Citigroup (C, $18.80, up $0.68) and Wachovia (WB, $15.73, up $1.18) continue to rally today as the Dow is up an impressive 171 points shortly after lunch. There’s no specific news concerning these two companies, they are just along for today’s ride. As we head towards the end of the week it’s good to see that some of our trades are going to be huge winners before the holiday weekend.

We will close either close them on Friday and simply look for more trades next Tuesday or we will sell half of our positions and let the rest ride. It all depends. Don’t forget we get the Personal Income and Outlays and the Consumer Sentiment reports tomorrow and they will either help extend the market gains or stop us out of our trades.

The Citigroup January 20 calls (CAD, $2.00, up $0.30) were at $1.37 and are up 50%. The Wachovia January 15 calls (WBAC, $4.00, up $0.70) were profiled at $3.00 so they are up 33%. Set stops on the Citigroup calls at $1.75. For Wachovia, set stops at $3.50.

These trades would have shown even bigger gains had we played the September or October option calls but the risk would have been much greater had these stocks headed the other way. I’ll provide another update before Friday’s closing bell.

Rick Rouse