Madoff Sentence Expected Shortly

9:00am (EST) Futures are pointing towards a higher open; Dow futures are up 22, Nasdaq futures are up 4 while the S&P 500 futures are up 4 points. This will only be a four-day work week for Wall Street so volume should be a little light. However, it is going to be the start of a long week for Bernie Madoff who is expected to be sentenced this morning and Allen Stanford who could be denied bail. As far as the trades we are following, ChangeYou.com (CYOU, $45.52) made a run on Friday and the July 50 calls (CQUGJ, $1.30) that were going for 75 cents soared. I said to watch these calls if ChangeYou.com made a run at its 52-week high and they gained 75% after the morning blog. It would have been tough to hold them over the weekend without taking a little off the table and if you missed the entry point, don’t chase. They could come back down to $1.00 but this stock looks like it could test $50 quickly. Imax (IMAX, $8.19) could get another pop this morning after announcing record revenue for “Transformers: Revenge of the Fallen”. The film took the top spot at the box office during its opening weekend and for Imax, Transformers was the biggest opening in its history. Wow, even bigger than Spider-Man… The July 7.50 calls (IMQGU, $0.90) have now returned 157% from entry prices of 35 cents and you could have closed at least some of the trade on Friday to protect profits or to roll over to further out months. Getting that type of return in two-days is great but make sure you protect your profits. Also, with the three-day weekend coming up, we will probably be closing the position anyway. The September 7.50 calls (IMQIU, $1.40) are up 65% from entry prices of 85 cents and the December 7.50 calls (IMQLU, $1.65) are up over 35%. I’m looking for Imax to continue higher but if the stock falls below $7.75, close the positions. All of our other positions remain a hold. Rick Rouse Rick@TheOptionInvestor.com]]>

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