Editor's Note:

The stock market continues to drift lower, which has helped trigger some of our bearish plays. JCP and YOKU were both triggered today. MCK, a call play, was stopped out.

Current Portfolio:


CALL Play Updates

American Tower Corp. - AMT - close: 69.90 change: -1.92

Stop Loss: 69.35
Target(s): 74.50
Current Option Gain/Loss: - 7.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/10/12 update: Warning! It was a bad day for AMT. Shares tagged a new high this morning above $72.00 but immediately reversed. I could not find any news to account for this plunge (-2.6%) today. The close under $70.00 and under its 10-dma is bearish. Furthermore today marks a bearish reversal pattern. If there is any follow through lower tomorrow we can expect AMT to hit our stop loss at $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: 81.80 change: -1.11

Stop Loss: 79.85
Target(s): 89.00
Current Option Gain/Loss: -10.0%
Time Frame: exit prior to earnings on July 19th
New Positions: see below

Comments:
07/10/12 update: ATHN was weak as well with a -1.3% decline. Shares continue to struggle with resistance near the $84.00 level. The close under short-term support at $82.00 would suggest ATHN is about to drop to the next level of support near $80.00. I am not suggesting new positions at this time.

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


Westlake Chemical Corp. - WLK - close: 54.37 change: -1.00

Stop Loss: 53.40
Target(s): 62.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
07/10/12 update: It was a disappointing session for WLK with the stock underperforming the market with a -1.8% decline. Furthermore today's session has created a bearish engulfing candlestick reversal pattern. If there is any follow through lower we will likely drop WLK as a candidate. Currently, I am suggesting a trigger to buy calls at $56.35. We are using a wide stop loss at $53.35 so that does raise the risk on this trade. The $60.00 level might be resistance but we're aiming for $62.00. FYI: The Point & Figure chart for WLK is bullish with a $69 target.

Trigger @ 56.35

- Suggested Positions -

(July options expire in less than two weeks)
buy the Jul $55 call (WLK1221G55)

- or -

buy the Aug $60 call (WLK1218H60)

Entry on July xx at $ xx.xx
Earnings Date 07/31/12 (unconfirmed)
Average Daily Volume = 543 thousand
Listed on July 09, 2012


PUT Play Updates

Deckers Outdoor Corp. - DECK - close: 44.86 change: +0.15

Stop Loss: 50.05
Target(s): 42.00
Current Option Gain/Loss: Jul45p: + 3.7% & Aug45P: +17.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/10/12 update: DECK is still churning sideways above short-term support at the $44.00 level. Today's show of relative strength, while minor, is a potential warning sign for the bears. More conservative traders may want to exit early 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

07/07/12 it's been a volatile couple of days for DECK and more conservative traders may want to exit now following Friday's bounce in these put options.
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: 18.87 change: -0.29

Stop Loss: 20.35
Target(s): 17.75
Current Option Gain/Loss: Jul20p: +10.5% & Aug19p: +15.3%
Time Frame: exit prior to the late July earnings report
New Positions: see below

Comments:
07/10/12 update: Good news! FLIR has broke down to new relative lows and closed under short-term support at $19.00. Today's move can be used as a new bearish entry point. Currently our target is $17.75 but more aggressive traders may want to aim lower.

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


J.C.Penney Co. - JCP - close: 22.13 change: -0.37

Stop Loss: 22.51
Target(s): 19.50, 15.50
Current Option Gain/Loss: +16.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/10/12 update: Our JCP put play is finally open. There were some bearish analyst comments on the company's earnings estimates this morning. Plus there were a number of headlines regarding JCP's move today to fire 350 people at its headquarters in Plano, Texas. Speculation is suggesting that today's employee reduction is a sign that business is getting worse at JCP.

The stock broke down to new multi-year lows and hit our trigger to buy puts at $21.30. I would still consider new bearish positions now.

Our first target is the 2010 lows near $19.50. Our second much more aggressive target is $15.50. FYI: The Point & Figure chart for JCP is bearish with a $7.00 target.

- Suggested Positions -

Long Aug $20 PUT (JCP1218T20) Entry $1.20

07/10/12 triggered @ 21.30

Entry on July 10 at $21.30
Earnings Date 08/08/12 (unconfirmed)
Average Daily Volume = 9.3 million
Listed on July 03, 2012


Sohu.com Inc. - SOHU - close: 40.05 change: +0.03

Stop Loss: 41.75
Target(s): 35.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
07/10/12 update: Shares of SOHU spent the day drifting sideways along support near the $40.00 level. I am a bit surprised since many of SOHU's Chinese peers all broke down today.

I am suggesting a trigger to buy puts at $39.65. We will want to keep our position size small to limit our risk because the most recent data listed short interest at 23% of the small 29.6 million-share float. FYI: The Point & Figure chart for SOHU is bearish with a $32 target.

Trigger @ 39.65 *Small Positions*

- Suggested Positions -

(July options expire in less than two weeks)
buy the Jul $40 PUT (SOHU1221S40)

- or -

buy the Aug $37.50 PUT (SOHU1218T37.5)

Entry on July xx at $ xx.xx
Earnings Date 07/30/12 (unconfirmed)
Average Daily Volume = 634 thousand
Listed on July 09, 2012


Weight Watchers Intl. - WTW - close: 47.97 change: -0.03

Stop Loss: 50.75
Target(s): 42.00
Current Option Gain/Loss: Jul47.50p: - 9.0% & Aug45p: - 5.4%
Time Frame: exit prior to the early August earnings report
New Positions: see below

Comments:
07/10/12 update: Hmm... WTW didn't make much progress either way today. I doubt the headlines that WTW had appointed a new CFO had any impact on the stock. The $50.00 level and the 10-dma remain overhead resistance.

FYI: The most recent data does list short interest at 10% of the small 26.6 million share float. That raises the risk of a short squeeze but lately the any short covering has failed at the 10 or 20-dma.

NOTE: July options expire in two weeks.

- Suggested Positions -

Long Jul $47.50 PUT (WTW1221S47.5) Entry $1.10

- or -

Long Aug $45 PUT (WTW1218T45) Entry $2.01

Entry on July 09 at $48.28
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 764 thousand
Listed on July 07, 2012


Youku Inc. - YOKU - close: 19.07 change: -1.02

Stop Loss: 21.25
Target(s): 16.00
Current Option Gain/Loss: + 6.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/10/12 update: Our YOKU trade has been opened. Shares finally broke down under round-number support at $20.00. Our trigger to buy puts was at $19.90. Now the $20 level should be new resistance.

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.

*Small Positions* - Suggested Positions -

Long Aug $19 PUT (YOKU1218T19) Entry $1.55

07/10/12 triggered @ 19.90

Entry on July 10 at $19.90
Earnings Date 08/08/12 (unconfirmed)
Average Daily Volume = 1.3 million
Listed on July 02, 2012


CLOSED BULLISH PLAYS

McKesson Corp. - MCK - close: 93.30 change: -0.62

Stop Loss: 93.25
Target(s): 99.00
Current Option Gain/Loss: Jul92.50c: -36.6% & Aug95c: -28.9%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/10/12 update: The rally attempt in MCK quickly failed and shares reversed lower. The stock broke down under its simple 10-dma and hit our stop loss at $93.25 this afternoon.

- Suggested Positions -

Jul $92.50 call (MCK1221G92.5) Entry $2.21 exit $1.40 (-36.6%)

- or -

Aug $95 call (MCK1218H95) Entry $1.90 exit $1.35 (-28.9%)

07/10/12 stopped out at $93.25
07/03/12 new stop loss @ 93.25
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