9:00am (EST)
The Dow zoomed 169 points, or 1.1%, to close at 15,460. The all-time intraday high is at 15,542 and yesterday’s crest was 15,483. A close above 15,500 today would be bullish for a test of the yearend targets we gave you in early February. More on that this weekend.
The S&P surged a double-deuce, or 1.4%, to settle at 1,675. The index landed exactly on our upside target after reaching 1,676 and a best ever close. The all-time intraday high is at 1,687.
The Nasdaq bolted 57 points higher, or 1.6%, to finish at 3,578. We said the bulls could push 3,600 on a close above 3,550 and they got half of it yesterday. Tech is at 12-year highs.
The Russell 2000 added a baker’s dozen, or 1.25%, to end at 1,033.18. The small-caps cleared our 1,025 target and we mentioned a run to 1,050 could come if triggered. Yesterday’s high was 1,033.34.
The S&P 500 Volatility ($VIX, 14.01, down 0.20) deflated 1.4% after kissing a low of 13.57. We have been mentioning a run to 13.50 would come if the bulls pushed new highs and it’s hard to call it much better than that.
We have a lot to talk about this morning, including an update on an earnings trade! As we head to press, futures look like so: Dow (-4); S&P 500 (-2); Nasdaq 100 (-1).
Subscribers, check the Members Area for the updates.
MEMBERS AREA
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 2013: 79-41, including the Weekly Wrap that is 26-3).
Sony (SNE, $22.20, up $0.43)
August 24 calls (SNE130817C00024000, $0.60, up $0.20)
Entry Price: $0.50 (7/11/13)
Exit Target: $1.00
Return: 20%
Stop Target: None
August 26 calls (SNE130817C00026000, $0.20, up $0.05)
Entry Price: $0.20 (7/11/13)
Exit Target: $0.60
Return: 0%
Stop Target: None
October 25 calls (SNE131019C00025000, $0.90, up $0.20)
Entry Price: $0.80 (7/11/13)
Exit Target: $1.60
Return: 13%
Stop Target: None
Action: The close above $22 should now get $24 in the mix. Support is at $20. News that China is lifting the ban of gaming counsels could have a huge impact on this stock.
Riverbed Technology (RVBD, $17.02, up $0.64)
August 18 calls (RVBD130817C00018000, $0.90, up $0.20)
Entry Price: $0.60 (7/9/13)
Exit Target: $1.20 (closed 1/3 at 80 cents on 7/11/13)
Return: 44%
Stop Target: 60 cents
Action: We closed a third of the trade yesterday to lock-in some profits. We have a near-term target of $18-$20 for the stock by mid-August. Support is at $16.
JPMorgan Chase (JPM, $55.14, up $0.31)
August 57.50 calls (JPM130817C00057500, $0.55, up $0.05)
Entry Price: $0.38 (7/8/13)
Exit Target: $1.00+ (closed 1/2 at 50 cents on 7/11/13)
Return: 38%
Stop Target: None
Action: We closed half of the trade ahead of earnings this morning. Shares traded to $55.87 at the open but folded like a cheap lawn chair immediately afterwards to $54.55. The options traded up to 70 cents then dipped to 41 cents before recovering to end a nickel higher. If we take action after the open on the other half of the trade we will send out a Trade Alert.
Aruba Networks (ARUN, $16.71, up $0.80)
August 17 calls (ARUN130817C00017000, $0.60, up $0.20)
Entry Price: $0.55 (7/8/13)
Exit Target: $1.10
Return: 9%
Stop Target: None
Action: Nice comeback on Thursday. We are looking for shares to make a run at $18, possibly $20 by mid-August. Support is at $15.50.
Apollo Group (APOL, $18.97, up $1.08)
August 16 puts (APOL130817P00016000, $0.30, down $0.25)
Entry Price: $0.65 (6/26/13)
Exit Target: $1.30
Return: -54%
Stop Target: 40 cents
Action: CLOSE the trade if shares break above $20.25 today.
Shares hel $20 yesterday following a run to $19.86. However, if the stock touches $20.25 we are done. We would love to see a close back below $18 today
Rambus (RMBS, $9.74, up $0.06)
August 9 calls (RMBS130817C00009000, $1.00, up $0.05)
Entry Price: $0.55 (6/18/13)
Exit Target: $1.10
Return: 82%
Stop Target: None
Action: Yesterday’s high was $9.89. At $10, these options will be worth at least $1-$1.10 for a 100% return. At $10.50 we could have a 200% return. Support is at $9.
Other 2013 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 2013Portfolio link in the Members Area to view ALL open/ closed trades.
MGM Resorts International July 17 calls (from May 2013) – HOLD
Clean Energy Fuels July 16 calls (from May 2013) – HOLD
Spiders Dow Jones July 141 puts (from June 2013) – HOLD
iShares Russell 2000 Index July 90 puts (from June 2013) – HOLD
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.
Scientific Games (SGMS, $12.41, up $0.18)
August 12.50 calls (SGMS130817C00012500, $0.70, up $0.10)
Thoughts: We may get into this trade on a close above $12.50.
Salesforce.com (CRM, $41.52, up $1.78)
August 42.50 calls (CRM130817C00042500, $1.30, up $0.65)
Thoughts: We knew it was coming and we missed an easy double. We were waiting for $40 to clear before possibly getting into this trade. If resistance is taken out, we could see shares make a quick run to $42-$43 with a shot at $45.
Yahoo (YHOO, $27.04, up $0.28)
August 26 calls (YHOO130817C00026000, $1.70, up $0.30)
August 28 calls (YHOO130817C00028000, $0.70, up $0.15)
Thoughts: A close back above $27 would be bullish for a run to $30. Support is at $25.
Applied Materials (AMAT, $16.49, up $0.19)
August 15 calls (AMAT130817C00015000, $1.60, up $0.15)
September 16 calls (AMAT130921C00016000, $1.00, up $0.10)
Thoughts: We think shares can test $17 over the next month. Support is at $15.
Domino’s Pizza (DPZ, $63.00, up $0.76)
July 60 calls (DPZ130720C00060000, $3.10, up $0.70)
August 60 calls (DPZ130817C00060000, $4.40, up $0.60)
Thoughts: If you haven’t locked-in the rest of your profits on this huge unofficial winner, do so today as we will be dropping coverage of the trade.
