9:00am (EST)

The market broke out of a week long trading range after the Fed hinted short-term interest rates wouldn’t rise.  The Fed heads announced another $10 billion cut to its monthly bond purchases citing an improving labor market and the combination of both pleased Wall Street.

The Dow roared 98 points higher, or 0.6%, to close at 16,906.  The blue-chips traded in negative territory throughout the session ahead of the news and reached a low of 16,755 before ending near session highs.  The bulls came within 60 points of clearing their all-time high of 16,970 and remain on track to clear 17,000.  Support has moved up to 16,800-16,700.

The S&P 500 surged 15 points, or 0.8%, to settle at 1,956.98.  The bears pushed 1,939 but fresh support at 1,940 held until the run to an intraday all-time high of 1,957.74.  I have talked about fluff to 1,975-2,000 as long as 1,950 holds.

The Nasdaq zoomed 25 points, or 0.6%, to end at 4,362.84.  Tech tested 4,320 but held support at 4,325-4,300 before coming within a 6-pack of its 52-week high of 4,371.71.  The talking heads really weren’t mentioning this story but the bulls are making a run towards 4,400-4,500 and my December fluff targets again.  They came close in March.

The Russell 2000 jumped 6 points, or 0.6%, to finish at 1,183.  Support at 1,175-1,170 was tested following the dip to 1,170 but the small-caps rebounded to end near session highs.  The bulls are a little over 1% from testing the 1,200 level again.

The S&P 500 Volatility Index ($VIX, 10.61, down 1.45) tanked 12% and kissed a low of 10.57.  Despite the market pullback for much of the session, the VIX also traded lower as was another telling sign a breakout to new highs could come if Yellen said all the right things.  Like a broken record, I have talked about the VIX tripping single-digits and this will be a hot topic once it does.  The see-saw is now tipping towards a test below 10 sooner rather than later with Friday’s June option expiration coming into the picture.  As long as 11.50 holds, 9ish is a real possibility this week or next.

There are a number of trades that continue to perform well and I have once again raised the trailing Stop Limit orders to protect the phenomenal gains they are showing.

Heading from desk to press, futures look like this:  Dow (+5); S&P 500 (+1); Nasdaq 100 (+2).


Closed Trades for 2014: 51-30 – the Weekly Wrap is 15-4 (79%) for 2014 (100-11, or 90% win rate, since 2011) and is designed for traders that want to use options with less risk.  All trades are dated and time stamped so new subscribers can look at the past history to see how the trades have played out.

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 12pm-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.

CVS Caremark (CVS, $77.36, up $1.16)

August 80 calls (CVS140816C00080000, $0.80, up $0.30)

Entry Price:  $0.60 (6/18/2014)
Exit Target:  $1.20
Return:  33%
Stop Target:  None

Action:  Shares held the 50-day MA after a recent back test and should resume their march towards $80.  Support is at $76-$75.

BlackBerry (BBRY, $8.29, up $0.24)

August 9 calls (BBRY140816C00009000, $0.45, up $0.10)

Entry Price:  $0.45 (6/18/2014)
Exit Target:  $0.90
Return:  0%
Stop Target:  None

Action:  Earnings are due out this morning.

Rambus (RMBS, $14.66, up $0.06)

August 15 calls (RMBS140816C00015000, $0.80, flat)

Entry Price:  $0.40 (6/13/2014)
Exit Target:  $1.20 Limit Order (Closed half @ 80 cents on 6/17/14)
Return:  100%
Stop Target:  50 cents, raise to 60 cents (Stop Limit)

Action:  Shares traded down to $14.35 before making another run at fresh 52-week peaks.  A close above $14.70 keeps $15 in play.

Hercules Offshore (HERO, $4.87, down $0.10)

October 5 calls (HERO141018C00005000, $0.50, down $0.05)

Entry Price:  $0.35 (6/11/2014)
Exit Target:  $0.70
Return:  43%
Stop Target:  None

Action:  A trip to $6 is in store if Hercules can hold $5.  Support is at $4.80.

Imax (IMAX, $28.06, flat)

September 28 calls (IMAX140920C00028000, $1.45, flat)

Entry Price:  $0.60 (6/5/2014)
Exit Target:  $1.20 (closed half @ $1.30 on 6/16/14)
Return:  129%
Stop Target:  $1.10, raise to $1.20 (Stop Limit)

Action:  A run to $30 is in the works as long as $28 can hold.  Yesterday’s high was $28.28 following a test to $27.76.

Limelight Networks (LLNW, $2.98, flat)

September 3 calls (LLNW140920C00003000, $0.40, flat)

Entry Price:  $0.15 (6/4/2014)
Exit Target:  $0.45
Return:  167%
Stop Target:  None

December 3 calls (LLNW141220C00003000, $0.50, flat)

Entry Price:  $0.20 (6/4/2014)
Exit Target:  $0.60
Return:  150%
Stop Target:  None

Action:  I would like to see a close above $3.25 this week.  Support is at $2.75.

Fortinet (FTNT, $24.41, up $0.07)

July 25 calls (FTNT140719C00025000, $0.65, flat)

Entry Price:  $0.25 (6/4/2014)
Exit Target:  $0.50 (closed half @ $0.45 on 6/11/14)
Return:  120%
Stop Target:  50 cents (Stop Limit)

July 24 calls (FTNT140719C00024000, $1.10, flat)

Entry Price:  $0.45 (5/30/2014)
Exit Target:  $0.90 (closed half @ $0.80 on 6/11/14)
Return:  111%
Stop Target:  90 cents (Stop Limit)

Action:  A run past $25 could be coming as long as $24 holds.

Twitter (TWTR, $38.74, up $0.72)

January 50 calls 2015 (TWTR150117C00050000, $2.60, up $0.30) LEAP option

Entry Price:  $1.75 (5/8/2014)
Exit Target:  $3.50 (closed half @ $2.10 on 6/12/14)
Return:  34%
Stop Target:  $1.80, raise to $2.10 (Stop Limit)

Action:  A run to $40 is still in the works.  Support is at $35 and is moving up.  I have raised the Stop Limit on the other half to $2.10.

Other 2014 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 2014 Portfolio link in the Members Area to view ALL open/ closed trades.

iShares Russell 2000 June 103 puts (from May 2014) – continue to hold
McDonald’s July 95 puts (from May 2014) – continue to hold
Apollo Group – continue to hold
June 25 puts (from April 2014)
August 23 puts
Bed, Bath & Beyond
June 60 puts (from May 2014)
August 55 puts