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Play Editor's Note: At this point I'm still willing to bet that the oversold bounce has more upside to it but we are due for a correction. The plan here is to buy a dip. Since we remain in a volatile market I'm looking for some significant dips. Don't forget that it is up to the individual trader to decide which month and which strike price best suits your trading style and risk.


NEW DIRECTIONAL CALL PLAYS

Apple Inc - AAPL - close: 99.72 change: +5.72 stop: 88.99

Why We Like It:
We are always looking for an opportunity to play the swings in AAPL. Honestly, traders could probably make a career out of just trading AAPL over the next few years. Today's move saw a nice breakout over resistance near $95.00 and its 50-dma. However, I suspect that the market is due for a mini-correction. The plan is to buy a dip.

The hard part is where to buy the dip. Broken resistance near $95.00 should now be support. That would be the logical place to look for a dip. Yet we know that market volatility is elevated so I'm looking for something a little more severe. More aggressive traders may want to buy calls on AAPL in the $96-95 zone. I am suggesting readers buy calls in the $94.00-92.00 zone. We'll use a stop loss at $88.99, just under Friday's low.

If triggered at $94.00 we have two targets. Our first target is $99.85. Our second target is $107.50.

Suggested Options:
We are suggesting the January calls.

BUY CALL JAN 95.00 QAA-AS open interest= 8182 current ask $11.40
BUY CALL JAN 100.0 QAA-AT open interest=27034 current ask $ 8.65
BUY CALL JAN 105.0 QAA-AA open interest= 8714 current ask $ 6.30

Annotated Chart:
AAPL

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           01/22/09 (unconfirmed)
Average Daily Volume =      52.8 million  


Goldman Sachs - GS - close: 77.15 change: +6.43 stop: 66.49

Why We Like It:
Goldman Sachs looks like it might be shaping up for a bullish rally into its earnings report next Tuesday, December 16th. We would like to jump on for the ride but first the stock needs to correct a bit. Today's move was bullish with a breakout over recent resistance near $70.00.

We are suggesting readers buy calls on a dip into the $71.00-68.00 zone with a stop loss at $66.49. If triggered we have two targets. Our first target is $79.85. Our second target is $89.00 or the 50-dma, whichever one GS hits first. We do not want to hold over the December earnings report. Thus we have five trading days to enter and exit this play.

Suggested Options:
Aggressive traders can play the December options that expire in less than two weeks since we plan to exit before next Tuesday.

More conservative traders will want to consider the January calls.

BUY CALL DEC 75.00 GS-LO open interest=11423 current ask $7.35
BUY CALL DEC 80.00 GS-LP open interest=14581 current ask $4.55
BUY CALL DEC 85.00 GS-LQ open interest=14069 current ask $2.64

BUY CALL JAN 75.00 GS-AO open interest=13663 current ask $11.05
BUY CALL JAN 80.00 GS-AP open interest= 7523 current ask $ 8.30
BUY CALL JAN 85.00 GS-AQ open interest= 5812 current ask $ 6.00

Annotated Chart:
GS

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           12/16/08 (confirmed)
Average Daily Volume =        29 million  


Jacobs Engineering - JEC - close: 48.87 change: +6.44 stop: 39.80

Why We Like It:
The major construction service stocks soared today on expectations that Obama's infrastructure-heavy stimulus plan will lead to big contracts for the sector leadership. JEC roared 15% higher and broke out from a bull-flag pattern. We want a piece of the action but we don't want to chase it.

Odds are good that JEC will see some profit taking and the likely spot is for JEC to fill the gap. We are suggesting readers buy calls on a dip into the $44.00-42.00 zone with a stop loss at $39.80. This is a volatile stock so expect some big intraday swings! If triggered we have two targets. Our first target is $49.90. Our second target is $54.00.

Suggested Options:
We are suggesting the January calls.

BUY CALL JAN 45.00 JEC-AI open interest= 860 current ask $7.70
BUY CALL JAN 50.00 JEC-AJ open interest= 899 current ask $4.90

Annotated Chart:
JEC

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           01/21/09 (unconfirmed)
Average Daily Volume =       3.0 million  


Wynn Resorts - WYNN - close: 44.40 change: +3.79 stop: 37.45

Why We Like It:
The global economy is in recession. The casino companies are going to struggle in this environment. Whether or not you think that has already been priced into the stock price is a discussion for longer-term investors. Short-term WYNN has broken out above various levels of resistance. We don't want to chase it here.

Our plan is to buy a dip in the $40.25-38.00 zone with a stop loss at $37.25. If triggered we have two targets. Our first target is $44.75. Our second target is $49.00. I would expect some resistance at the 50-dma but the P&F chart has turned bullish with a $62 target.

Suggested Options:
We are suggesting the January calls.

BUY CALL JAN 40.00 UWY-AH open interest= 700 current ask $8.20
BUY CALL JAN 45.00 UWY-AI open interest= 692 current ask $5.40
BUY CALL JAN 50.00 UWY-AJ open interest= 727 current ask $3.30

Annotated Chart:
WYNN

Picked on December xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           02/12/09 (unconfirmed)
Average Daily Volume =       3.2 million  


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