Editor's Note:

Stocks produced a very widespread rebound today. FOSL, one of our bullish candidates, hit an upside target.

This bounce could last a couple of days and that could get painful for some of our bearish put plays. Readers may want to take profits in our WFM trade early.

-James

Current Portfolio:


CALL Play Updates

Apple Inc. - AAPL - close: 332.44 change: +5.84

Stop Loss: 317.45
Target(s): 337.50, 347.50
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see trigger

Comments:
06/14 update: Hmm... after a day like today it would be easy to think we've missed our buy-the-dip entry point near the 200-dma. AAPL never hit our triggers at $324.00 or at $325.00 and I don't want to chase it now. We'll leave AAPL on the play list for another day and see if shares can produce any follow through on today's oversold bounce.

FYI: In the news today AAPL made headlines as it came to an agreement with rival Nokia (NOK) on a patent dispute.

Trigger @ $325.00 (SMALL POSITIONS)

- Suggested Positions -

buy the July $340 call (AAPL1116G340)

Entry on June xxth at $ xx.xx
Earnings Date 07/19/11 (unconfirmed)
Average Daily Volume = 12.9 million
Listed on June 8th, 2011


Fossil Inc. - FOSL - close: 107.72 change: +0.82

Stop Loss: 99.39
Target(s): 109.75, 114.00
Current Option Gain/Loss: + 3.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/14 update: Target achieved. FOSL rallied to a new high at $110.61 this morning. Our first target to take profits was hit at $109.75. The July $110 calls were trading with a bid near $3.20 at the time. The sharp pull back from its high is a little bit worrisome. I am not suggesting new positions at this time. Our final target is $114.00.

Earlier Comments:
We wanted to keep our position size small to limit our risk.

- Suggested (SMALL) Positions -

Long July $110 call (FOSL1116G110) Entry @ $3.00

06/14 1st target hit @ 109.75, July option @ 3.20 (+6.6%)
06/11 Exit June calls ASAP. Option @ 0.35 (-74.6%)

chart:

Entry on May 27th at $104.96
Earnings Date 08/09/11 (unconfirmed)
Average Daily Volume = 842 thousand
Listed on May 26th, 2011


Forest Labs Inc. - FRX - close: 38.92 change: +0.35

Stop Loss: 34.90
Target(s): 39.00, 42.50
Current Option Gain/Loss: +110.7%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/14 update: FRX rallied back toward yesterday's highs near $39.00. Shares remain overbought and due for some profit taking. More conservative traders may want to raise their stop higher. Our secondary target is $42.50. I am not suggesting new positions at this time.

- Suggested Positions -

Long the August $37 call (FRX1120H37) Entry @ $1.40

06/13 1st target hit @ $39.00. August $37 call @ $2.85 (+103.5%)
06/11 New stop loss @ 34.90
06/10 Planned exit of June $37 call. exit $1.10 (+69.2%)
06/09 Prepare to exit the June calls on June 10th at the close
06/04 new stop loss @ 34.45
05/28 New stop loss @ 33.75

Entry on May 20th at $35.29
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume = 3.2 million
Listed on May 19th, 2011


Goldman Sachs - GS - close: 137.10 change: -0.43

Stop Loss: 128.45
Target(s): 134.00, 137.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see trigger

Comments:
06/14 update: The major financial sector indices managed a gain but the group lagged behind the rally. Shares of GS underperformed and closed in negative territory. There is no change from my prior comments. We'll stick to our plan, which is to buy calls (small positions) at $130.25. However, if GS continues to bounce and closes above $140 we'll re-evaluate.

Earlier Comments:
The 2010 lows are near $130. I am suggesting we launch very small bullish positions on a dip at $130.25. This is a very aggressive, higher-risk trade.

Trigger @ 130.25 (very small positions)

- Suggested Positions -

buy the July $135 call (GS1116G135)

Entry on May xxth at $ xx.xx
Earnings Date 07/19/11 (unconfirmed)
Average Daily Volume = 6.5 million
Listed on May 21st, 2011


Union Pacific - UNP - close: 101.68 change: +1.04

Stop Loss: n/a
Target(s): 109.00, 114.00
Current Option Gain/Loss: -93.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
06/14 update: UNP gapped open higher this morning and then spent the rest of the day trading sideways under short-term resistance near $102. I am not suggesting new positions at this time. Odds are that our June $105 call option is going to expire worthless.

- Suggested Positions -

Long the June $105 call (UNP1118F105) Entry @ $1.62

06/11 option has deteriorated. Removing the stop loss.

Entry on May 9th at $102.19
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume = 3.4 million
Listed on May 7th, 2011


PUT Play Updates

Amazon.com Inc. - AMZN - close: 189.96 change: +3.67

Stop Loss: 192.55
Target(s): 180.25, 175.00
Current Option Gain/Loss: -84.7% & -38.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/14 update: AMZN has bounced back to the top of its recent trading range near resistance at $190 and it 50-dma. If this rebound continues tomorrow there is a good chance we'll get stopped out at $192.55. I am not suggesting new positions at this time.

Earlier Comments:
The plan was to keep our position size small. Our first target is $180.25. Our second target is $175.00 (or the simple 200-dma, whichever one AMZN hits first).

- small bearish positions -

Long June $185 PUT (AMZN1118R185) Entry @ $2.89

- or -

Long July $180 PUT (AMZN1116S180) Entry @ $4.40

06/11 New stop loss @ 192.55
06/07 New stop loss @ 195.15.

Entry on June 6th at $188.01
Earnings Date 07/26/11 (unconfirmed)
Average Daily Volume = 4.5 million
Listed on June 4th, 2011


Becton, Dickinson and Company - BDX - close: 86.25 change: +1.19

Stop Loss: 87.15
Target(s): 80.50
Current Option Gain/Loss: -60.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/14 update: BDX has bounced back toward last week's high and stalled. If this market continues to rally tomorrow there is a decent chance that we'll get stopped out at $87.15. I am not suggesting new positions at this time.

Our target is $80.50. We'll try and keep our target just above the 200-dma.

- Suggested (SMALL) Positions -

Long July $80 put (BDX1116S80) Entry @ $0.50

Entry on June 13th at $84.95
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on June 11th, 2011


Diamond Offshore Drilling, Inc. - DO - close: 67.84 change: +0.51

Stop Loss: 71.55
Target(s): 64.50, 62.50
Current Option Gain/Loss: - 3.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/14 update: Energy stocks were some of the best performers today thanks in part to a +2% rally in oil prices. Yet DO underperformed its peers with just a +0.5% gain. The OSX oil services index rallied +2.5%. There is no change from my prior comments. Wait for a bounce or a failed rally in the $69.50-70.00 zone before initiating new positions.

Earlier Comments:
Our targets are $64.50 and $62.50. FYI: Traders should note that the most recent data listed short interest at more than 14% of the float. That does raise the risk of a short squeeze should the stock suddenly find strength.

- Suggested Positions -

Long July $67.50 PUT (DO1116S67.5) entry @ $2.09

06/13 new stop loss @ 71.55

Entry on June 8th at $68.91
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume = 1.8 million
Listed on June 7th, 2011


General Dynamics Corp - GD - close: 70.44 change: +0.80

Stop Loss: 72.25
Target(s): 65.50
Current Option Gain/Loss: -32.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/14 update: The House Appropriations Committee passed a $649 billion defense spending bill this afternoon. There were expectations that congress would produce deeper budget cuts, especially for the big defense contractors. They did trim $9 billion but it could have been worse. This story came out late afternoon and didn't have much impact on GD. The stock had already popped higher with the market this morning.

The close over $70 and its 200-dma is short-term bullish but the larger trend is still bearish. Wait for a failed rally near $71 or $72 before initiating new positions.

-Suggested Positions-

Long July $67.50 PUT (GD1116S67.5) Entry @ $1.25

Entry on June 10th at $69.75
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on June 9th, 2011


Nike Inc. - NKE - close: 82.24 change: +1.73

Stop Loss: 83.05
Target(s): 75.50
Current Option Gain/Loss: -13.5%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
06/14 update: Our bearish put play on NKE could be in trouble. The May retail sales figures came out this morning. Economists had been expecting retail sales to slide -0.6% but the report this morning only showed a -0.2% decline. This would suggest the consumer is a little bit healthier than expected. Shares of NKE rallied on the news. The stock is testing resistance near $82.25 and its 200-dma. This is a critical spot with additional resistance at its 30-dma and 100-dma. If there is any follow through higher tomorrow we could get stopped out at $83.05. I am not suggesting new positions at this time.

Our target is $75.50 but we'll adjust the target as the trade progresses. NKE is due to report earnings on June 27th and we do not want to hold over the announcement.

- Suggested Positions -

Long July $80 PUT (NKE1116G80) Entry @ $2.00

06/11 New stop loss @ 83.05

Entry on June 7th at $81.75
Earnings Date 06/27/11 (confirmed)
Average Daily Volume = 2.3 million
Listed on June 6th, 2011


Transocean Ltd. - RIG - close: 64.02 change: +1.79

Stop Loss: 66.15
Target(s): 58.00, 55.25
Current Option Gain/Loss: -22.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/14 update: A positive market environment, a rally in crude oil, and a new upgrade this morning was enough to lift RIG to a +2.8% gain. The stock is nearing potential resistance at its 10-dma. RIG should have additional resistance near $66.00. Wait for this bounce to stall or reverse and then launch new positions.

More conservative traders may want to take profits early near $60.00 since the $60 level might be support but I'm setting our targets at $58.00 and $55.25.

We wanted to keep our position size small to limit our risk.

- Suggested (SMALL) Positions -

Long July $60 puts (RIG1116S60) Entry @ $1.32

Entry on June 13th at $63.32
Earnings Date 08/04/11 (unconfirmed)
Average Daily Volume = 4.3 million
Listed on June 11th, 2011


SanDisk Corp. - SNDK - close: 43.20 change: +0.75

Stop Loss: 46.25
Target(s): 40.50, 36.00
Current Option Gain/Loss: + 4.5% & -14.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/14 update: We have been expecting SNDK to produce an oversold bounce. Shares rallied to their 10-dma and stalled. The stock should have stronger resistance near $45 and its 200-dma. Wait for a bounce or failed rally near this level before launching new positions.

Our targets are $40.50 and $36.00, given enough time. FYI: The P&F chart for SNDK is bearish with a $30 target.

- Suggested Positions -

Long July $42.00 PUT (SNDK1116S42) Entry @ $1.10

- or -

Long July $40.00 PUT (SNDK1116S40) Entry @ $0.69

06/08 New stop loss @ 46.25

Entry on June 6th at $44.31
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume = 5.8 million
Listed on June 4th, 2011


Stericycle Inc. - SRCL - close: 85.74 change: +0.69

Stop Loss: 90.05
Target(s): 84.00, 80.50
Current Option Gain/Loss: +13.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/14 update: SRCL produced a +0.8% gain but the rebound stalled near $86 and its 10-dma. The stock didn't even make it to the top of its recent trading range near $86.40. That doesn't mean that bears aren't in trouble here. SRCL has been building support near $85 for days. More conservative traders may want their stop lower or consider taking profits early right now. Our first target is $84.00. Our second target is $80.50.

- Suggested Positions - Long July $85 PUT (SRCL1116S85) Entry @ $1.50

06/11 new stop loss @ 88.05
06/08 Exit June $85 puts. Bid @ $1.00 (+100%)
06/04 new stop loss @ 90.05

Entry on May 31st at $88.78
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume = 502 thousand
Listed on May 28th, 2011


T.Rowe Price Associates - TROW - close: 56.68 change: -0.03

Stop Loss: 62.25
Target(s): 55.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see Trigger

Comments:
06/14 update: We were expecting a bounce and TROW rallied +1.9%. This is just an oversold bounce inside a larger downtrend. We want to launch positions on a bounce near resistance. I'm expecting $60.00 to be new resistance. We want to buy puts on a bounce at $59.50. If triggered we'll use a stop loss at $62.25. Our target is $55.25. FYI: The Point & Figure chart for TROW is bullish with a $51 target.

Trigger @ 59.50

- Suggested Positions -

buy the July $60 PUT (TROW1116S60)

Entry on June xxth at $ xx.xx
Earnings Date 07/26/11 (unconfirmed)
Average Daily Volume = 2.0 million
Listed on June 13th, 2011


Whole Foods Market - WFM - close: 54.77 change: +0.06

Stop Loss: 58.15
Target(s): 55.10, 52.00
Current Option Gain/Loss: + 91.4%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/14 update: Wow! I am surprised that WFM didn't see a bigger bounce, especially with the May retail sales coming in better than expected. WFM spiked at the open and then slowly drifted sideways to settle with a minor gain. Readers may want to take profits early on our July puts. I am not suggesting new positions at this time. Our final target for the July puts is $52.00.

- Suggested Positions -

Long July $55 PUT (WFM1116S55) Entry @ $1.05

06/13 Exit June $60 puts. Bid @ $5.20 (+136.3%)
06/11 New stop loss @ 58.15.
06/11 Consider exiting our June puts early.
06/08 1st target hit @ 55.10. June $60 put @ 4.30 (+95.4%), July $55 put @ 1.92 (+82.8%)
06/06 new stop loss @ 60.15
06/04 new stop loss @ 60.65

Entry on June 2 at $58.70
Earnings Date 08/11/11 (unconfirmed)
Average Daily Volume = 1.6 million
Listed on June 1st, 2011