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Call Updates

Adobe Systems - ADBE - close: 43.22 chg: -0.31 stop: 40.95*new*

ADBE held up relatively well during the market's choppy session. Unfortunately, Thursday's session looks like a potential one-day reversal pattern in the NASDAQ. That doesn't bode well for tech stocks. If ADBE does pull back look for a bounce near $42.50 or $42.00 as a potential entry point. We're raising our stop loss to $40.95, which is under its four-week trendline of higher lows. ADBE does have what could be significant resistance near $45.00. Our target is the $47.50-50.00 zone. More conservative traders may want to use a stop loss closer to $40.50 or $40.75.

Picked on August 05 at $ 43.34
Change since picked: - 0.12
Earnings Date 09/16/08 (unconfirmed)
Average Daily Volume = 6.5 million

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Research In Motion - RIMM - cls: 127.25 chg: -0.05 stop: 119.45*new*

After yesterday's strong gain shares of RIMM spent Thursday churning sideways. Investors bought the dip near $125 late this afternoon. We're raising our stop loss to $119.45. More conservative traders might want to take some money off the table right here. We are raising our stop loss to $118.45. We have two targets. Our second target is $137.00.

Picked on July 31 at $120.50 *triggered
Change since picked: + 6.75
Earnings Date 09/25/08 (unconfirmed)
Average Daily Volume = 18.6 million

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CBOE Volatility Index - VIX - close: 21.15 chg: +0.92 stop: n/a

The VIX index erased yesterday's losses. This bounce looks like another entry point to buy calls. Remember, this is a very speculative bet that the market will see a sharp sell-off before September's option expiration and that the VIX will surge toward 30 on the move. Our target is $29.75.

Picked on August 03 at $ 22.57
Change since picked: - 1.42
Earnings Date 00/00/00
Average Daily Volume = x million
 

Put Updates

Freddie Mac - FRE - close: 5.89 change: -0.60 stop: n/a

An analyst firm's downgrade this morning gave FRE a little push on the way down today. Shares ended the session off 9% and near its lows for the day. We're not suggesting new put plays at this time. However, if you believe that the government will step in and that such a move would wipe out shareholders then you may want to go ahead and buy some out of the money puts two or three months out. 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: - 3.29
Earnings Date 08/06/08 (confirmed)
Average Daily Volume = 45.5 million

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VISA Inc. - V - close: 69.50 change: -1.98 stop: 72.55

Our put play in Visa is now open. Shares broke down under the $70.00 level and its three-week trendline of higher lows. Our suggested entry point to buy puts was $69.45. Now that the play is open we have two targets. Our first target is $65.25. Our second target is $61.00. FYI: More aggressive traders may want to use a wider stop loss.

Picked on August 07 at $ 69.45 *triggered
Change since picked: + 0.05
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.)

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Apple Inc. - AAPL - close: 163.57 chg: -0.62 stop: n/a

AAPL is still trying to bounce but failed to close over its simple 200-dma for the second day in a row. We are very quickly running out of time. It looks like this week's big two-day rally has killed our strangle play. We have less than two weeks before August options expire and need to see AAPL well above $180 or under $150. 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: - 1.58
Earnings Date 07/21/08 (confirmed)
Average Daily Volume = 31.7 million

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Popular Inc. - BPOP - close: 7.12 change: -0.13 stop: n/a

BPOP displayed some relative strength. The banking indices were down 5% but BPOP only lost 1.5%. 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: + 1.30
Earnings Date 07/18/08 (confirmed)
Average Daily Volume = 3.4 million

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DIAMONDS - DIA - close: 114.59 chg: -1.90 stop: n/a

More volatility, that's about all we can expect these days. Every time the DIA looks like it's about to break into a new trend it reverses again. This won't last forever. Depending on your bias the DIA is either in a bullish consolidation with higher lows or a bear wedge pattern that will eventually break lower. We remain very cautious here. We're not suggesting new strangle positions at this time. 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 $5.35 or more.

Picked on July 07 at $112.21
Change since picked: + 2.38
Earnings Date 00/00/00
Average Daily Volume = 15.5 million

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iShares Brazil - EWZ - cls: 75.91 chg: -1.59 stop: n/a

It looks like yesterday's bounce might already be failing. The trend is lower. More conservative traders may want to adjust their exit target to $3.50 or breakeven. Our new exit target is $5.00. 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 $5.00.

Picked on July 03 at $ 83.06
Change since picked: - 7.15
Earnings Date 00/00/00
Average Daily Volume = 13.6 million

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FosterWheeler - FWLT - close: 54.79 chg: -1.82 stop: n/a

FWLT encountered some profit taking after yesterday's big post-earnings rally. 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: - 6.45
Earnings Date 08/06/08 (confirmed)
Average Daily Volume = 2.5 million

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Corning Inc. - GLW - close: 19.81 chg: -0.57 stop: n/a

Hold on to your hats! GLW might be poised to breakout of its recent trading range. This is starting to look like a new entry point for directional put plays. 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: - 0.35
Earnings Date 07/30/08 (confirmed)
Average Daily Volume = 15.9 million

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Google Inc. - GOOG - close: 479.12 chg: - 7.22 stop: n/a

GOOG erased yesterday's gains with a dip back to its 10-dma. 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: -56.48
Earnings Date 07/17/08 (confirmed)
Average Daily Volume = 4.5 million

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Internet Holders - HHH - cls: 49.78 change: -0.40 stop: n/a

There is no change from our previous comments on 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: - 0.78
Earnings Date 00/00/00
Average Daily Volume = 132 thousand

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Lehman Brothers - LEH - close: 17.67 chg: -2.62 stop: n/a

Ouch! LEH just gave up a huge chunk of its recent gains with today's 12.9% loss. We don't have much time left so readers will want to consider an early exit if either option even gets close to our breakeven price. 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: + 0.62
Earnings Date 09/18/08 (unconfirmed)
Average Daily Volume = 63 million

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Legg Mason - LM - close: 39.25 chg: -3.08 stop: n/a

LM also suffered some serious profit taking with a 7% loss. Shares broke down under the $40.00 mark and its simple 10-dma. 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: - 0.95
Earnings Date 07/25/08 (confirmed)
Average Daily Volume = 3.1 million

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MarketVectors Agribusiness- MOO - close: 50.90 chg: -1.30 stop: n/a

The MOO just reversed yesterday's gains. What are the odds that this agribusiness ETF will be under $48 before August 15th? If MOO can hit $48.00 that should be enough to hit breakeven on our strangle. Under $48 should be a profit. 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: - 6.35
Earnings Date 00/00/00
Average Daily Volume = 745 thousand

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Netflix - NFLX - close: 30.46 change: +0.46 stop: n/a

Shares of NFLX added 1.5% as investors reacted positively to an earnings report from rival Blockbuster (BBI). In the report BBI raised its earnings guidance. 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: + 2.48
Earnings Date 07/25/08 (confirmed)
Average Daily Volume = 1.3 million

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PowerShares QQQ - QQQQ - cls: 46.27 chg: -0.36 stop: n/a

The situation was starting to improve yesterday with the Qs breakout from its trading range. Yet there was no follow through today and the QQQQ failed near its exponential 200-dma for the second day in a row. 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: + 1.37
Earnings Date 00/00/00
Average Daily Volume = 148 million

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Starbucks - SBUX - close: 14.52 change: -0.42 stop: n/a

There was nothing new to report on for SBUX. Shares continue to churn sideways. 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: + 0.94
Earnings Date 07/30/08 (confirmed)
Average Daily Volume = 14 million

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UBS Ag - UBS - close: 20.40 change: -0.21 stop: n/a

Financials stocks were hammered again today but UBS out performed its peers with a 1% decline. Bulls shouldn't be too confident here with the stock nearing overhead resistance at its 50-dma. We have less than two weeks before August options expire. 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.

Picked on July 13 at $19.49
Change since picked: + 0.90
Earnings Date 08/12/08 (unconfirmed)
Average Daily Volume: 7.3 million

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Valero Energy - VLO - close: 32.94 chg: -1.53 stop: n/a

The bears are still in control with VLO. Shares rolled over under its trend of lower highs. The stock gave up 4.4% and closed near its lows for the session. 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: + 1.06
Earnings Date 07/29/08 (confirmed)
Average Daily Volume = 12.7 million

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Washington Mutual - WM - close: 4.97 chg: -0.33 stop: n/a

Investors turned fearful on the financials again and WM lost more than 6% and closed under the $5.00 mark. 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: - 0.95
Earnings Date 07/22/08 (confirmed)
Average Daily Volume = 57 million
 

Dropped Calls

ArcelorMittal - MT - close: 82.83 change: -1.99 stop: 79.95

I hate to jump in and out of something so fast but the action in shares of MT today looks very ugly. The stock produced a bearish failed rally pattern and a bearish engulfing candlestick. At this point I would expect a dip back toward $80.00 and it's questionable if previous support at $80.00 will hold this time. More aggressive traders may still want to gamble on MT. I'd rather exit early and cut our losses quick. If MT does break down under $80 more nimble traders might want to consider bearish strategies.

Picked on August 05 at $ 83.27 /exit early 82.83
Change since picked: - 0.44
Earnings Date 11/13/08 (unconfirmed)
Average Daily Volume = 4.5 million
 

Dropped Puts

None
 

Dropped Strangles

None
 

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