Editor's Note:

We have four candidates on the watch list get triggered this week with Monday's decline and Tuesday's intraday dip. The correction may not be over for a few of these. Traders may want to be patient and wait to see if they slip any further before the week is out. See the individual play updates below for details.


Triggered Play Detail

FCX $47.18 +2.00 - Freeport McMoran

Commodity-related stocks continued to collapse on Monday thanks to a rally in the U.S. dollar. That rally in the dollar is fading today. Shares of FCX gapped open lower on Monday and dipped to $45.00. It was our plan to buy LEAPS on FCX when it hit $46.00. The 38.2% Fib retracement is around the $45-44 zone. Now that our play is open we have a stop loss at $35.95. Some investors might feel that is kind of a wide stop loss but FCX is a volatile stock and commodities will continue to be volatile. The pull back in the S&P 500 may not be over yet so readers may want to wait. FCX may offer an even better entry point in the $42-40.00 zone if you're patient. Our long-term target is $69.00.

June 22nd, 2009 - entry price on FCX @ 46.00, option @ 6.00
symbol: FCX-AK, 2010 JAN $55 LEAP call - current bid/ask $6.50/6.60
-stop loss on FCX @ 35.95

-or-

June 22nd, 2009 - entry price on FCX @ 46.00, option @ 10.00
symbol: OBQ-AL, 2011 JAN $60 LEAP call - current bid/ask $10.35/10.60
-stop loss on FCX @ 35.95

Chart of FCX:


JOYG $35.19 +2.25 -- Joy Global Inc.

JOYG, which manufacturers mining equipment, has been trading in sync with the commodity-stocks. Yesterday JOYG sank to $32.90 and its exponential 200-dma on the dollar's rally. Today's it's bounce. We were suggesting an entry point to buy LEAPS on a dip into the $33.00-30.00 zone. More patient traders may want to still wait for the $30.00 level. Our stop loss on this play is at $24.75. Our first target is $48.50.

June 22nd, 2009 - entry price on JOYG @ 33.00, option @ 3.80
symbol: JQY-AH, 2010 JAN $40 LEAP call - current bid/ask $4.60/4.90
-stop loss on JOYG @ 24.75

-or-

June 22nd, 2009 - entry price on JOYG @ 33.00, option @ 6.90
symbol: ZMC-AH, 2011 JAN $40 LEAP call - current bid/ask $7.60/8.50
-stop loss on JOYG @ 24.75

Chart of JOYG:


SGY $6.45 +0.23 -- Stone Energy Corp.

The profit taking in oil stocks was pretty steep on Monday and shares of SGY plunged to $6.20. We had a trigger to buy LEAPS at $6.35. Our play is open and SGY is still near the entry zone but readers may want to wait and hold out for a dip near $5.75 or its 100-dma as your entry point. Our stop loss is $4.90. Our target is $14.75.

June 22nd, 2009 - entry price on SGY @ 6.35, option @ 0.75
symbol: YLO-AB, 2010 JAN $10 LEAP call - current bid/ask .75/1.05
-stop loss on SGY @ 4.90

-or-

June 22nd, 2009 - entry price on SGY @ 6.35, (buying the stock)
-stop loss on SGY @ 4.90

Chart of SGY:


WFR $17.86 -0.15 -- MEMC Electronic Materials Inc.

Alternative energy tends to follow the path of oil. If oil goes up then solar goes up. If oil goes down then solar goes down. This week has seen further profit taking in the solar energy names. WFR dipped to $17.31 today. Our plan was to buy LEAPS in the $17.50-15.00 zone. You still have plenty of time if you haven't opened positions yet. Readers may want to focus on buying a dip near the 100-dma currently near $16.50. Now that our play is open our stop loss is at $14.95. Our target is the $30.00 region.

June 23rd, 2009 - entry price on WFR @ 17.50, option @ 2.50
symbol: CJC-AD, 2010 JAN $20 LEAP call - current bid/ask $2.50/2.65
-stop loss on WFR @ 14.95

-or-

June 23rd, 2009 - entry price on WFR @ 17.50, option @ 3.43
symbol: ZET-AE, 2011 JAN $25 LEAP call - current bid/ask $2.85/3.00
-stop loss on WFR @ 14.95

Chart of WFR:


Closed Play Detail

DRYS $5.45 -0.08 - DryShips, Inc.

The shipping stocks were caught up in the commodity-stock sell-off on Monday. Shares of DRYS broke down sharply under support at the $6.00 level and its 100-dma Monday morning. The weakness continued on Tuesday and DRYS hit our stop loss at $5.45. We've been cautious on DRYS ever since it broke its 50-dma and the up trend of higher lows in early June. What has been odd during the last couple of weeks is the sell-off in shipping stocks even as the Baltic Dry Goods index was climbing. That's changed in the last couple of days with the $BDI index rolling over.

May 13th, 2009 - entry price on DRYS @ 6.50, option @ 1.55
symbol: KOO-AY, 2010 JAN $10 LEAP call - estimated exit @ 0.75
-stop loss on DRYS @ 5.45

-or-

May 13th, 2009 - entry price on DRYS @ 6.50, option @ 0.85
symbol: KOO-AZ, 2010 JAN $15 LEAP call - estimated exit @ 0.35
-stop loss on DRYS @ 5.45

Chart of DRYS: