World Hits New 52-Week Low

Speculative: Add ICE Calls

By Bryan Bottarelli
Monday, October 06, 2008 11:09 AM EDT
Mon, 6 Oct 2008 15:09:00 GMT

PLAY: Buy the ICE October 85 Calls (ICE JQ) at or under $3.30, good for the day. Place a pre-determined sniper sell at $5.50 and a stop limit at $1.40.

Dear Bottarelli Research Member,

Not only is everything on my screen red today, but 1 out of every 3 stocks that I follow is currently at a new 52-week low. It’s an absolute bloodbath, no bones about it. Consider this:

New highs on the NYSE today: 1

New lows on the NYSE today: 1,160

This is a shocking ratio of highs to lows. And as the Dow approaches a 5-year low (under 10,000!) investors are selling everything. Good stocks, bad stocks, you name it. All of them are deeply in the red today. I really can’t describe in any more detail. It’s truly a bloodbath.

INDU

Like I mentioned earlier this morning, I’d like to take advantage of this panic selling by adding an upside call position. Now remember, this is a truly speculative play. While everyone else is sitting back and letting the selling pressure run it course, I’d like to carefully add October calls on ICE. All we need is any sort of buying interest (or perhaps a coordinated Fed announcement) and shares of ICE can aggressively shoot higher. In fact, we’ve seen this sort of movement when we played ICE calls on October 1st, so let’s try it once again. Here’s the speculative play:

ICE

PLAY: Buy the ICE October 85 Calls (ICE JQ) at or under $3.30, good for the day. Place a pre-determined sniper sell at $5.50 and a stop limit at $1.40.

And as always…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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