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 an “Alert” or “Trade Update” 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 but it is rare that we do.
1:30pm (EST)
Potash (POT, $54.34, up $3.26)
September 60 calls (POT110917C00060000, $1.15, up $0.45)
Entry Price: $1.00 (8/11/11)
Exit Target: $1.25-$1.30
Return: 15%
Stop Target: None
Action: We are just trying to make 20%-30% on the calls to finance some of our “cheaper” option plays. If Potash can trade $55 by Friday we should have a nice, quick profit.
Pepsi (PEP, $62.45, up $2.13)
October 67.50 calls (PEP111022C00067500, $0.70, up $0.30)
Entry Price: $0.45 (8/11/11)
Exit Target: $0.90+
Return: 56%
Stop Target: None
Action: Set limit prices to close HALF of the trade at 90 cents if Pepsi continues higher.
Rambus (RMBS, $10.70, up $0.85)
September 9 puts (RMBS110917P00009000, $0.55, down $0.15)
Entry Price: $0.55 (8/10/11)
Exit Target: $1.10+
Return: 0%
Stop Target: None
Action: We are looking for Rambus to drop below $8 which gets these options to $1+. These puts do not expire for over a month so try not to let the volatility get to you.
United Airlines (UAL, $17.70, up $0.70)
September 16 puts (UAL110917P00016000, $1.00, down $0.25)
Entry Price: $1.00 (8/10/11)
Exit Target: $2.00+
Return: 0%
Stop Target: None
Action: Shares of United Airlines hit a low of $16.95 yesterday and the 52-week low is $15.92. We are looking for shares to test $15 over the next few weeks.
Staples (SPLS, $12.90, up $0.41)
August 12 puts (SPLS110820P00012000, $0.40, down $0.15)
Entry Price: $0.50 (8/10/11)
Exit Target: $1.00+
Return: -20%
Stop Target: None
Action: Staples will announce earnings next Tuesday and we believe they are going to report a terrible quarter. A drop below $10 could be in the cards. This is an all-or-nothing trade so be aware of this as the August options expire next Friday. Our breakeven point is $11.50.
PowerShares QQQ (QQQ, $52.90, up $2.04)
September 50 puts (QQQ110917P00050000, $1.40, down $0.60)
Entry Price: $1.55 (8/8/11)
Exit Target: $3.10
Return: -10%
Stop Target: $1.55
Action: These are also September options and we believe a dip below $50 is coming before the bottom is in. Continue to hold.
Other 2011 Portfolio OPEN positions (14): These are trades that are still open in the portfolio that have longer expiration dates or 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 the options expire. Click on the 2011 Portfolio link in the Members Area to view ALL open/ closed trades.
RF MicroDevices August 10 calls (from February 2011)
Dendreon August 50 calls (from April 2011)
MGM Resorts International September 17 calls (from May)
Vivus September 10 calls (from May 2011)
Symantec October 20 calls (from June 2011)
Rediff.com India October 15 calls (from June 2011)
Seattle Genetics August 22.50 calls (from June 2011)
September 20 calls (from May 2011)
Global Payments August 55 calls (from July 2011)
TiVo August 11 calls (from July 2011)
iShares Russell 2000 August 86 calls (from July 2011)
Spider S&P 500 August 135 calls (from July 2011)
Spider Dow Jones Industrial Average August 126 calls (from July 2011)
Freeport-McMoRan August 57 calls (from July 2011)
Qualcomm October 65 calls (from July 2011)
Rambus September 17 calls, August 17 calls (from July 2011)
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.
We will update this section in the morning.
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10:40am (EST)
Potash (POT, $53.72, up $2.64)
September 60 calls (POT110917C00060000, $1.00, up $0.30)
Action: Use limit prices up to $1.10 to establish positions.
Pepsi (PEP, $61.75, up $1.43)
October 67.50 calls (PEP111022C00067500, $0.45, up $0.05)
Action: Use limit prices up to 50 cents to establish positions.
**********************************
9:00am (EST)
Rambus (RMBS, $9.85, down $0.50)
September 9 puts (RMBS110917P00009000, $0.70, up $0.20)
Entry Price: $0.55 (8/10/11)
Exit Target: $1.10+
Return: 27%
Stop Target: None
Action: Shares have traded to a low of $9.89 and we are looking for a drop below $8 which gets these options to $1+. These options do not expire for over a month so try not to let the volatility get to you.
United Airlines (UAL, $17.00, down $1.46)
September 16 puts (UAL110917P00016000, $1.25, up $0.35)
Entry Price: $1.00 (8/10/11)
Exit Target: $2.00+
Return: 25%
Stop Target: None
Action: Shares of United Airlines hit a low of $16.95 yesterday and the 52-week low is $15.92. We are looking for shares to test $15 over the next few weeks.
Staples (SPLS, $12.49, down $0.72)
August 12 puts (SPLS110820P00012000, $0.55, up $0.10)
Entry Price: $0.50 (8/10/11)
Exit Target: $1.00+
Return: 10%
Stop Target: None
Action: These options traded over 3,000 contracts and open interest was only 275 going into yesterday. Staples announces earnings next Tuesday and we believe they are going to report a terrible quarter. A drop below $10 could be in the cards. This is an all-or-nothing trade so be aware of this as the August options expire next Friday. Our breakeven point is $11.50.
PowerShares QQQ (QQQ, $50.86, down $2.17)
September 50 puts (QQQ110917P00050000, $2.00, up $0.80)
Entry Price: $1.55 (8/8/11)
Exit Target: $3.10
Return: 29%
Stop Target: $1.55
Action: These are also September options and we believe a dip below $50 is coming before the bottom is in. Continue to hold.
Other 2011 Portfolio OPEN positions (14): These are trades that are still open in the portfolio that have longer expiration dates or 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 the options expire. Click on the 2011 Portfolio link in the Members Area to view ALL open/ closed trades.
RF MicroDevices August 10 calls (from February 2011)
Dendreon August 50 calls (from April 2011)
MGM Resorts International September 17 calls (from May)
Vivus September 10 calls (from May 2011)
Symantec October 20 calls (from June 2011)
Rediff.com India October 15 calls (from June 2011)
Seattle Genetics August 22.50 calls (from June 2011)
September 20 calls (from May 2011)
Global Payments August 55 calls (from July 2011)
TiVo August 11 calls (from July 2011)
iShares Russell 2000 August 86 calls (from July 2011)
Spider S&P 500 August 135 calls (from July 2011)
Spider Dow Jones Industrial Average August 126 calls (from July 2011)
Freeport-McMoRan August 57 calls (from July 2011)
Qualcomm October 65 calls (from July 2011)
Rambus September 17 calls, August 17 calls (from July 2011)
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.
Sony (SNE, $21.32, down $1.29)
September 22 puts (SNE110917P00022000, $1.60, up $0.65)
Thoughts: We were trying to get into these options for $1.00-$1.10 when we sent out yesterday’s trades but the stock opened below $22 while the puts started the session at $1.60 and never looked back. The 52-week low is $21.59 for Sony but shares appear like they are heading below $20. If so, these options would double but the stock could touch $18 which gets these options to at least $4.
Potash (POT, $51.08, down $1.36)
September 60 calls (POT110917C00060000, $0.70, flat)
August 50 puts (POT110820P00050000, $1.70, up $0.50)
Thoughts: Watch for now.
Pepsi (PEP, $60.32, down $2.77)
October 67.50 calls (PEP111022C00067500, $0.40, down $0.40)
September 65 calls (PEP110917C00065000, $0.40, down $0.60)
January 2012 67.50 calls (PEP120121C00067500, $0.80, down $0.30)
Thoughts: There were a lot of good stocks that held up well yesterday but Pepsi wasn’t one of them. Support is $60 and Pepsi hit a new 52-week low of $60.10. Not good. However, if $60 sticks and the September calls are under 50 cents to start trading, we may throw a dart.
Bank of America (BAC, $6.77, down $0.83)
September 7 puts (BAC110917P00007000, $1.15, up $0.45)
May (2012) 15 calls (BAC120519C00015000, $0.15, down $0.07)
Thoughts: Watch for now but we like the put options on another pullback because we think shares could be headed to $5.
General Electric (GE, $15.09, down $0.87)
September 16 calls (GE110917C00016000, $0.55, down $0.20)
January (2012) 17.50 calls (GE120121C00017500, $0.55, down $0.20)
March 18 calls (GE120317C00018000, $0.55, down $0.05)
Thoughts: We are looking ahead to next year and at some point we going to start positioning for a relief rally and the possible continuation of the bull market. We haven’t hit a 20% decline to call the current one a bear market but we are close and it could still go either way.
Rediff.com India (REDF, $7.81, down $0.35)
January (2012) 12.50 calls (REDF120121C00012500, $0.55, down $0.10)
Thoughts: Speculative.
PNC Financial Services (PNC, $45.28, down $4.04)
September 55 calls (PNC110917C00055000, $0.40, down $0.25)
Thoughts: Continue to watch.
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