December 2012 | Members

 

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 “New Trade” 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.  Closed Trades for 2012: 150-55, or 73% win rate, including the Weekly Wrap which is 26-0).

  

12:05pm (EST)

NEW TRADE!!!

Bed Bath & Beyond (BBBY, $60.329, down $0.11)

Buy to OPEN January 55 puts (BBBY130119P00055000, $0.65, down $0.05) 

Action:  Use limit orders up to 70-75 cents but do not pay more than 80 cents tto establish positions.  This is a VERY risky trade so we are suggesting HALF positions.  Earnings are always tricky but we are looking for a miss and lowered guidance.

 

CURRENT TRADES

JPMorgan Chase (JPM, $44.09, up $0.22)

January 45 calls (JPM130119C00045000, $0.75, up $0.10)

Entry Price:  $0.65 (12/18/12)
Exit Target:  $1.30
Return:  15%
Stop Target:  None

Action:  The 52-week high is at $46.49 and we are expecting a push to $48 by mid-January.  Support is at $42.

 

Nuance Communications (NUAN, $22.95, flat)   

January 24 calls (NUAN130119C00024000, $0.40, flat)

Entry Price:  $0.35 (12/18/12)
Exit Target:  $0.70
Return:  14%
Stop Target:  None

Action:  The 200-day MA is just pennies ahead so a close above $23.05 could get $25 in play.  Support is strong at $20.

 

Southern Copper (SCCO, $38.60, up $0.20) 

January 40 calls (SCCO130119C00040000, $0.55, up $0.05)

Entry Price:  $0.45 (12/14/12)
Exit Target:  $1.00
Return:  22%
Stop Target:  None

Action:  The 52-week high is $39.44 set at the beginning of November and we would like to see a close above $40 this week.  We are going to have a tight stop for this trade and may close it if shares fail to hold $37.

 

Akamai Technologies (AKAM, $41.55, up $0.61)

January 42 calls (AKAM130119C00042000, $1.30, up $0.20)

Entry Price:  $0.56 (12/14/12)
Exit Target:  $1.60
Return:  132%
Stop Target:  85 cents (half), 75 cents (other half) (Hard Stop)

Action:  Close a THIRD of the trade at current levels.

 

MGM Resorts International (MGM, $11.60, down $0.03)

January 11 calls (MGM130119C00011000, $0.85, flat)

Entry Price:  $0.51 (12/11/12)
Exit Target:  $1.00
Return:  67%
Stop Target:  60 cents (Hard Stop) 

Action:  We would like to see a close above $11.75 this week and yesterday’s high was $11.65.  We will leave the Hard Stop at 60 cents for now.

 

Taser International (TASR, $8.44, down $0.02)

January 10 calls (TASR130119C00010000, $0.20, flat) 

Entry Price:  $0.15 (11/29/12)
Exit Target:  $0.45
Return:  33%
Stop Target:  None

 

March 10 calls (TASR130316C00010000, $0.45, flat)

Entry Price:  $0.30 (11/29/12)
Exit Target:  $0.50
Return:  50%
Stop Target:  None

Action:  The recent 52-week high is $9.26 and a move above this level could get Taser to double-digits and our options to triple-digits. 

 

Vivus (VVUS, $13.69, up $0.55)

January 15 calls (VVUS130119C00015000, $0.75, up $0.10)

Entry Price:  $0.65 (11/21/12)
Exit Target:  $1.30
Return:  15%
Stop Target:  None

Action:  There is a gap to fill to $16 and we will need support to stick at $12 if there is a pullback.

  

Rosetta Stone (RST, $12.06, down $0.23) 

January 15 calls (RST130119C00015000, $0.15, flat)

Entry Price:  $0.20 (11/19/12)
Exit Target:  $1.00
Return:  -25%
Stop Target:  None

Action:  We would like to see a close above $12.50 this week.  Support has been strong at $12 and we will stick with the trade as long as $11.50 holds.

 

Knight Capital Group (KCG, $3.54, up $0.21) 

January 2.50 calls (KCG130119C00002500, $1.05, up $0.20)

Entry Price:  $0.55 (8/21/12)
Exit Target:  $1.10
Return:  91%
Stop Target:  65 cents 

Action:  Close the trade at current levels.

 

Other 2012 Portfolio OPEN positions (5):  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.

 

Bank of America January 12.50 calls (2013) (from March 2012) – continue to hold

Solazyme December 12.50 calls (from September 2012) – continue to hold

Lufkin Industries December 45 puts (from November 2012) – half position open

LifeLock December 10 calls (from November 2012) – continue to hold

Monster Beverage January 35 puts (from November 2012) – continue to hold

Apollo Group December 18 puts (from October 2012) – continue to hol

 

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.