February 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.

1:05pm (EST)

Pan American Silver (PAAS, $34.35, down $0.58)

March 37 calls (PAAS110319C00037000, $1.15, down $0.15)

Entry Price:  $1.35 (2/4/11)
Exit Target: $2.70
Return: -15%
Stop Target: 60 cents 

Action:  We are expecting a run to $40 for the stock which gets these options to $3.


Akamai Technologies (AKAM, $47.83, down $0.28)

March 55 calls (AKAM110319C00055000, $0.80, down $0.05)

Entry Price:  $0.82 (2/4/11)
Exit Target: $1.65
Return: -2%
Stop Target: None 

Action:  This is a risky trade because the company announces earnings next week.  However, we think they will crush estimates which could lead to new 52-week highs.

 

Patriot Coal (PCX, $25.10, down $0.84)

March 30 calls (PCX110319C00030000, $0.70, down $0.20)

Entry Price:  $1.25 (1/31/11)
Exit Target: $2.50
Return: -44%
Stop Target: 60 cents 

Action:  We are going to look at the chart this weekend but Patriot has made a huge reversal over the last few days after the options were up 40%.  We probably should have closed half when we hit those levels but we had no idea of the block trade that was coming through at $27 which was from a large shareholder.  We will do some more research so continue to hold for now.


CurrencyShares Euro Trust (FXE, $135.43, down $0.37)

March 134 puts (FXE110319P00134000, $1.70, up $0.05)

Entry Price:  $1.60 (1/28/11)
Exit Target: $3.20
Return: 6%
Stop Target: 80 cents

Action:  We said the Euro could fall to $135 by mid-March and yesterday’s drop was good to see.  Our 6-week target is under $130 for this ETF which gets these options to $4+.  Continue to hold. 

 

Jabil Circuit (JBL, $21.10, up $0.18)

March 21 calls (JBL110319C00021000, $1.15, up $0.05)

Entry Price:  $0.70 (1/26/11)
Exit Target: $1.40
Return: 64%
Stop Target: None

Action:  We are going to push this one a little and hold it open.  We were thinking of closing half but we think we have another week of Tech gains. 

PowerShares QQQ (QQQQ, $57.22, up $0.16)

March 58 calls (QQQQ110319C00058000, $0.85, flat) 

Entry Price:  $0.75 (1/21/11)
Exit Target: $1.50
Return: 13%
Stop Target: None

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


Spider S&P 500 (SPY, $130.78, flat)

February 131 calls (SPY110219C00131000, $1.25, down $0.05)

Entry Price:  $0.95 (1/21/11)
Exit Target: $1.90 (closed half @ $1.35 on 2/1/11)
Return: 37%
Stop Target: $1.00 (HARD STOP) 

Action:  Close the other half at current levels.  We opened 2 new trades so wanted to close one to take a little off the table and protect profits.
 

Micron Technology (MU, $10.88, down $0.02)

April 10 calls (MU110416C00010000, $1.35, flat)

Entry Price:  $0.75 (1/21/11)
Exit Target: $1.50 (closed half @ $1.00 on 1/28/11)
Return: 57%
Stop Target: $1.00 (HARD STOP) 

Action:  Shares reached $11.02 yesterday and the 52-week high is $11.40.  Continue to hold the other half.

JPMorgan Chase (JPM, $44.70, down $0.76)

February 46 calls (JPM110219C00046000, $0.40, down $0.25)

Entry Price:  $0.88 (1/12/11)
Exit Target: $1.75
Return: -55%
Stop Target: None

Action:  We are riding this one out…good, bad or ugly. Some of you may wish to close things out but we are hoping for a rebound next week. Continue to hold.


Brocade Communications (BRCD, $6.01, flat)

July 6 calls (BRCD110716C00006000, $0.75, flat)

Entry Price:  $0.67 (1/4/11)
Exit Target: $1.35
Return: 12%
Stop Target: None

Action:  Back over $6, baby!  The 52-week high is $8 which gets these calls to $2 on a continued turnaround story.  Continue to hold.  


Electronic Arts (ERTS, $18.33, up $0.22)

March 20 calls (ERTS110319C00020000, $0.28, up $0.03)

Entry Price:  $0.22 (11/24/10)
Exit Target: $0.50+
Return: 27%
Stop Target: None

Action:  We expected a slight pullback following yesterday’s big surge but overall we said the momentum should continue.  If shares can reach $20.50 by mid-March, we double our money.  If shares are at $21 the trade returns 350%.  Continue to hold.  
 

Other 2011 Portfolio OPEN positions (4):  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)
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.

We will be back with a fresh list on Monday.

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

10:35am (EST)

NEW TRADES!!!

Pan American Silver (PAAS, $35.06, up $0.13)

Buy to Open March 37 calls (PAAS110319C00037000, $1.35, up $0.05)

Action:  The bid/ ask is $1.30-$1.40 so use limit prices of $1.35 to try and get these options.  You can go up to $1.50 to get positions filled if you can’t get in at $1.35-$1.40.  We are expecting a run to $40 for the stock which gets these options to $3.


Akamai Technologies (AKAM, $48.09, down $0.02)

Buy to OPEN March 55 calls (AKAM110319C00055000, $0.82, down $0.03)

Action:  This is a risky trade because the company announces earnings next week.  However, we think they will crush estimates which could lead to new 52-week highs.  Use limit orders up to 85 cents but do not pay over 90-95 cents for these options.

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

9:05am (EST)

Patriot Coal (PCX, $25.94, down $2.19)  

March 30 calls (PCX110319C00030000, $0.90, down $0.80)

Entry Price:  $1.25 (1/31/11)
Exit Target: $2.50
Return: -28%
Stop Target: $1.30 

Action:  We think shares are headed past $30, possibility to $35, but we are watching $25.50 as support.  Shares traded to a low of $25.57 so our technical outlook is still in play. 


CurrencyShares  Euro Trust (FXE, $135.80, down $1.75)

March 134 puts (FXE110319P00134000, $1.65, up $0.50)

Entry Price:  $1.60 (1/28/11)
Exit Target: $3.20
Return: 3%
Stop Target: 80 cents

Action:  We said the Euro could fall to $135 by mid-March and yesterday’s drop was good to see.  Our 6-week target is under $130 for this ETF which gets these options to $4+.  Continue to hold. 

 

Jabil Circuit (JBL, $20.92, up $0.28)

March 21 calls (JBL110319C00021000, $1.10, up $0.10)

Entry Price:  $0.70 (1/26/11)
Exit Target: $1.40
Return: 57%
Stop Target: None

Action:  The 52-week high for Jabil is $21.78 which was hit back in early January and shares were up 26 cents, to $21.18, in after-hours trading last night.  Everybody is jumping on our bandwagon but we have been playing Jabil since early December.  Continue to hold but we may take half profits today if we can get near our $1.40 target for the options.  With the weekend coming up, we might protect some capital just to be safe. 

PowerShares QQQ (QQQQ, $57.06, up $0.10)

March 58 calls (QQQQ110319C00058000, $0.85, flat) 

Entry Price:  $0.75 (1/21/11)
Exit Target: $1.50
Return: 13%
Stop Target: None

Action:  We are looking for the Q’s to test $60 which gets these options to $2.  We know we haven’t commented more on this trade but it’s that simple.  
 

Spider S&P 500 (SPY, $130.78, up $0.29)

February 131 calls (SPY110219C00131000, $1.30, flat)

Entry Price:  $0.95 (1/21/11)
Exit Target: $1.90 (closed half @ $1.35 on 2/1/11)
Return: 39%
Stop Target: $1.00 (HARD STOP) 

Action:  We aren’t sure on if we are going to keep this open through the weekend or not.  We had expected to be out of the entire trade by today but Egypt has thrown us a curve ball.  Continue to hold the other half and we will let you know at 1pm what we are thinking.


Micron Technology (MU, $10.90, up $0.01)

April 10 calls (MU110416C00010000, $1.35, flat)

Entry Price:  $0.75 (1/21/11)
Exit Target: $1.50 (closed half @ $1.00 on 1/28/11)
Return: 57%
Stop Target: $1.00 (HARD STOP) 

Action:  Shares reached $11.02 yesterday and the 52-week high is $11.40.  Continue to hold the other half.

JPMorgan Chase (JPM, $45.46, up $0.01)

February 46 calls (JPM110219C00046000, $0.65, flat)

Entry Price:  $0.88 (1/12/11)
Exit Target: $1.75
Return: -26%
Stop Target: None

Action:  Like Elvis once said…we’re caught in a trap, we can’t walk out, because we love you too much JP. 

These options have two weeks before they expire and they could make us 100% or cost us 88 cents.  We have expected a bull run through mid-February, then maybe a pullback before higher prices by April.  Let’s give this trade another week but we said yesterday we were in the danger zone.  Continue to hold. 


Brocade Communications (BRCD, $6.01, up $0.19)

July 6 calls (BRCD110716C00006000, $0.75, up $0.10)

Entry Price:  $0.67 (1/4/11)
Exit Target: $1.35
Return: 12%
Stop Target: None

Action:  Back over $6, baby!  The 52-week high is $8 which gets these calls to $2 on a continued turnaround story.  Continue to hold.  


Electronic Arts (ERTS, $18.11, up $0.22)

March 20 calls (ERTS110319C00020000, $0.25, up $0.01)

Entry Price:  $0.22 (11/24/10)
Exit Target: $0.50+
Return: 14%
Stop Target: None

Action:  We expected a slight pullback following yesterday’s big surge but overall we said the momentum should continue.  If shares can reach $20.50 by mid-March, we double our money.  If shares are at $21 the trade returns 350%.  Continue to hold.  
 

Other 2011 Portfolio OPEN positions (4):  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.

Update:  American Tower was up 1.5% yesterday and the APRIL options have a bid of 20 cents.  The company announces earnings on 2/23 and shares are showing strength.  Constellation Brands was up 2% but we have a long way to go.  Biodel was a trade from last October and is dead money while Vivus, well, you just never know but we have until June.  

Biodel March 7.50 calls (from October 2010)
American Tower April 60 calls (from October 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.


Akamai Technologies (AKAM, $48.11, up $0.05)

February 55 calls (AKAM110219C00055000, $0.40, flat)

March 55 calls (AKAM110319C00055000, $0.85, flat)

Thoughts:  We are seriously looking at the March options as a possible trade.  Akamai is a strong takeover target and there are numerous companies that would love to have this gem.  They announce earnings next week (February 9) and we think they are going to crush Wall Street’s estimates.  We may pull the trigger on a trade so stay locked and loaded after the opening bell.


Skyworks Solutions (SWKS, $33.81, up $0.89)

March 34 calls (SWKS110319C00034000, $1.70, up $0.40)

May 40 calls (SWKS110521C00040000, $0.85, up $0.15)

Thoughts:  We said shares looked poised to break their 52-week high yesterday and they did.  We are leaning more towards the May options and we like them for under $1.  We may add them today but we might wait to see where they are at next week.


Pan American Silver (PAAS, $34.93, up $0.97)

March 37 calls (PAAS110319C00037000, $1.35, up $0.35)

Thoughts:  If we don’t add Akamai, we may add these options.  Gold and silver had been in a downtrend since mid-January but have held their 200-day moving averages (MA).  More importantly, PAAS is in the midst of breaking through its 100-day MA and we think shares could make a run back to $40.  Yesterday’s entry price of a buck may have been our last best entry point so we shall see.  Continue to watch for now.

Molycorp (MCP, $51.99, down $1.26)

March 55 calls (MCP110319C00055000, $3.20, down $0.60) 

June 70 calls (MCP110618C00070000, $2.30, down $0.15)

Thoughts:  We are still trying to get into a trade with MCP but we are being very selective.

Imax (IMAX, $27.44, up $0.64)

March 28 calls (IMAX110319C00028000, $1.60, up $0.20)

June 30 calls (IMAX110618C00030000, $1.85, up $0.35)

Thoughts:  The June calls are safer and buy more time for a run back over $30.  Imax should get more exposure on the NYSE and $30 could come quickly.