NEW DIRECTIONAL CALL PLAYS

Pharmacyclics - PCYC - close: 60.66 change: +1.52

Stop Loss: 57.75
Target(s): 67.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
PCYC is a biotech/drug firm. The stock has been showing relative strength in recent days after a correction in July. Now PCYC is breaking out past resistance near $60 to hit ten-year highs.

I am suggesting a trigger to buy calls at $60.85 with a stop loss at 57.75 since recent resistance at $58 should offer some support. The next level of overhead resistance looks like $70 (from years ago).

We will aim for $67.00 but more aggressive traders could aim higher.

Trigger @ 60.85

- Suggested Positions -

buy the Sep $65 call (PCYC1222i65) current ask $2.70

Annotated Chart:

Entry on August xx at $ xx.xx
Average Daily Volume = 879 thousand
Listed on August 15, 2012


Netflix, Inc. - NFLX - close: 63.26 change: +1.50

Stop Loss: 59.45
Target(s): 69.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Shares of highly-shorted stock NFLX are showing strength. The breakdown back in late July looked pretty ugly but now that NFLX is back above resistance at $60.00 the stock is posting gains.

I do consider this an aggressive trade. NFLX can be volatile. Nimble traders may want to wait and buy calls on a dip in the $62-61 area. We are suggesting small bullish positions tomorrow with a stop loss at $59.45. Our target is $69.50.

- Suggested (SMALL) Positions -

buy the Sep $67.50 call (NFLX1222i67.5) current ask $2.10

Annotated Chart:

Entry on August xx at $ xx.xx
Average Daily Volume = 5.8 million
Listed on August 15, 2012