9:00am (EST)

Electronic Arts (ERTS, $14.82, down $0.16)

March 20 calls (ERTS110319C00020000, $0.22, up $0.01)

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 0%

Stop Target: None

Action:   We aren’t too worried about EA’s chart because it’s ugly.  However, we are hoping this is a bottom but shares could test the July low of $14.06 which is where we think the company catches a bid, or takeover offer.  If not, the stock would become cheap enough for us to seriously consider writing covered calls.  In the meantime, these are “cheap” out-of-the-money options that could payoff big-time if shares rally back to $20 on stronger titles and sales or a takeover bid. 

We should also note that we don’t advise going “overboard’ with these options just because they are cheap.  Stick to your normal number of contracts or your dollar allotment for each trade.  We cover this in our option trading manual, “How to Trade Options on Momentum Stocks”, and we believe every option trader should adhere to these rules. 

The March options have 110 days before expiration.

JDS Uniphase (JDSU, $12.34, up $0.14)

March 12 calls (JDSU110319C00012000, $1.30, flat)

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50

Return: 4%

Stop Target: 60 cents

Action:  We did a write-up on JDSU last night in our Weekly Wrap in case you missed it.  We are looking for shares to clear $12.50 which should lead to a run to $13-$14 over the next 3 months.  Continue to hold.

Juniper Networks (JNPR, $34.13, down $0.38)

January 35 calls (JNPR110122C00035000, $1.40, down $0.25)

Entry Price:  $1.30 (11/17/10)

Exit Target: $2.60

Return: 8%

Stop Target: $1.00 

Action:  If shares can clear $36, the 52-week high, then we could see a run to $40.  The January options have 54 days before expiration.  Continue to hold.

Riverbed Technology (RVBD, $34.81, up $0.06)

March 35 calls (RVBD110319C00035000, $4.00, up $0.10)

Entry Price:  $1.40 (11/17/10)

Exit Target: $2.80 (closed half @ $3.00 on 11/23/10)

Return: 150%

Stop Target:  $2.50 

Action:  Shares touched $35.32 last Wednesday and we are looking for a retest of that high this week and a run to $40 by yearend.  Continue to hold.

CBOE Holdings (CBOE, $23.50, down $0.38)

December 25 calls (CBOE101218C00025000, $0.30, down $0.10)

Entry Price:  $0.75 (11/8/10)

Exit Target: $2.40+

Return: -60%

Stop Target: None

Action:  CBOE will have to get some legs for a push back over $25 as the December options expire in 19 days.  Shares closed above $25 on November 19 but the recent tender offer at $25 has kept a lid on things.  To breakeven, we need the stock to be at $25.75, technically, by mid-December.  A run to $26.50 gives us a double but we will need a strong run, beginning today.

Darden Restaurants (DRI, $49.49, down $0.19)

December 49 calls (DRI101218C00049000, $1.60, down $0.10) 

Entry Price:  $1.20 (11/8/10)

Exit Target: $2.40+

Return: 33%

Stop Target: $1.25

Action:  Shares nearly broke $50 last week and came within a penny of making our prediction a reality.  A break at this level represents “blue-sky” territory and we think a run to $55 is in the cards.  However, we have to be careful because these options also expire in 3 weeks as well.  We may have to “roll-over” profits into further out options if shares remain flat for the week as the December options are really only worth 49 cents at current levels.

Continue to hold but be on the lookout for a Trade Alert if we decide it’s time to close and roll.

Aruba Networks (ARUN, $23.94, up $0.12)

January 25 calls (ARUN110122C00025000, $1.40, up $0.05)

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: 17%

Stop Target:  60 cents

Action:  The 52-week high is $24.28 which was set last Monday.  We are looking for a run past $25 up to $27-$28 by Christmas.  Continue to hold.

PowerShares QQQ (QQQQ, $52.77, down $0.35)

January 53 calls (QQQQ110122C00053000, $1.50, down $0.10)

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: -3%

Stop Target: 75 cents

Action:  If the Nasdaq can break 2,600, the Q’s should run past $55.  These are January options so we have nearly two months to wait and see if the bulls can breakout past current resistance.  Continue to hold.

American Tower (AMT, $51.77, down $0.27)

April (2011) 60 calls (AMT110416C00060000, $0.65, down $0.10)

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  0%

Stop Target: None

Action:  These options have 138 days before expiration.  Continue to hold.

Dendreon (DNDN, $36.27, down $0.50) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.25, down $0.10)

Entry Price:  $41.96 (9/13/10) sold October 45 call @ $1.30, (11/11/10) sold December call @$1.75

Exit Target: $45

Return: -7%

Stop Target: None

Action:  Dendreon opened at $41.96 and you could have sold the October 45 call option for $1.30 on 9/13/10.  This lowered the cost basis to $40.66.

On 11/11/10 we sold the December 40 call option for $1.75 which lowered our cost basis to $38.91.  If the stock gets “called away” from us by mid-December then we make 3% in 3 months.

Other 2010 Portfolio OPEN positions (2):  These are trades that are still open in the portfolio that have longer expiration dates or are on “hold” but are not worth mentioning until they turn around.  We are still keeping track of the trade and we will record the results, accordingly, when we close them or the options expire.  Click on the 2010 Portfolio link in the Members Area to view ALL open/ closed trades.   

Biodel March 7.50 calls (from October)

Chesapeake Energy January 25 calls (from October)


These trades are NOT recommendations until we send out an alert.  These are trades that we like but have not added to the portfolio as an official recommendation because of market conditions or because we are waiting for better entry prices.  We will not list entry prices because these stocks are on the verge of breaking out or they could sell-off.

Skyworks Solutions (SWKS, $25.99, down $0.15)

January 26 calls (SWKS110122C00026000, $1.65, flat)

Action:  Watch for now but we are really warming up to this trade if the momentum comes back for a Christmas rally.    

THQ (THQI, $5.19, up $0.18)

December 5 calls (THQI101218C00005000, $0.40, up $0.10)

March 5 calls (THQI110319C00005000, $0.75, up $0.05)

Action:  Continue to watch. 

Cisco Systems (CSCO, $19.49, up $0.03)

Action:  We are looking at Cisco as a covered call trade.  Shares could test $17.50-$18 which is where we are looking to establish positions.

Foster Wheeler (FWLT, $28.78, down $0.05)

January 30 calls (FWLT110122C00030000, $1.25, flat)

Action:  We think a run past $30 is coming.  Watch for now be also be on the lookout for a Trade Alert if we take action. 

Ingersoll-Rand (IR, $40.83, down $0.30)

January 42.50 calls (IR110122C00042500, $0.90, down $0.10)

Action:  Watch for now.