Current Portfolio:


CALL Play Updates

Bank of America - BAC - close 15.24 change -0.18 stop 14.65

Target(s): 15.50, 15.70, 16.05
Key Support/Resistance Areas: 16.45, 16.10, 15.00
Current Gain/Loss: -17.5%
Time Frame: 1 week
New Positions: Yes

Comments:
6/27: On Friday negotiators finished their work on the FinReg reform bill which provided a framework for certainty to the banks, however, on Monday that certainty is now in question. The death of Robert Byrd (D-WV) early this morning and comments from Scott Brown (R-Mass) regarding an unexpected provision in the bill are causing the Obama administration challenges. Other Democrats have come forward today stating that they will not vote for the bill because it fails to properly regulate Wall Street firms. In other words they feel there should be more regulations than in the current form of the bill. The vote was scheduled to take place before the 4th of July holiday (i.e. this week) but it is unclear if the vote will proceed as scheduled. As such, I'm going to adjust the targets lower to $15.50 and $15.70. From a technical perspective, a bullish case can be made on the intraday charts. BAC broke through an hourly downtrend line on Friday and tested the backside of it today. It also did not take out Friday's lows and on the daily chart BAC looks like it is trying to form a higher low. A bearish case can be made because the stock was turned away at the 20-day SMA and it also printed a bearish engulfing candlestick. At the end of the day I believe the broader market is oversold and I expect there to be a bounce. This should get things moving in our direction but I also suggest tightening stops and selling into strength as the stock approaches our lowered targets.

6/26: Details of the FinReg reform bill have been agreed upon in principle by both aisles in Washington so the banks have more certainty. BAC has held a critical support level near $14.75 dating back 12/08 and 1/09. $14.75 is the dashed red line on the weekly chart below and it has been on this chart for quite some time. I believe the bank stocks are going to catch a bid, even if its short lived, so I suggest we take advantage and initiate long positions in BAC. Every time BAC dips down to this level buyers have stepped in creating bottom tails 4 of the past 5 weeks. The stock has also broken through a steep downtrend line and looks like it is forming a rounded bottom on the weekly chart. Our initial stop is $14.65 which is below the most recent lows from early June.

Current Position: August $15.00 CALLS, entry was at $1.20

Entry on June 28, 2010
Earnings Date 7/16/10 (unconfirmed)
Average Daily Volume: 163 million
Listed on 6/26/10


Hanson Natural Corp - HANS - close 40.42 change +0.69 stop 38.25

Target(s): 40.50 (hit), 41.25, 42.40, 43.25
Key Support/Resistance Areas: 42.50, 41.00, 40.25, 39.30, 38.50
Current Gain/Loss: +25% Time Frame: 1 to 2 weeks
New Positions: Yes

Comments:
6/28: HANS closed above it 50-day SMA today and is maintaining the upward trend line that started on 5/7. The stock also traded to a new high that hasn't been since 5/18. Our first target of $40.50 was hit today but I think we have a good chance of hitting $41.25 so I am going to leave this open to see if we can get some follow through in the coming days.

6/26: HANS continues to make higher lows and if there is strength in the broader market early this week I believe our targets will be hit. On Friday the stock was increasing in the morning as the market was making now lows. The volume patterns are also bullish as the pullbacks tend to come on lighter volume. This shows me there may be institutions buying in this stock which bodes well for a bullish thesis. I've made some minor adjustments to the targets.

6/24: HANS printed a bullish engulfing candlestick today and closed +1.15% higher, despite the significant weakness in the broader market. The market should bounce soon, if not tomorrow, and this should bode well for HANS. The stock was turned back from its 50-day SMA today for the second time in the last 4 trading sessions. If it keeps knocking it should break through, and with the broader market in oversold conditions itching for a bounce, I expect this to happen and our targets to be hit. The 20-day and 200-day SMA are also providing support for the stock.

Current Position: August $40.00 CALLS, entry was at $2.20

Entry on June 23, 2010
Earnings Date 8/5/10 (unconfirmed)
Average Daily Volume: 1.1 million
Listed on 6/22/10


PUT Play Updates

Avon Products - AVP - close 27.78 change +0.29 stop 29.65

Target(s): 25.80, 25.25, 24.25
Key Support/Resistance Areas: 29.50, 29.00, 28.00, 27.17, 25.75, 25.00
Current Gain/Loss: -13%
Time Frame: Several weeks
New Positions: Yes

Comments:
6/28: AVP found some support at its 20-day SMA which also corresponds to its late May highs. AVP could bounce from here if the market does but I believe it will be short lived. Our stop is high enough to account for volatility and I expect the stock to trade down to $25.80 within the next week or so.

6/26: AVP ran into prior support and its 50-day SMA this past week and is now turning lower. The stock made a lower high and I believe it is due to make a lower low, or at least retest its recent lows near $25.00. If we simply catch a portion of this move we will have a nice profitable trade. Our primary target is $25.25 but I have also listed $25.80 as a target which is an area to consider tightening stops or taking profits. If the selling picks up AVP could go all the way down to the $24.00 area which was a prior support/resistance level from 10/08 and 5/09. Our stop is $29.65 and our time frame is several weeks.

Current Position: August $27.00 PUTS, entry was at $1.45

Entry on June 28, 2010
Earnings 7/29/2010 (unconfirmed)
Average Daily Volume: 4.2 million
Listed on June 26, 2010


Penn National Gaming, Inc. - PENN - close 24.19 change -1.18 stop 19.26

Target(s): 24.05, 23.60, 23.05
Key Support/Resistance Areas: 27.00, 26.45, 26.00, 24.60, 24.00, 23.50, 22.50
Current Gain/Loss: N/A
Time Frame: 1 to 2 weeks
New Positions: Waiting to be triggered

Comments:
6/28: PENN traded to within 26 cents of our entry trigger and reversed hard to the downside, closing -4.65% on the day. The position has run away from our trigger and I do not suggest chasing it lower. Let's wait for a bounce and be ready to pull the trigger on short positions if the stock trades to our new trigger of $24.80 to enter short positions. This equates to about a 50% retracement of today's losses.

6/26: PENN has a primary and secondary downtrend line as overhead resistance along with all of its SMA's which are declining. It is also below a key support resistance area at $26.45 dating back to late 2009. I believe the stock will bounce a tad higher from here before it makes new lows in the coming days/weeks. Let's use a trigger to enter short positions at $25.75. My primary target is $23.60 but I have also listed $24.05 as a target where the stock may find some support. If the selling intensifies PENN will probably trade down to the $22.50 area which is below our most aggressive target. I'm going to place a wide initial stop at $27.60 to account for volatility and will adjust it once we are in the position.

Suggested Position: August $25.00 PUTS, current ask $2.20, estimated ask at entry $1.85

Entry on June xx
Earnings 7/26/2010 (unconfirmed)
Average Daily Volume: 738,000
Listed on June 26, 2010


Whirlpool Corp - WHR - close 95.64 change -1.01 stop 105.50

Target(s): 94.10, 91.50, 86.05
Key Support/Resistance Areas: 101.70, 99.00, 97.50, 94.00, 85.25
Current Gain/Loss: +11%
Time Frame: 1 to 2 weeks
New Positions: Yes

Comments:
6/28: WHR traded up to our trigger 0f $97.50 to enter short positions. The stock hit a brick wall and sold off the remainder the day. Our primary target is $91.50 but $94.10 may provide support. This is an area to consider tightening stops and protecting profits. If WHR bounces I believe there is enough overhead resistance to keep things in check, but we may have to exhibit some patience.

6/26: We are waiting to be triggered at $97.50 to enter short positions. My comments remain the same from Thursday. I still believe WHR has a good chance to trade down to $91.50 and eventually $86.05 but I do not suggest chasing it at these levels. The broader market should bounce from here and I suspect WHR will as well. But these bounces should be short lived and I suggest we take advantage them. I have lowered our entry to short positions to $97.50. My comments from the play release remain the same. WHR has been making lower highs and has broken many trend lines. The stock has one more trend line providing support from the July lows to the February lows. However, I think it only a matter of time before this is broken and the stock retests or breaks its recent lows near $91.50. WHR is also below its 20-day and 50-day SMA's and I think there is enough overhead resistance to enter short positions at $97.50, which is below Thursday's highs and the 20-day SMA. I am going to place a wide initial stop at $105.50 to account for volatility and will adjust it once we are in the position.

Current Position: August $95.00 PUTS, entry was at $6.25.

Entry on June 28, 2010
Earnings 7/21/2010 (unconfirmed)
Average Daily Volume: 2 million
Listed on June 23, 2010