9:00am (EST)

Global Payments (GPN, $50.67, down $0.39)

August 55 calls (GPN110820C00055000, $0.40, flat)

Entry Price:  $0.40 (7/13/11)

Exit Target: $0.80

Return:  0%

Stop Target:  None 

Action:  Global Payments reports earnings next Thursday, a week from today and is usually a strong mover.  We are expecting the company to beat expectations and hit new highs of $55+.    


Patriot Coal (PCX, $22.57, up $0.47) 

August 24 calls (PCX110820C00024000, $0.85, up $0.20)

Entry Price:  $0.90 (7/13/11)

Exit Target: $1.80

Return:  -6%

Stop Target:  None 

Action:  Shares face resistance at $24 which if reached in a few weeks should get the trade to a 50%-75% return.  A run to $25-$26 gets us a double.  


Qualcomm (QCOM, $56.09, down $0.43)

October 65 calls (QCOM111022C00065000, $0.60, down $0.05)

Entry Price:  $0.85 (7/11/11)

Exit Target: $1.70

Return:  -29%

Stop Target:  None 

Action:  Qualcomm traded to a peak of $57.09 but appears headed to $55 which is what we thought could happen.  However, Tech usually leads the market and we are expecting a blowout quarter from Qualcomm which reports numbers next Wednesday.  The 52-week high is $59.84 which is why we got positioned early and a break above $60 will represent blue-sky territory. 

 

TiVo (TIVO, $10.46, up $0.18)

August 11 calls (TIVO110820C00011000, $0.40, up $0.05)

Entry Price:  $0.55 (7/1/11)

Exit Target: $1.10

Return:  -27%

Stop Target:  None 

Action:  TiVo continues to tease us as we wait for a breakout above $11.  The stock is currently in a clearly defined trading range and will either breakout or breakdown once $10 or $11 is violated.  TiVo could run to $18 on short covering, buyout news, or a partnership.  Our breakeven point is $11.55 and we have a little over a month to wait for a surge past $11. 


iShares Russell 2000 (IWM, $83.59, up $0.74)

August 86 calls (IWM110820C00086000, $1.15, up $0.20)

Entry Price:  $1.10 (7/1/11)

Exit Target: $2.20

Return:  5%

Stop Target:  $0.55 

Action:  The iShares reached $84.47 and we were pushing for a close past $85.  The 52-week high is $86.81 and we are expecting a run to $89-$90 for the small-cap index.


Freeport-McMoRan (FCX, $54.89, up $1.06)

August 57 calls (FCX110820C00057000, $1.70, up $0.35)

Entry Price:  $1.18 (7/1/11)

Exit Target: $2.40

Return:  44%

Stop Target:  $0.60

Action:  Freeport traded to a high of $55.89 yesterday while the options reached a high of $2.07 which represented a gain of 75% from our recommended purchase price.  We don’t think this will be the top because we are expecting shares to break $60. 

The company reports earnings on July 21 which should be the catalyst to take the stock to new highs or back under $50.  We think Freeport can trade to $60+ if the market holds up and they come in with better-than-expected earnings AND guidance.


Seattle Genetics (SGEN, $20.33, up $0.53)

August 22.50 calls (SGEN110820C00022500, $0.95, up $0.15)

Entry Price:  $1.10 (6/28/11)

Exit Target: $2.50

Return:  -14%

Stop Target:  $0.55 


September 20 calls (SGEN110917C00020000, $2.40, up $0.20) 

Entry Price:  $1.50 (5/9/11)

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

Return:  53%

Stop Target:  $2.20   

Action:  Shares closed back above $20 and today could be volatile.

The FDA “reviewers” will review the company’s two drug applications and there have been some concerns on the size of the clinical trials.  The FDA usually takes the panel’s review pretty seriously so let’s hope the company dotted its “i’s” and crossed its “t’s”.  If there is weakness, we may close the September calls to lock in gains but we would still roll with the September $20’s. 


Symantec (SYMC, $19.27, up $0.04)

October 20 calls (SYMC111022C00020000, $0.90, flat) 

Entry Price:  $0.93 (6/21/11)

Exit Target: $2.00  

Return:  -3%

Stop Target:  None

Action:  The company will report earnings on July 27.  The 52-week high is $20.50 and we are expecting shares to run up to $22+ by mid-October.  However, a breech below $19 would probably have a negative impact on the trade over the short-term.   


Rambus (RMBS, $14.23, up $0.13)

August 17 calls (RMBS110820C00017000, $0.25, flat)

Entry Price:  $0.60 (6/20/11)

Exit Target: $1.20+  

Return:  -58%

Stop Target:  None

Action:  If Rambus can win its current litigation case then expect a breakout and a run into the $20’s.  This is a day-to-day trial that could take a month or more so this trade carries risk and is already down over 50%.  However, this trade will make 5x the entry price if the stock trades $20 which is possible on a settlement – which could happen any day.

Rambus will report earnings next Thursday, July 21.  Resistance is at $15 and there is a big gap to fill from $15 up to $19 which was prior support. 


Rediff.com India (REDF, $11.71, up $0.81)

October 15 calls (REDF111022C00015000, $1.00, up $0.25)

Entry Price:  $1.25 (6/01/11)

Exit Target: $2.50

Return:  -20%

Stop Target:  None

Action:  Shares touched $11.95 yesterday and a break above $13 would be super bullish.  The October options 3 months before they expire and Rediff.com remains a likely takeover target.    


MGM Resorts International (MGM, $14.85, up $0.36)

September 17 calls (MGM110917C00017000, $0.50, up $0.05)

Entry Price:  $0.70 (5/13/11)

Exit Target: $1.40

Return:  -29%

Stop Target:  None

Action:  Any online gambling law that is passed will send the Casino stocks up sharply.  MGM Resorts has exposure to China and the options have until October before they expire.  We are expecting a run up to $20 on continued positive developments.


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)   

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.


Quality Systems (QSII, $88.49, down $0.61)

September 100 calls (QSII110917C00100000, $0.90, down $0.20)

Thoughts:  The 52-week high is $92.38 and the chart on Quality Systems is a thing of beauty.  We have 3 trades expiring on Friday so we may have room for one more trade next week.  Continue to watch in the meantime. 


RealD (RLD, $19.78, down $0.70)

August 17.50 puts (RLD110820P00017500, $1.40, up $0.30)

Thoughts:  We should have added this trade last week and we have been following the August 20 puts because we could see the drop below $20 coming, again. 


Cisco Systems (CSCO, $15.57, down $0.03)

September 16 calls (CSCO110917C00016000, $0.60, flat)

Thoughts:  If shares can hold support and trade up to $17 over the next 9 weeks then these calls will double. 

   

Polycom (PLCM, $31.01, down $0.06)

August 33.75 calls (PLCM110716C00033750, $0.90, down $0.05)

Thoughts:  Here is our next favorite trade on the Watch List – as long as shares hold $30. 


Juniper Networks (JNPR, $31.03, down $0.15)

August 35 calls (110820C00035000, $0.35, down $0.05)

Thoughts:  These are “cheap” call options to play on a run back to $35 and look very tempting.

 

Williams-Sonoma (WSM, $37.96, up $0.63)

August 39 calls (WSM110716C00039000, $1.20, up $0.20)

Thoughts:  We can feel a run past $40 coming.