Editor's Note:

Shares of HES hit our bullish target today. We're adjusting our IWM trade.

WLP was triggered.

Current Portfolio:


CALL Play Updates

BRCM - Broadcom - close: 33.90 change: -0.33

Stop Loss: 33.25
Target(s): 38.50
Time Frame: 4-6 weeks
New Positions: see below

Comments:
08/08/12 update: BRCM is not cooperating. Shares are having trouble with resistance near $34.50 and its simple 100-dma (currently 34.31). We are turning cautious on this trade and moving the stop loss up to $33.25. I am not suggesting new positions at this time.

- Suggested Positions -

Position: Nov $36.00 Call (BRCM1217K36) entry $1.80

08/08/12 new stop loss @ 33.25
no follow through, turning cautious
08/07/12 triggered @ $34.75
08/06/12 adjust stop loss to $32.45

Entry on August 07 at $34.75
Average Daily Volume = 10 million
Earnings Oct-23rd
Listed on Aug 4, 2012


Caterpillar - CAT - close: 87.22 change: +0.00

Stop Loss: 84.90
Target(s): 91.50
Current Option Gain/Loss: - 4.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/08/12 update: CAT moved sideways on Wednesday and closed unchanged on the session. I don't see any changes from my prior comments. Dips near $86.00 can be used as a new entry point.

Earlier Comments:
I do consider this somewhat aggressive. CAT's recent earnings were strong and the company raised guidance but its stock price is probably still vulnerable to negative economic headlines. Furthermore the $90.00 level might be round-number resistance.

- Suggested (SMALL) Positions -

Long Sep $90 call (CAT1222I90) Entry $1.90

08/07/12 triggered @ $87.25

Entry on August 07 at $87.25
Average Daily Volume = 8.6 million
Listed on August 6, 2012


Celgene Corp. - CELG - close: 71.77 change: +0.33

Stop Loss: 69.90
Target(s): 75.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/08/12 update: CELG is still drifting higher but it has yet to breakout past the $72.00 level. I am suggesting a trigger to buy calls at $72.25. Our target is $75.75.

FYI: The Point & Figure chart for CELG is bullish with an $81 target.

Trigger @ 72.25

- Suggested Positions -

buy the Sep $75 call (CELG1222I75)

Entry on August xx at $ xx.xx
Average Daily Volume = 3.4 million
Listed on August 7, 2012


Dollar Tree - DLTR - close: 52.95 change: +0.98

Stop Loss: 49.45
Target(s): 54.50
Time Frame: exit prior to earnings on Aug. 16th
New Positions: see below

Comments:
08/08/12 update: DLTR continues to show relative strength with today's +1.8% gain. The stock has also broken through potential resistance at its simple 50-dma today. More conservative traders may want to start inching up their stop loss.

We do not want to hold over the earnings report on August 16th.

- Suggested Positions -

Position: Long Sept $52.50 Call (DLTR1222I52.5) @ $1.90

08/06/12 new stop loss @ 49.45, adjust time frame to exit prior to Aug. 16th earnings report

Entry on Aug 3rd at $ 51.42 (gap open)
Average Daily Volume = 1.5 million
Listed on Aug 2, 2012


Qualcomm - QCOM - close: 61.45 change: +0.11

Stop Loss: 57.75
Target(s): 64.50
Time Frame: 4-6 weeks
New Positions: see below

Comments:
08/08/12 update: QCOM eked out a minor gain on Wednesday. I don't see any changes from my prior comments. If you missed our entry point then consider waiting for a dip near $60.50 as your entry point.

- Suggested Positions -

Position: Oct $62.50 Call (QCOM1222J62.5) entry $1.70

08/07/12 triggered @ 60.51

Entry on August 07 at $60.51
Average Daily Volume = 1.5 million
Listed on Aug 4, 2012


WellPoint Inc. - WLP - close: 57.44 change: +1.18

Stop Loss: 54.40
Target(s): 59.75
Current Option Gain/Loss: +23.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/08/12 update: Our new trade on WLP has been triggered. Traders bought the dip near $56.00 this morning and shares advanced to a +2.0% gain. Our trigger was hit at $56.50.

- Suggested Positions -

Long Sep $57.50 call (WLP1222I57.5) Entry $1.60

08/08/12 triggered @ 56.50

Entry on August 08 at $56.50
Average Daily Volume = 4.4 million
Listed on August 7, 2012


PUT Play Updates

Akamai Technologies - AKAM - close: 36.18 change: -0.16

Stop Loss: 36.75
Target(s): 32.00
Time Frame: 2-4 weeks
New Positions: see below

Comments:
08/08/12 update: Hmm... the intraday bounce failed near the $36.40 level again. I remain cautious here. At the moment I'm not suggesting new positions but a close under the 10-dma might change my mind.

- Suggested Positions -

Position: Long Sept $34 PUT (AKAM1222U34) @ $1.53

08/02/12 triggered @ $34.85

Entry on Aug 2nd at $ 34.85
Average Daily Volume = 3.0 million
Listed on July 30, 2012


FB - Facebook - close: 20.72 change: -0.00

Stop Loss: 23.25
Target(s): 17.00
Time Frame: 2-4 weeks
Current Option Gain/Loss: - 3.5%
New Positions: see below

Comments:
08/08/12 update: No, that's not a typo. FB actually closed unchanged today. Traders bought the morning dip at $20.22. We remain bearish here but cautious traders may want to look for a new relative low before initiating positions and tighten their stop if they already own puts.

Earlier Comments:
Facebook has turned into the stock everyone loves to hate. Facebook has 674 million shares outstanding as of Friday. On August 15th another 268 million shares will see their lockup expire and become available for trading. That is 40% additional shares. If you were an investor or employee and you watched your shares decline from $35 to $20 ahead of your lockup expiration you are probably just waiting for an opportunity to sell. Another factor is that taxes are due on the awarded shares regardless of whether they are sold. That means employees have a big tax bill and they have not been able to sell those shares to pay the taxes. That is an additional incentive to pull the trigger on at least part of their position on August 15th.

Facebook has hundreds of detractors and they seem to be racing each other trying to put a lower price target on the stock. Mark Hulbert was on CNBC on Friday with a $13.80 price target based on a bunch of different metrics.

Facebook also has the various lawsuits over the IPO including the valuation and the various claims made about users and revenue in the days leading up to the IPO. There are plenty of clouds and no real catalysts to pump up the stock.

Facebook said expenses grew by 60% in Q2 and they would grow faster in Q3/Q4. That means earnings will decline.

I am recommending a September option with plans to exit (some time) after the August 15th share lock up expiration.

Suggested Positions

current position: Sept $20 PUT (FB1220U20) entry $1.45

08/07/12 triggered @ 20.95
08/06/12 adjust entry trigger to $20.95

Entry on August 07 at $20.95
Average Daily Volume = 80.0 million
Listed on August 5, 2012


iShares Russell 2000 ETF - IWM - close: 79.94 change: +0.72

Stop Loss: 80.75
Target(s): 76.50
Time Frame: 3-5 weeks
New Positions: Yes, see below

Comments:
08/08/12 update: Depending on how you draw your trend lines the IWM is either still under resistance or recently broke out. Both bulls and bears could make a case for a short-term trade. One of my concerns with bearish trades here is that both the 50-dma and the 200-dma on the IWM are now both angling higher. That should be a bullish signal. Of course that does not mean the IWM can't see some dramatic short-term drops.

We are adjusting our strategy on this trade. We'll use a trigger to buy puts at $79.40 but we want to keep our position size very small to limit risk. We'll move our stop loss down to $80.75 to also limit risk. Our exit target is only $76.50.

Entry Trigger: buy puts at $79.40

- Suggested (SMALL) Positions -

Buy Oct $78 PUT (IWM1220V78)

08/08/12 Adjust entry/stop/exit
Use a trigger @ 79.40, stop @ 80.75, target 76.50. Small Positions Only!
08/07/12 adjust trigger to buy puts up to $78.90

chart:

Entry on Unopened XX at $ XX.XX
Average Daily Volume = 60.0 million
Listed on August 5, 2012


CLOSED BULLISH PLAYS

Hess Corp. - HES - close: 50.03 change: +0.61

Stop Loss: 45.35
Target(s): 49.85
Current Option Gain/Loss: Aug47.5c:+147.6% & Sep47.5c: +75.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/08/12 update: Target hit.

HES was weak at the open but recovered to rally +1.2%. Shares are now testing resistance at the $50.00 mark. Our exit target was hit at $49.85.

- Suggested Positions -

AUG $47.50 call (HES1218H47.5) Entry $1.05 exit $2.60 (+147.6%)

- or -

SEP $47.50 call (HES1222I47.5) Entry $2.02 exit $3.55 (+75.7%)

08/08/12 target hit
07/26/12 triggered on gap open higher at $46.65

chart:

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