CALL OPTIONS
STOCK PICKING
My source is www.advfn.com using CANSLIM screener provided for free. So, I come to this stock with strong earning increases during couple quarters.
Stock Symbol : KWK
Stock Price $ 40.10 (April 16, 2008) BMO (Before Market Open)
ENTRY PRICE
Open the chain provided in www.optionsxpress.com .
I choose the entry price with IV below 48%, which the strike price is $ 45 (OTM)..I’ve to be discipline by not entering strike price too far from ITM.
TECHNICAL ANALYSIS
As we can see, the candlestick still above 22 dma line, and also the MACD is above the average (indicated w/ blue color)
The stochastic also confrim strongly by the cross line of Red & Blue. So, we can assure that the stock price is in uptrend (indicated by red line move upward) for couple days ahead.
FUNDAMENTAL ANALYSIS
For the earnings date, just klik: http://moneycentral.msn.com/investor/market/earncalendar/
Earnings Date:
5/7/08 Q1 2008 (Before Market Opens – BMO)
2/26/08 Q4 2007
11/6/07 Q3 2007
8/8/07 Q2 2007
5/2/07 Q1 2007
DETERMINING
Stop Loss:
The premium paid (Ask Price) = $ 1.65
Stop Loss is 25% from the premium paid --> $ 1.65 -25% = $ 1.24
Day to expiration = 66 days – 3 days = 63 days
Input the data into Option Calculator: http://www.cboe.com/LearnCenter/OptionCalculator.aspx
Target (April 30, 2008):
Target is 60% from the premium paid --> $ 1.65 + 60% = $ 2.64
Day to expiration = 66 days – 14 days = 52 days
Input the data into Option Calculator:
ALERT SETTING
Go to http://alerts.yahoo.com
SUMMARY
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