Play STP Calls

Plus: MRO Answer

By Bryan Bottarelli
Monday, March 24, 2008 12:43 PM EDT
Mon, 24 Mar 2008 16:43:00 GMT

PLAY: Buy the STP April 35 Calls (STP DG) at or under $3.20, good for the day.

Dear Bottarelli Research Member,

Just to follow up on the MRO April 47.5 Calls (MRO DW), the error response we all received this morning was due to the fact that this option should not have been listed by the exchanges. It was brought out in error by the floor — and upon realizing that they listed these contracts, they rejected any orders that attempted to buy them. Of course, anyone who currently owned these contracts could still sell them, but the floor did not want to accept any new contracts on this particular strike price. Therefore, our buy orders from this morning were rejected. To me, this is “bad karma” so I’ll let Marathon Oil (MRO – NYSE) go (for now, at least) and move onto the next upside call play on my list. That company comes in the form of Suntech Power Holdings (STP – NYSE).

STP

What we have here is one of the best solar plays that your investment dollars can buy — and as you can see below, STP has gotten decimated over the last few months of trading. But now, STP shares could be showing signs of life — and this presents us with a fantastic opportunity to add April calls for bargain-basement prices. As you can see, STP has an un-filled gap just under $50.00 per share, and that could hand us an explosive winner in any April STP call. Therefore, let’s profit off this upside momentum using the STP April 35 Calls (STP DG). Here’s the play:

PLAY: Buy the STP April 35 Calls (STP DG) at or under $3.20, good for the day. Place a sniper sell order at $3.80 and a protective stop limit at $1.90.

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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