Closed Plays


Microsoft (MSFT) hit our exit target near $30.00.


Play Updates


ACI $22.73 +0.03 -- Arch Coal Inc.

I'm seeing a lot of mixed signals in ACI and many of the coal stocks. Last week it looks like ACI has produced a bearish reversal with the failed rally near $24.00. Yet shares have been finding support near the rising 50-dma. At the same time it looks like ACI is forming a bearish head-and-shoulders pattern. That's what really worries me here. The stock should have additional support at the exponential 200-dma and then a little lower at the $20.00 level. Yet if ACI dips that low the H&S pattern will look even worse (stronger).

I am not suggesting new bullish positions right here and if the S&P 500 fails at the 1100 level we might want to jump out of this trade early!

Our long-term target is the $30 region.

May 14th, 2009 - entry price on ACI @ 16.00, option @ 2.40
symbol: OSE-AF, 2011 JAN $30 LEAP call - current bid/ask $2.55/2.65
-stop loss on ACI @ 19.40

Chart of ACI:


ANR $39.31 +0.03 - Alpha Natural Resources, Inc.

ANR is another coal stock that looks like it could be forming a bearish head-and-shoulders pattern. The peak last week could be the second shoulder. I'm not suggesting new bullish positions at this time.

Our long-term target is the $50-60 zone.

Aug. 25th, 2009 - entry price on ANR @ 34.00, option @ 7.00
symbol: VJV-AH, 2011 JAN $40 LEAP call - current bid/ask $8.90/9.50
-stop loss on ANR @ 32.40
bought 1/2 LEAP position on 08/25/09 (option price @ 7.00)

Chart of ANR:


BAC $15.98 +0.08 - Bank of America Corp.

BAC delivered a decent bounce last week but the rally stalled at technical resistance near the 50-dma. The financials have under performed the rest of the market and last week could be a new "lower high". If the S&P 500 can close over the 1100 then I expect the financials to try and catch up with the rest of the market. If the S&P 500 reverses then bulls are in serious trouble and traders will want to consider exiting early!

I'm not suggesting new positions at this time. Our long-term target is the $25-30 zone.

Jan 25th, 2009 - entry price on BAC @ 6.24, option @ 2.38
symbol: VBA-AB, JAN 2011 $10 LEAP call - current bid/ask $7.05/7.10
-stop loss on BAC @ 11.90

10/31/09 Sell Half -- option at $6.00 (+152%)

Chart of BAC


CHK $25.03 +0.32 -- Chesapeake Energy Corp.

CHK is still trying to rebound from its early November low. Unfortunately crude oil looks vulnerable to more profit taking and natural gas prices are sinking to new lows on record-high storage and lackluster demand. The $22-24 zone should be support but we may get a better entry point a week or two from now. I'm not suggesting new positions just yet. Our long-term target is $40.00.

Oct 30th, 2009 - entry price on CHK @ 24.00, option @ 4.70
symbol: VEC-AE, JAN 2011 $25 LEAP call - current bid/ask $4.95/5.05
-stop loss on CHK @ 20.75

Chart of CHK:


CNX $46.84 -0.09 -- Consol Energy Inc.

CNX is yet another coal stock that appears to be building a bearish head-and-shoulders pattern. If you have positions in more than one coal stock you may want to pare them down so that you only have exposure to one stock in the same sector, especially with the group looking vulnerable to more selling pressure.

I find the action on CNX's daily chart pretty bearish and more conservative traders will want to consider an early exit right now (and lock in a gain)!

The $42.50-40.00 zone should be support but if CNX does pull back it will only strengthen the bearish H&S pattern. A close under $42.50 would forecast a decline toward $32.50. I am raising our stop loss to $39.50.

I'm not suggesting new positions at this time. CNX has already hit our first target at $48.50. We will plan to sell the second half or our position at $57.50.

Sep 1st, 2009 - entry price on CNX @ 36.50, option @ 7.80(estimate)
symbol: VTL-AH, 2011 JAN $40 LEAP call - current bid/ask $12.90/14.30
-stop loss on CNX @ 39.50

Target hit 09/16/09 @ 48.50, option price $15.40 (+97%)

Chart of CNX


EMR $41.77 +0.44 -- Emerson Electric Co.

EMR has been trading sideways this past week in the $41-42 zone. If the S&P 500 can breakout over the 1100 level then we can expect EMR to follow it higher. Otherwise, a breakdown from here could look like a big double top pattern. I am not suggesting new positions at this time. Our target is $47.50.

Sept. 8th, 2009 - entry price on EMR @ 38.00, option @ $4.50
symbol: VHH-AH, 2011 JAN $40 call - current bid/ask $5.80/6.10
-stop loss on EMR @ 33.50.

Chart of EMR:


FSLR $118.29 + 2.92 -- First Solar

The trend in FSLR is still down. Shares might find some support at their September lows near $112. If that fails I'd look for possible support near $100.

We're not suggesting new positions at this time. At the moment we're long the 2010 January $100 put and we have a covered call play that should be fine if FSLR stays above $90.

Covered Call position:

Long 100 shares of FSLR @ $128.00
Short 2010 $150 LEAPS Call LZL-AA @ $40.70
Profit if called is $40.70 in option premium + $22 in stock (+49%) if FSLR is above $150.00.

Put Spread position:

Long 2010 $100 LEAPS Put LQM-MT @ $32.90
Short 2010 $250 LEAPS Put LZL-MJ @ $135.70, net credit $103

- Update 08/15/09 -
Cover the 2010 $250 Put at $109.40. Keep the $100 put.

Currently the 2010 Jan. $100 put is worth (bid) $4.05.
If you're curious the 2010 Jan. $150 call is at $ 2.07.

Chart of FSLR


FST $19.90 -0.08 -- Forest Oil Corp.

It has not been a good week for the oil refiners. FST produced a bearish reversal pattern near $22.00 on the 11th. I suspect that shares will correct toward $18.00, which should be support. If you don't want to endure that sort of pull back then consider an early exit now. I'm not suggesting new bullish positions at this time. Our long-term target is $37.50.

Oct 15th, 2009 - entry price on FST @ 23.85, option @ 7.40
symbol: OJG-AD, 2011 $20 LEAP call - current bid/ask $4.50/4.90
-stop loss on FST @ 17.35

Chart of FST:


GHM $16.78 +0.37 -- Graham Corp.

GHM hasn't made much progress. Shares have been consolidating sideways near $17.00 the last several days. Volumes have been very, very light. I might consider new bullish positions if we see another bounce from the $15.00 level near its exponential 200-dma and its trendline of higher lows.

Our target is $24.00. Our stop is at $12.40.

Oct 26th, 2009 - entry price on GHM @ 15.15, option @ 2.65
symbol: GHM-FC, 2010 JUNE $15 call - current bid/ask $3.40/3.90
-stop loss on GHM @ 12.40

- or -

Oct. 26th 2009 - entry price on GHM (the stock) @ 15.15
- stop loss on GHM @ 12.40

Chart of GHM:


INTC $19.82 +0.14 -- Intel Corp.

The oversold bounce in INTC continued last week but it may have peaked near $20.50 on Thursday. There was big news in the semiconductor sector. It seems that Intel is making a huge gamble that it will be cheaper to pay off rival AMD with a $1.25 billion settlement and promises to play nice than to keep fighting various anti-trust and other legal battles around the globe over the next several years.

Shares of AMD surged more than 20% on the news while INTC only spike to $20.50 and retreated. This could end up being a new lower high, which is bearish and suggest INTC has further to correct.

I am not suggesting new long-term positions at this time. Our long-term target is the $24-26 zone.

FYI: Shares of Intel don't move very fast. Readers might want to consider turning this play into a calendar or diagonal spread to further maximize your gains.

June 13th, 2009 - entry price on INTC @ 16.31, option @ 1.36
symbol: VNL-AD, 2011 LEAP $20 call - current bid/ask $2.54/2.59
-stop loss on INTC @ 15.90.

Chart of INTC:


MTW $10.75 -0.04 -- Manitowoc Inc.

MTW managed another gain for the week but the action last week actually looks bearish. I would expect a pull back toward $10.00 and its rising 50-dma. I'm going to raise our stop loss to $7.90 since the $8.00 level should be strong support. I'm not suggesting new positions at this time. Our long-term target is $17.00.

Oct 30th, 2009 - entry price on MTW @ 9.10, option @ 2.61
symbol: VMT-AB, 2011 JAN $10 call - current bid/ask $3.40/3.70
-stop loss on MWT @ 7.90

- or -

Oct. 30th 2009 - entry price on MTW (the stock) @ 9.10
- stop loss on MTW @ 7.90

Chart of MTW:


PBR $50.18 +0.90 -- Petroleo Brasiliero

PBR is still out performing many of its peers in the oil sector but shares are stuck under resistance at the $52.00 level. I'm concerned that if crude oil does break down from here that PBR will correct toward the $46-45 zone.

The company reported earnings after the closing bell on Friday. I'm not seeing any big reaction in after hours trading but that doesn't mean much on a Friday night. I'm not suggesting new bullish positions at this time.

I'm suggesting we sell half our position at $54.50. We'll sell the second half at $59.50.

Apr. 4th, 2009 - entry price on PBR @ 35.10, option @ $2.80
symbol: PMJ-AJ, 2010 $50.00 LEAP call - current bid/ask $3.30/3.40
-stop loss on PBR at $43.40

Chart of PBR:


PEP $61.94 +0.67 -- PEPSICO Inc.

PEP's larger trend is still up but shares produced a bearish reversal at resistance near the October highs. This could be the beginning of a bearish double top pattern. I am not suggesting new bullish positions at this time.

More conservative traders might want to raise their stops toward the $55 region. Our exit target is the $69.90 mark.

July 7th, 2009 - entry price on PEP @ 57.25, option @ $4.50(estimate)
symbol: VP-AL, 2011 $60.00 LEAP call - current bid/ask $6.30/6.60
-stop loss on PEP at $51.50

Chart of PEP:


RAI $50.32 +1.00 -- Reynolds American Inc.

RAI has started showing some relative strength again. Friday's bullish breakout over round-number resistance at $50.00 is very positive. I am raising our stop loss to $43.40. I'm not suggesting new positions at this time.

Our second and final target is $57.50.

July 24th, 2009 - entry price on RAI @ 42.50, option @ $4.50(estimate)
symbol: OWO-AH, 2011 JAN $40.00 LEAP call - current bid/ask $ 9.60/10.70
-stop loss on RAI at $43.40

Sold Half on 10/19 @ 49.50, option @ $8.90 (+97%)

Chart of RAI:


RGLD $50.95 +1.01 -- Royal Gold Inc.

Weakness in the U.S. dollar has pushed gold futures toward new all-time highs near $1,120 an ounce. Yet the rally in the gold miners paused a bit last week. Shares of RGLD appear to have formed a mini bull-flag consolidation pattern. We're still bullish here. I would launch new positions now. More conservative traders might want to wait for a little more confirmation and look for a move over $52.50 to initiate a trade.

We'll use a stop loss at $41.95, which is under the 200-dma. The Point & Figure chart has a new buy signal with a $72 target. Our target to exit is $64.50.

Nov. 7th, 2009 - entry price on RGLD @ 50.70, option @ 7.50
symbol: ZMO-AL, 2011 JAN $60 LEAP call - current bid/ask $6.80/7.30
-stop loss on RLGD @ 41.95

Chart of RGLD


TEX $21.08 -0.45 -- Terex Corp.

The bounce in TEX is losing momentum. Shares look poised to breakdown under technical support at the 50-dma soon. If TEX does correct lower look for support near $18.00. I'm not suggesting new positions at this time.

Our final target is $29.50.

Sept. 11th, 2009 - entry price on TEX @ 18.25, option @ 4.10
symbol: VXQ-AD, JAN 2011 $20 LEAP call - current bid/ask $5.70/6.60
-stop loss on TEX @ 17.75

Sell half (10/24/09), option at $7.50 (+82.9%)

Chart of TEX:


UYG $5.67 -0.01 - ProShares Ultra Financials (2x) ETF

Investors have another tough decision to make. Do you exit early now after the UYG produced a bearish failed rally pattern under $6.00 last week? Or you do keep the position open because the S&P 500 might breakout over resistance at the 1100 level and drag the financials higher in spite of themselves?

We've already taken profits once and the $5.00 level has proven to be support thus far. I'm willing to hold on here and ride it out for now. More conservative traders may want to exit early. I am not suggesting new positions at this time. Our second and final target is $9.50.

FYI: The UYG trades off the DJUSFN index.

Our strategy called for buying the ETF instead of the options.

Current position in the UYG = $1.50 entry (stop loss: 4.40)

10/14/09 Exit - Sell Half @ 6.31 (gap open exit, +320%)

Chart of UYG:


CLOSED Plays

MSFT $29.63 +0.27 -- Microsoft Corp.

Target achieved. Shares of MSFT have been showing a lot of relative strength. The stock tagged a new 2009 high at $29.79 on Friday thanks to some positive analyst comments and a new $34 price target. Our final target to take profits was at $29.75 so our play is closed.

June 2nd, 2009 - entry price on MSFT @ 21.60, option @ 2.20
symbol: VMF-AE, 2011 Jan. $25 call - current bid/ask $6.25/6.30
-stop loss on MSFT @ 21.95.

11/13/09 - Final Exit @ 29.75, option @ 6.33 (+187.7%)

10/31/09 - Sell Half @ 27.73, option @ 4.80 (+118%)

Chart of MSFT: