Do not risk more than 5% of your trading account on any one trade but do try to take ALL of the trades. 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.
2:10pm (EST)
PowerShares QQQ (QQQ, $61.76, down $1.14)
August 59 puts (QQQ120818P00059000, $1.10, up $0.30)
Entry Price: $0.75 (6/27/12)
Exit Target: $1.50
Return: 47%
Stop Target: None
Action: We wanted to get back in the QQQ’s because we are expecting a breakdown below $60.
AOL (AOL, $27.51, up $0.20)
August 24 puts (AOL120818P00024000, $0.55, down $0.05)
Entry Price: $0.53 (6/26/12)
Exit Target: $1.00
Return: 4%
Stop Target: None
Action: AOL will do a “Dutch-auction” tender with the $1 billion that was burning a hole in their pocket instead of giving shareholders a dividend. We expect resistance to hold at $28 and we are still looking for a test to $26 over the near-term and then $24.
Consumer Discret Select Spider (XLY, $42.58, down $0.53)
August 41 puts (XLY120818P00041000, $0.80, up $0.15)
Entry Price: $0.80 (6/25/12)
Exit Target: $1.60
Return: 0%
Stop Target: None
Action: There is risk to $45 but we are expecting a test to $40 over the next week or two; mid-$30’s by August.
Coinstar (CSTR, $65.01, down $2.42)
July 60 puts (CSTR120721P00060000, $0.80, up $0.25)
Entry Price: $0.90 (6/25/12)
Exit Target: $1.80
Return: -11%
Stop Target: 40 cents
Action: The bears have recovered yesterday’s gains and shares are at their lows for the day. We are looking for a drop below $60 over the next week or two.
iShares Dow Jones US Real Estate (IYR, $61.72, down $0.28)
August 57 puts (IYR120818P00057000, $0.70, flat)
Entry Price: $0.85 (6/25/12)
Exit Target: $1.70
Return: -18%
Stop Target: 40 cents
Action: We would like to see a close below $60 this week.
KLA-Tencor (KLAC, $47.03, down $1.08)
August 43 puts (KLAC120818P00043000, $1.00, up $0.15)
Entry Price: $0.90 (6/25/12)
Exit Target: $1.80
Return: 11%
Stop Target: 45 cents
Action: There is risk up to $50 but we have a $40 price target by mid-August.
Illinois Tool Works (ITW, $50.37, down $1.22)
July 50 puts (ITW120721P00050000, $1.15, up $0.40)
Entry Price: $1.05 (6/4/12)
Exit Target: $2.10
Return: 10%
Stop Target: None
Action: We would like to see a close below $50.50 today.
Apollo Group (APOL, $35.60, down $0.33)
August 27 puts (APOL120818P00027000, $0.30, flat)
Entry Price: $0.90 (5/10/12)
Exit Target: $1.80
Return: -67%
Stop Target: 45 cents
Action: Resistance at $36 is holding up. The Department of Education (DOE) said it will conduct a review on Apollo’s verification process for federal student financial aid programs. The probe will start July 16 and they have already informed Apollo the “verification codes” from 2010-2011 are misreported.
Other 2012 Portfolio OPEN positions (8): 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)
Best Buy July 16 puts (from May 2012)
First Solar July 10 puts (from May 2012)
FedEx July 77.50 puts (from June 2012)
Potash July 35 puts (from June 2012)
iShares Russell 2000 July 70 puts (from June 2012)
Facebook July 24 puts (from June 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 wil update this section in the morning
