July 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.

1:00

TiVo (TIVO, $10.81, up $0.08)


August 11 calls (TIVO110820C00011000, $0.55, flat)


Entry Price:  $0.55 (7/1/11)

Exit Target: $1.10

Return:  0%

Stop Target:  None 


Action:  TiVo has some sweet intellectual property that makes it an attractive takeover target.  We could see a quick run up to $18 on short covering, buyout news, or a partnership with Google or someone else.  TiVo seems to be turning the corner after a decade of losing money and is becoming attractive.      



iShares Russell 2000 (IWM, $85.76, up $1.39)


August 86 calls (IWM110820C00086000, $2.15, up $0.60)


Entry Price:  $1.10 (7/1/11)

Exit Target: $2.20

Return:  95%

Stop Target:  $1.00 


Action:  We like the small-caps on the next leg higher and the 52-week high for the iShares is $86.81.  A break above $85, or 850 on the Russell, should get us at least a double for this trade.



Freeport-McMoRan (FCX, $55.59, up $2.07)


July 55 calls WEEKLY (FCX110708C00055000, $0.95, up $0.80)


Entry Price:  $0.24 (7/1/11)

Exit Target: $0.50 (closed at 95 cents on 7/7/2011)

Return:  296%

Stop Target:  None 



August 57 calls (FCX110820C00057000, $1.85, up $0.70)


Entry Price:  $1.18 (7/1/11)

Exit Target: $2.40

Return:  57%

Stop Target:  $0.60


Action:  We may have sold the July calls a little early but we felt it was best to lock in profits ahead of tomorrow’s unemployment numbers.  We still have the August calls to play a continued move higher.

 

   

Seattle Genetics (SGEN, $20.51, down $0.17)    


August 22.50 calls (SGEN110820C00022500, $0.85, down $0.10)


Entry Price:  $1.10 (6/28/11)

Exit Target: $2.50

Return:  -23%

Stop Target:  $0.55 



September 20 calls (SGEN110917C00020000, $2.50, flat) 


Entry Price:  $1.50 (5/9/11)

Exit Target: $3.00 (closed half at $2.20 on 6/8/2011)

Return:  57%

Stop Target:  $2.20   


Action:  The bullish channel is giving us a $25-$30 price target by the end of summer as the company moves closer towards approval of its drugs. We should hear some preliminary news in a few weeks and a final decision by the end of August.

 

   

Symantec (SYMC, $19.83, up $0.04)


October 20 calls (SYMC111022C00020000, $1.10, flat) 


Entry Price:  $0.93 (6/21/11)

Exit Target: $2.00  

Return:  19%

Stop Target:  None


Action:  The 52-week high is $20.50 and the October options have 106 days before they expire.  We are expecting shares to run up to $22+ by mid-October which gets these calls to 2+.

 


Rambus (RMBS, $14.94, up $0.30)


August 17 calls (RMBS110820C00017000, $0.40, up $0.05)


Entry Price:  $0.60 (6/20/11)

Exit Target: $1.20+  

Return:  -33%

Stop Target:  None


Action:  We think there is a good chance Rambus wins their current litigation battle and will be awarded damages that could be larger than what most analysts believe.  There is a huge gap to fill from $15 up to $19 which was prior support for Rambus. 



Rediff.com India (REDF, $12.38, up $0.43)


October 15 calls (REDF111022C00015000, $1.25, up $0.10)


Entry Price:  $1.25 (6/01/11)

Exit Target: $2.50  

Return:  0%

Stop Target:  None


Action:  Resistance is at $13 and if broken, shares could really get moving on short covering.  We would love to see another run back to the 52-week high of $18 which would get these options to $3.


Other 2011 Portfolio OPEN positions (8):  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)

MGM Resorts International September 17 calls (from May 2011)

Darling International July 20 calls (from May 2011)

Vivus September 10 calls (from May 2011)

LinkedIn July 55 puts (from June 2011)

Wells Fargo July 26 puts (from June 2011) 


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.

We will update this section in the morning.

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10:40am (EST)

Freeport-McMoRan (FCX, $55.70, up $2.18)

July 55 calls WEEKLY (FCX110708C00055000, $0.95, up $0.80)

Entry Price:  $0.24 (7/1/11)

Exit Target: $0.50

Return:  296%

Stop Target:  None 

Action:  We got our move above $55.  Let’s close the July calls now since they expire tomorrow.  We still have the August calls to play more upside.

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9:00am (EST)

TiVo (TIVO, $10.73, up $0.10) 

August 11 calls (TIVO110820C00011000, $0.55, down $0.05) 

Entry Price:  $0.55 (7/1/11)

Exit Target: $1.10

Return:  0%

Stop Target:  None 

Action:  Open interest for these options is near 30,000 contracts.  For the August 10 calls, open interest is over 42,000 which is telling us there are a lot of traders in this position and are also expecting higher prices.

TiVo has some sweet intellectual property that makes it an attractive takeover target.  We could see a quick run up to $18 on short covering, buyout news, or a partnership with Google or someone else.  TiVo seems to be turning the corner after a decade of losing money and is becoming attractive.      


iShares Russell 2000 (IWM, $84.38, up $0.34)

August 86 calls (IWM110820C00086000, $1.55, up $0.10)

Entry Price:  $1.10 (7/1/11)

Exit Target: $2.20

Return:  41%

Stop Target:  $0.55, raise to $1.00 

Action:  We raised the stop on this position but it is not a “hard stop”.  We want to protect profits in case we fall back from current levels but we are still expecting new highs.

We like the small-caps on the next leg higher and the 52-week high for the iShares is $86.81.  A break above $85, or 850 on the Russell, should get us at least a double for this trade.


Freeport-McMoRan (FCX, $53.52, down $0.10)

July 55 calls WEEKLY (FCX110708C00055000, $0.15, down $0.09)

Entry Price:  $0.24 (7/1/11)

Exit Target: $0.50

Return:  -38%

Stop Target:  None 


August 57 calls (FCX110820C00057000, $1.15, down $0.12)

Entry Price:  $1.18 (7/1/11)

Exit Target: $2.40

Return:  -3%

Stop Target:  $0.60

Action:  We think Freeport can break through resistance at $55 and challenge $57 over the near-term.  The 52-week high is $61.35.

 

Seattle Genetics (SGEN, $20.68, down $0.20)    

August 22.50 calls (SGEN110820C00022500, $0.95, down $0.10)

Entry Price:  $1.10 (6/28/11)

Exit Target: $2.50

Return:  -14%

Stop Target:  $0.55 


September 20 calls (SGEN110917C00020000, $2.50, down $0.10) 

Entry Price:  $1.50 (5/9/11)

Exit Target: $3.00 (closed half at $2.20 on 6/8/2011)

Return:  57%

Stop Target:  $2.20   

Action:  The bullish channel is giving us a $25-$30 price target by the end of summer as the company moves closer towards approval of its drugs. We should hear some preliminary news in a few weeks and a final decision by the end of August.

 

Symantec (SYMC, $19.79, up $0.03)

October 20 calls (SYMC111022C00020000, $1.10, flat) 

Entry Price:  $0.93 (6/21/11)

Exit Target: $2.00  

Return:  19%

Stop Target:  None

Action:  The 52-week high is $20.50 and the October options have 106 days before they expire.  We are expecting shares to run up to $22+ by mid-October which gets these calls to 2+.


Rambus (RMBS, $14.64, down $0.11) 

August 17 calls (RMBS110820C00017000, $0.35, flat)

Entry Price:  $0.60 (6/20/11)

Exit Target: $1.20+  

Return:  -42%

Stop Target:  None

Action:  We think there is a good chance Rambus wins their current litigation battle and will be awarded damages that could be larger than what most analysts believe.  There is a huge gap to fill from $15 up to $19 which was prior support for Rambus. 


Rediff.com India (REDF, $11.95, up $0.71)

October 15 calls (REDF111022C00015000, $1.15, up $0.35)

Entry Price:  $1.25 (6/01/11)

Exit Target: $2.50  

Return:  -8%

Stop Target:  None

Action:  Shares are hot right now and last time we saw action like this, the stock pushed a high of nearly $18.  We would love to see another run back to the 52-week high which would get these options to $3.


Other 2011 Portfolio OPEN positions (8):  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)

MGM Resorts International September 17 calls (from May 2011)

Darling International July 20 calls (from May 2011)

Vivus September 10 calls (from May 2011)

LinkedIn July 55 puts (from June 2011)

Wells Fargo July 26 puts (from June 2011) 


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.

Cisco Systems (CSCO, $15.56, down $0.11)

August 16 calls (CSCO110820C00016000, $0.45, down $0.10)

September 16 calls (CSCO110917C00016000, $0.55, down $0.10)

Thoughts:  Watch for now.


Patriot Coal (PCX, $22.44, down $0.49)

August 24 calls (PCX110820C00024000, $0.80, down $0.20)

Thoughts:  If shares come down to $22 and hold, we might get into this position.  The next area of resistance is at $24.    


VeriFone Systems (PAY, $45.34, up $0.43)

August 50 calls (PAY110820C00050000, $1.00, up $0.15)

August 40 puts (PAY110840P00040000, $1.05, down $0.20)

Thoughts:  The chart shows resistance at $48 with support at $40.  We think there is enough volatility to play a strangle option trade with VeriFone and we might be getting a good opportunity at current levels but let’s wait. 


Coinstar (CSTR, $56.21, down $0.27)

August 65 calls (CSTR110820C00065000, $0.80, down $0.10)

Thoughts:  The 52-week high for Coinstar is $67 and the close above $55 last week was bullish.     


Polycom (PLCM, $33.53, up $0.90)

August 35 calls (PLCM110716C00067500, $1.30, up $0.40)

Thoughts:  These options opened at $1.05 yesterday and we would like to close a few open positions before adding this trade although we like it a lot.  


PowerShares QQQ Trust (QQQ, $58.39, up $0.19)

August 60 calls (QQQ110701C00055000, $0.55, up $0.05)

Thoughts: If the Q’s run to $60+ these options should double.   


Williams-Sonoma (WSM, $36.62, up $0.04)

August 39 calls (WSM110716C00039000, $0.75, flat)

Thoughts:  Continue to watch.


SanDisk (SNDK, $43.01, down $0.44)

August 47 calls (SNDK110820P00047000, $0.90, down $0.15)

August 38 puts (SNDK110820P00038000, $0.75, up $0.05)

Thoughts:  If we do a strangle trade this could become an official recommendation as the volatility and the headline news should moves shares above or below these targets over the next 6 weeks.