Two New Calls

Play FLR & PCP Now

By Bryan Bottarelli
Monday, August 27, 2007 2:40 PM EDT
Mon, 27 Aug 2007 18:40:00 GMT

Dear Bottarelli Research Member,

While the markets continue to “battle it out” for control of the next major directional move, it’s nice to see our PEG September 85 Puts (PEG UQ) trade from this morning handing us a nice intra-day gain. But as the trading day progressed, the opportunity has become available for us to play two powerful stocks to the upside — and I’d like to take full advantage. The first upside candidate comes in the form of Fluor Corporation (FLR – NYSE).

FLR

The company provides worldwide engineering and construction services to the oil & gas industry, and as you can see from the chart, the stock is just about to break out and establish a new 52-week high at the $128.00 level. Let’s play this move using September calls.

PLAY: Buy the FLR September 125 Calls (FLR IE) at or under $5.00, good for the day. Current bid/ask spread is $4.60 to $4.90. Place a protective stop limit at $2.40.

The second upside play comes courtesy of Precision Castparts (PCP – NYSE). The company manufactures metal components for the aerospace, power generation, and automotive markets, and as you can see from the chart, the stock is poised to make a run towards its 52-week high at $144.89. Let’s ride this upside move using September calls as well. Here’s the play:

PCP

PLAY: Buy the PCP September 140 Calls (PCP IH) at or under $4.60, good for the day. Current bid/ask spread is $4.10 to $4.40. Place a protective stop limit at $2.20.

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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