Option Investor
Newsletter

Daily Newsletter, Thursday, 5/12/2011

Table of Contents

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

Market Wrap

Nice Rebound But Still An Ugly Day

by Jim Brown

Click here to email Jim Brown
The Dow rebounded from a -93 point decline to close +66 points higher but there was still a failure of the trend. Giving up -120 on Wednesday and gaining +66 today is a losing proposition on a repetitive basis.

Market Statistics

The markets opened in distress this morning thanks to currencies, commodities and concern over inflation. Futures were severely negative ahead of the open and led by another implosion in commodity prices. Oil declined to $95.26 before the rebound began. The daily changes in margin requirements for the various futures products is creating some intense volatility.

There was some worry over the Jobless Claims report due out at 8:30 after the big spike last week. When the claims were released they had fallen to 434,000 from last week's 474,000. Continuing claims fell to 3.688 million from 3.77 million the prior week. This is positive as long as they finding work and not just falling off the rolls because their benefits have expired.

New York, Wisconsin and Michigan led the group in reporting more than 1,000 in new claims each. California, New Jersey and Massachusetts reported a drop in claims of more than 1,000 each.

The Labor Department said the sharp spike in the prior week was due to a spring break holiday in New York that was not accounted for in the department's seasonal adjustments. The information from the states normally comes in a week later than the national data. New York was the biggest addition to claims in the prior week with Michigan, Indiana and Ohio the next three highest new claim states. Those last three states were more than likely impacted by parts shortages from Japan and temporary layoffs by the automakers until those parts arrive.

Jobless Claims Chart

The first of two inflation reports this week showed a slight uptick in inflation at the producer level. The Producer Price Index (PPI) headline number showed a rise in prices of +0.8% and only a tenth of a point over the estimates. Excluding food and energy prices the core rate showed a rise of only 0.3%. That was the second month at +0.3% after a +0.2% rise in February and inflation is now at +2.1% over the last twelve months.

The big increase in all components in the PPI was due to the rise in energy costs. Also pushing up the core rate were increases in passenger car prices (+0.5%), light trucks (+0.6%) and civilian aircraft (+1.2%). Prices for metal products also rose thanks to higher prices for raw materials due to global demand.

The sustained rise in prices appears to be suggesting the economy is recovering and producers are able to pass through some of the costs to buyers. It will be welcome news to the Fed but only as long as it stays under +2.5% or the Fed will begin to remove stimulus.

Retail sales for April rose by +0.5% and below the +0.9% gain in March. Sales typically moderate in April as a result of those tax checks being written to IRS. As refund checks trickle out in May the rate of sales should increase. The biggest declines in April were electronics and appliances at -2.2%, sporting goods -1.9% and home furnishings -1.1%. Not surprisingly gas stations saw a sharp increase of +2.7%.

If you subtract gasoline sales the core rate of retail sales only rose +0.2% and at a disappointing level. Building supply stores and department stores reported year over year declines in sales while electronics retailers were flat. The slowdown in electronics sales was surprising given the number of tablets and smartphones flying off the shelves.

High unemployment continues to be a drag on the retail sector since a lack of regular paychecks severely restricts discretionary spending.

Reports out on Friday include the Consumer Price Index and Consumer Sentiment. This consumer sentiment report was completed before Osama was killed and before gasoline prices temporarily declined.

Goldman Sachs was in the news today and it was the kind they would like to avoid. S&P warned that Goldman Sachs was increasingly exposed to the potential for a major criminal suit by the government over tactics they used in selling Collateralized Debt Obligations or CDOs. Apparently the scrutiny of Goldman is increasing with the Justice Dept, SEC, CFTC, FINRA and state regulators. These entities are comparing notes and there are several investigations in progress. Analysts believe these investigations will result in the filing of civil and criminal actions. Now that the election cycle is in full swing there is more pressure on the government agencies to bring high profile cases.

Richard Bove said the pressure for the Justice Dept to bring an action was reaching a "high pitch." Bove recommending selling Goldman shares because of the increasing risk. Bove commented on the Rolling Stone article by Matt Taibbi calling Goldman a "great vampire squid wrapped around the face of humanity." He said attacks by the consumer media were tainting sentiment. In a recent survey more than 54% of responders had negative feelings about Goldman.

Goldman closed at a 6-month low on the downgrades.

Goldman Sachs Chart

Kohl's (KSS) reported earnings of 73-cents that were inline with estimates and revenue rose +3% to $4.16 billion. It was not an outstanding earnings quarter but they did lift their outlook for the full year and shares rose +4%. Same store sales growth of +1.3% was much less than Macy's +5.4% and JC Penny at +3.8%. Kohl's raised full year estimates to between $4.25-$4.40 from $4.05-$4.25. Analysts were expecting $4.36.

Kohl's Chart

Cisco reported earnings on Wednesday night and the result was ugly. Shares fell -5% today and nearly every commentator was hanging John Chambers in verbal effigy. They did not like his defensive nature on the conference call or in the various interviews. He definitely had a chip on his shoulder and was taking exception to some of the questions posed. It is tough to realize you are living in the slums today when you were the biggest company in the USA ten years ago. Cisco's market cap has shrunk from $450 billion in 2000 to only $94 billion today and dropping rapidly.

Chambers still acts like he is the tech sector when Cisco is getting beaten like a drum in multiple markets and product offerings. Competitors are springing up everywhere and they are beating Cisco on bandwidth capability and prices. Chambers is probably hostile because his efforts to restructure Cisco is painful and it will take a long time with more market share losses along the way. Cisco is planning on announcing a major layoff program later this summer and analysts believe it could be from 3,000 to 7,000 jobs.

Cisco Chart

Nvidia (NVDA) reported earnings of 27-cents that declined -2% but still beat the street estimates of 19-cents. Nvidia said it expected revenue to increase +4% to 6% in the current quarter to $1.1 billion. Analysts were expecting $992 million. Nvidia said sales of its Tegra processor for the mobile computing market had "taken off." Shares were up +3% during regular trading but much of those gains were erased in after hours.

Nvidia Chart

The futures markets were agitated again by currency issues, worries over China's economy and a continued daily margin change by the CME. Silver declined from $39.25 to $32.30 before rebounding to slightly over $35. Gold declined from $1526 to $1477 before rebounding to $1510 intraday. Crude oil declined from $104.40 to $95.25 before rebounding back over $100 at 2:PM.

Commodity traders are in shock and most analysts are recommending everyone avoid commodities until normal trends return. There were 348 million shares traded on the silver ETF (SLV) and there are 1.7 million option contracts. This commodity is broken and it may not recover for quite a while.

However, nearly all analysts believe silver will finish the year after setting new highs. In the energy sector noted oil trader Mark Fisher of MBF Asset Management said he thought the correction was great for oil prices. "Now there is a fear premium in the market where there was no fear before." He believes WTI will end the year over $120 and Brent over $130. Any decline under $100 on WTI is a buying opportunity.

Crude Oil Chart

On Tuesday I thought we were going to keep easing higher to retest the two year highs on the indexes from May 1st. It appeared there was a stealth rally underway where prices continue to rise even though the sentiment was turning negative. There was a denial of the market move in progress.

Wednesday's decline shocked a lot of people including me. I understood we could retest support at 1330 for a second test of the May 5th decline but I did not expect it. This morning's dip to 1332 was a successful retest of that level. The rebound from deeply negative territory was encouraging BUT now we have a lower high from Tuesday that we must deal with.

Tuesday's high was 1359 and that is now the level to watch. If we rebound over that level then the stealth rally is still alive and traders are managing to climb that wall of worry on multiple fronts. If we fail again below 1359 it will be negative for sentiment. If by chance we dip back below support at 1330 it would be downright bearish. It would tell me to prepare for the summer doldrums. Next support is in the 1300-1305 range but I would not expect it to hold.

We are at the pivotal point in the market where traders either decide to buy because they believe the economy is recovering or they decide to sell and move to the sidelines ahead of the end of QE2 in June. We have had very little market reaction to the coming halt in QE2 buying but we can't assume there will be no reaction. The market has moved sideways for the last two weeks and volatility is increasing not only in commodities but also in equities.

Volatility is good because it forces people to choose sides. Without both sides active in the market there is a false sense of security. When volatility exists it forces traders and investors to analyze the fundamentals and technicals and make an informed decision. That is what is happening so far in May. Investors are trying to read the tealeaves and decide what position they should take over the summer.

As long as the economic reports are questionable as they were in April, investors are likely to chose the safety of the sidelines than bet it all on the chance of a recovery. Until this decision process plays out in the markets we need to be cautious about our trades.

S&P Chart

The Dow respected support at 12,600 but we still have a lower high I place. Until that high is broken we should remain cautious and watch for a close under the 12,600 level as confirmation of a new trend lower.

Dow Chart

The Nasdaq rebounded slightly stronger than the other indexes but the weakness in Apple and Google still held it back. There is something wrong with both of those stocks and it could be related to lingering rebalance issues but this far into the month I doubt it. I believe a large fund or funds is rotating out of these stocks and doing it on a very casual basis to avoid depressing the prices.

The Nasdaq recovered the majority of the Wednesday loss and is still the strongest index. Watch 2825 as support and 2875 as a move over the Tuesday close.

Apple Chart

Nasdaq Chart

The Russell 2000 rebounded to close up +7 points at 847 but it remains well below the Tuesday close at 855. The same story applies here. The Russell needs to move over the Tuesday close to continue the prior trend. A failure to do this suggests support at 830 will eventually be broken.

Russell Chart

I would urge caution on entering any new trades on Friday. The market is in a state of confusion and complicated by the volatility in the currencies and commodities. Economic reports have been less than inspiring and the latest earnings reports have been a sharp departure from the trend set by the blue chips in the first two weeks.

There are growing indications there may be some market weakness in our future ahead of the June FOMC meeting and the end of QE2. If the economic reports show a rebound from April's dip then the weakness could be minimal. If the economic dip continues it would likely prompt quite a few hedge funds to turn bearish on the market.

Patience is a virtue we should practice on Friday.

Enter passively and exit aggressively.

Jim Brown

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New Plays

Biotech & Semiconductors

by James Brown

Click here to email James Brown


NEW BULLISH Plays

Gilead Sciences Inc. - GILD - close: 41.29 change: +0.52

Stop Loss: 39.75
Target(s): 44.75
Current Gain/Loss: + 0.0%
Time Frame: 8 to 9 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
GILD is a biotech stock that produced a bullish double bottom in late April. The stock has spent the last several days digesting the rally from early May. Now it looks like GILD is poised to breakout from this consolidation. More conservative traders may want to wait for a rally past $42.00 before initiating positions. I am suggesting bullish positions now with a stop loss at $39.75. The spring highs near $43 could be resistance but I'm setting our target at $44.75. FYI: The Point & Figure chart for GILD is bullish with a $57 target.

Suggested Position: buy GILD stock @ current levels

- or -

Buy the June $41 calls (GILD1118F41) current ask $1.44

Annotated chart:

Entry on May 13 at $xx.xx
Earnings Date 07/19/11 (unconfirmed)
Average Daily Volume: 10.9 million
Listed on May 12th, 2011


Semiconductor HOLDRs - SMH - close: 36.75 change: +0.38

Stop Loss: 35.49
Target(s): 39.95
Current Gain/Loss: unopened
Time Frame: 8 to 12 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
The action in the semiconductor sector is improving. Many of the individual stocks look poised to rally. However, instead of choosing an individual name that might be subject to headline risk or downgrades I am suggesting bullish positions on the SMH. Readers may want to go ahead and launch positions now but I see short-term resistance at $37.00. I'm suggesting a trigger to open bullish positions at $37.05. If triggered we'll use a stop loss at $35.49. The SMH doesn't move very fast so it could take several weeks for this play to work out. Our first target is $39.95. The Point & Figure chart for SMH is bullish with a $61 target.

FYI: The top ten components in the SMH are: TXN, INTC, AMAT, ALTR, ADI, LLTC, XLNX, KLAC, BRCM, and ATML.

Trigger @ 37.05

Suggested Position: buy the SMH @ $37.05

- or -

Buy the August $40 calls (SMH1120H40) current ask $0.61

Annotated chart:

Entry on May x at $xx.xx
Earnings Date --/--/--
Average Daily Volume: 9.8 million
Listed on May 12th, 2011


In Play Updates and Reviews

NVDA Rallies Into Earnings

by James Brown

Click here to email James Brown

Editor's Note:
Technology stock NVDA rallied into the closing bell just ahead of its earnings report. We were able to close this play a winner. Less fortunate was our DOW trade, which has been stopped out. Meanwhile RVBD and XRAY have been triggered.

-James

Current Portfolio:


BULLISH Play Updates

Autodesk Inc. - ADSK - close: 45.99 change: +0.79

Stop Loss: 42.75
Target(s): 48.50
Current Gain/Loss: + 3.9%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
05/12 update: It looks like our patience might finally be rewarded. ADSK rallied +1.7% and closed at new 52-week highs on decent volume. This is a nice improvement with only four trading days left for this play. Our target is $48.50 but we'll plan on exiting ahead of the mid May earnings report.

Current Position: Long ADSK stock @ $44.25

- or -

Long the May $45 calls (ADSK1121E45) Entry @ $1.19

05/10 New stop loss @ 42.75

Entry on May 3 at $44.25
Earnings Date 05/19/11 (confirmed)
Average Daily Volume: 2.1 million
Listed on April 23rd, 2011


Arrow Electronics, Inc. - ARW - close: 46.53 change: +0.65

Stop Loss: 43.90
Target(s): 49.90
Current Gain/Loss: + 0.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: ARW rebounded off its morning lows to eventually hit new two-week highs this afternoon. The stock looks poised to challenge its April highs soon. Our target is $49.90. FYI: The Point & Figure chart for ARW is bullish with an $81 target.

Current Position: long ARW stock @ $46.30

- or -

long the June $47.50 call (ARW1118F47.5) Entry @ $1.20

Entry on May 11 at $46.30
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 1.1 million
Listed on May 10th, 2011


Capital One Financial - COF - close: 52.95 change: -0.08

Stop Loss: 50.85
Target(s): 57.00, 59.50
Current Gain/Loss: - 0.2%
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Comments:
05/12 update: COF slipped to new three-week lows this morning. Yet traders bought the dip near $52 and the stock pared its losses and came close to breakeven on the session. I remain cautious here. I'd like to see COF break the short-term trend of lower highs before we consider new positions. I am not suggesting new positions at this time.

Current Position: Long COF stock @ $53.07

- or -

Long the June $55 calls (COF1118F55) Entry @ $0.96

Entry on May 5 at $53.07
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 3.7 million
Listed on May 4th, 2011


Discover Financial Services - DFS - close: 24.20 change: +0.02

Stop Loss: 23.40
Target(s): 27.25
Current Gain/Loss: + 0.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: DFS also bounced off its morning lows and managed to close in positive territory, albeit by a very small margin. DFS is also suffering a short-term trend of lower highs. I am not suggesting new positions at this time.

(Small Positions)

Current Position: long DFS stock @ $24.10

- or -

Long the May $24 calls (DFS1121E24) Entry @

05/04 Triggered at $24.10.
04/30 Added an alternative entry point @ $25.25
04/26 New trigger @ 24.10, New stop loss @ 23.40

Entry on May 4 at $24.10
Earnings Date 06/23/11 (unconfirmed)
Average Daily Volume: 5.9 million
Listed on April 12th, 2011


EMC Corp. - EMC - close: 27.73 change: +0.43

Stop Loss: 26.45
Target(s): 29.95, 32.25
Current Gain/Loss: + 0.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: EMC is finally showing some life again. I would use today's bounce as a new entry point for bullish positions. I'm listing a secondary option position below. EMC has resistance at $28.75 but we're listing our targets at $29.95 and $32.25.

Current Position: Long EMC stock @ $27.55

- or -

Long the June $27.00 calls (EMC1118F27) Entry @ $1.35

Second Option Position (listed 05/12/11)

Buy the June $29.00 calls (EMC1118F29) current ask $0.46

05/12 New entry point. Added second option position.

Entry on May 3 at $27.55
Earnings Date 04/20/11
Average Daily Volume: 21.4 million
Listed on April 27th, 2011


Ingersoll-Rand - IR - close: 50.79 change: +0.43

Stop Loss: 48.75
Target(s): 54.75
Current Gain/Loss: + 1.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: Good news! Traders bought the dip this morning and IR's close higher should negate the potential bearish reversal from yesterday. I would use this bounce as a new entry point. More conservative traders can wait for a close over the $51.00 level before initiating positions. Our target is $54.75.

Current Position: long IR stock @ $50.12

- or -

Long the June $50 call (IR1118F50) Entry @ $1.80

Entry on May 9 at $50.12
Earnings Date 07/22/11 (unconfirmed)
Average Daily Volume: 2.6 million
Listed on May 7th, 2011


KLA-Tencor - KLAC - close: 44.89 change: +0.84

Stop Loss: 43.95
Target(s): 49.85
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
05/12 update: More aggressive traders might want to consider bullish positions in KLAC right now. The action in the SOX semiconductor index and the SMH are improving. Plus, KLAC has produced a bullish engulfing candlestick pattern today. There is still technical resistance at the 50-dma so the newsletter will stick to our current plan and wait. Our trigger to launch bullish positions is at $46.25.

Trigger @ 46.25

Suggested Position: buy KLAC stock @ 46.25

- or -

buy the June $47.00 calls (KLAC1118F47) current ask $1.65

Entry on May x at $xx.xx
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 653 thousand
Listed on May 9th, 2011


Kansas City Southern - KSU - close: 55.69 change: +0.12

Stop Loss: 54.75
Target(s): 64.00
Current Gain/Loss: - 2.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: The spike lower this morning came close to hitting our stop loss at $54.75 but thankfully our trade is still open. I would use this bounce as a new entry point or you can wait for a new rise past $56.50 as an entry point.

Current Position: Long KSU stock @ 56.99

- or -

Long the June $60 call (KSU1118F60) Entry @ $0.90

Entry on May 11 at $56.99
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume: 1.0 million
Listed on May 10th, 2011


Oracle Corp. - ORCL - close: 35.73 change: +0.75

Stop Loss: 33.95
Target(s): 38.00
Current Gain/Loss: + 2.9%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: Once again traders bought the dip near ORCL's rising 20-dma. The stock outperformed the major averages with a +2.1% gain.

Current Position: Long ORCL stock @ $34.70

- or -

Long the June $35 call (ORCL1118F35) Entry @ $0.98

05/10 New stop loss @ 33.95

Entry on April 25 at $34.70
Earnings Date 06/23/11 (unconfirmed)
Average Daily Volume: 25.1 million
Listed on April 23rd, 2011


Riverbed Technology, Inc. - RVBD - close: 37.55 change: +1.50

Stop Loss: 34.95
Target(s): 39.90, 43.00
Current Gain/Loss: + 0.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: Wow! I have to confess that I was not expecting RVBD to rally this strongly today. Shares have hit our trigger to launch bullish positions at $37.25. The breakout past its 50-dma and 100-dma is certainly a bullish development but I was expecting it to take a few days to actually happen. RVBD spiked down toward $35 this morning and then rocketed to new five-week highs. The trade is open. I would still consider new positions now or you can look for a minor dip (maybe the $37.00-36.50 zone). Today's move has produced a new triple-top breakout buy signal on the P&F chart with a $46 target (this could grow).

Current Position: Long RVBD stock @ $37.25

- or -

Long the June $40 call (RVBD1118F40) Entry @ $1.15

chart:

Entry on May 12 at $37.25
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 5.1 million
Listed on May 11th, 2011


SAIC, Inc. - SAI - close: 17.50 change: +0.22

Stop Loss: 16.95
Target(s): 18.40
Current Gain/Loss: + 0.9%
Time Frame: 8 to 9 weeks
New Positions: see below

Comments:
05/12 update: As expected SAI is bouncing from the bottom of its recent trading range. The stock is once again nearing resistance at $17.60. I am still not suggesting new positions at this time.

Current Position: long SAI stock @ $17.33

- or -

Long the August $18.00 call (SAI1120H18) entry @ $0.55

04/30 Warning, SAI has produced a reversal. consider an early exit
04/27 New stop loss @ 16.95

Entry on April 6 at $17.33
Earnings Date 06/02/11 (unconfirmed)
Average Daily Volume: 2.4 million
Listed on April 5th, 2011


DENTSPLY Intl. - XRAY - close: 38.95 change: +0.34

Stop Loss: 37.30
Target(s): 42.00, 44.50
Current Gain/Loss: - 0.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: XRAY is bouncing off its 10-dma. Shares managed to hit $39.00, which happens to be our trigger to launch bullish positions. I would still consider new positions now at current levels. Our profit targets are $42.00 and $44.50. FYI: The Point & Figure chart for XRAY is bullish with a $59 target.

NOTE: Readers may want to avoid the options. XRAY doesn't have a lot of option volume and the spreads are wide, which puts traders at a disadvantage.

Current Position: Long XRAY stock @ 39.00

- or -

Long the June $40 call (XRAY1118F40) Entry @ 0.60

chart:

Entry on May 12 at $39.00
Earnings Date 07/25/11 (unconfirmed)
Average Daily Volume: 904 thousand
Listed on May 7th, 2011


BEARISH Play Updates

Raytheon Co. - RTN - close: 49.20 change: -0.16

Stop Loss: 50.15
Target(s): 45.25
Current Gain/Loss: - 1.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
05/12 update: The morning bounce in RTN failed and shares underperformed the major averages. Our bearish play will live to see another day. Bear in mind that I'm ready to drop this trade if shares show almost any relative strength. I am not suggesting new positions at this time.

Small Positions

Current Position: Short RTN stock @ $48.68

- or -

Long the May $47.00 PUTs (RTN1121Q47) Entry @ $0.28

Entry on May 2 at $48.68
Earnings Date 04/28/11
Average Daily Volume: 2.6 million
Listed on April 30th, 2011


CLOSED BULLISH PLAYS

The Dow Chemical Co. - DOW - close: 38.93 change: -0.07

Stop Loss: 38.75
Target(s): 43.00, 44.85
Current Gain/Loss: - 4.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/12 update: DOW has been a big disappointing. Yesterday's overreaction sent the stock plunging lower. The weakness continued this morning. DOW hit our stop loss at $38.75 before bouncing from its 40-dma.

closed Position: Long DOW stock @ 40.46, exit 38.75 (-4.2%)

- or -

June $42 call (DOW1118F42) Entry @ $0.79, exit @ 0.33 (-58.2%)

05/12 Stopped out @ 38.75 (-4.2%), Option @ -58.2%

chart:

Entry on May 11 at $40.46
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume: 8.5 million
Listed on May 10th, 2011


NVIDIA Corp. - NVDA - close: 20.50 change: +0.63

Stop Loss: 18.90
Target(s): 21.85
Current Gain/Loss: + 7.6%
Time Frame: less than two weeks
New Positions: see below

Comments:
05/12 update: NVDA delivered a strong session just prior to its earnings report out tonight. A very late day rally pushed shares to new two-month highs. It was our plan to exit this position at the closing bell tonight to avoid holding over earnings. FYI: NVDA beat Wall Street's estimates by 8 cents and beat on revenues. Plus, management has issued positive guidance for the second quarter. Yet the stock is trading lower after hours under $20. That could change by morning.

Closed Position: Long NVDA stock @ 19.05, Exit $20.50 (+7.6%)

- or -

May $20 call (NVDA1121E20) Entry @ $0.56, exit $1.16 (+107.1%)

05/12 Planned exit. NVDA @ $20.50 (+7.6%), Option @ +107.1%
05/11 New stop loss @ 18.90, Prepare to exit tomorrow at the close.

chart:

Entry on May 3 at $19.05
Earnings Date 05/12/11 (confirmed)
Average Daily Volume: 19.0 million
Listed on May 2nd, 2011