Celgene (CELG) 3/4/10 Daily Market Radar Support Down To $60.47

Posted: Thursday, March 04, 2010 8:26 AM EDT
By: Market Intelligence Center Staff

Celgene (NASDAQ: CELG) closed yesterday at $61.22. So far the stock has hit a 52-week low of $36.90 and 52-week high of $62.09. Celgene stock has been showing support around 60.47 and resistance in the 62.47 range. Technical indicators for the stock are Bullish and S&P gives CELG a very positive 5 STAR (out of 5) strong buy rating. CELG appears on the Investors Observer Momentum Plays list. For a hedged play on this stock, look at a Jul '10 65 covered call for a net debit in the $58.52 area. That is also the break even stock price for this trade. This covered call has a 135 day duration, provides 4.41% downside protection and an 11.07% assigned return rate for a 29.94% annualized return rate (comparison purposes only). A lower cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the CELG Jan '11 50 Call and selling the Jul '10 65 call for an $11.75 debit. The trade has a 135 day life and would provide no downside protection and a 27.66% assigned return rate for a 75.00% annualized return rate (for comparison purposes only). Celgene does not pay dividends at this time. [THA-Seven Summits Research]