Seattle Genetics (SGEN, $21.09, down $0.25)
August 22.50 calls (SGEN110820C00022500, $1.15, down $0.10)
Entry Price: $1.10 (6/28/11)
Exit Target: $2.50
Stop Target: $0.55
September 20 calls (SGEN110917C00020000, $3.10, down $0.10)
Entry Price: $1.50 (5/9/11)
Exit Target: $3.00 (closed half at $2.20 on 6/8/2011)
Stop Target: $2.20 (HARD STOP on other half)
Action: Shares made a brief trip into positive territory but spent the majority of the day trending slightly lower. We like these trades a lot and have big expectations for both call options as we have a $25-$30 price target for the stock by the end of summer.
LinkedIn (LNKD, $87.99, up $2.43)
July 55 puts (LNKD110716P00055000, $0.35, down $0.10)
Entry Price: $1.20 (6/24/11)
Exit Target: $2.40
Stop Target: None
Action: LinkedIn reached a high of $91.38 on Wednesday. The options are still holding up well but we will need a major reversal by week’s end to get the momentum back in our favor.
Symantec (SYMC, $19.53, up $0.03)
October 20 calls (SYMC111022C00020000, $1.10, flat)
Entry Price: $0.93 (6/21/11)
Exit Target: $2.00
Stop Target: None
Action: We are looking for a close above $19.65 this week and the shares traded up to $19.63 yesterday. A break above this level should clear the way for a run at the 52-week high of $20.50. These options have 113 days before they expire and we are expecting shares to run up to $22+ by mid-October which gets these calls to at least $2+.
Wells Fargo (WFC, $28.07, up $0.58)
July 26 puts (WFC110716P00026000, $0.15, down $0.15)
Entry Price: $0.50 (6/20/11)
Exit Target: $1.00+
Stop Target: None
Action: Shares closed above resistance at $28 which wasn’t a good sign but we know support and resistance levels can get stretched. We only need shares to drop to $25 to make a double so we still like the risk/ reward as the options were only 50 cents.
Rambus (RMBS, $14.45, up $0.12)
August 17 calls (RMBS110820C00017000, $0.40, flat)
Entry Price: $0.60 (6/20/11)
Exit Target: $1.20+
Stop Target: None
Action: If Rambus can win it current litigation case then there is a big gap to fill on positive news. A break above $15 could get us off to the races.
Krispy Kreme Doughnuts (KKD, $9.70, down $0.03)
July 10 calls (KKD110716C00010000, $0.35, down $0.05)
Entry Price: $0.20 (6/14/11)
Exit Target: $0.40+
Stop Target: None
Action: Krispy Kreme traded to a high of $10.08 but ended slightly lower for the session. We were hoping for a close above $10 for a possible move up to $12 but we also have to realize we are running out of time as these options expire in 2 weeks. Let’s see where we are at by Friday’s update but if shares start to fade and shows signs of topping out we will close the trade to protect profits.
RealD (RLD, $23.41, up $0.37)
July 20 puts (RLD110716P00020000, $0.60, flat)
Entry Price: $0.45 (6/9/11)
Exit Target: $0.90+ (closed half at $1.60 on 6/10/2011)
Stop Target: 30 cents
Action: RealD traded to a low of $22.78 and we are looking for a test below $22.50. We have already sold half the position at $1.60 and our entry price was 45 cents. The gain on the closed half was 256% so even if these puts expire worthless the trade will make 78%. However, a test back to $18 gets these options at $2 but we do not recommend new positions.
Other 2011 Portfolio OPEN positions (7): 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. This means we would not open any new positions. We are still keeping track of the trades and we will record the results, accordingly, when we close them or the options expire. Click on the 2011 Portfolio link in the Members Area to view ALL open/ closed trades.
eBay July 40 calls (from February 2011)
RF MicroDevices August 10 calls (from February 2011)
Dendreon August 50 calls (from April 2011) – back over $40!
MGM Resorts International September 17 calls (from May 2011)
Rediff.com India October 15 calls (from June 2011)
Darling International July 20 calls (from May 2011) – up 3% yesterday!
Vivus (September 10 calls (from May 2011) – looking to break $8!
WATCH LIST SECTION
These trades are NOT recommendations. They 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 try not to have more than 12-15 open trades at any one time which is why we created a Watch List. We will not list entry prices because these stocks are on the verge of breaking out or they could sell-off.
iShares Russell 2000 (IWM, $82.20, up $0.39)
August 85 calls (IWM110820C00085000, $1.15, up $0.05)
Thoughts: We were close to releasing this trade but we didn’t feel a sense of urgency because we don’t know if the market will actually breakout or test the top of its trading range. It is also possible the market pulls back or stays choppy so we want to make sure the small-caps are setting up well.
Freeport-McMoRan (FCX, $51.62, up $1.18)
August 55 calls (FCX110820C00055000, $1.50, up $0.30)
Thoughts: We said last week that Freeport could trade back above $50 and $52 did come quick as shares reached a high of $52.62. It looks as though shares could challenge double-nickels ($55) over the near-term.
Garmin (GRMN, $32.08, up $0.17)
August 30 puts (GRMN110820P00030000, $0.90, down $0.05)
Thoughts: We have been saying Garmin is due for a crash and after holding the $34 level forever, shares seem to be cracking. The company will report earnings in early August and this could be the quarter that makes Wall Street push the panic button. We have been saying this company could be a non-factor down the road as GPS becomes more popular on smart-phones and Tom-Tom recently lowered their guidance.
Apollo Group (APOL, $43.24, up $0.19)
July 40 puts (APOL110716P00038000, $0.75, down $0.05)
Thoughts: Apollo Group will announce earnings after the bell today. If Apollo misses Wall Street’s estimates then shares could finally make a trip below $40. These options are “expensive” based on the premium which is holding us back from making this an official recommendation.
Polycom (PLCM, $63.89, down $0.15)
July 67.50 calls (PLCM110716C00067500, $1.00, down $0.10)
Thoughts: After the 2-for-1 stock split announcement, shares surged and then pulled back like we expected. There should be continued strength as the split takes effect this week.
PowerShares QQQ Trust (QQQ, $56.31, up $0.24)
July 55 calls (QQQ110701C00055000, $1.50, up $0.20)
Thoughts: Watch for now.
Potash (POT, $56.86, up $1.91)
July 55 calls (POT110716C00055000, $2.55, up $1.15)
Thoughts: These options opened at 72 cents on Monday and our chart work was spot on. The WEEKLY July 55 calls (POT110701C00055000, $2.00, up $1.50) opened at 21 cents on Monday. Yes, we wish this would have been an official recommendation but some of you swung the bat and are being rewarded judging by your happy emails to us over the last few days.
Williams-Sonoma (WSM, $36.44, up $0.62)
August 39 calls (WSM110716C00039000, $0.85, up $0.10)
Thoughts: Continue to watch but Tuesday could have been the bottom.
SanDisk (SNDK, $40.49, down $0.28)
July 39 puts (SNDK110716P00039000, $0.70, down $0.05)
August 35 puts (SNDK110820P00035000, $0.75, down $0.05)
Thoughts: SanDisk could be setting up for another drop below $40. Although there is takeover chatter concerning the company, the trend seems to be lower and we might take a flyer on the August puts if the $40 level is penetrated.