9:00am (EST) continued…
The Dow jumped 206 points, or 1.4%, to close at 15,373. The blue-chips went out near their high and the close above 15,350 puts 15,500-15,600 back in play. Support is back at 15,200.
The S&P 500 surged 23 points, or 1.4%, to settle at 1,721. The 52-week high is at 1,729.86 and a break above this level could lead to a run to 1,750. Support is at 1,710-1,700.
The Nasdaq zoomed 45 points, or 1.2%, to end at 3,839. Tech traded to a high of 3,840 and a close above 3,850 gets 3,900 in the mix. Near-term support is at 3,825-3,8000
The Russell 2000 soared a baker’s dozen, or 1.2%, to finish at 1,092. The small-caps set another all-time high and inched closer to our 1,100 target after closing a half-point of its intraday high of 1.092.91. Support at 1,075 has been holding all week.
The S&P Volatility 500 Index (^VIX, 14.71, down 3.95) tanked 21% to close back below 15. The index opened below 17.50 and was a good sign the rally was on. If the bulls can hold 15 there is a chance the VIX trades down to 13 but another close above 17.50 could suggest a top is in.
As we head to press, futures are lower and look like so: Dow (-66); S&P 500 (-3); Nasdaq 100 (-2). International Business Machines (IBM, $186.73, up $2.07) is testing $175 in pre-market action and will weigh on the blue-chips today. We will cover the story in our midday update.
Subscribers, check the Members Area for the updates.
MEMBERS ARE
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: 115-55 – the Weekly Wrap is 38-3 for 2013 (82-5 since 2011) and is designed for traders that want to use options with less risk.
H&R Block (HRB, $28.86, up $1.22)
November 29 calls (HRB131116C00029000, $0.90, up $0.45)
Entry Price: $0.45 (10/15/13)
Exit Target: $0.90
Return: 100%
Stop Target: 45 cents
Action: Shares traded to a high of #29.11 and look poised to trip $30 this week or next. Support is at $26.
Opko Health (OPK, $12.27, down $0.01)
November 11 calls (OPK131116C00011000, $1.75, flat)
Entry Price: $0.45 (10/14/13)
Exit Target: $1.00 (closed half at $1.05 on 10/15/2013)
Return: 211%
Stop Target: $1.35, raise to $1.40 (Stop Limit)
December 12 calls (OPK131221C00012000, $1.50, flat)
Entry Price: $0.40 (10/14/13)
Exit Target: $0.90 (closed half at $0.90 on 10/15/2013)
Return: 200%
Stop Target: $1.00 cents, raise to $1.10 (Stop Limit)
Action: Shares reached another 52-week high of $12.95 before slipping by a penny into the close. We have raised our Stop Targets and set limit stops in case $13 holds as resistance and shares slip. Support is at $12-$11.75.
Aruba Networks (ARUN, $18.68, down $0.09)
November 20 calls (ARUN131116C00020000, $0.45, down $0.05)
Entry Price: $0.80 (10/11/13)
Exit Target: $1.60
Return: -44%
Stop Target: None
Action: A move past $20 should get $22 in play and we believe shares could make a run at $25 over the next month. Support is at $18.
MGM Resorts International (MGM, $20.69, up $0.13)
November 21 calls (MGM131116C00021000, $0.80, flat)
Entry Price: $0.80 (10/7/13)
Exit Target: $1.60
Return: 0%
Stop Target: None
Action: We believe shares can make a run past $22-$23 by mid-November. Support is at $20 with risk down to $19.50. Earnings are due out on October 28.
Safeway (SWY, $33.08, up $0.34)
November 34 calls (SWY131116C00034000, $0.70, up $0.05)
Entry Price: $0.80 (10/2/13)
Exit Target: $1.60 (closed a quarter at $1.10 on 10/11/2013)
Return: 0%
Stop Target: None
Action: We are expected a run to $35 as long as support holds at $32.
Kodiak Oil & Gas (KOG, $12.87, up $0.26)
November 13 calls (KOG131116C00013000, $0.75, up $0.15)
Entry Price: $0.50 (10/1/13)
Exit Target: $1.00
Return: 50%
Stop Target: 50 cents
Action: We have said shares could trade to $15 if momentum returns and $13 is cleared. Yesterday’s high was $13.10. We like this trade as long as $11 holds.
Other 2013 Portfolio OPEN positions (6): 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.
Sony October 25 calls (from July 2013) – HOLD
Jos. A. Bank Clothiers October 35 puts (from August 2013) – HOLD
eBay October 45 puts (from September 2013)Earnings 10/16 – HOLD
Microsoft October 30 puts (from September 2013)Earnings 10/24 – HOLD
Jabil Circuit October 25 calls (from September 2013) – HOLD
Skyworks Solutions October 26 calls (from September 2013) – Bid/ Ask 5/15 cents
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.
Keryx Biopharmaceuticals (KERX, $10.49, up $1.73)
November 12 calls (KERX131116C00012000, $0.80, up $0.50)
November 13 calls (KERX131116C00013000, $0.65, up $0.45)
Thoughts: Most of you are familiar with this name as we have taken a few trades in the Daily and Weekly on Keryx. We were hoping shares would come down to $8 this week so that we could play the move back above double-digits. These options exploded on the stock’s 20% surge after opening at 38 cents and 25 cents. They are still cheap as shares could make a run at $15.
General Electric (GE, $24.40, up $0.15)
November 24 calls (GE131116C00024000, $0.75, flat)
Thoughts: Earnings are due out Friday morning and these calls can be used to play a possible move past $25. We will see where they are at in our miday update and if we like them we could take a trade.
Spider Gold Shares (GLD, $123.54, down $0.19)
November 115 puts (GLD131116P00115000, $0.80, down $0.10)
Thoughts: We will talk about Gold this weekend and we have said it could test $1,100 this year. If so, the Spiders could fall below $115.
WisdomTree Japan Hedged Equity (DXJ, $48.35, up $0.70)
November 49 calls (DXJ131116C00049000, $1.05, up $0.30)
January 53 calls (DXJ140118C00053000, $0.65, up $0.15)
Thoughts: This ETF could be setting up for a run past $50.
3D Systems (DDD, $55.25, up $1.35)
November 55 calls (DDD131116C00055000, $3.80, up $0.40)
Thoughts: The close above $55 gets $60 in the mix. Support is at $53.50 and a close below $50 would signal a possible short opportunity.
iShares Russell 2000 (IWM, $108.49, up $1.33)
November 110 calls (IWM131116C00110000, $1.20, up $0.15)
November 101 puts (IWM131116P00101000, $0.50, down $0.35)
Thoughts: We could go long on a pop above $108 or short on a close below $105.
Spiders Dow Jones Industrial Average (DIA, $153.52, up $2.18)
November 155 calls (DIA131116C00155000, $1.10, up $0.15)
November 145 puts (DIA131116P00145000, $0.60, down $0.45)
Thoughts: We could go long on a move above $153, or short on a drop below $151.
Salesforce.com (CRM, $52.58, up $1.86)
November 55 calls (CRM131116C00055000, $1.00, up $0.40)
Thoughts: We believe shares will make a run past $55 as long as $50 holds.
Intel (INTC, $23.70, up $0.31)
November 23 calls (INTC131116C00023000, $1.00, up $0.10)
January 24 calls (2014) (INTC140118C00024000, $0.80, up $0.05)
November 24 calls (INTC131116C00024000, $0.45, up $0.05)
Thoughts: These options are a cheap way to play a 5%-7% move in the stock. Analysts are bearish on the stock but we like Intel for the long-term.