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.

1:20pm (EST)

Rambus (RMBS, $15.65, up $0.40)

September 17 calls (RMBS110917C00017000, $0.65, up $0.20)

Entry Price:  $0.65 (7/22/11)

Exit Target: $1.30+  

Return:  0%

Stop Target:  None


August 17 calls (RMBS110820C00017000, $0.30, up $0.05)

Entry Price:  $0.60 (6/20/11)

Exit Target: $1.20+  

Return:  -50%

Stop Target:  None

Action:  Rambus has been pushing $15 all week and it just feels like something big is about to happen.  We have been following this company for years and this could finally be the case that wins Rambus a windfall.  The current litigation isn’t expected to end until August but we are hearing things could wrap up sooner than that.  In other words, there could be a settlement or a verdict soon.


Broadcom (BRCM, $35.49, up $0.66)

August 38 calls (BRCM110820C00038000, $0.70, up $0.10)

Entry Price:  $0.55 (7/20/11)

Exit Target: $1.10

Return:  27%

Stop Target:  None 

Action:  The next wave of resistance is at $36 and then $38.  A break above $38 should be enough momentum to get the stock to $40.


Global Payments (GPN, $48.02, down $4.18)

August 55 calls (GPN110820C00055000, $0.10, down $0.45)

Entry Price:  $0.40 (7/13/11)

Exit Target: $0.80

Return:  -75%

Stop Target:  None 

Action:  These were “cheap” options so the negative return so far looks worse than what it really is.  Remember, we use lower priced options to hit the homerun trades and this one took a hit today.  There is still time for a recovery but hopefully our other trades will make up for the loss if this one doesn’t come back.  


Qualcomm (QCOM, $57.25, up $0.31)

October 65 calls (QCOM111022C00065000, $0.55, flat)

Entry Price:  $0.85 (7/11/11)

Exit Target: $1.70

Return:  -35%

Stop Target:  None 

Action:  Qualcomm held up well and these options have 3 months before they expire.  We are still looking for a run past $60 with a $70 price target. 

 

TiVo (TIVO, $10.27, up $0.19)

August 11 calls (TIVO110820C00011000, $0.25, flat)

Entry Price:  $0.55 (7/1/11)

Exit Target: $1.10

Return:  -55%

Stop Target:  None 

Action:  We are looking for a run to $18 on short covering, buyout news, or a partnership.  Our breakeven point is $11.55 and we have 4 weeks to wait for a surge past $11. 


iShares Russell 2000 (IWM, $84.14, up $0.20)

August 86 calls (IWM110820C00086000, $1.10, flat)

Entry Price:  $1.10 (7/1/11)

Exit Target: $2.20

Return:  0%

Stop Target:  $0.55 

Action:  We are looking for a test to new highs in July or by mid-August which will more than double these calls.  The 52-week high is $86.81 and we would like to see a move above $84.50-$85 today.  


Freeport-McMoRan (FCX, $55.70, up $0.36) 

August 57 calls (FCX110820C00057000, $1.45, up $0.20)

Entry Price:  $1.18 (7/1/11)

Exit Target: $2.40

Return:  23%

Stop Target:  $1.40 

Action:  We are looking for a run past $60 to take place over the next month.    

   

Symantec (SYMC, $18.93, down $0.09)

October 20 calls (SYMC111022C00020000, $0.75, flat) 

Entry Price:  $0.93 (6/21/11)

Exit Target: $2.00  

Return:  -19%

Stop Target:  None

Action:  Our near-term target is $22 for Symantec and the company will report earnings on July 27.    


Rediff.com India (REDF, $11.14, up $0.32)

October 15 calls (REDF111022C00015000, $0.70, up $0.10)

Entry Price:  $1.25 (6/01/11)

Exit Target: $2.50

Return:  -44%

Stop Target:  $1.00

Action:  Continue to hold.         


MGM Resorts International (MGM, $15.80, up $0.22)

September 17 calls (MGM110917C00017000, $0.65, up $0.05)

Entry Price:  $0.70 (5/13/11)

Exit Target: $1.40

Return:  -7%

Stop Target:  None

Action:  We are looking for shares to make a run at $17 once $15.75 is cleared on the close.  Support is strong at $14. 


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.  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.


RF MicroDevices August 10 calls (from February 2011)  

Dendreon August 50 calls (from April 2011)

Vivus September 10 calls (from May 2011)

Seattle Genetics August 22.50 calls (from June 2011)

Seattle Genetics September 20 calls (from May 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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11:45am (EST)

Rambus (RMBS, $15.58, up $0.64)

Buy to OPEN September 17 calls (RMBS110917C00017000, $0.65, up $0.20)

Action:  Use limit prices up to 70 cents but do not pay more than 75 cents
to establish positions.

Rambus made a huge move above $15 which was strong resistance and those gains seems to be sticking.  We have said there is a huge gap to fill from here to $20 so let’s add these call options to our current trade which is back to even.

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9:00am (EST)

Broadcom (BRCM, $34.83, down $0.24)

August 38 calls (BRCM110820C00038000, $0.55, down $0.05)

Entry Price:  $0.55 (7/20/11)

Exit Target: $1.10

Return:  0%

Stop Target:  None 

Action:  The next wave of resistance is at $36 and then $38.  A break above $38 be enough momentum to get the stock to $40.


Global Payments (GPN, $52.20, up $0.07)

August 55 calls (GPN110820C00055000, $0.55, up $0.05)

Entry Price:  $0.40 (7/13/11)

Exit Target: $0.80

Return:  38%

Stop Target:  None 

Action:  Global came in with some pretty good numbers although they may have sandbagged on their revenue outlook going forward.  In any event, let’s see where we open.        


Qualcomm (QCOM, $56.94, down $0.36)

October 65 calls (QCOM111022C00065000, $0.55, down $0.20)

Entry Price:  $0.85 (7/11/11)

Exit Target: $1.70

Return:  -35%

Stop Target:  None 

Action:  Qualcomm held up well and these options have 3 months before they expire.  We are still looking for a run past $60 with a $70 price target. 

 

TiVo (TIVO, $10.08, up $0.09)

August 11 calls (TIVO110820C00011000, $0.25, flat)

Entry Price:  $0.55 (7/1/11)

Exit Target: $1.10

Return:  -55%

Stop Target:  None 

Action:  We are looking for a 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, $83.97, up $0.76)

August 86 calls (IWM110820C00086000, $1.10, up $0.40)

Entry Price:  $1.10 (7/1/11)

Exit Target: $2.20

Return:  0%

Stop Target:  $0.55 

Action:  We are looking for a test to new highs in July or by mid-August which will more than double these calls.  The 52-week high is $86.81 and we would like to see a move above $84.50-$85 today.  


Freeport-McMoRan (FCX, $55.34, down $0.58)

August 57 calls (FCX110820C00057000, $1.35, down $0.55)

Entry Price:  $1.18 (7/1/11)

Exit Target: $2.40

Return:  14%

Stop Target:  $1.40 

Action:  Freeport traded to a high of $56.68 yesterday while the calls reached nearly $2.  The puts were up 70%, intraday, but we are looking for mid-triple-digit returns as we still expect a run past $60 to take place over the next month.    

   

Symantec (SYMC, $19.02, up $0.14)

October 20 calls (SYMC111022C00020000, $0.75, dowflat) 

Entry Price:  $0.93 (6/21/11)

Exit Target: $2.00  

Return:  -19%

Stop Target:  None

Action:  Our near-term target is $22 for Symantec and the company will report earnings on July 27. 


Rambus (RMBS, $14.94, up $0.25)

August 17 calls (RMBS110820C00017000, $0.30, up $0.05) 

Entry Price:  $0.60 (6/20/11)

Exit Target: $1.20+  

Return:  -50%

Stop Target:  None

Action:  We got a bonus package when Rambus announced earnings after the bell as shares surged up to $16. 

Rambus has been pushing $15 all week and it just feels like something big is about to happen.  We have been following this company for years and this could finally be the case that wins Rambus a windfall.  The current litigation isn’t expected to end until August but we are hearing things could wrap up sooner than that.  In other words, there could be a settlement or a verdict soon.


Rediff.com India (REDF, $10.82, down $1.44)

October 15 calls (REDF111022C00015000, $0.60, down $0.40)

Entry Price:  $1.25 (6/01/11)

Exit Target: $2.50

Return:  -52%

Stop Target:  $1.00

Action:  Shares fell 12% yesterday and this position has been down 70%, then up 30%, now down 50%.  This is one of the reasons we went with OCTOBER options because we feel certain a test back to $18 is coming.  Rediff.com is a speculative play on India’s playground and sports 100 million users.      


MGM Resorts International (MGM, $15.58, up $0.16)

September 17 calls (MGM110917C00017000, $0.60, flat) 

Entry Price:  $0.70 (5/13/11)

Exit Target: $1.40

Return:  -14%

Stop Target:  None

Action:  MGM traded to $15.79 and we have nearly 2 months before these options expire.  We are looking for shares to make a run at $17 once $15.75 is cleared on the close.  Support is strong at $14. 


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.  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.

RF MicroDevices August 10 calls (from February 2011)  

Dendreon August 50 calls (from April 2011)

Vivus September 10 calls (from May 2011)

Seattle Genetics August 22.50 calls (from June 2011)

Seattle Genetics September 20 calls (from May 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.

Amgen (AMGN, $55.49, up $0.50)

August 55 calls (AMGN110820C00055000, $1.50, up $0.20)

Thoughts:  Amgen has traded lower for much of July and has dropped from $58 to $55 in 3 weeks.  The company reports earnings on July 29, before the bell, and shares have held support all week.


Mead Johnson Nutrition (MJN, $69.77, up $0.82)

August 70 calls (MJN110820C00070000, $1.65, up $0.35)

November 80 calls (MJN111119C00070000, $0.80, up $0.10)

Thoughts:  Shares broke $70 yesterday and hit a 52-week high of $70.08.  We think shares can trade north of $80 as they looked poised to make a run to $100.       


Quality Systems (QSII, $89.75, up $2.10)

September 100 calls (QSII110917C00100000, $0.90, up $0.30)

Thoughts:  These options jumped 50% yesterday and this is another trade we really like.  The 52-week high is $92.38 and the chart on Quality Systems is a thing of beauty.  We had a feeling shares were going to make a run to $90 and they reached $89.90 yesterday.


RealD (RLD, $18.27, up $0.23)

August 17.50 puts (RLD110820P00017500, $1.60, down $0.20)

Thoughts:  We would love to see RealD test $20 again.


Polycom (PLCM, $28.93, down $2.01) 

August 33.75 calls (PLCM110716C00033750, $0.40, down $0.40)

Thoughts:  Good numbers, stock gets slammed.  Polycom was guilty by association and may be becoming an attractive candidate for our Weekly Wrap portfolio if shares fall further.


Juniper Networks (JNPR, $30.32, down $0.83)

August 33 calls (110820C00033000, $0.50, down $0.25)

Thoughts:  We may start looking at longer-term options for Juniper as it feels like a test to $28 is coming before $35.  

 

Williams-Sonoma (WSM, $38.78, up $0.64)

August 39 calls (WSM110716C00039000, $1.50, up $0.25)

Thoughts:  The stock cleared resistance at $38 and held as it eyes a run to $40+.  The 52-week high is $45.48 so we will be watching for a break above $40 as confirmation shares are serious on challenging their highs.