CALL Play Updates

FISERV Inc. - FISV - close: 47.85 change: -0.20 stop: 46.60

FISV tried to rally this morning but failed after gapping higher at $48.48. The plan is to buy calls at $48.60. Our first target to take profit is at $52.50.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 48.60
Change since picked:      + 0.00
Earnings Date           10/28/09 (unconfirmed)
Average Daily Volume =       1.5 million  
Listed on August 19, 2009         


Fluor Corp. - FLR - close: 54.44 change: +1.22 stop: 49.95 *new*

FLR continues to bounce and tagged its 20-dma today. The high was $54.68. I'm raising our stop loss to $49.95. More conservative traders may want to raise their stop toward $51.00. I would still buy calls on dips. Our first target is $54.80. Our second target is $59.00. This could take several weeks.

Picked on   August 17 at $ 51.00 *triggered            
Change since picked:      + 3.44
Earnings Date           08/10/09 (confirmed)
Average Daily Volume =       2.4 million  
Listed on  July 25, 2009         


Flowserve - FLS - close: 89.29 change: +1.80 stop: 72.45

FLS is still climbing but volume is falling fast. Shares are nearing resistance at $90.00. Right now the plan is to wait and buy calls on a dip at $76.00 but we might want to up that trigger toward $80.00.

More conservative traders can use a stop closer to $74.00. If triggered at $76.00 our first target is $83.50. Our second target is $89.00. Our time frame is several weeks.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 76.00
Change since picked:      + 0.00
Earnings Date           10/28/09 (unconfirmed)
Average Daily Volume =       1.1 million  
Listed on August 17, 2009         


Genesse & Wyoming - GWR - close: 29.44 change: +0.27 stop: 27.35 *new*

GWR is still climbing but shares are under performing their peers. GWR gained 0.9%. The railroad index climbed 1.9%. Look to initiate new positions in the $28.50-27.50 zone. An alternative would be to wait for a rise over $30.00 before launching positions. Our first target is $32.90. Our second target is $34.75. Please note that I'm adjusting the stop loss to $27.35.

FYI: The plan was to use small position sizes to limit our risk.

Picked on   August 15 at $ 28.66 /gap down entry
                               /originally listed at $29.30
Change since picked:      + 0.78
Earnings Date           11/03/09 (unconfirmed)
Average Daily Volume =       230 thousand
Listed on August 15, 2009         


IDEXX Labs - IDXX - close: 50.58 change: +0.13 stop: $44.95

There is no change from my prior comments on IDXX. The plan is to buy calls on a dip at $47.50. If triggered at $47.50 our first target is $52.00. Our second target is $54.90. Our time frame is six to eight weeks once triggered.


*Original Strategy*
Picked on     July xx at $ xx.xx <-- TRIGGERs @ 47.50 
Change since picked:      + 0.00
Earnings Date           07/24/09 (confirmed)
Average Daily Volume =       383 thousand 
Listed on  July 25, 2009         


Legg Mason - LM - close: 28.25 change: +0.41 stop: 24.95 *new*

I am adjusting our trigger to buy calls to $26.60. We'll inch up our stop loss to $24.95. Aggressive traders might want to consider a trigger to buy LM above $28.50 or above the August high (29.20).

If triggered our first target is $29.95. Our second target is $33.45. My time frame is six to eight weeks. FYI: The P&F chart is bullish with a $39 target.

Picked on     July xx at $ xx.xx <-- TRIGGER 26.60 *new*
Change since picked:      + 0.00
Earnings Date           07/20/09 (confirmed)
Average Daily Volume =       3.4 million  
Listed on  July 25, 2009         


Lorillard Inc. - LO - close: 73.59 change: +0.43 stop: 69.45

There are no changes from my previous comments on LO. We have a trigger to buy calls at $70.50. Our first target is $74.50. Our second target is $77.00. The Point & Figure chart is bullish with a $92.00 target.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 70.50
Change since picked:      + 0.00
Earnings Date           07/27/09 (confirmed)
Average Daily Volume =       1.5 million  
Listed on August 01, 2009         


U.S. Oil Fund - USO - close: 38.12 change: +1.26 stop: 33.75

It was very interesting to see the U.S. dollar down yet almost all of the commodities were down as well. Normally if the dollar is down commodities are up. The USO has stalled at its August highs. We are waiting for a dip. The plan is to buy calls at $35.00. Our first target is $37.90 (new)

Picked on   August xx at $ xx.xx <-- TRIGGER @ 35.00 
Change since picked:      + 0.00
Earnings Date           00/00/00
Average Daily Volume =      11.5 million  
Listed on August 15, 2009         


PUT Play Updates

Ultra-Short Oil&Gas - DIG - close: 28.71 change: +0.51 stop: 29.10

The rally in oil has stalled a bit and oil stocks saw their momentum stall as well. The DIG gained 1.8% but failed to rise past the $29.00 mark. The DIG is now testing its three-week trendline of lower highs. If stocks (and oil) can rally again tomorrow we'll probably be stopped out. I would wait for a new decline under $27.75 or $27.50 before initiating new put positions. Our first target is $24.50.

Picked on   August 19 at $ 27.75 *triggered 
Change since picked:      + 0.96
Earnings Date           00/00/00
Average Daily Volume =       5.9 million  
Listed on August 18, 2009         


First Solar - FSLR - close: 130.42 chg: -1.01 stop: 146.00 *new*

FSLR tried to rally this morning but shares stalled at $135.00. The early morning rise was fueled by an earnings report from rival SunTech Power (STP) that managed to beat the estimates but missed on the revenue number. Both STP and FSLR ended up getting downgraded on the session. I am lowering our stop loss to $146.00.

We have two targets. Our first target is $122.50. Our second target is $111.00. This is a very aggressive trade and FSLR can be an extremely volatile stock. I'm suggesting very small position sizes. FYI: the Point & Figure chart is bearish with a $108 target.

Picked on   August 17 at $135.88 *triggered/gap down entry
Change since picked:      - 5.46
Earnings Date           11/03/09 (unconfirmed)
Average Daily Volume =       3.5 million  
Listed on August 15, 2009         


Intl.Business Machines - IBM - cls: 118.95 change: +0.38 stop: 120.10

IBM is inching back toward resistance at $120.00. Readers may want to consider buying a straddle at the $120 level, which involves buying a call and a put at the same strike or consider buying a strangle, which involves buying an out of the money call and put. That way you don't care what direction IBM moves as long as it picks a direction.

I'm not suggesting new positions at this time but a failed rally under $120 would be a new bearish entry point. Our first target to take profits is at $113.75, which is just above the top of the gap from mid July. Our second and final target is $111.25, which is near the bottom of the gap.

FYI: The newsletter will buy calls at $120.25 should IBM breakout higher. Use the September strikes. I prefer the $120s and $125s.

Picked on   August 08 at $118.17 /gap down entry
                               /originally listed at $119.33
Change since picked:      + 0.78
Earnings Date           10/08/09 (unconfirmed)
Average Daily Volume =       7.9 million  
Listed on August 08, 2009         


iShares Transports - IYT - close: 65.90 change: +0.50 stop: 66.75

The IYT bounced past the $66.00 level twice but both times it stalled near $66.15. I would still consider new bearish positions here but readers may want to wait for some sign of weakness in the broader market first. More aggressive traders can place their stop above resistance at $68.00 instead. We'll take some money off the table at $62.00 (1st target) and exit completely at $60.25 (2nd target).

Picked on   August 19 at $ 65.40
Change since picked:      + 0.50
Earnings Date           00/00/00
Average Daily Volume =       772 thousand 
Listed on August 19, 2009         


Marvel Entertainment - MVL - close: 38.01 change: +0.35 stop: 39.26

MVL rallied back above resistance at $38.00 and its 50-dma. More conservative traders may want to tighten their stop down toward $38.50 to reduce their risk. Our target is $34.10 as the $34.00 level could be support. I am lowering the stop loss to $39.26.

Picked on   August 17 at $ 37.90 *triggered         
Change since picked:      + 0.11
Earnings Date           11/04/09 (unconfirmed)
Average Daily Volume =       710 thousand 
Listed on August 10, 2009         


Shanda Interactive - SNDA - close: 48.79 chg: +2.24 stop: 50.75 *new*

A huge +4% bounce in the Chinese market helped SNDA gain 4.8%. The MACD on the daily chart for SNDA is nearing a new buy signal. I am adjusting our stop loss down to $50.75. Watch for a failed rally under $50.00 as a new entry point for puts. Our target is the $41.50-40.00 zone. Remember, SNDA is a volatile stock and readers may want to use smaller position sizes.

Picked on   August 08 at $ 48.10 /gap higher entry
                               /originally listed at $47.83
Change since picked:      + 0.69
Earnings Date           09/01/09 (unconfirmed)
Average Daily Volume =       1.5 million  
Listed on August 08, 2009         


Strangle & Spread Play 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.)

McDonald's - MCD - close: 56.14 change: +0.49 stop: n/a

Unless MCD just collapses tomorrow it looks like game over for our strangle play. I am not suggesting new strangle positions at this time.

I suggested the August $60 calls (MCD-HL) and the August $55 puts (MCD-TK). Our estimated cost is $1.25 (0.70 + 0.55). We want to sell if either option hits $1.75 or higher.

Picked on     July 18 at $ 57.84
Change since picked:      - 1.70
Earnings Date           07/23/09 (unconfirmed)
Average Daily Volume =       7.8 million  
Listed on  July 18, 2009         


Schlumberger - SLB - close: 53.80 change: +0.93 stop: n/a

SLB is trading back near the $53-54 zone where we decided to launch positions. If you are looking for a new entry point then this is it.

The options we suggested were the September $60.00 calls (SLB-IL) and the September $45.00 puts (SLB-UI). Our estimated cost is $1.00 and we want to sell if either option hits $2.50 or higher.

Picked on   August 15 at $ 52.00 /gap down entry Aug. 17th
Change since picked:      + 1.80
Earnings Date           10/15/09 (unconfirmed)
Average Daily Volume =       9.2 million  
Listed on August 15, 2009         


CLOSED BULLISH PLAYS

Ultra-Short S&P 500 - SDS - close: 44.98 chg: -0.92 stop: 44.90

Our aggressive bet that the market bounce would roll over did not pan out. The SDS hit our stop loss at $44.90 late this afternoon with stocks' final push higher.

Chart:

Picked on   August 18 at $ 46.70 
Change since picked:      - 1.80<-- stopped out @ 44.90 (-3.8%)
Earnings Date           00/00/00
Average Daily Volume =        38 million  
Listed on August 18, 2009         



CLOSED BEARISH PLAYS

Genzyme - GENZ - close: 52.42 change: +1.39 stop: 52.55

It looks like a positive review in Barron's Online sparked some buying or short covering in GENZ this morning. The stock spiked higher and powered past the $51-52 zone to hit our stop loss at $52.55 closing the play. the long-term trend is still bearish and readers can watch for a failed rally under $55.00 or a new drop under $49.00 as an entry point to buy puts.

Chart:

Picked on   August 03 at $ 49.90 *triggered         
Change since picked:      + 2.65<-- stopped @ 52.55 (+5.3%)
Earnings Date           10/22/09 (unconfirmed)
Average Daily Volume =       3.9 million  
Listed on August 01, 2009         


Intercontintental Exchange - ICE - cls: 95.00 change: +5.15 stop: 92.55

ICE was one of our more promising put plays. The initial position had an $8.00 gain at one time. The potential gains (declines in the stock) vanished over the last couple of sessions. Today's move appears to be inspired by news that the CFTC and England's FSA have agreed to cooperate on regulation of the oil markets, which will affect all of ICE futures Europe contracts.

Once shares of ICE shot through resistance at $90.00 and technical resistance at its 30-dma the short covering began in earnest and ICE gained 5.7% on the session. Our stop was hit at $92.55.

Chart:

Picked on   August 08 at $ 93.60 Buy Half 
Change since picked:      - 1.05 <-- stopped @ 92.55 (-1.1%)

Picked on   August 13 at $ 89.85 triggered 2nd half
Change since picked:      + 2.65 <-- stopped @ 92.55 (+2.9%)

Earnings Date           10/29/09 (unconfirmed)
Average Daily Volume =       2.1 million  
Listed on August 08, 2009