9:00am (EST)

Potash (POT, $37.58, down $0.80)       

July 35 puts (POT120721P00035000, $0.95, up $0.25)

Entry Price:  $0.75 (6/11/12)
Exit Target: $1.50
Return:  20%
Stop Target:  None

Action:  Shares opened at $39.07 and added a penny before spending the rest of the day on a downhill ride.  The options opened and resistance at $40 has been rock solid.  We are looking for shares of Potash to fall below $35 by mid-July. 

 

iShares Russell 2000 (IWM, $75.27, down $1.70)

July 70 puts (IWM120721P00070000, $1.25, up $0.35)

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

Action:  We said the bears will be looking for a close below $75 this week and we nearly got there.  Shares traded down to $75.09 which gets $72-$73 back into play over the near-term.

 

Veeco Instruments (VECO, $33.04, down $1.56)

July 30 puts (VECO120721P00030000, $1.30, up $0.30)

Entry Price:  $1.00 (6/6/12)
Exit Target: $2.00
Return:  25%
Stop Target:  50 cents

Action:  We got our close below $33.50 as shares traded to a low of double 3’s yesterday.  A move below $30 is now just 10% away and could happen on any given day.   

 

Illinois Tool Works (ITW, $55.02, down $0.99) 

July 50 puts (ITW120721P00050000, $0.70, up $0.10)

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, $19.47, down $0.53)

July 17.50 puts (CTCT120721P00017500, $0.75, up $0.05)

Entry Price:  $0.55 (5/24/12)
Exit Target: $1.10
Return:  36%
Stop Target:  None

Action:  We are expecting a drop below $18 by mid-July.  

 

First Solar (FSLR, $12.33, down $0.47)         

July 10 puts (FSLR120721P00010000, $0.54, up $0.04) 

Entry Price:  $0.62 (5/23/12)
Exit Target: $1.20
Return:  -13%
Stop Target:  None

Action:  This company is running out of cash which should get shares to single-digits by mid-July.

 

Apollo Group (APOL, $34.31, down $0.67)

August 27 puts (APOL120818P00027000, $0.60, up $0.05)

Entry Price:  $0.90 (5/10/12)
Exit Target: $1.80
Return:  -33%
Stop Target:  45 cents

Action:  We would like to see a dip below $33 this week.    

 

Arena Pharmaceuticals (ARNA, $7.08, up $0.46)  

July 3 calls (ARNA120723C00003000, $4.20, up $0.40)

Entry Price:  $1.00 (4/30/12)
Exit Target: $2+ (closed half on 6/5/12 at $3.40)
Return:  280%
Stop Target:  $3.20 (Hard Stop on other HALF)

Action:  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.

 

Coinstar (CSTR, $61.84, down $0.26)   

July 52.50 puts (CSTR120721P00052500, $0.60, flat)

July 55 puts (CSTR120721P00055000, $1.05, flat)

Thoughts:  A close below $60 would get us interested in Coinstar again.

 

KLA-Tencor (KLAC, $46.99, down $0.34)

July 44 puts (KLAC120721P00044000, $0.85, up $0.05)

September 37 puts (KLAC120922P00037000, $0.65, down $0.05)

Thoughts:  We would like to see a quick pop to $50 which is where we might start half positions.  We may add the September 37 as a speculative trade with the 200-day south of $34.

 

Apache (APA, $81.83, down $1.14)

July 72.50 puts (APA120721P00072500, $1.15, up $0.10)  

Thoughts:  We are still waiting for another break below $80 before possibly going short.   

 

Schlumberger (SLB, $64.07, down $0.47)

July 57.50 (SLB120721P00057500, $1.10, up $0.05)

August 55 puts (SLB120818P00055000, $1.35, up $0.05)

Thoughts:  Shares easily look like they are headed below $60. 

 

PowerShares QQQ (QQQ, $61.81, down $1.06)

July 60 puts (QQQ120721P00060000, $1.30, up $0.25)

Thoughts:  The July 60’s traded down to 79 cents before bouncing 60% off the lows.