I believe this is a record. This is the first time ever there are no LEAPS trades to update. The volatility over the past couple of weeks has been astonishing. The remainder of our call LEAPS trades were stopped out during last week's roller coaster ride in the market.
AXP and KO were both stopped out.
There are no active trades to update.
Please see the New Plays section for several new trades tonight. Plus, we have a number of new Watch List candidates.
American Express Co. - AXP - close: 44.89
Just as I feared, the market sold off hard on the U.S. credit downgrade and AXP followed. Monday saw AXP gap open lower under support at $46 and its 200-dma. Shares then plunged to an low of $42.78 on Monday. Reversed that with a bounce back to $46 on Tuesday, etc. I warned readers that a breakdown under $46 probably meant a drop into the $44-42 zone. The oversold bounce on Friday stalled at resistance near the 200-dma.
Our stop loss was hit at $44.75 on Monday. Readers may want to keep AXP on their watch list for a new close over the $47 or $48 levels as a potential bullish entry point to buy call LEAPS again.
- Suggested Positions -
Aug 04, 2011 - entry price on AXP @ 47.00, option @ 2.60
symbol: AXP1221A50 2012 JAN $50 call - Exit $2.00 (-23.0%)
- or -
Aug 04, 2011 - entry price on AXP @ 47.00, option @ 3.50
symbol: AXP1319A55 2013 JAN $55 call - Exit $3.00 (-14.2%)
08/08/11 stopped out @ 44.75
08/04/11 play opened at $47.00
Chart of AXP:
Current Target: $59.00, 64.00
Current Stop loss: 44.75
Play Entered on: 08/04/11
Originally listed on the Watch List: 05/21/11
The Coca-Cola Co. - KO - close: 67.14
Record volatility last week and panicked selling across the market was enough to push KO past its 200-dma and under the $65 and $64 levels. Our stop loss was hit at $63.95 on Tuesday, Aug. 9th. Since then KO has rebounded and actually closed up on the week. I am putting KO back on the watch list tonight.
Our plan was to keep our opening positions small, 1/4 to 1/2 your normal trade size.
- Suggested (SMALL) Positions -
Jul 25, 2011 - entry price on KO @ 69.12, option @ 2.25
symbol: KO1221A70 2012 JAN $70 call - Exit $1.20 (-46.6%)
- or -
Jul 25, 2011 - entry price on KO @ 69.12, option @ 2.40
symbol: KO1319A75 2013 JAN $75 call - Exit $1.68 (-30.0%)
08/09/11 stopped out @ 63.95
08/06/11 adjust stop loss to $63.95 to give KO more room. We do not know how the market will react to the U.S. downgrade news on Monday.
Chart of KO:
Current Target: $79.00 & 84.00
Current Stop loss: 63.95
Play Entered on: 07/25/11
Originally listed in the New Plays 07/23/11