Editor's Note:

Rising crude oil prices pushed the USO to our bullish target. Meanwhile shares of SAM almost hit our target on Tuesday. I am suggesting we go ahead and exit early on our SAM trade at the open on Thursday. The U.S. markets are closed for the Fourth of July holiday tomorrow.

We are dropping ASH as a candidate.

We have updated multiple stop losses tonight.

Current Portfolio:


CALL Play Updates

American Tower Corp. - AMT - close: 71.43 change: -0.07

Stop Loss: 69.35
Target(s): 74.50
Current Option Gain/Loss: +30.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: The rally in AMT ran out of steam today. It could have been a reflection of the low volume (due to the holiday tomorrow, people are out of town). Readers may want to look for a dip back toward the $70.50-70.00 zone as a new entry point.

We are raising our stop loss to $69.35.

- Suggested Positions -

Long Aug $70 call (AMT1218H70) entry $2.15

07/02/12 new stop loss @ 69.35
06/29/12 triggered @ 70.25

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


Athenahealth, Inc. - ATHN - close: 82.61 change: +0.98

Stop Loss: 79.85
Target(s): 89.00
Current Option Gain/Loss: +15.0%
Time Frame: exit prior to earnings on July 19th
New Positions: see below

Comments:
07/03/12 update: ATHN continues to climb and added another +1.2% today, outperforming the NASDAQ and S&P 500 index.

We are going to try and reduce our risk by raising the stop loss up to $79.85.

Earlier Comments:
We'll aim for $89.00 but conservative traders may want to exit early near the June highs (about $87). We will plan to exit prior to the July 19th earnings report. FYI: The Point & Figure chart for ATHN is bullish with a $92 target.

- Suggested Positions -

Long Jul $85 call (ATHN1221G85) Entry $2.00

07/03/12 new stop loss @ 79.85

Entry on July 03 at $81.51
Earnings Date 07/19/12 (confirmed)
Average Daily Volume = 481 thousand
Listed on July 02, 2012


Costco Wholesale - COST - close: 94.42 change: +0.02

Stop Loss: 93.25
Target(s): 99.00
Current Option Gain/Loss: Jul$92.50c: +56.5% & Aug95c: + 98.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: Looks like traders in COST are already on vacation. The stock drifted sideways in a very narrow range today. We are going to try and reduce our risk by raising the stop loss to $93.25. More conservative traders may want to take profits now! I am not suggesting new positions at this time.

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

07/03/12 new stop loss @ 93.25, readers may want to take profits now
06/30/12 new stop loss @ 91.75
06/28/12 triggered @ 92.50

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: 95.67 change: +0.64

Stop Loss: 93.25
Target(s): 99.00
Current Option Gain/Loss: Jul92.50c: +44.8% & Aug95c: +36.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: Today's rally in MCK (+0.6%) kept pace with the rally in the S&P 500. The $95.00 level was potential round-number resistance so today's close above it is positive. We are going to try and reduce our risk by moving the stop loss to $93.25. I am not suggesting new positions at this time.

- Suggested Positions -

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

- or -

Long Aug $95 call (MCK1218H95) Entry $1.90

07/03/12 new stop loss @ 93.25
06/29/12 triggered on gap higher at $94.47 (trigger was 93.55)

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: 127.01 change: +3.59

Stop Loss: 117.25
Target(s): 127.50
Current Option Gain/Loss: +46.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: It was another big day for SAM. Shares surged +2.9% to set new highs. The intraday high was $127.38. We've been aiming for $127.50.

I am suggesting we go ahead and exit now. We'll close positions at the open on Thursday morning (markets are closed tomorrow).

- Suggested Positions -

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

07/03/12 prepare to exit at the open on Thursday morning
*option entry price is an estimate. option did not trade when our play opened
06/29/12 triggered @ 120.25

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


PUT Play Updates

Deckers Outdoor Corp. - DECK - close: 44.18 change: +0.46

Stop Loss: 50.05
Target(s): 42.00
Current Option Gain/Loss: Jul45p: + 44.4% & Aug45P: +24.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: The market is up three days in a row so it's not a surprise to see DECK trying to bounce. Shares rallied to short-term technical resistance at the 10-dma and stalled today. Stocks like DECK could move on Thursday as the market reacts to June same-store sales data.

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.

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


FLIR Systems - FLIR - close: 19.71 change: +0.30

Stop Loss: 20.35
Target(s): 17.75
Current Option Gain/Loss: Jul20p: -36.8% & Aug19p: -30.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: FLIR outperformed the NASDAQ with a +1.5% gain today. This close over the simple 10-dma is short-term bullish. Odds just jumped that we'll see FLIR test round-number resistance at $20.00 soon.

I am not suggesting new positions at this time.

FYI: The Point & Figure chart for FLIR is bearish with a $7 target.

- Suggested Positions -

Long Jul $20 PUT (FLIR1221S20) Entry $0.95

- or -

Long Aug $19 PUT (FLIR1218T19) Entry $0.65

Entry on July 02 at $19.56
Earnings Date 07/20/12 (unconfirmed)
Average Daily Volume = 1.7 million
Listed on June 30, 2012


Youku Inc. - YOKU - close: 20.82 change: +0.64

Stop Loss: 21.25
Target(s): 16.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
07/03/12 update: After yesterday's big drop YOKU managed a little bit of an oversold bounce today. I don't see any changes from my prior comments.

I am suggesting we launch small bearish positions if YOKU trades at $19.90 or lower. We'll use a stop loss at $21.25. More conservative traders may want to wait for YOKU to trade under the May low of $19.47 before initiating positions instead. If triggered our target is $16.00.

FYI: We want to keep our position size small because YOKU already has a high amount of short interest. The most recent data listed short interest at almost 19% of the 50.2 million share float and that raises the risk of a short squeeze higher.

Trigger @ 19.90 *Small Positions*

- Suggested Positions -

buy the Jul $19 PUT (YOKU1221S19)

- or -

buy the Aug $19 PUT (YOKU1218T19)

Entry on July xx at $ xx.xx
Earnings Date 08/08/12 (unconfirmed)
Average Daily Volume = 1.3 million
Listed on July 02, 2012


CLOSED BULLISH PLAYS

Ashland Inc. - ASH - close: 69.19 change: +0.19

Stop Loss: 67.75
Target(s): 74.75, 77.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
07/03/12 update: The stock market has been up three days in a row. Yet ASH remains stuck under resistance at the $70.00 level. Technically ASH still seems to be coiling for a bullish breakout higher but we are going to go ahead and drop ASH as a candidate. Our trade did not open.

Readers can keep this stock on their watch list for a potential trade on a close over $70.00.

Our trade did not open.

07/02/12 removed from the newsletter. trade did not open.

chart:

Entry on June xx at $ xx.xx
Earnings Date 07/24/12 (unconfirmed)
Average Daily Volume = 937 thousand
Listed on June 30, 2012


U.S. Oil ETF - USO - close: 32.94 change: +1.51

Stop Loss: 30.49
Target(s): 33.00
Current Option Gain/Loss: Jul$30c: +228.7% & Aug30c: +157.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/03/12 update: Target achieved with big gains for the options!

Crude oil continues to rally with another +4.6% gain today. Today's gain in oil was fueled by news out last night that Iranian lawmakers were considering a bill to block off the Straits of Hormuz. Nearly one third of the world's oil tankers flow through the Strait of Hormuz, so blocking the channel would instantly drive up the price of oil. The U.S. has vowed they won't let that happen. Iran is desperate because the EU oil embargo began on July 1st.

Shares of the USO gapped open higher at $32.69 and hit our exit target at $33.00 intraday. The bid on our calls soared as well. The bid on the July $30 call was at $3.09 (+228.7%) and the bid on the August $30 call at our exit was $3.50 (+157.3%).

- Suggested Positions -

Jul $30 call (USO1221G30) Entry $0.94 exit $3.09 (+228.7%)

- or -

Aug $30 call (USO1218H30) Entry $1.36 exit $3.50 (+157.3%)

07/03/12 target hit at $33.00
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