CALL Play Updates

Euro Currency ETF - FXE - close: 139.45 chg: -0.87 stop: 137.90

Unfortunately the U.S. dollar is churning sideways instead of continuing its decline like we thought. This has left the euro drifting sideways as well. The path of least resistance for the dollar should be down so I remain bullish on the FXE. I would still consider new bullish positions in the $139.00-141.00 zone.

Our first target is $144.50. Our second target is $148.50. The P&F chart is bullish with a $168 target.

Suggested Options:
I would suggest using the August or September calls. Strikes are available at $1.00 increments.

Annotated Chart:

Picked on     June 23 at $140.76
Change since picked:      - 1.31
Earnings Date           00/00/00
Average Daily Volume =       461 thousand    
Listed on  June 23, 2009         


UltraShort SP& 500 - SDS - cls: 60.25 chg: +0.33 stop: 55.90

It was not a good week for the S&P 500. The index broke critical support at 880, which is the neckline to a bearish head-and-shoulders pattern. Stocks tried to bounce but the rebound was too weak. Instead of buying puts on the SPY I'm suggesting calls on the SDS to maximum any profit potential. That also means we're taking a little more risk because the SDS is twice as volatile.

Due to this inverse ETF's volatility readers may want to trade half or less than their normal position size. Our first target to take profits is the $64.00 level. Our second target is the $67.00 level. My time frame is several weeks (toward August option expiration) but traders might want to buy September calls instead.

Suggested Options:
I'm suggesting the August or September calls. I prefer the $60 or $65 strikes but strikes are available at $1.00 increments.

Annotated Chart:

Picked on     July 08 at $ 60.50 *triggered     
Change since picked:      - 0.25
Earnings Date           00/00/00
Average Daily Volume =        40 million  
Listed on  July 07, 2009         


Ultra-Short REIT - SRS - close: 22.75 change: +0.07 stop: 19.45

Nothing has changed from my Thursday night comments on the SRS so I'm reposting my play description here:

We've been hearing about how commercial real estate was the next shoe to drop for months. Well it finally looks like the sector is breaking down (along with the rest of the market). One way to play it is the SRS. This is a double-short ETF, which tries to move twice the daily inverse of the DJ U.S. real estate index. This index is full of REITs. The top ten components are: SPG, NLY, PSA, EQR, VNO, PCL, HCP, BXP, AVB, and HCN.

I'm suggesting readers buy calls on the SRS now but if we get the chance a dip in the $21.00-20.00 zone would be more attractive. This ETF can be somewhat volatile so I'm using a wide stop loss at $19.45. I suggest readers only trade half or less than their normal position size. Our first target is $26.00. Our second target is $29.50.

Suggested Options:
I am suggesting the August calls. Strikes are available at $1.00 increments.

BUY CALL AUG 22.00 SAK-HP open interest=1191 current ask $3.10
BUY CALL AUG 25.00 SAK-HE open interest=1444 current ask $1.95
BUY CALL AUG 28.00 SAK-HU open interest=5986 current ask $1.25

Annotated Chart:

Picked on     July 09 at $ 22.67
Change since picked:      + 0.08
Earnings Date           00/00/00
Average Daily Volume =      27.8 million  
Listed on  July 09, 2009         


PUT Play Updates

Agrium Inc. - AGU - close: 36.28 change: -1.62 stop: 40.05 *new*

The potash-fertilizer stocks were all weaker today over concerns about falling potash prices. AGU sank to new relative lows at $35.50 and closed with a 4.2% loss. Volume was above average on the decline. Please note our new stop at $40.05. I would watch for a failed rally in the $39.00-40.00 zone as a new entry point for puts. Our first target is $35.10. Our second target is $31.00.

FYI: Readers should note that AGU is trying a hostile takeover for CF Industries, which is itself trying a hostile takeover of Terra Industries.

Suggested Options:
If AGU provides a new entry point I would use the August puts. We will plan to exit before the late July earnings report.

Annotated Chart:

Picked on     July 06 at $ 38.75 *triggered     
Change since picked:      - 2.47
Earnings Date           07/27/09 (unconfirmed)
Average Daily Volume =       4.2 million  
Listed on  June 30, 2009         


Core Labs - CLB - close: 78.99 change: -3.95 stop: 85.25

CLB just collapsed this morning and I didn't see any specific news for the gap down. The stock failed at technical resistance on Thursday and Friday saw CLB break support at $80.00 and its 100-dma.

CLB has already hit our first target at $80.25. Our second target is $76.00.

Suggested Options:
I am not suggesting new positions at this time.

Annotated Chart:

Picked on     July 01 at $ 83.16 /gap down entry
                              /originally listed at 84.53
Change since picked:      - 4.17
                              /1st target hit @ 80.25 (-3.5%)
Earnings Date           07/22/09 (unconfirmed)
Average Daily Volume =       232 thousand 
Listed on  July 01, 2009         


Compass Minerals Intl. - CMP - cls: 51.01 change: -1.78 stop: 55.25 *new*

CMP sank to new relative lows and tested support near $50.00. If this stock produces another oversold bounce wait for it to fail in the $52.50-54.00 zone. I am lowering our stop loss to $55.25. More conservative traders may want to lower theirs closer to $ 54.00. Our first target is $47.50. Our second target is $43.00.

Suggested Options:
I'm not suggesting new positions at this time.

Annotated Chart:

Picked on     July 06 at $ 52.25 *triggered     
Change since picked:      - 1.24
Earnings Date           07/27/09 (unconfirmed)
Average Daily Volume =       792 thousand 
Listed on  June 29, 2009         


Costco - COST - close: 44.97 change: -0.53 stop: 46.10

There is no change from my prior comments on COST. We are still waiting for a breakdown under support at $44.00. Our plan is to buy puts at $43.90. If triggered our target is $40.25.

Suggested Options:
If triggered I would use the August or October puts. I prefer the $45.00 and $42.50 strikes.

Annotated Chart:

Picked on     July xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           10/08/09 (unconfirmed)
Average Daily Volume =      4.75 million  
Listed on  July 04, 2009         


ITT Educational - ESI - close: 89.62 change: +0.98 stop: 92.65

After several days of declines ESI managed a little oversold bounce but it stalled under new resistance at $90.00. I would use this move as a new entry point to buy puts. Our first target is $81.00. We do not want to hold over the late July earnings report.

Suggested Options:
I am suggesting the August puts.

BUY PUT AUG 90.00 ENJ-TR open interest= 214 current ask $6.90
BUY PUT AUG 85.00 ENJ-TQ open interest= 328 current ask $4.60
BUY PUT AUG 80.00 ENJ-TP open interest=  64 current ask $2.95

Annotated Chart:

Picked on     July 09 at $ 88.99 *triggered     
Change since picked:      + 0.63
Earnings Date           07/23/09 (unconfirmed)
Average Daily Volume =       902 thousand 
Listed on  July 08, 2009         


Freeport McMoran - FCX - close: 46.64 change: -0.05 stop: 50.51

Shares of FCX followed the bounce in copper and gold from their midweek lows but the bounce didn't get very far. The trend in FCX is still down. I am suggesting readers look for a failed rally in the $48-50 zone to launch new positions. FCX has already hit our first target at $45.25. Our second target is $41.00.

Suggested Options:
If FCX provides a new entry point I would use the August puts but we plan to exit ahead of the late July earnings report.

Annotated Chart:

Picked on     July 04 at $ 47.92 /gap down entry
                               /originally listed at $49.72
Change since picked:      - 1.23
                               /1st target hit @ 45.25 (-5.5%)
Earnings Date           07/22/09 (unconfirmed)
Average Daily Volume =        18 million  
Listed on  July 04, 2009         


L-3 Comm. - LLL - close: 65.13 change: +0.44 stop: 68.55

LLL is still trying to bounce after a four-week plunge. The stock is oversold so a bounce is not surprising. I am inching our stop loss down to $68.15. I'm not suggesting new positions at this time. LLL has already hit our first target at $66.00. Our second target is $61.00.

Suggested Options:
No new plays at this time.

Annotated Chart:

Picked on     June 16 at $ 71.75
Change since picked:      - 6.62
                               /1st target hit @ 66.00 (-8.0%)
Earnings Date           07/23/09 (unconfirmed)
Average Daily Volume =       976 thousand  
Listed on  June 16, 2009         


MetLife Inc. - MET - close: 27.36 change: -0.27 stop: 30.35

The trend in MET is down but readers may want to wait for a bounce or failed rally near $29.00 before launching new positions. Our first target is $25.25. Our second target is $21.75.

Suggested Options:
If MET provides a new entry point I would use the August puts.

Annotated Chart:

Picked on     July 04 at $ 28.04
Change since picked:      - 0.68
Earnings Date           07/30/09 (unconfirmed)
Average Daily Volume =       7.4 million  
Listed on  July 04, 2009         


NII Holdings - NIHD - close: 18.43 change: -0.44 stop: 20.10

NIHD is consolidating sideways between support at $18.00 and technical resistance at its 200-dma. The trend of lower highs would suggest the next move will be down. More conservative traders might want to lower their stops toward $19.50. I would still consider new positions here or on a breakdown under $18.00. Our first target is $16.15.

Suggested Options:
I am suggesting the August puts but we will exit ahead of the July earnings report.

Annotated Chart:

Picked on     July 04 at $ 18.61
Change since picked:      - 0.18
Earnings Date           07/23/09 (unconfirmed)
Average Daily Volume =       2.9 million  
Listed on  July 04, 2009         


Sears Holdings - SHLD - close: 57.35 change: -0.78 stop: 64.25 *new*

SHLD continues to sink. The stock is down seven out of the last eight trading days. The relative weakness is encouraging but SHLD is starting to look a little oversold. The plan was to buy half our put position near $60.00 and the second half on a bounce in the $62.00-64.00 zone. I am lowering our stop loss to $64.25. Our first target is $55.10. Our second target is $50.50.

Suggested Options:
If SHLD provides a new entry point I would use the August or September puts.

Annotated Chart:

Picked on     July 07 at $ 59.75
Change since picked:      - 2.40
Earnings Date           08/27/09 (unconfirmed)
Average Daily Volume =       1.2 million  
Listed on  July 07, 2009         


United Parcel Serv. - UPS - close: 48.57 change: +0.55 stop: 51.55

The transports were a bright spot in the market today with a 1% bounce. UPS followed the sector index higher. Technically Friday's move is a bullish engulfing candlestick pattern so we can look for the bounce to continue this week. However, watch for a failed rally near $50.00 and its 200-dma as a new entry point to buy puts.

Our first target to take profits is $45.50. I am setting a secondary target at $43.00. We do not want to hold over the late July earnings report.

Suggested Options:
If UPS provides a new entry point I would use the August puts.

Annotated Chart:

Picked on     June 26 at $ 49.50 *triggered     
Change since picked:      - 0.93
Earnings Date           07/23/09 (confirmed)
Average Daily Volume =       5.2 million  
Listed on  June 17, 2009         


Weyerhaeuser - WY - close: 27.97 change: +0.09 stop: 31.51

Shares of WY have been trading sideways for three days in a row. This could be a set up for a short-term bounce. Wait for a new failed rally near $30.00 before launching new positions. Our first target is $26.00. Our second target is $23.00. The P&F chart points to a $24 target.

Suggested Options:
If WY provides a new entry point I would use the August puts.

Annotated Chart:

Picked on     July 04 at $ 29.51
Change since picked:      - 1.54
Earnings Date           07/31/09 (unconfirmed)
Average Daily Volume =       2.1 million  
Listed on  July 04, 2009         


Wynn Resorts - WYNN - close: 30.98 change: -0.95 stop: 35.25

The oversold bounce in gambling stocks is already failing and WYNN under performed its peers with a 2.9% decline on Friday. I'm not suggesting new positions at this time. WYNN has already exceeded our first target at $30.25. Our second target is $26.00.

Suggested Options:
I'm not suggesting new positions at this time.

Annotated Chart:

Picked on     June 22 at $ 34.28
Change since picked:      - 3.30
                               /1st target hit @ 30.25 (-11.7%)
Earnings Date           07/30/09 (unconfirmed)
Average Daily Volume =       3.4 million  
Listed on  June 22, 2009         


CLOSED BULLISH PLAYS

Express Scripts - ESRX - close: 64.72 change: -0.93 stop: 64.75

The market's weakness this morning was too much for ESRX and shares broke down under the $65.00 level. The stock hit our stop loss at $64.75 closing the play.

Chart:

Picked on     June 22 at $ 65.25
Change since picked:      - 0.50<-- stopped @ 64.75 (- <1%)
Earnings Date           07/29/09 (unconfirmed)
Average Daily Volume =       3.7 million  
Listed on  June 18, 2009         


Lorillard Inc. - LO - close: 67.05 change: +0.29 stop: 67.30

I am dropping LO as a bullish candidate for now. The stock is stuck drifting under resistance at $70.00. There might be some support near $66.00 but if I was going to buy a dip I'd rather buy a dip near the longer-term trendline (see chart). Personally I'd move LO to your watch list and wait for a move back toward $70.00. Shares never hit our trigger to buy calls at $70.10.

Chart:

Picked on     July xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00 *never opened*
Earnings Date           07/27/09 (unconfirmed)
Average Daily Volume =       1.8 million  
Listed on  July 01, 2009         


U.S. Oil Fund - USO - close: 32.37 change: -0.39 stop: 31.95

Oil has continued to sink with today marking its 8th decline in a row. I thought yesterday's intraday bounce off its lows looked like the beginning of a short-term bottom. The plan was to use a tight stop loss to limit our risk on the aggressive, buy-the-plunge entry point. The USO opened at $32.13 and quickly hit our stop loss at $31.95. Eventually oil will bounce but I'll watch for a more clearly defined reversal.

Chart:

Picked on     July 09 at $ 32.14 /gap down entry 
                               /originally listed at $32.77
Change since picked:      - 0.19<-- stopped out @ 31.95 (- <1%)
Earnings Date           00/00/00
Average Daily Volume =      13.7 million  
Listed on  July 09, 2009         


Visa - V - close: 59.86 change: -0.58 stop: xx.xx

The oversold bounce in Visa is stalling. Investors are uninterested in taking new bullish positions ahead of the second quarter earnings season. I'm dropping Visa from the play list. I'm still keeping it on my watch list but shares may need to spend several days building a new base along support at the $57-58 zone. Our bullish play was never opened because I temporarily eliminated our entry point over concerns that the wider market was falling. I could see a potential entry point on a move over $62.00 but V has short-term resistance at $64.00.

Chart:

Picked on     July xx at $ xx.xx <-- *never opened*
Change since picked:      + 0.00
Earnings Date           07/29/09 (unconfirmed)
Average Daily Volume =       7.7 million  
Listed on  July 04, 2009