Option Investor
Play Updates

In Play Updates and Reviews

HAVING TROUBLE PRINTING?
Printer friendly version

Call Updates

CurrencyShares Euro - FXE - cls: 158.13 chg: -1.22 stop: 157.75

Last night we turned more aggressive on the FXE and decided to open the play near $159 instead of waiting for a breakout to new highs over $160.55. That may have been a mistake. The U.S. dollar looked like it was rolling over yesterday but the dollar surged higher on Tuesday and that pulled the FXE lower. The Euro is now below its simple 10-dma and the MACD on the daily chart is growing closer to a sell signal. The intraday low was $157.98 so the play is still open for now. Readers might want to cinch up their stops toward today's low. We're not suggesting new positions at this time. Our ten-week target is $169.50. We're suggesting the September calls.

Picked on July 21 at $159.35
Change since picked: - 1.22
Earnings Date 00/00/00
Average Daily Volume = 909 thousand

---

Intl. Bus. Mach. - IBM - cls: 129.95 chg: +1.31 stop: 124.95

IBM rallied again and is testing resistance at $130 again. We are going to add a second entry point to open this play at $130.25. That means we have two entry points. Buy calls on a pull back at $127.00 or buy calls on a breakout over $130.00 at $130.25. We're adjusting the stop loss to $124.95. We're also setting two targets. Our first target is $134.75. Our second target is $139.00. We are now suggesting the August or September calls.

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/17/08 (confirmed)
Average Daily Volume = 7.7 million
 

Put Updates

Freddie Mac - FRE - close: 9.70 change: +0.95 stop: n/a

FRE was trading lower most of the day until the markets, more specifically the financials suddenly turned higher in the last 60 to 90 minutes. FRE ended the day up 10.8%. Volume remains strong. We do not have a stop loss listed for this play since it's more of a lottery-ticket style of strategy as we bet on FRE doing something that damages shareholders in favor of supporting their debt. More conservative investors will want to strongly considering placing a stop loss somewhere. Wait for this bounce to stall or roll over before initiating new positions. Our short-term target would be a move back to $5.00. More aggressive traders may want to aim lower.

Picked on July 20 at $ 9.18
Change since picked: + 0.52
Earnings Date 08/28/08 (unconfirmed)
Average Daily Volume = 45.5 million
 

Strangle Updates

(What is a strangle? It's when a trader buys an out-of-the-money (OTM) call and an OTM put on the same stock. The strategy is neutral. You do not care what direction the stock moves as long as the move is big enough to make your investment profitable.)

---

Apple Inc. - AAPL - close: 162.02 chg: -4.27 stop: n/a

AAPL delivered an amazing recovery from its lows today. The initial reaction to AAPL's earnings report and warning last night sent the stock gapping lower. AAPL opened at $153.41 and dipped to $146.53 before reversing. When the broader market started to rally this afternoon it only accelerated the bounce in AAPL. While the rebound is impressive I wouldn't trust it. AAPL has resistance near $165 and about every $5 above that with the $180 level being a tough barrier to break. We are no longer suggesting new strangle positions. The options we suggested were the August $180 calls (APV-HP) and the August $150 puts (APV-TJ). Our estimated cost is $8.90. We want to sell if either option hits $14.50 or more.

Picked on July 20 at $165.15
Change since picked: - 3.13
Earnings Date 07/21/08 (confirmed)
Average Daily Volume = 31.7 million

---

Popular Inc. - BPOP - close: 6.80 change: +0.74 stop: n/a

Tuesday produced another volatile session for BPOP. The afternoon bounce in the financials helped push BPOP to a 12% gain. We're no longer suggesting new plays. The options we listed were the August $7.50 calls (BQW-HU) and the August $5.00 puts (BQW-TA). Our estimated cost was $0.65. We want to sell if either option hits $1.45 or more.

Picked on July 16 at $ 5.82
Change since picked: + 0.98
Earnings Date 07/18/08 (confirmed)
Average Daily Volume = 3.4 million

---

DIAMONDS - DIA - close: 115.70 chg: +1.05 stop: n/a

The DJIA rebounded and produced a bullish engulfing candlestick pattern today. The DIA added 0.9%. We are not suggesting new strangles. The options we suggested were the August $115 calls (DIA-HK) and the August $109 puts (DIA-TE). Our estimated cost is $4.35. We want to sell if either option hits $6.90 or more.

Picked on July 07 at $112.21
Change since picked: + 3.49
Earnings Date 00/00/00
Average Daily Volume = 15.5 million

---

iShares Brazil - EWZ - cls: 81.43 chg: -1.16 stop: n/a

Nothing has changed with the EWZ. It continues to drift sideways. If we don't see some significant movement by the end of this week (July 25th) we'll consider abandoning this play. We are not suggesting new strangle positions. The options we suggested were the August $90 calls (EWZ-HR) and the August $75 puts (EWQ-TO). Our estimated cost is $3.95. We want to sell if either option hits $5.90.

Picked on July 03 at $ 83.06
Change since picked: - 1.60
Earnings Date 00/00/00
Average Daily Volume = 13.6 million

---

FosterWheeler - FWLT - close: 58.37 chg: +0.12 stop: n/a

FWLT also drifted sideways in spite of the sell-off in crude oil today. We are not suggesting new strangle positions in FWLT at this time. The options we suggested were the August $70 calls (UFB-HN) and the August $50 puts (UFB-TJ). Our estimated cost was $2.60. We want to sell if either option hits $4.00.

Picked on July 15 at $ 61.24
Change since picked: - 2.87
Earnings Date 08/06/08 (unconfirmed)
Average Daily Volume = 2.5 million

---

Corning Inc. - GLW - close: 20.10 chg: -0.42 stop: n/a

There is no real change in GLW. The stock pulled back to the $20.00 level. We had previously suggested readers open strangle positions in the $20.25-19.75 zone. The options we suggested were the August $22.50 calls (GLW-HX) and the August $17.50 puts (GLW-TW). Our estimated cost is $0.75. We want to sell if either option hits $1.50. Try and keep your investment balanced on both sides of the trade.

Picked on July 10 at $ 20.16
Change since picked: - 0.06
Earnings Date 07/30/08 (confirmed)
Average Daily Volume = 15.9 million

---

Google Inc. - GOOG - close: 477.11 chg: + 8.31 stop: n/a

GOOG spent the session churning sideways until the market's afternoon rally gave GOOG a boost. We're not suggesting new strangle positions in GOOG at this time. The options we listed were the August $590 calls (GOO-HR) and the August $480 puts (GOP-TI). Our estimated cost was $19.10. We want to sell if either option hits $30.00 or more.

Picked on July 16 at $535.60
Change since picked: -58.49
Earnings Date 07/17/08 (confirmed)
Average Daily Volume = 4.5 million

---

Internet Holders - HHH - cls: 48.38 change: +0.51 stop: n/a

A bounce in EBAY and ETFC overshadowed weakness in YHOO and the HHH posted a gain today. If we don't see another big move by the end of this week we're going to be considering an early exit! We are not suggesting new positions. The options we suggested were the August $55 calls (HHH-HK) and the August $45 puts (HHH-TI). Our estimated cost is $1.65. We want to sell if either option hits $2.45.

Picked on July 03 at $ 50.50
Change since picked: - 2.12
Earnings Date 00/00/00
Average Daily Volume = 132 thousand

---

MarketVectors Agribusiness- MOO - close: 56.71 chg: -0.14 stop: n/a

After Monday's rally the MOO pulled back this morning but traders were buying the dip near its 200-dma midday. The daily chart's MACD is getting closer to a new buy signal but the trend of lower highs remains unbroken. We're not suggesting new positions at this time. The options we suggested were the August $62 calls (MYV-HJ) and the August $50 puts (MOO-TX). Our estimated cost is $2.10. We want to sell if either option hits $3.15.

Picked on July 03 at $ 57.25
Change since picked: - 0.54
Earnings Date 00/00/00
Average Daily Volume = 745 thousand

---

PowerShares QQQ - QQQQ - cls: 44.78 chg: +0.00 stop: n/a

The Qs traded lower thanks to weakness in AAPL but the market and AAPL's rebound lifted the Qs back to unchanged on the day. We're not suggesting new positions at this time. The options we suggested were the August $47 calls (QQQ-HU) and the August $43 puts (QQQ-TQ). Our estimated cost is $1.80. We want to sell if either option hits $2.75 or more.

Picked on July 07 at $ 44.90
Change since picked: - 0.12
Earnings Date 00/00/00
Average Daily Volume = 148 million

---

Starbucks - SBUX - close: 15.13 change: +1.04 stop: n/a

It proved to be a very strong day for SBUX. We didn't find any clear catalyst to account for today's 7% gain. The next level of overhead resistance looks like $16.00. We are not suggesting new strangle positions at this time. The options we suggested for the strangle were the August $14.00 calls (SQX-HK) and the August $13.00 puts (SQX-TJ). Our estimated cost was $1.38. We want to sell if either option hits $3.50 or more.

Picked on July 15 at $ 13.58
Change since picked: + 1.55
Earnings Date 07/30/08 (confirmed)
Average Daily Volume = 14 million

---

UBS Ag - UBS - close: 22.42 change: +0.83 stop: n/a

The late afternoon rally in the financials lifted UBS to a 3% gain. We're not suggesting new positions at this time. We listed two different strangles.

UBS Strangle #1) This uses the August $22.50 calls (UBS-HX) and $17.50 puts (UBS-TW). Our estimated cost was $1.90. We want to sell if either option hits $3.00.

UBS Strangle #2) This uses the August $25.00 calls (UBS-HE) and $15.00 puts (UBS-TC). Our estimated cost was $0.90. We want to sell if either option hits $1.90.

Picked on July 13 at $19.49
Change since picked: + 2.93
Earnings Date 08/12/08 (unconfirmed)
Average Daily Volume: 7.3 million

---

Wachovia - WB - close: 16.79 change: +3.61 stop: n/a

It was a very ugly earnings report. Wall Street was expecting a loss of $0.78/share. WB delivered a loss of $4.20/share. Management said they will cut the quarterly dividend from almost 38 cents to 5 cents and will cut jobs by almost 11,000. The stock rallied on the news in spite of the results and WB ended up more than 27% on the day. The August $15 calls are trading close to $3.00. Readers may want to consider an early exit right now. We are no longer suggesting new strangle positions on the stock. The options we suggested were the August $15.00 calls (WB-HC) and the August $10.00 puts (WB-TB). Our estimated cost is $2.00. We want to sell if either option hits $3.50 or more.

Picked on July 20 at $ 12.97
Change since picked: + 3.82
Earnings Date 07/22/08 (confirmed)
Average Daily Volume = 64 million

---

Washington Mutual - WM - close: 5.82 chg: +0.34 stop: n/a

It was a volatile session for WM. The stock traded in a 20% range today and the volatility continued after hours. WM reported earnings after hours and like WB the results were a huge miss. Yet WM is not seeing the same reaction. Instead shares of WM continue to bounce around in the $5.00-6.50 range after hours. We are not suggesting new positions at this time. The options we suggested were the August $8.00 calls (WM-HV) and the August $4.00 puts (WM-TH). Our estimated cost is $0.72. We want to sell if either option hits $2.25 or more.

Picked on July 20 at $ 5.92
Change since picked: - 0.10
Earnings Date 07/22/08 (confirmed)
Average Daily Volume = 57 million

---

FinancialSector SPDR - XLF - cls: 22.49 chg: +1.74 stop: n/a

Traders bought the dip in the XLF near $20.00 and this financial ETF soared to a 5% gain. We are not suggesting new positions at this time. The options we ended up with given the Monday, July 14th, morning open on the XLF were the August $21 calls (XLF-HU) and the August $17 puts (XJZ-TQ). Our estimated cost was $1.22. We want to sell if either option hits $2.85.

Picked on July 14 at $ 19.12
Change since picked: + 3.37
Earnings Date 00/00/00
Average Daily Volume = 128 million
 

Dropped Calls

United States Oil - USO - close: 103.53 chg: -3.14 stop: 103.49

Oil reversed lower today and the USO followed. We were expecting Monday's bounce following last week's sell-off and the Iran talks over the weekend. Today's reversal is somewhat of a surprise but the turn in Tropical Storm Dolly's path has decreased its threat toward the Gulf's oil facilities. The USO opened at $105.20 and then plunged to $101.87 before bouncing. Our stop loss was hit at $103.49.

Picked on July 21 at $105.10 /stopped out 103.49
Change since picked: - 1.57
Earnings Date 00/00/00
Average Daily Volume = 14.8 million
 

Dropped Puts

None
 

Dropped Strangles

iShares Rus.2000 - IWM - cls: 71.47 chg: +1.75 stop: n/a

Target achieved. Small caps appeared to be the market leaders today. The IWM rallied past the $70 level and continued to rally through technical resistance at its 100-dma and 50-dma. Shares ended with a 2.5% gain. Volume was well above average, which is bullish. Today's big move pushed the August $70 calls to $2.76 intraday. Our target to exit was $2.75 or higher. The options we suggested were the August $70 calls (DIW-HR) and the August $61 puts (DIW-TI). Our estimated cost is $1.84.

Picked on July 14 at $ 66.16
Change since picked: + 5.31
Earnings Date 00/00/00
Average Daily Volume = 90 million

---

Ultra Financials - UYG - close: 22.60 chg: +2.18 stop: n/a

Target exceeded. The afternoon strength in the financials fueled a 10.6% gain in the UYG. This ETF, which moves twice the performance of the U.S. financial sector, is up more than 50% from July 15th and more than that from its lows. The August $20 calls hit $3.80 intraday and are currently trading at $3.40bid/$3.90ask. Our target to exit was $3.50 or more. The options we listed were the August $20 calls (UYG-HD) and the August $11 puts (UUF-TM). Our estimated cost was $1.45.

Picked on July 15 at $ 14.75
Change since picked: + 7.85
Earnings Date 00/00/00
Average Daily Volume = 27.3 million
 

Play Update Archives