Editor's Note:

The U.S. stock market is slowly wilting in the summer heat thanks to Washington's lack of a debt ceiling deal. We are removing some trade candidates tonight and we've updated a couple of stop losses.

-James

Current Portfolio:


CALL Play Updates

Agrium Inc. - AGU - close: 91.04 change: -1.36

Stop Loss: 87.75
Target(s): 94.00, 98.00
Current Option Gain/Loss: +22.2% & +17.0%
Time Frame: 4 to 5 weeks
New Positions: see below

Comments:
07/26 update: As expected AGU pulled back and looks headed for support near $90.00. More conservative traders may want to raise their stop loss. I would use the dip to $90 or a bounce from $90 as a new bullish entry point to buy calls.

- Suggested Positions -

Long AUG $90 call (AGU1120H90) Entry @ $2.70

- or -

Long AUG $95 call (AGU1120H95) Entry @ $0.94

07/21 New stop @ 87.75
07/19 Breakout past $90.00 is a new entry point.
07/19 new stop @ 86.90

Entry on July 11 at $88.54
Earnings Date 08/03/11 (unconfirmed)
Average Daily Volume = 1.7 million
Listed on July 9, 2011


Helmerich & Payne Inc. - HP - close: 72.57 change: -0.03

Stop Loss: 69.75
Target(s): 76.50
Current Option Gain/Loss: +28.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/26 update: HP managed to hit another new two-year high this morning and then spent most of the day in a 50-cent range. I am not suggesting new positions at this time. HP reports earnings on Friday morning (July 29th). We will plan to exit on Thursday at the closing bell if we don't see an exit or get stopped before then.

I am raising our stop loss to $69.75.

- Suggested Positions -

Long AUG $75 call (HP1120H75) Entry @ $1.25

07/26 new stop loss @ 69.75
07/23 new stop loss @ 68.45
07/23 Plan to exit on July 28th at the close

Entry on July 20 at $71.49
Earnings Date 07/29/11 (confirmed)
Average Daily Volume = 1.3 million
Listed on July 19, 2011


Nu Skin Enterprises - NUS - close: 39.78 change: -0.74

Stop Loss: 39.40
Target(s): 44.00
Current Option Gain/Loss: -21.4%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/26 update: Warning! Readers may want to abandon ship with our NUS trade. After yesterday's relative strength the stock has reversed course. Today's -1.8% decline is a show of relative weakness. The close under $40.00 and the close under its 10-dma is short-term bearish. I still see potential support near $39.50 but that might be wishful thinking. The safer bet here is to exit positions. You could put NUS on your watch list for a dip or a bounce near $38 and its 50-dma as an alternative entry point.

Please note I am raising our stop loss to $39.40.

Earlier Comments:
Our target is the $44.00 mark but we will plan to exit ahead of the early August earnings report. FYI: The Point & Figure chart for NUS is bullish with a $62 target. Investors should note that the most recent data did list short interest at 14.4% of the 53.4 million-share float. That does provide some fuel for a short squeeze.

- Suggested Positions -

Long AUG $40 call (NUS1120H40) Entry @ $2.10
07/26 new stop loss @ 39.40, readers may want to exit early now!
07/23 new stop loss @ 38.90
07/20 Entered at $40.80
07/19 buy calls tomorrow if NUS and S&P 500 are both up at the open.
07/19 new stop loss @ 38.40
07/18 Our play has not been opened yet. We're going to wait 24 hours and reconsider.

Entry on July 20 at $40.80
Earnings Date 08/02/11 (confirmed)
Average Daily Volume = 700 thousand
Listed on July 16, 2011


Open Text Corp. - OTEX - close: 69.40 change: +0.54

Stop Loss: 67.45
Target(s): 74.50
Current Option Gain/Loss: Unopened
Time Frame: 2 to 3 weeks
New Positions: Yes, see below

Comments:
07/26 update: OTEX was showing some relative strength today. Traders bought the dip near the bottom of its trading range again and OTEX was in rally mode this afternoon. Shares still have resistance at $70.00 and I'm still suggesting that more conservative traders wait for a breakout past $70.00 before initiating positions.

Our trade is still not open. The S&P 500 opened fractionally lower this morning. Once again, I am suggesting we buy calls if both OTEX and the S&P 500 open in positive territory tomorrow morning. We do want to keep our position size small. The market looks vulnerable so we want to lower our exposure here.

Earlier Comments:
A breakout over $70.00 could produce another short squeeze. The most recent data listed short interest at more than 10% of the 55.9 million-share float. We do not want to hold over the August earnings report.

If both S&P 500 and OTEX open positive tomorrow morning

- Suggested Positions -

buy the AUG $70 call (OTEX1120H70)

Entry on July xx at $ xx.xx
Earnings Date 08/10/11 (unconfirmed)
Average Daily Volume = 300 thousand
Listed on July 23, 2011


Potash Corp. - POT - close: 61.11 change: -0.71

Stop Loss: 59.90
Target(s): 63.75, 68.00
Current Option Gain/Loss: +13.7%
Time Frame: exit prior to July 28th
New Positions: see below

Comments:
07/26 update: This is it. Tomorrow is our last day. The plan is to exit tomorrow at the closing bell to avoid earnings on Thursday. More conservative traders may want to exit immediately instead since both the market and POT were trending lower on Tuesday. I am inching our stop loss up to $59.90.

- Suggested Positions -

Long AUG $60 call (POT1120H60) entry @ $2.40
07/26 new stop loss @ 59.90, prepare to exit tomorrow at the close
07/25 new stop loss @ 59.60
07/23 New stop loss @ 58.95
07/23 Time is running out. Prepare to exit on Wednesday
07/19 Play is opened. POT gapped open at $59.98
07/18 We are still unopened. Try again. Both POT and S&P 500 need to open higher on July 19th to buy calls.
07/18 new stop @ 56.70

Entry on July 19 at $59.98
Earnings Date 07/28/11 (confirmed)
Average Daily Volume = 7.4 million
Listed on July 16, 2011


PowerShares QQQ - QQQ - close: 59.63 change: +0.15

Stop Loss: 57.75
Target(s): 62.50, 64.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
07/26 update: Believe it or not our trade is still not open. The condition was to buy calls of the QQQs opened higher. Shares opened lower but eventually drifted higher. I am still cautiously bullish here. We will try again tomorrow with the same condition (buy calls of the Qs open higher) but we want to keep our position size small. We're getting closer and closer to the August deadline for the debt ceiling issue. If lawmakers don't make a deal soon the market could reverse lower. FYI: The Point & Figure chart for QQQ is bullish with a $89 target.

Trigger @ if the QQQs open positive in the morning.

- Suggested Positions - (SMALL POSITIONS)

buy the AUG $60 call (QQQ1120H60)

- or -

buy the AUG $62 call (QQQ1120H62)

Entry on July xx at $ xx.xx
Earnings Date --/--/--
Average Daily Volume = 61.7 million
Listed on July 23, 2011


PUT Play Updates

FactSet Research - FDS - close: 94.76 change: -0.85

Stop Loss: 100.25
Target(s): 90.50, 86.00
Current Option Gain/Loss: -34.2% & -33.3%
2nd Position Gain/Loss: + 0.0% Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
07/26 update: Hmm... it looks like the bounce attempt in FDS is done. I am suggesting new bearish positions now. We'll add new positions below. Please note our new stop loss at $98.25. More conservative traders might want to consider a stop loss closer to $97.00 instead. I do want to warn readers that a potential risk here is a debt ceiling deal. The entire market could rally if lawmakers do agree on a debt extension.

Earlier Comments:
Our targets are $90.50 and $86.00 but the $90.00 level is support and FDS will probably see a bounce from this level. The Point & Figure chart for FDS is bearish with a $64 target.

- Suggested (SMALL) Positions -

Long AUG $95 PUT (FDS1120T95) Entry @ $3.50

- or -

Long SEP $90 PUT (FDS1117U90) Entry @ $2.40

- 2nd Position, listed 7/26 -

Buy Aug $95 PUT (FDS1120T95) current ask $2.65

07/26 New stop loss @ 98.25, Adding positions

chart:

Entry on July 18 at $94.48
Earnings Date 09/21/11 (unconfirmed)
Average Daily Volume = 363 thousand
Listed on July 16, 2011


CLOSED BULLISH PLAYS

Caterpillar Inc. - CAT - close: 105.20 change: -0.46

Stop Loss: 102.95
Target(s): 110.00,
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/26 update: It was a close call but our CAT trade is still not open. Shares of CAT opened higher only to fade back toward the $105 level. The S&P 500 actually opened lower but it was less than a point. If you did choose to buy CAT this morning anyway, I'd consider a tighter stop loss. We have tried two days in a row to open positions and have been unsuccessful. Taking into consideration the lack of progress in Washington on the debt ceiling issue I am suggesting investors trade small. In CAT's case I am removing CAT as a candidate. We'll put it on our watch list to see what happens in a couple of days.

Our Trade Never opened

chart:

Entry on July xx at $ xx.xx
Earnings Date 07/22/11 (confirmed)
Average Daily Volume = 8.5 million
Listed on July 23, 2011


Diamond Foods Inc. - DMND - close: 73.86 change: -1.06

Stop Loss: 73.60
Target(s): 79.50, 83.00
Current Option Gain/Loss: -48.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/26 update: We have been concerned with DMND for days but it was not until today that shares actually broke key support at its rising 30-dma. The morning rally attempt failed and shares fell through support at the 30-dma and the $74.00 level. Our stop loss was hit at $73.60 late this afternoon.

- Suggested (small) Positions -

AUG $75 call (DMND1120H75) Entry @ $2.25, exit $1.15 (-48.8%)

07/26 stopped out @ 73.60
07/23 Cautious traders may want to exit early now
07/19 new stop loss @ 73.60
07/15 triggered at $74.25
07/14 Adjusted entry point to $74.25 and stop to $72.75

chart:

Entry on July 15 at $74.25
Earnings Date 10/05/11 (unconfirmed)
Average Daily Volume = 237 thousand
Listed on July 11, 2011


Joy Global - JOYG - close: 98.03 change: -2.18

Stop Loss: 96.45
Target(s): 104.50, 107.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
07/26 update: Normally rising copper and gold prices would be bullish for shares of JOYG. Strength in these commodities today did not help. JOYG opened lower and then fell toward its 10-dma. The stock settled with a -2.1% loss. We've been trying to launch new positions but we can't seem to get both JOYG and the S&P 500 to open positive on the same day. Our trade is still not open.

I am growing concerned over the lack of progress in Washington over the debt ceiling issue so I am removing JOYG as a trade. We'll put it on our watch list.

Our Trade Has Not Opened

07/26 I'm giving up. Our trade has not opened
07/25 try again.
07/23 Open positions if JOYG and market are positive on Monday morning
07/21 New entry point. Buy calls, small positions only, if the stock and the S&P 500 are positive at the open.
07/21 New stop loss @ 96.45. New targets are $104.50 and $107.50
...please see earlier updates for previous notes here...

chart:

Entry on July xx at $ xx.xx
Earnings Date 08/31/11 (unconfirmed)
Average Daily Volume = 1.9 million
Listed on June 30, 2011


Teradata Corp. - TDC - close: 56.62 change: -0.33

Stop Loss: 56.25
Target(s): 62.00
Current Option Gain/Loss: -48.3%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
07/26 update: I am finally throwing in the towel on TDC. Shares have continued to disappoint. Today the stock flirted with a breakdown under key support at its 50-dma. Shares have continued to build a bearish trend of lower highs. Technically TDC is still holding support at the 50-dma but I want to exit early anyway. We can jump back in later if the situation improves.

- Suggested Positions -

AUG $60 call (TDC1120H60) Entry @ $1.55, exit $0.80 (-48.3%)

07/26 Exit early
07/25 New stop loss @ 56.25
07/21 TDC is underperforming. Cautious traders may want to exit
07/19 new stop @ 55.40
07/19 Trade is open. TDC gaps up at $57.69.

chart:

Entry on July 19 at $57.69
Earnings Date 08/04/11 (confirmed)
Average Daily Volume = 1.5 million
Listed on July 18, 2011