Editor's Note:

The Germans caved into the pressure and new EU proposals helped send stocks higher on Friday.

AMT, MCK, and SAM were all triggered.

CMI and JOY, both industrial names, were stopped out.

Current Portfolio:


CALL Play Updates

American Tower Corp. - AMT - close: 69.91 change: +0.23

Stop Loss: 67.40
Target(s): 74.50
Current Option Gain/Loss: - 9.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/30/12 update: I am unimpressed with AMT's performance on Friday. Shares gapped open higher at $70.19 and hit $70.65 before reversing course. AMT spent most of the day hovering underneath resistance at the $70.00 level and only gained +0.3% for the day compared to a +2.5% gain in the S&P 500. That's not very inspiring.

The stock did hit our trigger to buy calls at $70.25 and the trade is open but I would wait for a new rally past $70.25 before launching new positions.

Trigger @ 70.25

- Suggested Positions -

Buy the Aug $70 call (AMT1218H70) entry $2.15

06/29/12 triggered @ 70.25

chart:

Entry on June 29 at $70.25
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on June 27, 2012


Costco Wholesale - COST - close: 95.00 change: +2.08

Stop Loss: 91.75
Target(s): 99.00
Current Option Gain/Loss: Jul$92.50c: +86.3% & Aug95c: +144.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/30/12 update: It was a big day for COST on Friday. The stock gapped open higher and surged to new record highs with a +2.2% gain on the day. You could argue COST is now short-term overbought so don't be surprised to see a pullback toward the $93 area. I am not suggesting new positions at this time. We are adjusting the stop loss to $91.75.

The plan was to keep our position size small. FYI: The Point & Figure chart for COST is bullish with a $116 target.

- Suggested *Small* Positions -

Long Jul $92.50 call (COST1221G92.5) entry $1.61

- or -

Long Aug $95 call (COST1218H95) entry $0.88

06/30/12 new stop loss @ 91.75
06/28/12 triggered @ 92.50

chart:

Entry on June 28 at $92.50
Earnings Date 10/11/12 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on June 26, 2012


McKesson Corp. - MCK - close: 93.75 change: +0.48

Stop Loss: 91.45
Target(s): 99.00
Current Option Gain/Loss: Jul92.50c: -11.7% & Aug95c: - 7.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/30/12 update: I am not very impressed with MCK's performance on Friday. The stock gained +0.5% versus the market's +2.5% surge. Shares did gap open higher at $94.47, which was way above our proposed trigger entry price at $93.55. So not only did MCK underperform the market but the gap higher negatively impacted our trade. We are lucky the options did not see a bigger gap higher on Friday morning.

The $93.50 level "should" be short-term support and traders could buy calls now but I would be tempted to wait for a new dip into the $92.50 area and then buy a bounce instead.

- Suggested Positions -

Long Jul $92.50 call (MCK1221G92.5) Entry $2.21

- or -

Long Aug $95 call (MCK1218H95) Entry $1.90

06/29/12 triggered on gap higher at $94.47 (trigger was 93.55)

chart:

Entry on June 29 at $94.47
Earnings Date 07/30/12 (unconfirmed)
Average Daily Volume = 1.6 million
Listed on June 28, 2012


Boston Beer Co. - SAM - close: 121.00 change: +3.04

Stop Loss: 117.25
Target(s): 127.50
Current Option Gain/Loss: + 7.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/30/12 update: The market's big rally on Friday helped push SAM past resistance at the $120 level. The stock hit our trigger to buy calls at $120.25. We'll start with a stop loss at $117.25. More aggressive traders may want to give SAM more room and put their stop under short-term technical support at the 10-dma (near 116.35) instead.

- Suggested Positions -

Long Aug $125 call (SAM1218H125) Entry $3.35*

*option entry price is an estimate. option did not trade when our play opened
06/29/12 triggered @ 120.25

chart:

Entry on June 29 at $120.25
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 117 million
Listed on June 27, 2012


U.S. Oil ETF - USO - close: 31.83 change: +2.33

Stop Loss: 30.49
Target(s): 33.00
Current Option Gain/Loss: Jul$30c: +130.8% & Aug30c: +91.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/30/12 update: The EU summit news helped spark a big drop in the U.S. dollar, which sent commodity prices soaring. Oil surged and the USO delivered a +7.8% gain. The ETF is testing resistance near $32.00.

Readers may want to go ahead and take some money off the table now. We are raising our stop loss up to $30.50. I am not suggesting new positions at this time.

Earlier Comments:
Make no mistake, this is an aggressive trade since we're trying to call a short-term bottom in oil prices here. The commodity could definitely see some strength as we get closer to the EU oil embargo against Iran, which is scheduled to start on July 1st.

- Suggested Positions -

Long Jul $30 call (USO1221G30) Entry $0.94

- or -

Long Aug $30 call (USO1218H30) Entry $1.36

06/30/12 new stop loss @ 30.49
06/29/12 USO surges as oil rallies on dollar weakness.

chart:

Entry on June 22 at $29.57
Earnings Date --/--/--
Average Daily Volume = 8.6 million
Listed on June 21, 2012


PUT Play Updates

Deckers Outdoor Corp. - DECK - close: 44.01 change: +0.76

Stop Loss: 50.05
Target(s): 42.00
Current Option Gain/Loss: Jul45p: + 70.3% & Aug45P: +34.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/30/12 update: On Friday morning most of the market was in rally mode yet DECK quickly reversed the morning pop and tagged a new relative low at $42.16. Shares recovered and spent the rest of the day churning sideways near $44.00.

We've been aiming to exit at $42.00 and now given the market's big rally readers may want to go ahead and just take profits now. I'm not suggesting new positions at this time.

Earlier Comments:
This is an aggressive trade because so many investors are already short this stock. The most recent data listed short interest at 26% of the small 36.7 million share float. That does raise the risk of a short squeeze, although DECK hasn't seen a squeeze in a while. FYI: The Point & Figure chart for DECK is bearish with a $34 target.

- Suggested (SMALL) Positions -

Long Jul $45 PUT (DECK1221S45) Entry $1.35

- or -

Long Aug $45 PUT (DECK1218T45) Entry $2.90

06/29/12 DECK almost hit our target but bounced at $42.16
06/25/12 readers may want to take profits early now.

chart:

Entry on June 21 at $47.31
Earnings Date 07/26/12 (unconfirmed)
Average Daily Volume = 1.45 million
Listed on June 20, 2012


CLOSED BEARISH PLAYS

Cummins Inc. - CMI - close: 96.91 change: +4.65

Stop Loss: 92.55
Target(s): 82.50
Current Option Gain/Loss: -82.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/30/12 update: Industrial names were some of the biggest winners on Friday. Odds are it's mostly short covering since the economy did not suddenly improve overnight.

CMI gapped open higher and broke out past resistance. We had a stop at $92.55 but CMI opened at $95.80!

- Suggested Positions -

Jul $87.50 PUT (CMI1221S87.5) Entry $2.80 exit $0.50 (-82.1%)

06/29/12 CMI gapped open above our stop loss
06/25/12 triggered on the gap down at $89.06 (trigger was 89.35)

chart:

Entry on June 25 at $89.06
Earnings Date 07/31/12 (unconfirmed)
Average Daily Volume = 2.8 million
Listed on June 23, 2012


Joy Global, Inc. - JOY - close: 56.73 change: +2.80

Stop Loss: 55.05
Target(s): 47.50
Current Option Gain/Loss: -63.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
06/30/12 update: JOY is another industrial name that is probably rising on short covering. The stock gapped open higher above resistance at $55.00 and above our stop loss at $55.05. Friday's close is also a breakout above one of its key trend lines of resistance. Plus, chart readers will point out that on the weekly chart the newest candle looks like a bullish engulfing reversal pattern. In spite of the big rebound the larger trend is still down but the bounce may not be over yet.

- Suggested *SMALL* Positions -

Jul $50 PUT (JOY1221S50) Entry $1.60 exit $0.58 (-63.7%)

06/29/12 JOY gapped open higher at $55.30, which is above our stop loss at $55.05

chart:

Entry on June 26 at $52.23
Earnings Date 08/29/12 (unconfirmed)
Average Daily Volume = 2.6 million
Listed on June 25, 2012