Editor's Note:

The market's oversold bounce is already over. Stocks reversed yesterday's gains with a sharp decline on Wednesday. Our aggressive call play in AAPL has been triggered.

-James

Current Portfolio:


CALL Play Updates

Apple Inc. - AAPL - close: 326.75 change: -5.69

Stop Loss: 317.45
Target(s): 337.50, 347.50
Current Option Gain/Loss: + 14.7%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/15 update: Yesterday's bounce in AAPL has been completely erased. The stock plunged back to the $325.00 level and tagged its 200-dma. The intraday low was actually $324.88. Our aggressive buy-the-dip entry point was hit at $325.00. If AAPL doesn't hold support at $325 and its 200-dma then shares will likely see a quick drop to its next level of support at $320.00. More conservative traders may want to consider a tighter stop (maybe closer to $320.00 or closer to $324.00 instead).

Remember, we wanted to keep our position size very small. This is a high-risk trade. There is no guarantee that AAPL will hold support at its 200-dma.

(SMALL POSITIONS)- Suggested Positions -

Long July $340 call (AAPL1116G340) entry @ $3.05

chart:

Entry on June 15th at $325.00
Earnings Date 07/19/11 (unconfirmed)
Average Daily Volume = 12.9 million
Listed on June 8th, 2011


Fossil Inc. - FOSL - close: 106.40 change: -1.32

Stop Loss: 99.39
Target(s): 109.75, 114.00
Current Option Gain/Loss: -13.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/15 update: FOSL gave up -1.2%. The stock is likely to retest support near $105 again. If this level fails then FOSL's could drop toward the bottom of its rising bullish channel near the $101-100 area. 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%)

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: 38.58 change: -0.34

Stop Loss: 34.90
Target(s): 39.00, 42.50
Current Option Gain/Loss: + 92.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/15 update: FRX is still holding up pretty well. Shares erased yesterday's gain but FRX is hovering near its recent highs. The stock remains short-term overbought. More conservative traders may want to just take profits and exit now. I am expecting a pull back toward the $36.00 level if the market continues to sink. 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: 134.85 change: -2.25

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:
06/15 update: The oversold bounce in GS is rolling over again. Odds are good that this time GS will test what should be support near $130. Our plan is to buy calls (very small positions) at $130.25. This is a very aggressive trade as we try and catch the falling knife.

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: 99.43 change: -2.25

Stop Loss: n/a
Target(s): 109.00, 114.00
Current Option Gain/Loss: - 100%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
06/15 update: Time is almost up. June options expire after Friday. I am not suggesting new positions at this time. Nimble traders may want to consider buying puts on UNP if the stock breaks down under $99.00. The 100-dma might offer some support but I'd target the $95 area or the 200-dma.

- 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: 185.98 change: -3.98

Stop Loss: 192.55
Target(s): 180.25, 175.00
Current Option Gain/Loss: -51.2% & - 7.9%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/15 update: Wow! AMZN gave us a scare this morning. There was a brief rally past resistance at its 50-dma and shares hit $192.45. Our stop loss is at $192.55. Fortunately AMZN rolled over and completely erased yesterday's gains. The stock is back to testing support near $185. I am not suggesting new positions at this time.

NOTE: June options expire soon. More conservative traders may want to exit the June position immediately. The newsletter will plan on exiting our June $185 puts tomorrow (Thursday) at the closing bell unless AMZN hits our first target at $180.25 first - where we would exit completely.

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


Abercrombie & Fitch Co. - ANF - close: 65.38 change: -1.95

Stop Loss: 72.05
Target(s): 65.50, 62.75(100-dma)
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see trigger

Comments:
06/15 update: The market's oversold bounce has reversed much more quickly than anticipated. I was expecting ANF to bounce back toward resistance near $70 first. Today shares lost -2.8% and I wouldn't chase it. We'll leave ANF on the play list for a couple of more days and then re-evaluate. Currently the plan is to launch bearish positions at $69.75. Our first target is $65.50. Our second target is the 100-dma but if this trade takes too long we may abandon the second target. Aggressive traders could aim for support near $60 but I'm concerned the 100-dma will act as support.

Trigger @ 69.75

- Suggested Positions -

buy the July $70 PUT (ANF1116S70)

Entry on June xxth at $ xx.xx
Earnings Date 08/17/11 (unconfirmed)
Average Daily Volume = 2.8 million
Listed on June 14th, 2011


Becton, Dickinson and Company - BDX - close: 84.91 change: -1.34

Stop Loss: 87.15
Target(s): 80.50
Current Option Gain/Loss: -30.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/15 update: The bounce in BDX has failed with shares back under $85 and its 50-dma. Today's move looks like a new entry point for bearish positions. More conservative traders could wait for a little more confirmation and open positions at $84.45 instead.

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: 66.65 change: -1.19

Stop Loss: 70.55
Target(s): 64.50, 62.50
Current Option Gain/Loss: +27.2%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/15 update: DO gave up -1.75% and slipped to new four-month lows this afternoon. I am adjusting our stop loss down to $70.55.

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

06/15 new stop loss @ 70.55
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: 70.85 change: +0.41

Stop Loss: 72.25
Target(s): 65.50
Current Option Gain/Loss: -36.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/15 update: Some bullish analyst comments helped GD close in positive territory today. Traders bought the dip near $70 this morning and the stock looks poised to breakout past short-term resistance at $71.00. Volume was above average on the rally today. More conservative traders may want to exit early following today's relative strength. I am not suggesting new positions at this time.

-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: 80.39 change: -1.85

Stop Loss: 83.05
Target(s): 75.50
Current Option Gain/Loss: +28.0%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
06/15 update: NKE has erased yesterday's gain in what appears to be another failed rally at technical resistance. I would use today's move as a new entry point or you can wait for NKE to trade under recent support and use a trigger at $79.45 as your entry point to buy puts.

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: 62.63 change: -1.39

Stop Loss: 66.15
Target(s): 58.00, 55.25
Current Option Gain/Loss: + 9.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/15 update: RIG gapped open lower and the morning rebound attempt quickly rolled over. Shares lost -2.1% but volume was below average on the session.

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: 42.18 change: -1.02

Stop Loss: 46.25
Target(s): 40.50, 36.00
Current Option Gain/Loss: +48.1% & +27.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/15 update: The bounce in SNDK is rolling over. Readers can use this move as a new entry point. More conservative traders might want to lower their stop closer to the $45.00 level.

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: 84.39 change: -1.35

Stop Loss: 88.05
Target(s): 84.00, 81.00
Current Option Gain/Loss: +53.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/15 update: Good news! After several days of consolidating near support at $85.00 SRCL is finally breaking down. Shares lost -1.5% today and closed at new twelve-week lows. Our first target to take profits is at $84.00. With the simple 200-dma at $80.59 I am moving our second and final target to $81.00.

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

06/15 adjusted 2nd target to $81.00.
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: 56.66 change: -1.11

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:
06/15 update: TROW is in the same boat as our new ANF trade. The oversold bounce has failed more quickly than expected. The trend is down but we don't want to chase it. We'll give TROW a couple of more days and then re-evaluate. Currently 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: 53.98 change: -0.79

Stop Loss: 58.15
Target(s): 55.10, 52.00
Current Option Gain/Loss: +136.1%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/15 update: WFM has closed under short-term support at $54.00. This bodes well for tomorrow. The stock might have technical support at the 200-dma (currently near $51.60). At the moment our final target to exit is at $52.00. I am not suggesting new positions at this time.

- 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