June 2012 | Members

MEMBERS AREA

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 a “Profit 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)

NEW TRADE!!!

FedEx (FDX, $87.10, up $0.82)

Buy to OPEN July 77.50 puts (FDX120721P00077500, $0.92, down $0.03)

Action:  Use limit orders up to 95 cents-$1.00 to establish positions but do not pay over $1.05-$1.10 to get in.

 

CURRENT TRADES

Potash (POT, $37.58, down $0.80)       

July 35 puts (POT120721P00035000, $0.80, down $0.15)

Entry Price:  $0.75 (6/11/12)
Exit Target: $1.50
Return:  7%
Stop Target:  None

Action:  We are looking for $38 to hold today and resistance at $40 has been strong.  Our price target is calling for a drop below $35 for Potash by mid-July. 

 

iShares Russell 2000 (IWM, $75.61, up $0.34)

July 70 puts (IWM120721P00070000, $1.15, down $0.10)

Entry Price:  $1.20 (6/6/12)
Exit Target: $2.40
Return:  -4%
Stop Target:  60 cents

Action:  Shares have traded down to $74.78 today and we are looking for a close below $75.  

 

Veeco Instruments (VECO, $33.44, up $0.40)

July 30 puts (VECO120721P00030000, $1.10, down $0.20)

Entry Price:  $1.00 (6/6/12)
Exit Target: $2.00
Return:  10%
Stop Target:  50 cents

Action:  Veeco has kissed a low of $32.78 and we would like to see a finish below $33-$32.50 today.   

 

Illinois Tool Works (ITW, $55.00, down $0.02) 

July 50 puts (ITW120721P00050000, $0.70, flat)

Entry Price:  $1.05 (6/4/12)
Exit Target: $2.10
Return:  -33%
Stop Target:  None

Action:  We are looking for a drop below $53.50 over the next 2 weeks which will quickly bring $50 into play.

 

Constant Contact (CTCT, $19.13, down $0.34)

July 17.50 puts (CTCT120721P00017500, $0.80, up $0.05)

Entry Price:  $0.55 (5/24/12)
Exit Target: $1.10
Return:  45%
Stop Target:  None

Action:  Shares have touched a low of $18.66 and a close below $19 would be beautiful.     

 

First Solar (FSLR, $14.01, up $1.68)

July 10 puts (FSLR120721P00010000, $0.35, down $0.19) 

Entry Price:  $0.62 (5/23/12)
Exit Target: $1.20
Return:  -44%
Stop Target:  None

Action:  Short-sellers are covering and we are looking for resistance at $14 to hold.  This company is running out of cash which should get shares to single-digits by mid-July.

 

Apollo Group (APOL, $33.24, down $1.08)

August 27 puts (APOL120818P00027000, $0.75, up $0.15)

Entry Price:  $0.90 (5/10/12)
Exit Target: $1.80
Return:  -17%
Stop Target:  45 cents

Action:  We said we would like to see a dip below $33 this week and shares have traded down to $33.10 today.    

 

Arena Pharmaceuticals (ARNA, $7.60, up $0.52)  

July 3 calls (ARNA120723C00003000, $4.70, up $0.50)

Entry Price:  $1.00 (4/30/12)
Exit Target: $2+ (closed half on 6/5/12 at $3.40)
Return:  305%
Stop Target:  $3.20 (Hard Stop on other HALF)

Action:  Shares have reached a peak of $7.75 and we are looking for a break above $8 this week. 

We have a price target of $10+ if there is no delay with their obesity drug, Lorcaserin, which could go to market by the end of the year if all goes well.  For those of you just joining us, the company will meet with the FDA on June 27 and we did a big update on the company in our last Weekly Wrap.

 

Other 2012 Portfolio OPEN positions (4):  These are trades that are still open in the portfolio but are down over 50%.  They have longer expiration dates and 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 if the options expire.  Click on the 2012 Portfolio link in the Members Area to view ALL open/ closed trades.

 

E*Trade Financial July 12 calls (from March 2012)

Bank of America January 12.50 calls 2013, July 12 calls (from March 2012)

RealD June 10 puts (from May 2012)

Best Buy July 16 puts (from May 2012)

 

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 but these are the trades we are watching as new candidates.

We will update this section in the morning.