Option Investor
Play Updates

In Play Updates and Reviews

HAVING TROUBLE PRINTING?
Printer friendly version

Call Updates

Research In Motion - RIMM - cls: 116.43 chg: -3.72 stop: 114.45

RIMM dipped at the open but was holding relatively steady above the $118 level until another last-hour sell-off pushed the stock to a 3% decline. At the moment we're looking for some short-term support near $115. Over the weekend we raised our stop loss to $114.45. The $115 level should be underpinned by the simple 200-dma. A decent bounce near $115 could be used as a new bullish entry point. However, with the major market averages looking vulnerable I would hesitate to open new bullish plays. We have two targets. Our first target is $129.00. Our second target is $137.00.

Picked on July 31 at $120.50 *triggered
Change since picked: - 4.07
Earnings Date 09/25/08 (unconfirmed)
Average Daily Volume = 18.6 million

---

SunPower - SPWR - close: 73.26 change: -3.16 stop: 76.45

SPWR just posted its third loss in a row. It's not looking good for this solar energy stock. Fortunately, we're still on the sidelines. If SPWR doesn't attempt some sort of bounce tomorrow we'll drop it as a bullish candidate. Right now our strategy is to wait for a breakout with a trigger to buy calls at $81.75. If triggered our target is the $89.75 mark (or the 200-dma).

Picked on July xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 10/16/08 (unconfirmed)
Average Daily Volume = 2.8 million

---

CBOE Volatility Index - VIX - close: 23.49 chg: +0.92 stop: n/a

We knew the market was vulnerable and the VIX jumped 4% today as stocks slipped lower. We would still consider new speculative call plays at current levels. We're gambling on another market meltdown before September's option expiration. Our target is $29.75.

Picked on August 03 at $ 22.57
Change since picked: + 0.92
Earnings Date 00/00/00
Average Daily Volume = x million
 

Put Updates

Freddie Mac - FRE - close: 7.52 change: -0.46 stop: n/a

There were several analysts issuing new comments today about how the housing downturn still has much further to go before finding a bottom. This undermined the financials and FRE lost 5.7%. We remain bearish and do not see any changes from our weekend comments. We consider this a lottery-ticket style of play. The put option is our ticket. If we win, we should win big. If we lose, we lose it all. Our short-term target would be a move back to $5.00. More aggressive traders may want to aim lower. We are thinking about moving the target closer to $4.00.

Picked on July 20 at $ 9.18
Change since picked: - 1.66
Earnings Date 08/06/08 (confirmed)
Average Daily Volume = 45.5 million

---

VISA Inc. - V - close: 72.50 change: +0.77 stop: 72.55

There is no change from our weekend comments for V. The stock is in a two-month bearish trend of lower highs. This past week has produced a bearish reversal under that line. We're suggesting that readers buy puts on Visa if the stock trades at $69.45 or lower. If triggered we have two targets. Our first target is $65.25. Our second target is $61.00.

Picked on August xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 07/30/08 (confirmed)
Average Daily Volume = 14 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: 153.23 chg: -3.43 stop: n/a

We are not surprised to see AAPL sinking again. The stock has been acting weak since the oversold bounce following its earnings report. We are not 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: -11.92
Earnings Date 07/21/08 (confirmed)
Average Daily Volume = 31.7 million

---

Popular Inc. - BPOP - close: 6.78 change: -0.17 stop: n/a

BPOP spent another day trading sideways. We don't see any changes from our weekend comments. More conservative traders may want to consider an early exit now. We are not suggesting new strangle plays on BPOP. 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: + 0.96
Earnings Date 07/18/08 (confirmed)
Average Daily Volume = 3.4 million

---

DIAMONDS - DIA - close: 112.77 chg: -0.35 stop: n/a

The path of least resistance seems to be down but the DIA has not yet broken down from its sideways consolidation. We are not suggesting new strangles on the DIA. 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: + 0.56
Earnings Date 00/00/00
Average Daily Volume = 15.5 million

---

iShares Brazil - EWZ - cls: 75.65 chg: -3.43 stop: n/a

The Brazilian Bovespa index plunged another 3.5% on Monday and the EWZ responded with a 4.3% decline. The August $75 puts jumped to $2.45 intraday. We have two weeks left before August options expire. More conservative traders will want to seriously consider an early exit. We're not suggesting new positions at this time. The options we suggested back in early July were the August $90 calls (EWZ-HR) and the August $75 puts (EWZ-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: - 7.41
Earnings Date 00/00/00
Average Daily Volume = 13.6 million

---

FosterWheeler - FWLT - close: 50.75 chg: -5.33 stop: n/a

Shares of FWLT were just crushed today. The stock lost almost 10% and closed at new four-month lows. The August $50 put spiked to $2.60 intraday. More conservative traders may want to exit now! 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: -10.49
Earnings Date 08/06/08 (confirmed)
Average Daily Volume = 2.5 million

---

Corning Inc. - GLW - close: 20.10 chg: -0.24 stop: n/a

There is still no movement in GLW. We do not see any changes from our weekend comments. At this point more conservative traders may want to exit if either side of this strangle gets back into the $0.65-0.85 range to recoup our cost. We are not suggesting new strangle positions. 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.

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: 463.00 chg: - 4.86 stop: n/a

GOOG continues to sink and it looks like shares are headed for the $450 level. The August $480 puts rose to $22.70 intraday. More conservative traders might want to consider an early exit since we have less than two weeks before August options expire. Currently, with GOOG moving in our favor, we're going to keep the play open. 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: -72.60
Earnings Date 07/17/08 (confirmed)
Average Daily Volume = 4.5 million

---

Internet Holders - HHH - cls: 49.10 change: +0.06 stop: n/a

There is no change from our weekend comments on the HHH. We are not suggesting new positions at this time. 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 $1.50 or higher!

Picked on July 03 at $ 50.50
Change since picked: - 1.40
Earnings Date 00/00/00
Average Daily Volume = 132 thousand

---

Lehman Brothers - LEH - close: 17.94 chg: -0.71 stop: n/a

We do not see any changes from our weekend comments on LEH. We're not suggesting new positions at this time. The options we suggested were the September $24.00 calls (LYH-IR) and the September $10.00 puts (LYH-UB). Our estimated cost is $2.15. We want to sell if either option hits $3.50 or higher.

Picked on July 27 at $ 17.05
Change since picked: + 0.89
Earnings Date 09/18/08 (unconfirmed)
Average Daily Volume = 63 million

---

Legg Mason - LM - close: 40.00 chg: -0.76 stop: n/a

LM is still trying to rise with its bullish trend of higher lows but momentum is definitely fading. We don't see any changes from our weekend comments. We are not suggesting new strangles at this time. The options we listed were the August $45 calls (LM-HW) and the August $35 puts (LM-TG). Our estimated cost was $3.15. We want to sell if either option hits $4.85 or more.

Picked on July 23 at $ 40.20
Change since picked: - 0.20
Earnings Date 07/25/08 (confirmed)
Average Daily Volume = 3.1 million

---

MarketVectors Agribusiness- MOO - close: 51.55 chg: -3.00 stop: n/a

Anything related to materials and commodities, including the fertilizer stocks, were crushed hard today. A lot of the fertilizer stocks were down 10%. The MOO lost more than 5% and closed at a new four-month low. 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: - 5.70
Earnings Date 00/00/00
Average Daily Volume = 745 thousand

---

Netflix - NFLX - close: 29.83 change: +0.61 stop: n/a

NFLX provided a little bounce on Monday but it stalled near the $30.00 level. We don't see any changes from our weekend comments. More conservative traders may want to exit early or adjust their exit target. We're not suggesting new strangles at this time. The options we suggested were the August $32.50 calls (QNQ-HT) and the August $22.50 puts (QNQ-TX). Our estimated cost is $1.20. We want to sell if either option hits $2.20 or more.

Picked on July 23 at $ 27.98
Change since picked: + 1.85
Earnings Date 07/25/08 (confirmed)
Average Daily Volume = 1.3 million

---

PowerShares QQQ - QQQQ - cls: 44.43 chg: -0.45 stop: n/a

The QQQQ has pulled back toward the lower edge of its $46-44 trading range. We are not suggesting new strangles and more conservative traders will want to consider closing this play. 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: - 0.47
Earnings Date 00/00/00
Average Daily Volume = 148 million

---

Starbucks - SBUX - close: 14.06 change: -0.36 stop: n/a

As expected shares of SBUX continue to drift lower. We don't see any changes from our previous comments. We are not suggesting new strangles. 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 $2.10 or more. (FYI: The $14 calls hit $2.10 on the July spike to $16.00.)

Picked on July 15 at $ 13.58
Change since picked: + 0.48
Earnings Date 07/30/08 (confirmed)
Average Daily Volume = 14 million

---

UBS Ag - UBS - close: 19.07 change: -0.32 stop: n/a

UBS spent another day trading sideways. We don't see any changes from our prior comments. More conservative traders may want to consider an early exit now or adjust their exit target to 75% or 100% of breakeven. 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.

Suggested Options:
We are not suggesting new strangles in UBS.

Annotated chart:

Picked on July 13 at $19.49
Change since picked: - 0.42
Earnings Date 08/12/08 (unconfirmed)
Average Daily Volume: 7.3 million

---

Valero Energy - VLO - close: 30.99 chg: -1.81 stop: n/a

It doesn't matter what direction oil prices go the oil refiners just can't seem to win. VLO lost another 5% today and is nearing round-number support at the $30.00 level. We are not suggesting new strangle positions. The options we suggested were the August $37.50 calls (VLO-HU) and the August $27.50 puts (VLO-TS). Our estimated cost is $1.38. We want to sell if either option hits $2.25 or higher.

Picked on July 27 at $ 31.88
Change since picked: - 0.89
Earnings Date 07/29/08 (confirmed)
Average Daily Volume = 12.7 million

---

Washington Mutual - WM - close: 4.87 chg: -0.45 stop: n/a

WM took a turn for the worse. New comments about how the housing crisis still has a long way to go undermined the buying interest in financials, especially anyone who deals in mortgages. Shares of WM lost more than 8%. 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 $1.45 or more.

Picked on July 20 at $ 5.92
Change since picked: - 1.05
Earnings Date 07/22/08 (confirmed)
Average Daily Volume = 57 million
 

Dropped Calls

United States Nat.Gas - UNG - cls: 40.53 chg: -3.28 stop: 40.99

UNG was weak from the start this morning. This natural gas ETF gapped open lower. Then midday, an unexpected and unexplained spike down in crude oil helped push the UNG to $40.21 intraday. This move looks very bearish even though the UNG might have round-number, psychological support near $40.00. UNG traded at our stop loss of $40.99 closing the play.

Picked on July 30 at $43.39 /stopped out 40.99
Change since picked: - 2.86
Earnings Date 00/00/00
Average Daily Volume: 2.9 million

---

United States Oil - USO - close: 97.52 chg: -3.52 stop: 97.40

I happened to be watching CNBC when oil spiked lower today. The commentator said that oil traders on the floor were scratching their heads unable to explain why oil was falling when it should have been rising. More tough comments from Iran, more violence out of Nigeria, and a tropical storm off the coast of Texas should have been more than enough to inspire a rally. Unfortunately, the USO followed crude oil lower and hit our stop loss at $97.40 closing the play.

Picked on August 03 at $101.04 /stopped out 97.40
Change since picked: - 3.52
Earnings Date 00/00/00
Average Daily Volume = 14.7 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

Play Update Archives