Editor's Note:

Thursday proved to be a quiet summer trading session on Wall Street. Art Cashin, on the floor of the NYSE, said the hottest seller today was No Doze!

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:
08/09/12 update: BRCM managed a rebound near its rising 10-dma and outperformed the market with a +1.2% gain. Shares remain under resistance in the $34.50-35.00 zone. 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: 88.40 change: +1.18

Stop Loss: 84.90
Target(s): 91.50
Current Option Gain/Loss: +16.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/09/12 update: I heard positive comments about CAT on CNBC today. Shares outperformed the wider market with a +1.3% gain and a new multi-week high. I am not suggesting new positions at current levels.

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: 71.25 change: -0.52

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:
08/09/12 update: Lack of movement in the broader market has left CELG to hover just under resistance near the $72.00 level. We are still waiting for a breakout. 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: 51.66 change: -1.29

Stop Loss: 49.45
Target(s): 54.50
Current Option Gain/Loss: - 5.2%
Time Frame: exit prior to earnings on Aug. 16th
New Positions: see below

Comments:
08/09/12 update: Ouch! After yesterday's nearly one dollar gain in DLTR shares gave it all back and more today (-2.4%). I couldn't find any specific news behind today's relative weakness. I'd wait for a bounce near $51.00 before considering new positions.

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


PPG Industries - PPG - close: 111.37 change: +0.26

Stop Loss: 109.75
Target(s): 117.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
08/09/12 update: Thursday was a quiet session for the market and PPG drifted sideways under short-term resistance at $112.00.

I am suggesting a trigger to buy calls at $112.25. We'll use a stop loss at $109.75. The $115 level could be resistance but we are aiming for $117.50. FYI: The Point & Figure chart for PPG is bullish with a $137 target.

Trigger @ 112.25

- Suggested Positions -

buy the Sep $115 call (PPG1222I115)

Entry on August xx at $ xx.xx
Average Daily Volume = 1.3 million
Listed on August 8, 2012


Qualcomm - QCOM - close: 62.00 change: +0.55

Stop Loss: 57.75
Target(s): 64.50
Current Option Gain/Loss: +24.7%
Time Frame: 4-6 weeks
New Positions: see below

Comments:
08/09/12 update: QCOM continues to show relative strength with a +0.89% gain. Shares closed at another new relative high. You could argue that QCOM is a little bit short-term overbought here. Readers may want to wait for a dip near $60.50 before considering new positions.

- 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: 56.79 change: -0.65

Stop Loss: 54.40
Target(s): 59.75
Current Option Gain/Loss: + 6.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/09/12 update: WLP hit a little bit of profit taking after a strong two-day advance. Shares slipped -1.1%. Broken resistance near $56.00 should be new support.

- 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: 36.21 change: +0.03

Stop Loss: 36.75
Target(s): 32.00
Current Option Gain/Loss: -54.2%
Time Frame: 2-4 weeks
New Positions: see below

Comments:
08/09/12 update: AKAM is little changed on the session. I remain cautious here. More conservative traders may want to exit early now to limit losses.

- 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: 21.01 change: +0.29

Stop Loss: 23.25
Target(s): 17.00
Time Frame: 2-4 weeks
Current Option Gain/Loss: -17.2%
New Positions: see below

Comments:
08/09/12 update: FB danced on either side of the $21.00 level all day long. The stock did manage to post a +1.3% gain by the close. There is no change from my prior comments. Cautious traders may want to look for a new relative low before initiating positions.

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: 80.20 change: +0.38

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

Comments:
08/09/12 update: Hmm... the small caps managed to outperform the big cap stocks today. The IWM closed up +0.4% and above the $80 level. I remain very cautious on this trade and suggest readers limit their position size to reduce risk.

Currently the plan is open small bearish put positions if the IWM trades at $79.40 or lower.

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

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