Editor's Note:

The S&P 500 index seems to be bouncing off technical support at its simple 50-dma and an intermediate trend of higher lows.

HES and CRM have been triggered. We are removing RAX.

Current Portfolio:


CALL Play Updates

Health Care REIT - HCN - close: 61.05 change: +0.18

Stop Loss: 59.85
Target(s): 64.75
Current Option Gain/Loss: -16.1%
Time Frame: exit prior to the Aug 6th earnings
New Positions: see below

Comments:
07/26/12 update: Hmm... HCN is just not having much success. Shares tried to rally this morning but quickly returned to this recent sideways churn near $61. I am growing more cautious on this trade.

FYI: The Point & Figure chart for HCN is bullish with a $70 target.

- Suggested Positions -

Long Aug $60 call (HCN1218H60) entry $1.55

07/24/12 triggered @ 61.15

Entry on July 24 at $61.15
Earnings Date 08/06/12 (confirmed)
Average Daily Volume = 1.5 million
Listed on July 23, 2012


Hess Corp. - HES - close: 47.56 change: +2.10

Stop Loss: 44.45
Target(s): 49.85
Current Option Gain/Loss: Aug$47.5c: +47.6% & Sep$47.5c: +24.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/26/12 update: It was a big day for many stocks in the energy sector. I saw a lot of strong rallies. HES gapped open higher at $46.65 and closed up +4.6% on the day. Since our trigger to buy calls was $46.55 the trade opened first thing this morning. I wouldn't chase it here.

- Suggested Positions -

Long AUG $47.50 call (HES1218H47.5) Entry $1.05

- or -

Long SEP $47.50 call (HES1222I47.5) Entry $2.02

07/26/12 triggered on gap open higher at $46.65

Entry on July 26 at $46.65
Earnings Date 07/25/12
Average Daily Volume = 4.3 million
Listed on July 25, 2012


PUT Play Updates

Alliant Techsystems - ATK - close: 44.64 change: -0.39

Stop Loss: 46.25
Target(s): 40.50
Current Option Gain/Loss: - 5.8%
Time Frame: exit prior to the early August earnings
New Positions: see below

Comments:
07/26/12 update: ATK tried to rally this morning but the initial spike higher failed near short-term technical resistance at the simple 10-dma. The fact that ATK did not post a gain today with the market's widespread rally is a good sign for the bears.

FYI: The Point & Figure chart for ATK is bearish with a $35 target.

- Suggested Positions -

Long Aug $45 PUT (ATK1218T45) Entry $1.70

07/23/12 triggered @ 44.75

Entry on July 23 at $44.75
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 261 thousand
Listed on July 21, 2012


Salesforce.com - CRM - close: 124.61 change: -0.71

Stop Loss: 130.25
Target(s): 111.00
Current Option Gain/Loss: - 7.2%
Time Frame: exit prior to the mid August earnings
New Positions: see below

Comments:
07/26/12 update: It was a volatile day for shares of CRM. The stock gapped open higher at $128.36, spiked past resistance near $130.00, and then reversed. The stock fell under support near $125.00 and hit our trigger to buy puts at $124.00. I would still consider new positions at current levels.

Readers should consider this an aggressive, higher-risk trade because CRM can be a volatile stock.

- Suggested Positions -

Long Aug $120 PUT (CRM1218T120) Entry $4.15

07/26/12 triggered at $124.00

Entry on July 26 at $124.00
Earnings Date 08/16/12 (unconfirmed)
Average Daily Volume = 1.8 million
Listed on July 24, 2012


SINA Corp. - SINA - close: 46.20 change: +0.72

Stop Loss: 47.60
Target(s): 40.50
Current Option Gain/Loss: -44.6%
Time Frame: exit prior to the mid August earnings report
New Positions: see below

Comments:
07/26/12 update: The stock market's widespread gains on Thursday helped SINA to a +1.5% gain. This is the first time the stock has closed above $46 and its simple 10-dma in days. The larger trend is still bearish but we're not suggesting new positions at this time.

- Suggested Positions -

Long Aug $42.50 PUT (SINA1218T42.5) Entry $2.71

Entry on July 23 at $43.99
Earnings Date 08/16/12 (unconfirmed)
Average Daily Volume = 2.7 million
Listed on July 21, 2012


Wynn Resorts - WYNN - close: 93.10 change: +0.31

Stop Loss: 96.25
Target(s): 85.50
Current Option Gain/Loss: - 9.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/26/12 update: A 0.3% gain in WYNN versus the +1.6% rally in the S&P 500 doesn't bode well for this casino stock. Yet it's worth noting that WYNN did bounce sharply off the $90.00 level. I previously cautioned readers that the $90 mark is probably round-number support. WYNN's stock is scheduled to begin trading ex-dividend tomorrow. Don't be surprised if the stock gaps open lower at the open. The quarterly cash dividend is 50 cents.

FYI: The Point & Figure chart for WYNN is bearish with a $60 target.

- Suggested Positions -

Long Aug $90 PUT (WYNN1218T90) Entry $2.20

07/24/12 triggered @ 93.75

Entry on July 24 at $93.75
Earnings Date 07/17/12
Average Daily Volume = 2.3 million
Listed on July 23, 2012


CLOSED BEARISH PLAYS

Rackspace Hosting - RAX - close: 43.15 change: +1.32

Stop Loss: 41.55
Target(s): 35.50
Current Option Gain/Loss: Unopened
Time Frame: exit prior to the Aug 7th earnings
New Positions: Yes, see below

Comments:
07/26/12 update: Strong gains for the tech sector helped RAX produce a +3.1% rally. The stock has bounced back into the middle of its $41-45 trading range. We are giving up on RAX as a candidate. Our trade did not open. The play was to buy puts on a breakdown with a trigger at $39.90.

Trade did not open.

07/26/12 removed. trade did not open.

chart:

Entry on July xx at $ xx.xx
Earnings Date 08/07/12 (confirmed)
Average Daily Volume = 1.6 million
Listed on July 24, 2012