January 2011 | Members

Please remember, ALL “Exit Targets” and “Stop Targets” are targets.  You should not have any “Hard Stops” entered to close any trades or “Exit Orders” in your brokerage account unless we list one.  We will send out an “Alert” or “Trade Update” if we want you to close a position OR if a new trade comes out.  Otherwise, follow instructions at all times in the 9am and 1pm updates.  Also, we will usually give you a heads-up if we think we are going to send an email outside of these time frames but it is rare that we do.

1:00pm (EST)

Jabil Circuit (JBL, $20.50, up $0.65)

March 21 calls (JBL110319C00021000, $1.00, up $0.30)

Entry Price:  $0.70 (1/26/11)

Exit Target: $1.40

Return: 43%

Stop Target: None

Action:  We are looking for a quick trip to $21-$22.  


PowerShares QQQ (QQQQ, $57.19, up $0.36)

March 58 calls (QQQQ110319C00058000, $0.90, up $0.08)

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50 

Return: 20%

Stop Target: None

Action:  We are looking for the Q’s to test $60 which gets these options to $2.  Continue to hold.


Spider S&P 500 (SPY, $129.92, up $0.25)

February 131 calls (SPY110219C00131000, $1.20, up $0.07)

Entry Price:  $0.95 (1/21/11)

Exit Target: $1.90  

Return: 26%

Stop Target: None

Action:  If the S&P cracks 1,300 then we could run to 1,325 where we will look to close at least half of the trade.    


Micron Technology (MU, $10.55, up $0.60)

April 10 calls (MU110416C00010000, $1.20, up $0.35) 

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50  

Return: 60%

Stop Target: None

Action:  Shares are up 5% today and we are expecting a run up to $11-$12 over the next month or two.  We might have to change that to a week or two.  Continue to hold.


JPMorgan Chase (JPM, $45.26, up $0.28)

February 46 calls (JPM110219C00046000, $0.65, up $0.07) 

Entry Price:  $0.88 (1/12/11)

Exit Target: $1.75  

Return: -26%

Stop Target: None

Action:  Continue to hold.   

   

Apollo Group (APOL, $42.39, up $0.32)

February 34 puts (APOL110219P00035000, $0.10, flat)

Entry Price:  $0.85 (1/7/11)

Exit Target: $1.70 (closed half @ $1.70 on 1/10/11)   

Return: 6%

Stop Target: None

Action:  We closed half of the trade at $1.70 on 1/10/11 and the current 14 cents on the other half gives an average price of $0.90 so far.  Continue to hold the other half.

     

Brocade Communications (BRCD, $5.88, up $0.12)

July 6 calls (BRCD110716C00006000, $0.70, up $0.07)

Entry Price:  $0.67 (1/4/11)

Exit Target: $1.35

Return: 4%

Stop Target: None   

Action:  The 52-week high is $8 which gets these calls to $2 on a continued turnaround story.  Brocade could also be a takeover target down the road.  Continue to hold.   

     

Skyworks Solutions (SWKS, $32.76, up $1.27)

May 32 calls (SWKS110521C00032000, $3.30, up $0.80)   

Entry Price:  $1.70 (12/29/10)

Exit Target: $3.40 (closed half @ $3.30 on 1/18/11)

Return: 94%

Stop Target: $1.20, raise to $2.00 (HARD STOP on other half)     

Action:  We’ve got our triple-digit gain back.  Continue to hold the other half but we are raising the stop.

          

Other 2011 Portfolio OPEN positions (5):  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 2010)

American Tower April 60 calls (from October 2010)  

Electronic Arts March 20 calls (from November 2010)

Constellation Brands February 22.50 calls (from January 2011) 

Vivus June 14 calls (from January 2011)     


WATCH LIST SECTION

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.


Molycorp (MCP, $47.26, up $1.41)

February 55 calls (MCP110219C00055000, $0.80, up $0.20)

February 50 calls (MCP110219C00050000, $2.00, up $0.50)

Thoughts:  We would love to get the 50’s for a buck but we may have to move out to the March options while we find the perfect entry point for getting in a trade.  The company is also offering additional shares which some investors feel is a bad thing but it’s not.  Molycorp could double and hit $100 this year if shares get the momentum we think they are going to get.  It’s hard to say when but that is what our gut is telling us.


Patriot Coal (PCX, $24.90, down $0.49)

March 28 calls (PCX110319C00028000, $1.15, down $0.20)

Thoughts:  Watch for now.


CurrencyShares Euro Trust (FXE, $136.48, up $0.13)

March 135 puts (FXE110319P00130000, $1.90, flat)

Thoughts:  We have been waiting for the Euro to rally back to these levels and these puts look attractive.  There is still a chance the Euro can trade up to $138-$140 which would be the ideal short.  Continue to watch.   


Cree (CREE, $51.85, down $0.50)

March 55 calls (CREE110319C00055000, $1.75, down $0.20) 

Thoughts:  Watch for now but let’s not forget shares dropped over 20% last week and could still be vulnerable.  However, CREE is a fast-mover so we don’t want to miss a run to the upside.     


Imax (IMAX, $26.28, up $0.02)

June 35 calls (IMAX110618C00035000, $0.50, down $0.10) 

Thoughts:  Shares have lost 20% since the high of $32.30 which was hit on the last trading day for 2010.  The company is subject to takeover rumors but continues to do well as it expands and grows into new markets.  Tempting…


Green Mountain Coffee Roasters (GMCR, $34.45, down $0.92)

March 38 calls (GMCR110319C00038000, $1.20, down $0.30)

Thoughts:  Watch for now but the option activity is picking up.

=========================

9:20am (EST)

Jabil Circuit (JBL, $19.85, up $0.09)

March 21 calls (JBL110319C00021000, $0.70, up $0.10)

Entry Price:  $0.70 (1/26/11)

Exit Target: $1.40

Return: 0%

Stop Target: None

Action:  Jabil doesn’t announce earnings until March 22 so we don’t have that headline risk to worry about.  This is what we are looking for with this trade.  First, we need to see shares hold $19. 

A break below $19.50 will get us nervous but a break above $20.25 will be very bullish and could get shares to new 52-week highs which would occur on a break of $21.78.  This trade will be a double if it plays out this way. 


PowerShares QQQ (QQQQ, $56.83, up $0.30)

March 58 calls (QQQQ110319C00058000, $0.82, up $0.10)

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50 

Return: 9%

Stop Target: None

Action:  We are looking for the Q’s to test $60 which gets these options to $2.  Continue to hold.


Spider S&P 500 (SPY, $129.67, up $0.50) 

February 131 calls (SPY110219C00131000, $1.13, up $0.15)

Entry Price:  $0.95 (1/21/11)

Exit Target: $1.90  

Return: 19%

Stop Target: None

Action:  If the S&P cracks 1,300 then we could run to 1,325 where we will look to close at least half of the trade.    


Micron Technology (MU, $9.95, down $0.03)

April 10 calls (MU110416C00010000, $0.86, down $0.02) 

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50  

Return: 15%

Stop Target: None

Action:  We are expecting a run up to $11-$12 over the next month or two.  Continue to hold.


JPMorgan Chase (JPM, $44.98, up $0.11)

February 46 calls (JPM110219C00046000, $0.58, down $0.02) 

Entry Price:  $0.88 (1/12/11)

Exit Target: $1.75  

Return: -34%

Stop Target: None

Action:  Continue to hold for now but this has been a frustrating trade to hold from day 1..

   

Apollo Group (APOL, $42.07, up $0.35)

February 34 puts (APOL110219P00035000, $0.10, flat)

Entry Price:  $0.85 (1/7/11)

Exit Target: $1.70 (closed half @ $1.70 on 1/10/11)   

Return: 6%

Stop Target: None

Action:  We would like to see a break back below $40 this week but the worse we can do on this trade is break even.  We closed half of the trade at $1.70 on 1/10/11 and the current 14 cents on the other half gives an average price of $0.90 so far.  Continue to hold the other half.

     

Brocade Communications (BRCD, $5.76, up $0.23)

July 6 calls (BRCD110716C00006000, $0.63, up $0.08)

Entry Price:  $0.67 (1/4/11)

Exit Target: $1.35

Return: -6%

Stop Target: None   

Action:  The 52-week high is $8 which gets these calls to $2 on a continued turnaround story.  Brocade could also be a takeover target down the road.  Continue to hold.   

     

Skyworks Solutions (SWKS, $31.49, up $1.48)

May 32 calls (SWKS110521C00032000, $2.50, up $0.60)   

Entry Price:  $1.70 (12/29/10)

Exit Target: $3.40 (closed half @ $3.30 on 1/18/11)

Return: 71%

Stop Target: $1.20 (HARD STOP on other half)     

Action:  We told you there was some life left in this trade.  The May call options have 114 days before they expire and we were looking for Skyworks to hit new 52-week highs by then.  Continue to hold.

         

Other 2011 Portfolio OPEN positions (5):  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 2010)

American Tower April 60 calls (from October 2010)  

Electronic Arts March 20 calls (from November 2010)

Constellation Brands February 22.50 calls (from January 2011) 

Vivus June 14 calls (from January 2011)     


WATCH LIST SECTION

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.

Molycorp (MCP, $45.85, down $1.04)

February 55 calls (MCP110219C00055000, $0.60, down $0.30)

February 50 calls (MCP110219C00050000, $1.50, down $0.45)

Thoughts:  We would love to get the 50’s for a buck but we may have to move out to the March options while we find the perfect entry point for getting in a trade.  The company is also offering additional shares which some investors feel is a bad thing but it’s not.  Molycorp could double and hit $100 this year if shares get the momentum we think they are going to get.  It’s hard to say when but that is what our gut is telling us.


Patriot Coal (PCX, $25.39, up $1.87)

March 28 calls (PCX110319C00028000, $1.35, up $0.50)

Thoughts:  We didn’t want to “rush” this trade and the calls opened at $1.  We were hoping to get them for 75 cents at the open but we didn’t want to pay more than a buck to establish positions.  For those of you who jumped the gun made a nice 35% pop in 24 hours.  Let’s wait and see if we can get these for 75 cents this week or next. but if not, good luck to those of you in.


CurrencyShares Euro Trust (FXE, $136.35, up $0.07)

March 135 puts (FXE110319P00130000, $1.85, down $0.10)

Thoughts:  We have been waiting for the Euro to rally back to these levels and these puts look attractive.  There is still a chance the Euro can trade up to $138-$140 which would be the ideal short.  Continue to watch.   


Cree (CREE, $52.35, up $0.48)

March 55 calls (CREE110319C00055000, $1.95, up $0.10) 

Thoughts:  Watch for now but let’s not forget shares dropped over 20% last week and could still be vulnerable.  However, CREE is a fast-mover so we don’t want to miss a run to the upside.     


Imax (IMAX, $26.25, down $0.01)

June 35 calls (IMAX110618C00035000, $0.60, flat) 

Thoughts:  Shares have lost 20% since the high of $32.30 which was hit on the last trading day for 2010.  The company is subject to takeover rumors but continues to do well as it expands and grows into new markets.  Tempting…


Green Mountain Coffee Roasters (GMCR, $35.37, up $0.57)

March 38 calls (GMCR110319C00038000, $1.50, up $0.15)

Thoughts:  Watch for now but the option activity is picking up.