CALL Play Updates

AutoZone Inc. - AZO - close: 156.98 change: -0.87 stop: 151.49

The slow-motion whipsaw in AZO continues. After producing a significant bullish breakout on Tuesday last week there was absolutely no follow through higher. The S&P 500 produced a 7% rally and AZO failed to participate the last three days. This should be a warning sign for bullish traders. I am expecting the stock to drift towards previous resistance and what should be new support near its 50-dma and the $155.00 to 154.00 region. More conservative traders might want to up their stop loss toward $154.00 or $155.00 depending on your tolerance for risk. I am not suggesting new bullish positions at this time. Our target is $169.00. FYI: The P&F chart is bullish with a $186 target.

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

Annotated Chart:

Picked on     July 14 at $158.77
Change since picked:      - 1.79
Earnings Date           09/22/09 (unconfirmed)
Average Daily Volume =       1.0 million  
Listed on  July 14, 2009         


Bunge Ltd. - BG - close: 64.95 change: -0.10 stop: 59.35

Caution! We are running out of time with BG and may have to abandon this play early. The company is due to report earnings on Thursday morning and we don't want to hold positions over the announcement. I am raising the stop loss to $59.35 (if triggered).

BG has delivered a massive rally from $54.00 to $65.00 in six days. Obviously the relative strength is bullish but we don't want to chase this move. We want to buy calls on a dip at $61.00. More conservative traders can wait for a dip closer to $60.00. Our first target is $67.40. We don't want to hold over the July 23rd earnings report.

Suggested Options:
Use the August options if triggered.

Annotated Chart:

Picked on     July xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           07/23/09 (unconfirmed)
Average Daily Volume =       1.5 million  
Listed on  July 15, 2009         


Euro Currency ETF - FXE - close: 141.01 chg: -0.39 stop: 138.75 *new*

Nothing has really changed for us. The FXE is poised to move higher as the dollar appears ready to breakdown again. I am going to adjust the stop loss to $138.75. If you're looking for an entry point look for a dip near $140. I would use the September calls. 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 use the September calls. Strikes are available at $1.00 increments.

Annotated Chart:

Picked on     June 23 at $140.76
Change since picked:      + 0.25
Earnings Date           00/00/00
Average Daily Volume =       461 thousand    
Listed on  June 23, 2009         


Gold Miner ETF - GDX - close: 38.64 change: +0.31 stop: 34.90

A weak dollar should be good news for gold and the gold miners. The GDX rallied toward resistance near $39.00 last week. I'm not suggesting new bullish positions at this time. More conservative traders might want to raise their stops closer to $36.00. Our first target is $39.50. Our second target is $42.40.

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

Annotated Chart:

Picked on     July 13 at $ 36.49 /gap higher entry
                               /originally listed at $35.93
Change since picked:      + 2.15
Earnings Date           00/00/00
Average Daily Volume =       6.8 million  
Listed on  July 13, 2009         


O'Reilly Automotive - ORLY - close: 40.73 change: -0.36 stop: 38.49

ORLY broke out to new all-time highs last week. Buying calls is a bet the relative strength continues. I would consider new positions on dips near $40.00 or the $39.00 level. Our first target is $44.00. We do not want to hold positions over the July 29th earnings report.

Suggested Options:
Use the August calls if ORLY provides a new entry point.

Annotated Chart:

Picked on     July 13 at $ 40.00
Change since picked:      + 0.73
Earnings Date           07/29/09 (confirmed)
Average Daily Volume =       1.9 million  
Listed on  July 13, 2009         


SPX Corp. - SPW - close: 52.27 change: +0.43 stop: 47.75 *new*

The plan is to buy calls on SPW with a dip in the $50.25-48.00 zone. I'm raising the stop loss to $47.75. If we don't see SPW contract soon (Monday or Tuesday) I'll probably drop it as a bullish candidate. We don't want to hold positions over the July 29th earnings report. The stock has resistance near $54.00. Our first target is $53.75. Our second target is $57.00.

Suggested Options:
If SPW hits our trigger I would use the August $50 or $55 calls.

Annotated Chart:

Picked on     July xx at $ xx.xx <-- see TRIGGER
Change since picked:      + 0.00
Earnings Date           07/29/09 (confirmed)
Average Daily Volume =       777 thousand 
Listed on  July 15, 2009         


PUT Play Updates

Compass Minerals Intl. - CMP - cls: 50.02 change: +0.09 stop: 52.55

Volume was very light on Friday's bounce. We can still expect resistance at the 10-dma and near $52.00. I'm not suggesting new positions at this time. CMP has exceeded our first target at $47.50. Our second target is $43.00. FYI: The P&F chart is bearish with a $35 target.

Suggested Options:
No new positions at this time.

Annotated Chart:

Picked on     July 06 at $ 52.25 *triggered     
Change since picked:      - 2.23
                               /1st target hit @ 47.50 (-9.0%)
Earnings Date           07/28/09 (confirmed)
Average Daily Volume =       792 thousand 
Listed on  June 29, 2009         


LEAP Wireless - LEAP - close: 26.24 change: -1.00 stop: 29.45

Our new play on LEAP is open. The stock broke down from its sideways consolidation and closed at new relative lows. Our trigger at $26.80 was hit. Volume was above average on the decline for the second day in a row, which is bearish. Our first target is $22.65. Our second target is $20.25. The $22.50 level could be strong support so I suggest readers take off most of their position there. FYI: The P&F chart is bearish with a $19.00 target.

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

BUY PUT AUG 25.00 UAO-TY open interest= 554 current ask $1.40
BUY PUT AUG 22.50 UAO-TX open interest= 585 current ask .65

Annotated Chart:

Picked on     July 17 at $ 26.80 *triggered    
Change since picked:      - 0.56
Earnings Date           08/06/09 (confirmed)
Average Daily Volume =       2.2 million  
Listed on  July 16, 2009         


Sears Holdings - SHLD - close: 62.72 change: -0.53 stop: 65.05

SHLD spiked to $64.21 on Friday morning but saw the rally fail at its 30-dma. This could be the entry point we've been looking for. However, I can understand hesitating with the S&P 500 in rally mode. Consider waiting for a little more confirmation before launching new put positions. A drop under $61.40 or the 50-dma should suffice as a new entry point for puts. Our first target is $55.10. Our second target is $50.50.

Suggested Options:
We want to use the August or September puts. I prefer the $65, 60 or $55 strikes.

Annotated Chart:

Picked on     July 07 at $ 59.75
Change since picked:      + 2.97
Earnings Date           08/27/09 (unconfirmed)
Average Daily Volume =       1.2 million  
Listed on  July 07, 2009         


Weyerhaeuser - WY - close: 30.64 change: +0.10 stop: 31.51

The bounce in WY has stalled at resistance near $31.00. More conservative traders might want to consider a tighter stop closer to $31.00. I would wait for a new drop under $29.50 before launching positions. Our first target is $26.00. Our second target is $23.00. The P&F chart points to a $24 target. We do not want to hold positions over the July 31st earnings report.

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:      + 1.13
Earnings Date           07/31/09 (confirmed)
Average Daily Volume =       2.1 million  
Listed on  July 04, 2009