Editor's Note:

The markets bounced back this afternoon after opening lower on the heels of weak international markets and higher than expected jobless claims. The volatile action is making us more defensive. Don't forget that there are only 6 trading days left until April options expire. If you are still holding April options plan an exit strategy soon.

Current Portfolio:


CALL Play Updates

F5 Networks - FFIV - close: 63.92 change: -0.64 stop: 61.40

Shares of FFIV sold off hard (about -2.50%) in the first 30-minutes of trading today, but then buyers stepped in and bought the stock the remainder of the day. The result is a bullish bottoming tail candlestick on the daily chart which indicates sellers may be diminishing. We now need the stock to follow through higher on the initial break out above $65.25. Our call position is near break-even despite the lower stock price since our entry. If the stock can push higher I would recommend that readers move up their stops or take profits to lock in gains. We are looking for a target of $69.75. I want to remind readers that this is an aggressive, higher-risk trade and we want to keep our position size small.

Current Position: CALL MAY $65.00 (FFIV 10E65.00) @ $3.00

Entry on April 6th at $ 65.26
Earnings Date 04/21/10
Average Daily Volume = 1.0 million
Listed on April 5th, 2010


Coca-Cola - KO - close: 53.76 change: -0.06 stop: 52.95

We mentioned yesterday that KO should find support at its 200-day SMA. Shares traded down to this level today almost to the penny before bouncing and closing at $53.76. We are looking for KO to bounce from here as it looks poised to be forming a higher low on the daily chart. The stock will still need to contend with its 20-day and 50-day SMA's in $53.35 range. If KO can bust through these SMA's I think the stock could rally at least to the $55.00 to $56.00 area. I am recommending readers consider selling into any strength of KO to limit losses in the position. We still have plenty of time with our May options but KO is a slow mover and I don't want to get stuck in a losing position. If the stock can't find some legs in the coming days I will consider adjusting our targets or exit completely next week. Our target to exit is $59.00 but the stock should find resistance at $55.00 to $56.00.

Current Position: CALL May $55.00 (KO 10E55.00) at $1.62

Entry on March 24th at $ 55.22
Earnings Date 04/21/10
Average Daily Volume = 14.6 million
Listed on March 23rd, 2010


L-3 Communications - LLL - close: 92.52 change: -0.15 stop: 88.90

Our comments on LLL remain the same as yesterday. We initially viewed this trade as a highly speculative trade and our $0.30 options are now only worth $0.05. I don't think it is worth exiting the options for a nickel so we will hold onto them to see if LLL can muster a rally into next week's expiration. If our miracle gains traction readers should consider selling positions if the April calls increase in value. I am not suggesting any new positions in LLL at this time.

We chose the out of the money $100 calls to keep our capital investment very small and our position size limited.

Current Position: CALL APRIL 100.00 (LLL 10D100.00) @ $0.30

Entry on March 18th at $ 93.88
Earnings Date 04/22/10
Average Daily Volume = 908 thousand
Listed on March 17th, 2010


Occidental Petrol. - OXY - close: 86.58 change: +0.28 stop: 83.45

OXY was weak again this morning and our entry to buy calls was triggered. Yesterday we suggested readers take advantage of any short-term weakness in shares of OXY and use it as an entry point to buy calls. We still expect the stock's recent broken resistance near the $85 level to hold as support and are now long May $85 at $3.25. Our first target is $89.75. We'll use a longer-term target at $94.00 but this could take several weeks to achieve.

Current Position: BUY CALL MAY $85.00 (OXY 10E85.00) at $3.25

Entry on April xxth at $ xx.xx
Earnings Date 04/29/10
Average Daily Volume = 5.5 million
Listed on April 6th, 2010


PartnerRe Ltd. - PRE - close: 80.51 change: -0.29 stop: 77.75

PRE gave back some of the gains from yesterday but still looks good here. The stock is still holding its upward trend line from early March and looks poised to for another leg up. There is potential resistance near the October 2009 highs ($81.70) so don't be surprised to see some congestion there. If PRE follows through and breaks through $81.70 we have a good chance to reach our first of $84.75. Our second, longer-term target is $89.00.

Current Position: CALL MAY $80.00 (PRE 10E80.00) $ $2.40

Entry on April 6th at $ 80.55
Earnings Date 04/27/10
Average Daily Volume = 989 thousand
Listed on March 20th, 2010


Wynn Resorts - WYNN - close: 86.23 change: +4.57 stop: 74.45

WYNN is running away from us after news was released today that year over year gaming revenues were up significantly in Las Vegas. Shares continue to look a overbought here and we would like to see a dip back toward the $78 area, which as broken resistance should be support. Our plan remains the same: buy calls on a dip at $78.50 with a new stop loss at $74.45. This remains an aggressive, higher-risk trade so please use smaller position size when initiating new positions. Our target is $84.50.

Trigger to buy calls at $78.50

Suggested Position: BUY CALL MAY $80 (WYNN 10E80.00) current ask $6.35

Entry on April xxth at $ xx.xx
Earnings Date 05/05/10
Average Daily Volume = 2.7 million
Listed on March 24th, 2010


PUT Play Updates

Cerner Corp. - CERN - close: 86.12 change: +1.23 stop: 88.25

Cerner triggered our entry this morning and then proceeded with a hard reversal, closing the day +1.23%. The reversal may have been shorts covering. The stock still looks weak and appears to be forming a lower high. I would like to give this a few days to see how the stock reacts. Plus it is our only short position in the portfolio at this time and provides us with a hedge against our long positions. If the stock does not follow through lower we will consider exiting the trade. Please note that I consider this play somewhat aggressive due to CERN's higher than normal short interest. The most recent data listed short interest at nearly 14% of the 68.4 million share float. That raises the risk for a short squeeze. You may want to keep your positions limited.

Current Position: PUT MAY $80.00 (CERN 10Q80.00) at $1.90

Entry on April 8 at $ 85.75
Earnings Date 04/28/10 (unconfirmed)
Average Daily Volume = 526 thousand
Listed on April 3rd, 2010


CLOSED BULLISH PLAYS

NII Holdings Inc. - NIHD - close: 42.65 change: +0.18 stop: 41.88 *NEW*

NIHD hit our stop this morning and we exited calls at $2.10 to protect our profits. When it was all said and done we managed to eek out a +13.50% gain.

Stopped out

Closed Position: CALL APRIL $40 (NIHD 10D40.00) at $2.10, Entry was at $1.85

Annotated Chart:

Entry on March 11th at $ 40.10
Earnings Date 04/22/10
Average Daily Volume = 2.68 million
Listed on March 10th, 2010


CLOSED BEARISH PLAYS

Amedisys Inc. - AMED - close: 57.04 change: -0.39 stop: 59.05

As discussed in last night's updates we sold our AMED puts this morning on the early morning weakness for $0.35. I just don't see AMED making a large leg down prior to next Friday's expiration so we wanted to limit our loss and salvage what we could out of the position. We are now flat AMED.

Closed Position: PUT APRIL $50.00 (AMED 10P50.00) at $0.35, Entry was at $0.85

Annotated Chart:

Entry on April 1st at $ 55.88
Earnings Date 04/28/10
Average Daily Volume = 749 thousand
Listed on March 31st, 2010