JEC, ABT, FLR, RIG, PSA ... more - Watch n Analyze

CLF, V, SWN, and FSLR will hopefully have a nice ride. Will MA follow the same path of V , is to be determined. AET will announce its earnings too.

The following are some additional positions to monitor and analyze application of a few theories to see the performance.

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JEC: If it crosses above 82.95, its 40 days SMA , then analyze the following trade
CALLS - Buy Oct 80 & Sell Sept 85 ; OR BUY Sept 80 & Sell 85

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ABT : If it stays above 56.34, its 9 days SMA, then analyze the following trade
CALLS - Buy Sept 55 & Sell Sept 57.5

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FLR : If it stays above 86.09, its 22 days SMA, then analyze the following trade
CALLS - Buy Sept 85 or Buy Oct ; do not sell anything yet.
It may pull back a bit bec it rallied too much recently. It is generally on steroids.

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RIG: It is approaching its 22 day SMA of 143.07 followed by 40 day SMA of 145.3
So watch this one.

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PSA : is already on the watch list from a previous posting.

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Analyze Additional August Covered Calls

Analyze the following covered calls that provide 7 to 10 % return for August expiration in 16 days.

The price may vary based on when one enters, but the return is still good.

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Buy 1,000 Shares of AMR at $9.15
Sell to Open Call 10 Contracts of -AMRHL, Strike price = 10 for $1.15

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Buy 500 Shares of MER at $25.9384
Sell to Open Call 5 Contracts of -MERHD, Strike price = 25 for $2.35

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Buy 500 Shares of FNM at $11.90
Sell to Open Call 5 Contracts of -NJWHK , Strike price = 11 at $2.2

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Buy 500 Shares of XLF at $21.2395
Sell to Open Call 5 Contracts of -XLFHU, Strike= 21 at $1.16
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Buy 500 Shares of FRE at $8.489
Sell to Open Call 5 Contracts of -FREHL, Strike=9 at $0.88

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V , FSLR , PSA , SBUX

One can analyze the verticals so as to reduce the cost & have a limited risk & limited income strategy.

Or, simply buy a Call; put a stop loss ; or sell a call later a position moves up.

Stop loss will be 1 or 1.5 dollar below the threshold values mentioned for each.

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V : Analyze CALLS if it stays above threshold 75.21 - Buy Sept 75 & Sell Sept 80

Earnings July 30, after market close for Visa

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FSLR : Analyze CALLS if it stays above threshold 270.1 - Buy Sept 270 & Sell Sept 280

Earnings July 30, after market close. This is a high flyer with high volatility, so doing a vertical preferred.

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PSA : Analyze CALLS if it stays above threshold 80.71 - Buy Sept 75 & Sell Sept 85

Earnings August 7, after market close [Wait for a Pull Back]

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SBUX : Analyze CALLS if it stays above threshold 14.81 - Buy Sept 15 & Sell Sept 17

Earnings July 30, after market close

Controversial, however with cutbacks announced & bad news already built in, this may move upwards.

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Covered Call

Investigate Buy DAL stock for 7.32 & Sell August 7.5 Call for .90
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Some Changes n Updates

Analyze:

Will BIDU , MOS , GOOG & XOI be a good candidate for Straddle? These swing quite a bit. [ Buy a Put & a Call for Sept or Oct; slightly OTM and plot the curve ]

CALLS

SWN : Sept 32.5
V : Sept 70
CLF: Sept 95
AET: Sept 35
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PUTS
SBUX: Aug 15
MA: 260
MUR: 80
CMI: 67.5

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CLF broke thru its 22 & 50 day SMA, so change previous list to a Call for it or monitor it closely for changes

MET below its 22 SMA, so monitor for PUT position.

BTW: SBUX just went below its 200 SMA.
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Paper Trade These Thoughts

The above is the pricing of the stocks as of this morning. After monitoring it for an hour and confirming that the directional move is still upwards for Call or downwards for Puts, jot down on paper & see if the paper trade for these positions would be successful.

SWN, MET, NOV, VZ seem to have bounce back in the other direction & may confirm the suggested trend. Refer to a comment & nice reasoning posted by a reader on Visa in the previous post.

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Analyze for July 28-30 Earnings

Refer to the image & if some of you can analyze & provide feedback on these or any other suggestions, it will be great.

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July 24 Spreads

Analyze these Spreads that expire in August. With small fluctuation in pricing, the positions may need slight adjustments.
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Investigate Financial Plays

Once the finance bill to help housing & foreclosing real estate industry passes in next few days thru the political pathway, it will be interesting to see the financial stocks move. For Thursday, there can be several strategies to consider for FNM, FRE, SLM, BAC, C, & of course XLF. Along with simply buying the stock, one can investigate buying Calls as well as Bull Put Spreads.

Note - SLM had earnings report on Wednesday, so it will be interesting to see how it moves on Thursday morning. A sell-off reaction, such as the one for FNM & FRE that occurred last week on their bad news is welcome so as to load it up.

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Status on analyzing pre-earnings game - July 23 closing

BIDU - (this will be painful) announced stellar earnings, so the PUT will go down south at open. A remedial step to analyze will be to either 1) Buy a call & sell the PUT 2) &/Or convert the PUT into a Bull Put Spread & Buy a Call at same time.

Other positions - we will know the picture prior to open on Thursday.

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POT, NEM, WYNN, CELG

Based on the team's discussions last night, the above will serve as a good basis to see how this works out for playing the earnings game.

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InPlay for Short Term - July 24 Earnings

After shortlisting the companies for July 24 earnings play from the screen, here is what may be worth for further analysis:

1) Analyze Buying CALLs ATM or ITM for :

SII - Can't really figure what may be the best strategy. It is consolidating & will move in either direction, mostly upwards.

POT - Buy a PUT & a CALL for 220 Strike. After announcement, ride the wave in a direction & close the other. This is expected to swing big time. Exit in maximum 2 - 3 days or preferably the same day.

RTN - Can't figure out a clear strategy. However, our expectation is Bullish.

OXY - At 200 day MA Take no position. However, our expectation is Bullish.

NEM - Buy 50 dollar Call for September, instead of August.

WYNN - Buy 95 or 100 dollar CALL for September (preferably 95) . It broke thru its 50 day & 22 day SMAs.



2) Analyze Buying PUTs ATM or ITM for : CELG. Strategy will be to Buy a 75 dollar PUT for August

3) Buy Stock = F . Then Later on, if it moves upwards, Selling a near the money Covered Call.

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Analyzing July 24 Earnings Candidates

The above screen has some candidates that can be investigated to see if there is a potential to play their anticipated movements in either direction when the earnings are announced on July 24th.

The data shown is as of close on July 22.

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Analyzing Oil, Financials, & Earnings Game

BIDU announces earnings after market close.
300 Strike Price PUT seemed an attractive move in anticipation of the stock going down after the announcements.
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OXY : Along the same lines OXY will announc earnings on July 24 & therefore the following seemed a good position for analysis.

Sell August 85 Strike, credit = 1.04
Buy November 75 Call, Debit = 9.04
Net Debit = 8.00

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FNM : 1) Calendar Calls. Sell Dec 13 Call & Buy March 09 Calls for 0.55 debit.

2) Bull PUT Spread: Sell August 7 & Buy 5 for 0.20 for a $2 spread.
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DUG : This trades inverse for the Oil. If Oil goes down, this goes up.
Analyze Buying Oct 30 Call & Selling August 37 Call for $1.32 debit
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XLE : Analyze Buying September 79 Put & Selling August 75 Put for $3.29 Debit

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IWM & RUT : These have been going up, however, there seem to be less reasons to
sustain this uptrend after earnings announcements expire.

Analyze IWM Buying September 70 PUT & Selling 67 PUT for $1.20 debit.

There are other similar PUT combinations that can also be analyzed.

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August

After being bruised by XOI & surviving some beating with XSP in July, there was great sigh of relief from XLF, C, FNM, & BAC.

Now, for August, the following new examples may seem to be worth for analysis & study:

Bear Call Spreads: IWM (73/74) ; SPY or XSP (130/131) ; XLF (23/24) ; SDS (77/78 or 77/79 or even higher combinations) ;

Bull Put Spreads: FNM (5/7) ; BAC (20/22.5) ; XLE (70/68) ; TWM (64/62)

The above are small risk spreads that may provide a decent rate of return with fixed/known risks & returns.

Based on the direction, a position on one side can be followed up with a condor in opposite direction in the future.

Of course, one needs to be aware that there is no real direction in the markets & it is driven by emotions. The technicians & experts can perform all the analysis, but all that analysis gets thrown out of the window in a market driven more by emotions.

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Still Afloat n Fishing ?

Oh well , are we still afloat. Given the volatility and the turmoil, it is best to stay on sidelines & settle existing positions.

However, there is a temptation to analyze the following low risk strategies that offer a good return & turn into a potential cash machine to sell positions every other month or every month.

1) FNM
BUY Jan 2010 Call , Strike = 5 ; Pay 7.05

Then either ride it or sell Short August 2008 Call, Strike 14 for credit of 2.00


2) XLF
BUY Jan 2010 Call , Strike = 10 ; Pay 9.20

Then either ride it or sell Short August 2008 Call, Strike 20 for credit of .90

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IWM - Bull PUT Spreads

IWM trades at 1/10th of RUT ( Russell 2000 ).
Analyze a Bull PUT Spread
Buy July 61 PUT for .18
Sell July 63 PUT for .36 or .35
Credit = .18 or .17 for a 2 dollar spread.
Return about 8 - 9 % before commission for less than 3 weeks
This position enters risk should IWM fall all the way down to 63

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Aug XSP

XSP trades at 1/10th of $SPX, S&P.
Analyze a Bull PUT Spread
Buy August 114 PUT for 1.03
Sell Aug 116 PUT for 1.27
Credit = .24 for a 2 dollar spread.
Return about 12% before commission
This position enters risk should XSP fall all the way down to 116

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