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.

12:50pm (EST)

NEW TRADE!!!

Jabil Circuit (JBL, $20.02, up $0.26)

Buy to OPEN March 21 calls (JBL110319C00021000, $0.70, up $0.10)

Action:  You should be able to get these options for 70-75 cents right now.  Use limit prices up to 80 cents but do not pay more than 90 cents to establish positions. 

Current Trades

PowerShares QQQ (QQQQ, $56.73, up $0.20)

March 58 calls (QQQQ110319C00058000, $0.77, up $0.05)

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50 

Return: 3%

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, $129.54, up $0.37)

February 131 calls (SPY110219C00131000, $1.05, up $0.07)

Entry Price:  $0.95 (1/21/11)

Exit Target: $1.90  

Return: 11%

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, $10.00, up $0.02)

April 10 calls (MU110416C00010000, $0.88, flat)

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50  

Return: 17%

Stop Target: None

Action:  We are expecting a run up to $11-$12 over the next month or two.  These options have 79 days before expiration.  Continue to hold.


JPMorgan Chase (JPM, $45.32, up $0.45)

February 46 calls (JPM110219C00046000, $0.73, up $0.13) 

Entry Price:  $0.88 (1/12/11)

Exit Target: $1.75  

Return: -17%

Stop Target: None

Action:  Continue to hold for now.

   

Apollo Group (APOL, $42.13, up $0.41)

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, $5.63, up $0.10)

July 6 calls (BRCD110716C00006000, $0.58, up $0.03)

Entry Price:  $0.67 (1/4/11)

Exit Target: $1.35

Return: -13%

Stop Target: None   

Action:  These options have 170 days before they expire.  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, $31.30, up $1.29)

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:  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, $45.48, down $1.41)

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

February 50 calls (MCP110219C00050000, $1.40, down $0.55)

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.


Patriot Coal (PCX, $25.25, up $1.73)

March 28 calls (PCX110319C00028000, $1.25, up $0.40)

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.  Let’s wait and see if we can get these for 75 cents this week or next.


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

March 130 puts (FXE110319P00130000, $0.65, down $0.03)

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.  If the euro trades higher for a bit longer, we may have to watch the 135’s instead of these put options to get a closer strike price.     


Cree (CREE, $52.12, up $0.25)

March 55 calls (CREE110319C00055000, $1.85, flat)

Thoughts:  Watch for now but let’s not forget shares dropped over 20% last week and could still be vulnerable.  


Imax (IMAX, $26.37, up $0.11)

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, $34.79, down $0.01)

March 38 calls (GMCR110319C00038000, $1.35, flat)

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

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

9:00am (EST)

PowerShares QQQ (QQQQ, $56.53, up $0.08)

March 58 calls (QQQQ110319C00058000, $0.72, up $0.03)

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50 

Return: -3%

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, $129.17, up $0.07)

February 131 calls (SPY110219C00131000, $0.98, down $0.07)

Entry Price:  $0.95 (1/21/11)

Exit Target: $1.90  

Return: 3%

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, $9.98, down $0.08)

April 10 calls (MU110416C00010000, $0.88, down $0.05)

Entry Price:  $0.75 (1/21/11)

Exit Target: $1.50  

Return: 17%

Stop Target: None

Action:  Shares traded to a high of $10.22 yesterday and we are expecting a run up to $11-$12 over the next month or two.  These options have 79 days before expiration.  Continue to hold.


JPMorgan Chase (JPM, $44.87, down $0.15)

February 46 calls (JPM110219C00046000, $0.60, down $0.10) 

Entry Price:  $0.88 (1/12/11)

Exit Target: $1.75  

Return: -32%

Stop Target: None

Action:  The one sector we have been saying needed to rebound for the bulls blew the roof off the market was this one and we took a chance with one of the better names of the group.  It hasn’t led to a profit but we are hoping a rising tide will lift all boats.  Continue to hold for now.

   

Apollo Group (APOL, $41.72, down $0.15)

February 34 puts (APOL110219P00035000, $0.10, down $0.04)

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, $5.53, down $0.06)

July 6 calls (BRCD110716C00006000, $0.55, down $0.03)

Entry Price:  $0.67 (1/4/11)

Exit Target: $1.35

Return: -18%

Stop Target: None   

Action:  These options have 171 days before they expire.  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, $30.01, up $0.82)

May 32 calls (SWKS110521C00032000, $1.90, up $0.40)   

Entry Price:  $1.70 (12/29/10)

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

Return: 53%

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

Action:  The May call options have 114 days before they expire and we were looking for Skyworks to run back above $30 on a continued Tech rebound.  So far, so good.

          

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, $46.89, up $0.07)

February 55 calls (MCP110219C00055000, $0.90, down $0.30)

Thoughts:  Watch for now.


Patriot Coal (PCX, $23.52, down $0.41)

March 28 calls (PCX110319C00028000, $0.85, down $0.15)

Thoughts:  We like these calls at current levels but we would love to get them for under 75 cents today.  If was can get in at 65-70 cents, we might pull the trigger but wait for confirmation.  If shares move past $24 and the options are under a buck, we may also get into the trade. 


CurrencyShares Euro Trust (FXE, $136.28, up $0.36)

March 130 puts (FXE110319P00130000, $0.68, down $0.07)

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.  If the euro trades higher for a bit longer, we may have to watch the 135’s instead of these put options to get a closer strike price.     


Cree (CREE, $51.87, up $0.42)

March 55 calls (CREE110319C00055000, $1.85, flat)

Thoughts:  Watch for now but let’s not forget shares dropped over 20% last week and could still be vulnerable.  


Jabil Circuit (JBL, $19.76, down $0.41)

March 21 calls (JBL110319C00021000, $0.65, down $0.20)

Thoughts:  Watch for now.


Imax (IMAX, $26.26, down $0.39)

June 35 calls (IMAX110618C00035000, $0.60, down $0.05) 

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, $34.80, down $0.37)

March 38 calls (GMCR110319C00038000, $1.35, down $0.05)

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