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New Plays

New Option Plays

HAVING TROUBLE PRINTING?
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Call Options Plays
Put Options Plays
Strangle Options Plays
TWM ISRG None
USO    

Play Editor's Note: Traders need to be careful. The VIX is climbing as investors become more fearful of where the market is headed. Right now is the worst part of the year for stocks and this year looks like it's going to live up to its reputation.

FYI: Keep an eye on JOYG. Shares of JOYG have just been crushed in the last few days. The stock might have some long-term support around $40.00. I'd keep an eye on it. Plus, readers might want to check out WYNN. Shares of WYNN look very bearish and this might be a bearish entry point. You could aim for $80.00 or the July lows near $70.


New Calls

UltraShort Russell2000 - TWM - cls: 71.37 chg: +4.68 stop: 64.75

Company Description:
The UltraShort Russell2000 ProShares is an exchange traded fund (ETF) that moves twice the inverse performance of the Russell 2000 small cap index.

Why We Like It:
The market looks poised to move lower following this week's failed rally. If you're feeling optimistic you could argue that the Russell 2000 might be building a bull flag pattern. I suspect the index is going to breakdown under its trend of lower lows and accelerate toward its July lows. This should produce a big move in the TWM. We are suggesting call positions now but a dip back to the $68.50-68.00 zone would also work as an entry point. We have two targets. Our first target is $77.50. Our second target is $82.50.

Suggested Options:
We are suggesting the October calls. Strikes are available at $1.00 increments.

BUY CALL OCT 74.00 TWM-JV open interest=249 current ask $4.50
BUY CALL OCT 76.00 TWM-JX open interest=197 current ask $3.90
BUY CALL OCT 78.00 TWM-JZ open interest=223 current ask $3.40
BUY CALL OCT 82.00 TWM-JD open interest=283 current ask $2.40

Picked on September 09 at $ 71.37
Change since picked: + 0.00
Earnings Date 00/00/00
Average Daily Volume = 7.4 million

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United States Oil - USO - cls: 82.35 chg: -3.58 stop: 77.45

Company Description:
The United States Oil is an exchange traded fund (ETF) that mimics the performance of the spot price for West Texas Intermediate (WTI) light, sweet crude oil.

Why We Like It:
Crude oil is starting to look very oversold and analysts have been talking about support for oil in the $98.00-100.00 zone for weeks. It looks like the $80.00 region on the USO corresponds to the $100 region for crude oil futures. We are suggesting that readers use a trigger to buy calls in the $80.50-80.00 zone. If you're feeling really nimble you could wait and try to jump in near $79.00. We're suggesting a stop loss at $77.45 but more conservative traders might want to inch theirs higher around $78.00. If we are triggered at $80.50 we have two targets. Our first target is $84.75. Our second target is $87.50.

Suggested Options:
We are suggesting the October calls. Strikes are available at $1.00 increments.

BUY CALL OCT 80.00 UNA-JB open interest=1640 current ask $6.00
BUY CALL OCT 84.00 UNA-JF open interest=407 current ask $4.00

Picked on September xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 00/00/00
Average Daily Volume = 13.8 million
 

New Puts

Intuitive Surgical - ISRG - cls: 268.11 chg: -3.37 stop: 280.55

Company Description:
Intuitive Surgical is the global leader in the rapidly emerging field of robotic-assisted minimally invasive surgery. (source: company press release or website)

Why We Like It:
High-flying tech stocks have been getting hammered lately. ISRG has seen its oversold bounce fail twice at the $280 level near its exponential 200-dma. We're suggesting readers buy puts on today's failed rally with a stop loss at $280.55. Right now we're only listing one target at $251.00. More aggressive traders might want to consider aiming for the January 2008 lows near $225 but keep in mind the $250 level could be strong support. This should be considered a higher-risk play because the stock price can be so volatile and the options can have wide spreads.

Suggested Options:
We are suggesting the October puts.

BUY PUT OCT 260.00 AXV-VX open interest= 946 current ask $17.70
BUY PUT OCT 250.00 AXV-VJ open interest=1004 current ask $13.60

Picked on September 09 at $268.11
Change since picked: + 0.00
Earnings Date 10/16/08 (unconfirmed)
Average Daily Volume = 655 thousand
 

New Strangles

None today.
 

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