Take TBT Profits

Plus, Add CMED Calls

By Bryan Bottarelli
Wednesday, April 22, 2009 3:00 PM EDT
Wed, 22 Apr 2009 19:00:00 GMT

PLAY: Sell your TBT June 44 Calls (TBT FR) at market, good for the day.

*Play: Buy the CMED May 20 Calls (QCY ED) at or under $2.20, good for the day. Place a protective stop limit at $0.90 and a pre-determined sniper sell at $4.00.

Dear Bottarelli Research Member,

Right now, here’s the best way that I can explain the U.S. stock markets…

On one hand, you have the bearish argument, which is flush with indisputable facts about our current economic situation, unanswered questions about the future viability of our banking institutions, and heaping mountains of suffocating debt.

On the other hand, you have a bullish argument that’s fueled by governmental lip service, a U.S. dollar printing press, and false hope.

In my view, the winner of this battle will be inevitable. The bears will outlast the bulls. It’s only a matter of time. Now, as you can see from the Dow chart below, the up-move over the last two days has yet to recover the losses of Monday (but they’re getting close). As a result, the battle to hold at the 8,000 level continues.

INDU

In terms of our TBT June 44 Calls (TBT FR), I think it’s time to lock in our gains. As you can see below, the TBT just pushed above the 50-day moving average, which is helping our calls close in on our pre-set profit target at $4.00 per contract. Since these calls just hit a high of $3.90, that’s close enough for me. Let’s lock in the gains now!

TBT

PLAY: Sell your TBT June 44 Calls (TBT FR) at market, good for the day.

At the same time, continue holding your FAZ June 8 Calls (FAY FH), SRS May 32 Calls (SAK EZ), and SMH May 22 Puts (SMH QJ). But just to protect against more market upside, let’s go ahead and add a new call play on China Medical Technologies (CMED – NASDAQ).

CMED

As you can see from the CMED chart, the Chinese medical device company is on the verge of an upside breakout. As a way to play both sides of this market, lets’ add May 20 calls now.

Play: Buy the CMED May 20 Calls (QCY ED) at or under $2.20, good for the day. Place a protective stop limit at $0.90 and a pre-determined sniper sell at $4.00.

And as always…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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