1:35pm (EST)

Shares of Best Buy (BBY, $27.20, down $10.37) are down 28% today after the company posted weaker-than-expected holiday sales.

There have been a number of analyst upgrades on the rocket ride from a 52-week low of $13-and change to a 52-week peak north of $44 but they are jumping ship after issue downgrades.

Best Buy said sales were off 0.8% as revenue came in at $9.75 billion and below expectations.  The decline was a result of lower same store sales versus last year as they fell nearly 1%.

So much for the turnaround.

We should have watched the drop below $40 more closely in December as it was a clear sign lower prices were in store but we have been trading call options to start the year and missed the boat.

The January 35 puts (BBY140118C00035000, $7.82, up $7.27) are zooming over 1,300% after closing yesterday at double-nickels (55 cents).  These options expire tomorrow and the traders who went short with these puts are having a monster payday.

The February 35 puts (BBY140222P00035000, $7.90, up $6.60) are soaring over 500%.

We will check the chart to see if there is further weakness ahead but if you are thinking of going long, it’s not wise to catch a falling knife.

As far as the market, the indexes are making a slight back test to support that served as prior resistance and as long as these levels hold into the close, there should be further upside action into next week.

The Dow is down 76 points to 16,405 while the S&P 500 is lower by 4 points to 1?844.  The Nasdaq is up a tick to 4,215.

We have a lot to cover with our current trades so we have to roll.  Subscribers, check the Members Area for the updates.