9:00am (EST) continued…

The Dow added 2 points, or 0.01%, to close at 15,545 on Monday.  The blue-chips traded to a low of 15,516 on the open but recovered to push a high of 15,576.  Resistance remains at 15,600 and a close above this level should lead to 15,800-16,000.  The bears are trying to get the index back below 15,500 and then 15,350.

The S&P 500 gained 3 points, or 0.2%, to settle at 1,695.  The index tested a low of 1,690 at the start of the session but rebounded to push a new all-time intraday high of 1,697.61.  The index still looks poised to crack 1,700 with fluff up to 1,725 as long as support holds at 1,685-1,675.

The Nasdaq advanced 13 points, or 0.4%, to end at 3,600.  Tech made a good showing and held positive territory throughout the session following a very slight dip at the open of less than a point.  The recovery of 3,600 should lead to another test to 3,625 with fluff up to 3,650.  Support remains steady at 3,575.  If and when this level cracks it will be time to buy put options by using the PowerShares QQQ (QQQ, $74.81, up $0.22).  In the meantime, call options have been going up as the QQQ’s approach their 52-week peak north of $75.

The Russell 2000 jumped another 3 points, or 0.3%, to finish at 1,053.  The small-caps tagged another fresh closing high and an intraday all-time high of 1,054.68.  There is still a good chance the index can reach 1,075 on continued momentum as long as 1,040 holds.  Yesterday’s low was 1,049.

The S&P 500 Volatility Index ($VIX, 12.29, down 0.25) slipped another 2% and went out at its low following a brief test to 13.48.  The bulls held 13.50 and this level is the first wave of resistance the bears need to crack to slow down the July rally.

As we head to press, futures are showing a nice open:  Dow (+40); S&P 500 (+5); Nasdaq 100 (+12).

We were able to close another winning trade yesterday for a 91% win and we could have a New Trade (or 2) shortly after the open this morning.  One is a name we have done well with this year and shares are nearing their 52-week highs again.  We want to see how the stock opens before getting in as we would like to get a discount on the options we are looking at but if not, we should be able to get in for 60 cents or less.  The other is a play in the Financial sector on a stock at $10ish that could be headed to the mid-teens.

 

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 tradesor “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: 84-45, including the Weekly Wrap that is 27-3).

 

Finisar (FNSR, $18.65, up $0.17)

August 19 calls (FNSR130817C00019000, $0.60, flat)

Entry Price:  $0.50 (7/18/13)
Exit Target:  $1.00
Return:  20%
Stop Target:  None

Action:  Shares should challenge $20 over the near-term, possibly $25 by yearend.  Support is at $17.  The company has some sweet, new products that could add some extra pennies to their earnings for the current quarter.

 

Skyworks Solutions (SWKS, $23.93, up $0.04)

August 25 calls (SWKS130817C00025000, $0.40, down $0.15)

Entry Price:  $0.55 (7/17/13)
Exit Target:  $1.10
Return:  -27%
Stop Target:  None

Action:  Shares tested a low of $23.40 yesterday but were able to kiss $24 by the close and finished in the green.  A move above $25 would be bullish for a run to $30. The potential for a big return is there with this trade as long as $23.50 holds.

 

MGM Resorts International (MGM, $16.16, down $0.02)

August 16 calls (MGM130817C00016000, $0.70, down $0.05)

Entry Price:  $0.50 (7/17/13)
Exit Target:  $1.00
Return:  40%
Stop Target:  50 cents

 

September 17 calls (MGM130921C00017000, $0.55, down $0.05)

Entry Price:  $0.42 (7/17/13)
Exit Target:  $1.00
Return:  31%
Stop Target:  40 cents

Action:  MGM seems to trade weak in the mornings but has been strong in the afternoons.  A run past $16.25 should trigger $17 and we like this trade as long as $15.50 holds.

 

Aruba Networks (ARUN, $17.78, up $0.04)

August 18 calls (ARUN130817C00018000, $0.60, down $0.10)

Entry Price:  $0.55 (7/15/13)
Exit Target:  $1.10
Return:  9%
Stop Target:  None

 

October 22 calls (ARUN131019C00022000, $0.50, down $0.05)

Entry Price:  $0.50 (7/15/13)
Exit Target:  $1.00
Return:  0%
Stop Target:  None

Action:  The August 17 calls were closed for a 91% profit.  Shares bottomed at $17.29 before bouncing back to push $17.70.  We still believe shares can make a run to $18-$20 over the next few months.  Support is at $17.25 and we will likely close the trade if shares fall below $17.

 

Sony (SNE, $22.59, up $0.48)

August 24 calls (SNE130817C00024000, $0.45, up $0.10)

Entry Price:  $0.50 (7/11/13)
Exit Target:  $1.00
Return:  -10%
Stop Target:  None

August 26 calls (SNE130817C00026000, $0.15, flat)

Entry Price:  $0.20 (7/11/13)
Exit Target:  $0.60
Return:  -25%
Stop Target:  None

October 25 calls (SNE131019C00025000, $0.90, up $0.10)

Entry Price:  $0.80 (7/11/13)
Exit Target:  $1.60
Return:  13%
Stop Target:  None

Action:  Resistance is at $23-$24 and the close above $22.50 should get 52-week highs in play.  News that China is lifting the ban of gaming counsels could have a huge impact on this stock.  Support is at $21 and the 50-day MA and we like these trades going forward as long as it holds.

 

Other 2013 Portfolio OPEN positions (1):  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.

Apollo Group August 16 puts (from June 2013) – HOLD – We still like this trade and will bring back coverage once shares fall below $18.  We will close the trade if the stock clears $20, and if we do, we will send out a Trade Alert.

 

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.

 

SolarCity (SCTY, $41.99, up $0.32)

August 45 calls (weekly) (SCTY130802C00045000, $0.85, down $0.10)

Thoughts:  A run to $45 appears likely and a close above this level could lead to $50.  Support is at $40.

 

Zillow (Z, $71.59, up $4.83)

August 85 calls (Z130817C00085000, $0.90, up $0.45)

Thoughts:  Shares are breaking ou to new 52-week highs.

 

Trius Therapeutics (TSRX, $12.16, up $0.68)

August 12.50 calls (TSRX130817C00012500, $0.75, up $0.20)

 

September 15 calls (TSRX130921C00015000, $0.55, up $0.05)

Thoughts:  A run to $15 could be coming and the call option pits have been active.

 

Exact Sciences (EXAS, $14.32, down $0.15)

August 15 calls (EXAS130817C00017000, $0.50, down $0.10)

Thoughts:  We have said a close above $14 would be super bullish for a run to the upper teens as long as support at $12.50 and the uptrend line holds.

 

TearLab (TEAR, $12.42, up $0.50)

August 12.50 calls (TEAR130817C00012500, $0.90, up $0.10)

September 15 calls (TEAR130921C00015000, $0.40, flat)

Thoughts:  The 52-week high is at $12.97 and shares are up 300+% from the 52-week low of $3.10.  Earnings are due out in early August.

 

Rambus (RMBS, $10.67, up $0.65)

August 10 calls (RMBS130817C00010000, $0.85, up $0.45)

January 12 calls (RMBS140118C00012000, $0.80, up $0.20)

Thoughts:  If $10 holds, we could go long again on Rambus.  Shares jumped 6.5% and look strong.

 

Spider Gold Shares (GLD, $128.84, up $3.73)

August 122 puts (GLD130817P00122000, $0.70, down $0.80)

September 118 puts (GLD130921P00118000, $1.05, down $0.70)

Thoughts:  We would like to see a failed test to $130 and we could go short thisweek if it looks like resistance will hold.

 

Nvidia (NVDA, $14.23, down$0.01)

August 14 call (NVDA130817C00014000, $0.65, flat)

Thoughts:  There is additional support is at $13.50, if $14.25 fails this week.  A close back above $14.75 would be bullish.

 

Scientific Games (SGMS, $13.24, flat)

August 12.50 calls (SGMS130817C00012500, $1.15, flat)

Thoughts:  We said a close above $12.50 would be bullish for a run to the mid-teens.  The options trade in $2.50 increments and we like both of these options as long as support and the uptrend line holds.

 

Salesforce.com (CRM, $42.04, down $0.46)

August 45 calls (CRM130817C00045000, $0.40, down $0.20)

August 40 puts (CRM130817P00040000, $0.60, up $0.10)

Thoughts:  There could be a back test to $42 and where we may establish a position if support holds.  We would consider puts on a drop back below $41.50.