NEW DIRECTIONAL CALL PLAYS
Sina Corp. - SINA - close: 81.78 change: +4.65
Stop Loss: 70.85
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below
Why We Like It:
Big picture I am worried about SINA and its September breakdown. Looking at the weekly chart the larger trend might be construed as bearish. If you change your time frame then SINA looks a lot more bullish on the daily chart. Today's breakout over resistance near $80 is positive. Plus the P&F chart is bullish.
SINA can be a very volatile stock. We want to keep our position size very small. I suspect that SINA can bounce back toward resistance near $100 and its simple 200-dma before rolling over again. We are suggesting small bullish positions now but only if both SINA and the S&P 500 index both open positive tomorrow morning. We'll use a wide stop at $70.85. Our target is $94.50. Aggressive traders could aim for $99.00 while conservative traders may want to exit early near $90.00.
It is worth noting that the most recent data listed short interest at 10% of SINA's 65.4 million-share float. Plus, the Point & Figure chart for SINA has turned bullish with a $110 target.
*See Entry Point Details Above*
- Suggested Positions - (Very Small Positions, SINA is volatile)
(more aggressive traders, less than 2 weeks left)
Buy the OCT $85 call (SINA1122J85) current ask $3.40
- or -
buy the NOV $90 call (SINA1119K90) current ask $6.40
Entry on October xx at $ xx.xx
Earnings Date 11/15/11 (unconfirmed)
Average Daily Volume = 8.0 million
Listed on October 11, 2011