52-week highs — and they’ve just now put in a strong bounce after a two-day sell-off. All the indicators point to further upside, so let’s get positioned in July calls now.

PLAY: Buy the JOYG July 60 Calls (JQY GL) at or under $2.10, good for the day. Current bid/ask spread is $1.90 to $2.00. Place a protective stop limit at $1.20.

I’m also keeping any eye on utilities like Entergy (ETR – NYSE) for a quick upside pop, but it’s not quite right to initiate a new play. You’ll know the moment it’s time to strike, but until then…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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