Option Investor
Newsletter

Daily Newsletter, Tuesday, 1/15/2013

Table of Contents

  1. Market Wrap
  2. New Option Plays
  3. In Play Updates and Reviews

Market Wrap

Apple and Gravity

by Jim Brown

Click here to email Jim Brown

Apple succumbed to Newton's Universal Law of Gravitation as it broke through orbital support at $500 and the decline accelerated.

Market Statistics

Apple was the biggest drag on the equity market over the last two days with a -35 point decline. This crippled the Nasdaq and was a major drag on the S&P as well. The Wall Street Journal reported that Apple had cut parts orders for the iPhone by 50% for Q1 due to lagging sales. Samsung is grabbing more market share on a daily basis and appears to be unstoppable. Motorola also has some new models out that are successfully competing with the iPhone.

Over the last six years Apple has been able to demand a premium price for their products because they were the leading technology. That is no longer the case. Apple is one of the crowd. They may still be the leader in some areas but the competition is chipping away at the Apple base.

In Q4 Apple had a 14.6% share of the smartphone market, down from 23% in Q4-2011. Samsung's share rose to 31.3%, up from 8% in Q3-2010 when the current smartphone battle began. Apple is seen to be running out of ideas on how to innovate their existing product line and come up with new products. The iPhone 5 looks like the 4s, which looks like the 4, which looks like the 3, etc. Several people in my family have recently moved from the iPhone to an Android device. That is being repeated all across the consumer spectrum. People are no longer rushing out to buy the most current iPhone offering and the iPhone 6 announcement is already been rumored. The iPhone Mini has been rumored as well. Every rumor of a new device slows demand for the current device because consumers don't want to buy only to find out the new product has some previously unknown feature they want.

Apple shares closed at $700 on Sept 21st and has fallen to close at $485 today. Analysts are saying $450-$475 should be strong support ahead of what should be spectacular earnings on January 23rd after the close. If Apple were to lower guidance significantly to match the 50% cut in parts orders another leg down could begin.

Apple Chart

Other than the Apple decline the market was relatively calm once again. Volume was light as traders wait for the monster earnings schedule on Wednesday. This is going to be a very strong day for financial earnings and that could provide a strong directional move depending on the outcome.

The financial reports out today failed to move the market although there was a decent dip at the open. The S&P dipped to 1464 at the open as a result of weakness overseas and the lackluster economics. Traders immediately bought the dip.

The NY Empire Manufacturing Survey for January fell to -7.8 from an upwardly revised -7.3 in December. Originally it was a reading of -8.1. Zero is the dividing line between retraction and expansion. This was the sixth month the survey has been in contraction territory and it does not appear to be getting any better.

New orders declined to -7.3 from -3.4. Backorders declined again to -7.5 from -6.4. Backorders have been contracting since June 2011. Employment improved slightly to -4.3, up from -9.7 but that component has been in contraction since September.

In a supplemental question to the survey employers were asked about 2013 employment plans. Only 27% said they expected to hire and 19% expected to reduce their workforce. In January 2012 there were 51% planning to hire and only 9% planning cuts.

The NY survey was a wet blanket on the market but only because the negativity continued. It did not get appreciably worse. Everyone was hoping for signs of a rebound.

Empire State Manufacturing Survey

The Producer Price Index (PPI) declined -0.2% and the third consecutive monthly decline. Analysts had expected an unchanged reading. Declining energy prices impacted the headline number. The core rate, excluding food and energy, rose +0.1% and the second monthly gain. Prices are declining as a result of moderating prices in the commodity sector that exploded higher because of the summer drought.

The recession in Europe is reducing demand and is helping to hold down prices at the producer level. The Consumer Price Index (CPI) is due out on Wednesday.

Retail sales for December rose +0.5% and well above the consensus estimates for a +0.2% gain. Auto sales contributed to the gain as the surge in buying continues. The decline in fuel prices caused gasoline stations to show a -1.6% decline in sales. Sporting goods sales rose +0.6% thanks to the surge in firearms sales after the election and the Sandyhook shooting. More than 1.1 million guns were sold in November and December.

Clothing sales rose +1.0%, motor vehicles and parts +1.6%, food service +1.2% and furniture +1.4%. Electronics declined -0.6%.

Year over year sales growth was +4.7% and the strongest since September.

The economic calendar for tomorrow is headlined by the CPI, NAHB Housing and the Fed Beige Book. The biggest of those is the Beige Book. That will outline the economic conditions in all 12 Fed regions and hopefully conditions have improved. Last month the majority of regions were showing improvement with the exception those hit by Sandy.

Economic Calendar

Wednesday's real market focus will be on earnings. This is a major earnings day for the financial sector. Only two of the symbols listed below for Wednesday are not financials. Goldman Sachs, JP Morgan and US Bank are the headliners but the rest will count as well. Clearly we will have a very good idea how the rest of the financial sector will report after the Wednesday lineup.

Ebay and Wendy's are the two non-financial companies reporting. Ebay is not really a tech company but results there will predict how companies like Amazon and Best Buy will fare.

Earnings Calendar

The big news for Tuesday was the private buyout of Dell by Michael Dell and Silverlake Partners. According to CNBC the deal has been under discussion for several months. Michael Dell and Silverlake will put up about $2 billion and the buyout will be in the range of $13.50 to $14.00. Michael said the company would bring back some cash from overseas to pay down debt and reduce the overall cost of the deal. The partners would finance $15 billion and according to reports that debt offering is oversubscribed. Seems a lot of investors are willing to loan on the strength of Dell's business.

The deal could be concluded within the next two weeks according to sources close to the company. Share volume hit 155 million today and about seven times normal. Dell shares closed at $13.00 in after hours. Michael Dell owns 15% of the company and he will be bringing fresh money to the table for his portion of the deal in addition to the 15%.

Dell went public in 1990 at the now split adjusted price of 5-cents. Dell was a regular splitter of its stock during the boom years and thousands of millionaires were created from early investments in the company. If they can pull this off and take the company private it will represent a full circle for a business that was started in Michael Dell's dorm room of making computers for other students.

Dell Chart - Monthly

Luluemon (LULU) shares lost nearly $3 after the company reported preliminary earnings of 74 cents. That was up from their prior guidance of 71-73 cents. Analysts were expecting 74 cents. Revenue projections came in light at $475-$480 million and analysts were expecting $489 million.

The company said same store sales would increase by "high single digits" and that was disappointing to the street. Analysts began to worry that growth was slowing since LULU has a history of beating estimates. Nothing grows to the sky as Michael Dell found out a decade ago.

LULU Chart

Express Inc (EXPR) raised its Q4 guidance to 72-74 cents per share, up from 62-68 cents. Revenue expectations rose from $53-$58 million to $61-$62 million. However, same store sales were up only +1% but expectations were for a low single digit decline. Express operates more than 600 stores targeting the 20-30 year old customer. Express shares rallied +24% on the news.

Express Chart

Facebook held its long awaited mystery announcement event today and investors were disappointed. The new product is called Graph Search. It allows users to search through the posts of friends looking for common interests, photos, associates of even dates. For instance you could search for pictures of Paris or people who like your favorite TV show. You could also search for potential dates that might like the Broncos, pizza and work in the financial sector.

I can see it now. Hi, you don't know me but I am a friend of Julie and she is a friend of your friend Mary and I know from your posts you liked 50 Shades of Gray. I did too. Do you want to go out?

The number one comment I heard after the announcement was "I need to change my privacy settings." Users can opt out of the searches and apparently may are going to do just that.

Shares of Facebook declined -3% after the announcement. Also making news today was a survey by social media company SocialBakers. They claim Facebook lost 1.4 million active users in December. The company said increased advertising on the site and new fees are driving away some users. Facebook is experimenting with charging $1 to send a message to anyone outside their friends list. I guess that will work well with the dating search above. Also, Facebook is going to charge $7 to promote your posts to more than just your friends. The rampant spamming of political posts of all kinds has also ruined the experience of many less involved users. According to SocialBakers there have actually been a large number of users who have taken a break from Facebook over the last month because of the heated debate over gun control. That is a subject that polarizes people even more than religion.

Analysts claim once you remove anyone 13 and under or 65 and older from the U.S. population, because those are not demographics for active users, the potential for new Facebook account growth is rather limited. The company has to profit from existing users rather than count on adding to the subscriber base.

Facebook Chart

When the VIX is low it is time to go. That is an old Wall Street saying and it normally proves out to be true. However, the timing is always questionable since the VIX can remain low for a long time before the inevitable market crash.

The VIX is at five-year lows and the markets may not be rushing higher but they are still ignoring relatively weak economics and debt threat worries. This will continue until it suddenly stops. There won't be a flashing red light warning that the market is going to cease its gains the next day. It will happen like a bolt of lightning when least expected.

VIX Chart

Right now the market is in full bullish mode except for Apple. If you removed Apple from the Nasdaq and S&P both indexes would have been positive today and that would have stimulated further buying. When traders look at their screens and the Nasdaq is -12 points it kills some of the incentive to add to risk positions.

However, if traders were only slightly observant they would have seen the Dow Transports and the Russell 2000 both closing at historic highs and the combination is very bullish. The Nasdaq will catch up once Apple finds a bottom.

The Dow Transports gained +39 points to close at 5,639 and well over the prior high of 5,618. Any further gains are going to be a money magnet for the market.

Dow Transports Chart - Weekly

The small caps are in breakout mode as well. Given the various factors weighing on the market this is very bullish. It suggests fund managers are not concerned about the coming debt debate and like the fiscal cliff they assume a deal will eventually be reached.

Russell 2000 Chart

The S&P has also broken out to five year highs and were it not for the Apple drag we could have seen the S&P over 1,475 at the close. The most recent intraday high of 1,474 on September 14th is the only remaining resistance of any significance until 1,550. We are VERY close to starting a new leg higher.

The key for this week is the financial earnings on Wednesday. This will be a market driver, only the direction is unknown. However, with bullish sentiment so strong we may see any lackluster earnings ignored while strong earnings will be celebrated.

S&P Chart - Daily

The Dow is stronger than the Nasdaq but the gains have been coming slowly. Adding 15-25 points a day is like watching paint dry but the overall result is still a gain. The next material resistance is 13,625 and with multiple Dow components reporting on Wednesday we could see a decent spike if the earnings are strong. Once past the financial earnings on Wednesday the next hurdle is the Intel earnings on Thursday and GE on Friday. Neither are expected to do poorly but you never know what trouble is lurking under the headlines.

Dow Chart - Daily

The Nasdaq hit strong resistance at 3125 on Friday and the -34 point Apple decline this week has prevented the index from retesting that level. However, once Apple finds a bottom the Nasdaq should catch up with the Dow. The CES show had plenty of positive headlines and even the Dell news is somewhat positive for market sentiment. Short term support is 3100 so the range of movement is very small.

Nasdaq Chart

We are still in a buy the dip market as the S&P drop to 1464 this morning proved once again. The financial earnings are going to be the key element Wednesday morning and the Fed Beige Book the key for the afternoon market.

With the Russell 2000 and Dow Transports breaking out it would take a seriously negative spate of earnings to slow down the advance. The debt threat does not seem to be impacting sentiment simply because the actual battle is still more than a month away. Secretary Geithner sent another letter to Congress today saying the government will run out of money by mid March. That extends the prior expectations by about two weeks. Nothing will happen until the last minute so there is plenty of time for the markets to run if they decide to do so.

I remain in buy the dip mode until proven wrong.

Enter passively, exit aggressively!

Jim Brown

Send Jim an email

 

The ABSOLUTELY Last Chance for the EOY Special


New Option Plays

Hotels & Technology

by James Brown

Click here to email James Brown

Editor's Note:

In addition to tonight's new candidate(s), consider these stocks as possible trading ideas and watch list candidates. Many of these need to see a break past key support or resistance:

(bearish ideas) Keep an eye on WCG. A breakdown under support at $45.00 could be a bearish entry point to buy puts. Target the $40 area.



NEW DIRECTIONAL CALL PLAYS

Starwood Hotels - HOT - close: 60.41 change: +0.88

Stop Loss: 58.85
Target(s): 64.50
Current Option Gain/Loss: Unopened
Time Frame: exit prior to earnings on Feb. 7th
New Positions: Yes, see below

Company Description

Why We Like It:
It seems that China has become a hot place to invest again. Traders are suddenly interested in shares of HOT thanks to news the company is building 100 new hotels in China. The stock outperformed today and broke out above round-number resistance at $60.00. I'd like to see some follow through with a rally past its early January high.

We are suggesting a trigger to buy calls at $60.60. If triggered our stop loss is $58.85. Our target is $64.50. However, we will plan to exit prior to the earnings report on Feb. 7th.

Trigger @ 60.60

- Suggested Positions -

buy the Feb $60 call (HOT1316B60) current ask $2.04

Annotated Chart:

Entry on January xx at $ xx.xx
Average Daily Volume = 1.9 million
Listed on January 15, 2012


Red Hat, Inc. - RHT - close: 54.99 change: +0.00

Stop Loss: 53.90
Target(s): 59.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Shares of RHT have been stuck trading near the $55 level and its simple 200-dma the last few weeks. However, you'll notice the stock has a bullish pattern of higher lows. This would suggest the stock is about ready to breakout from this consolidation pattern. The January 9th, 2013 high was $55.30. I am suggesting a trigger to buy calls at $55.40. If triggered our target is $59.25. FYI: The Point & Figure chart for RHT is bullish with a $72 target.

Trigger @ 55.40

- Suggested Positions -

buy the Feb $55 call (RHT1316B55) current ask $1.65

Annotated Chart:

Entry on January xx at $ xx.xx
Average Daily Volume = 1.7 million
Listed on January 15, 2012



In Play Updates and Reviews

SOHU Hits Our Target

by James Brown

Click here to email James Brown

Editor's Note:

Shares of Sohu.com hit our bullish exit target today. Most of the market managed a rebound off their intraday lows.

CHRW and IWM were triggered. FISV was stopped out. We want to exit our TRMB trade at the close tomorrow.


Current Portfolio:


CALL Play Updates

CH Robinson Worldwide - CHRW - close: 65.35 change: +0.55

Stop Loss: 63.75
Target(s): 69.25
Current Option Gain/Loss: - 2.3%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
01/15/13: CHRW continues to show relative strength and broke through resistance near $65.00 today. Our trigger to open bullish positions was hit at $65.20. Our target is $69.25.

We do not want to hold over CHRW's earnings report, which is expected in very late January or early February so this is a short-term two or three week trade.

- Suggested Positions -

Long Feb $65 call (CHRW1316B65) entry $2.10

Entry on January 15 at $65.20
Average Daily Volume = 1.3 million
Listed on January 14, 2012


Concur Technologies - CNQR - close: 71.60 change: -0.48

Stop Loss: 69.40
Target(s): 74.85
Current Option Gain/Loss: + 6.0%
Time Frame: exit prior to the late January earnings report
New Positions: see below

Comments:
01/15/13: The market's widespread dip this morning pushed CNQR to short-term technical support at its 10-dma. Shares hovered there the rest of the session. I'd look for a dip or a bounce off the $70.00 level as our next entry point.

Earlier Comments:
More aggressive traders could aim for the 2012 highs near $76.00. We do not want to hold over the late January earnings report. FYI: The Point & Figure chart for CNQR is bullish with an $81 target.

- Suggested Positions -

Long Feb $70 call (CNQR1316B70) entry $3.30

01/11/13 new stop loss @ 69.40, adjust exit target to $74.85

Entry on January 07 at $70.25
Average Daily Volume = 462 thousand
Listed on January 05, 2012


Deere & Co - DE - close: 89.73 change: -0.13

Stop Loss: 88.25
Target(s): 99.00
Current Option Gain/Loss: -19.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/15/13: DE continues to churn sideways below the $90.00 level. Readers may want to wait for a close above $90 before considering new bullish positions.

We do not want to hold over its mid February earnings report (still unconfirmed). FYI: The Point & Figure chart for DE is bullish with a $104 target.

- Suggested Positions -

Long Feb $90 call (DE1316B90) entry $2.35

Entry on January 11 at $90.25
Average Daily Volume = 2.3 million
Listed on January 09, 2012


EOG Resources - EOG - close: 125.10 change: +0.61

Stop Loss: 123.40
Target(s): 134.00
Current Option Gain/Loss: - 24.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/15/13: Traders bought the dip this morning but EOG remains under short-term resistance near the $126.00-126.25 area. There is no change from my prior comments.

FYI: EOG is due to begin trading ex-dividend on January 15th. The quarterly cash dividend is 17 cents.

Earlier Comments:
We do not want to hold positions over the earnings report in February.

- Suggested Positions -

Long Feb $130 call (EOG1316B130) entry $2.45

Entry on January 11 at $126.30
Average Daily Volume = 1.4 million
Listed on January 10, 2012


Ingersoll-Rand - IR - close: 49.79 change: +0.04

Stop Loss: 48.25
Target(s): 54.00
Current Option Gain/Loss: Unopened
Time Frame: Exit prior to earnings on Feb. 1st!
New Positions: Yes, see below

Comments:
01/15/13: Traders bought the dip near its 10-dma again. IR is still hovering just below resistance at the $50.00 mark.

We are suggesting a trigger to buy calls at $50.25 with a stop loss at $48.25. Our target is $54.00 but we will plan on exiting prior to the earnings in early February.

Trigger @ 50.25

- Suggested Positions -

buy the Feb $50 call (IR1316B50) current ask $1.30

Entry on January xx at $ xx.xx
Average Daily Volume = 1.8 million
Listed on January 12, 2012


iShares Russell 2000 (ETF) - IWM - close: 87.77 change: +0.38

Stop Loss: 85.90
Target(s): 94.50
Current Option Gain/Loss: - 2.2%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
01/15/13: The IWM gapped down at the open but quickly started to rebound. Shares broke to new highs and hit our trigger to buy calls at $87.85. Our multi-week target is $94.50.

Trigger @ 87.85

- Suggested Positions -

Long Mar $90 call (IWM1316c90) entry $1.36

Entry on January 15 at $87.85
Average Daily Volume = 41.2 million
Listed on January 10, 2012


Mohawk Industries - MHK - close: 94.16 change: +0.08

Stop Loss: 91.25
Target(s): 99.00
Current Option Gain/Loss: - 30.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/15/13: MHK has been going nowhere this week. The stock is drifting sideways in a very narrow range as it hugs the $94.00 level. MHK did test what should be short-term support at its rising 10-dma today. Readers might want to wait for a new rally above $94.50 or $95.00 before initiating new positions.

- Suggested Positions - *Small Positions*

buy the Feb $95 call (MHK1316B95) entry $3.30

Entry on January 10 at $95.00
Average Daily Volume = 787 thousand
Listed on January 09, 2012


Noble Energy - NBL - close: 105.31 change: -0.12

Stop Loss: 101.75
Target(s): 114.00
Current Option Gain/Loss: -30.4%
Time Frame: Exit prior to earnings on Feb. 7th!
New Positions: see below

Comments:
01/15/13: NBL gapped down at the open thanks to the widespread market weakness this morning. Fortunately shares rebounded near short-term support at its 10-dma. NBL looks poised to rally from here. I would use today's intraday bounce as a new bullish entry point.

- Suggested Positions -

Long Feb $110 call (NBL1316B110) entry $1.15

Entry on January 14 at $105.31
Average Daily Volume = 820 thousand
Listed on January 12, 2012


OpenTable, Inc. - OPEN - close: 52.89 change: -0.11

Stop Loss: 49.90
Target(s): 58.00
Current Option Gain/Loss: -13.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/15/13: It's been a common theme today. Stocks dipping near the rising 10-dma and then bounce. OPEN did the same and the stock pared its losses to just 11 cents.

More conservative traders may want to raise their stop loss closer to the $51.50 level instead (near last week's low).

Earlier Comments:
OPEN could see a short squeeze. The most recent data listed short interest at 42% of the very small 19.4 million share float. FYI: The Point & Figure chart for OPEN is bullish with a $73 target.

- Suggested Positions -

Long Feb $55 call (OPEN1316B55) entry $2.54

01/12/13 new stop loss @ 49.90

Entry on January 04 at $52.23
Average Daily Volume = 361 thousand
Listed on January 03, 2012


Sherwin-Williams Company - SHW - close: 161.02 change: -0.16

Stop Loss: 154.65
Target(s): 169.00
Current Option Gain/Loss: -20.9%
Time Frame: Exit prior to earnings on Jan. 31st!
New Positions: see below

Comments:
01/15/13: There is no change from my prior comments on SHW. The stock is still consolidating sideways.

Earlier Comments:
We keep our position size small to limit our risk. Plus, this is a shorter-term trade. We do not want to hold over the January 31st earnings report. FYI: The Point & Figure chart for SHW is bullish with a $196 target.

- Suggested Positions - *Small Positions*

Long Feb $165 call (SHW1316B165) entry $3.10

Entry on January 09 at $161.28
Average Daily Volume = 928 thousand
Listed on January 08, 2012


iShares Silver ETF - SLV - close: 30.36 change: +0.32

Stop Loss: 27.45
Target(s): 33.50
Current Option Gain/Loss: +45.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/15/13: The bounce in the SLV continues. Today shares managed to close above their 300-dma but stalled at the exponential 200-dma. More importantly it remains above round-number resistance at the $30.00 level. Readers could open new positions here.

Earlier Comments:
More cautious traders might want to raise their stop loss.

- Suggested Positions -

Long March $30 call (SLV1316c30) entry $0.95

Entry on December 31 at $29.07
Average Daily Volume = 11.6 million
Listed on December 29, 2012


Trimble Navigation - TRMB - close: 62.22 change: -0.29

Stop Loss: 60.90
Target(s): 64.75
Current Option Gain/Loss: - 6.6%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
01/15/13: We only have three days left before our January options expire. I don't want to wait any longer. We will plan on closing any bullish positions tomorrow (Wednesday, Jan. 16th) at the closing bell.

Earlier Comments:
We do want to keep our position size small to limit our risk.

- Suggested Positions - (Keep positions small)

Long Jan $60 call (TRMB1319a60) entry $2.25

01/15/13 prepare to exit tomorrow at the closing bell
01/14/13 new stop loss @ 60.90
01/10/13 we only have six trading days left for our January options. More conservative traders may want to exit early now

Entry on January 03 at $61.32
Average Daily Volume = 750 thousand
Listed on January 02, 2012


PUT Play Updates

Green Mtn Coffee Roasters - GMCR - close: 39.36 change: +0.02

Stop Loss: 41.20
Target(s): 35.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
01/15/13: Most of the market was weak this morning. GMCR moved the opposite direction thanks to an analyst upgrade before the opening bell. The morning rally didn't last and GMCR closed virtually unchanged.

I don't see any changes from my prior comments. We are waiting for a breakdown under support.

Earlier Comments:
Last Thursday's low was $38.83. I am suggesting a trigger to buy puts at $38.45. If triggered our target is $35.25. More aggressive traders might want to aim for a drop near $31.00 instead.

NOTE: GMCR can be a volatile stock. We want to keep our position size small.

Trigger @ 38.45 *Small Positions*

- Suggested Positions -

buy the Feb $35 PUT (GMCR1316n35)

Entry on January xx at $ xx.xx
Average Daily Volume = 4.2 million
Listed on January 10, 2012


CLOSED BULLISH PLAYS

Fiserv, Inc. - FISV - close: 80.47 change: -2.43

Stop Loss: 79.75
Target(s): 88.00
Current Option Gain/Loss: - 65.0%
Time Frame: exit prior to earnings on Feb. 5th
New Positions: see below

Comments:
01/15/13: I warned readers last night that FISV could be volatile this morning as the market reacts to news the company was acquiring Open Solutions, Inc. The news did spark at least one analyst downgrade. FISV gapped open lower at $80.06 this morning. Our stop loss was hit at $79.75 pretty quickly.

- Suggested Positions -

Feb $80 call (FISV1316B80) entry $3.00 exit $1.05 (-65.0%)

01/15/13 FISV gapped down on news of its acquisition,
our trade was stopped out.
01/10/13 do not hold over the earnings report on Feb. 5th

chart:

Entry on January 08 at $81.60
Average Daily Volume = 864 thousand
Listed on January 07, 2012


Sohu.com - SOHU - close: 48.88 change: +0.03

Stop Loss: 45.75
Target(s): 49.25
Current Option Gain/Loss: +70.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
01/15/13: Target achieved.

SOHU rallied to $49.49 intraday. Our exit target was hit at $49.25.

- Suggested Positions -

Feb $47.50 call (SOHU1316b47.5) entry $2.05 exit $3.50* (+70.7%)

01/15/13 target hit
*option exit price is an estimate since the option did not trade at the time our play was closed.
01/05/13 new stop loss @ 45.75
01/02/13 adjust exit down to $49.25
SOHU almost hit our target at $49.75 but the high today was only $49.70. We don't want that to happen again.
12/29/12 new stop loss @ 43.45

chart:

Entry on December 27 at $45.20
Average Daily Volume = 606 thousand
Listed on December 26, 2012