EOT Position Update – July 28, 2010

July 28, 2010

Market Snapshot

As an investor, you know how important it is to expect the unexpected.

And in today’s manic-depressive markets, it’s more important than ever.  Just look at the headlines describing the market’s daily movements.

One day we’ll see, “Stocks Rally As Strong Earnings Outweigh Weak Economic Data”.

Only to see, “Weak Economic Data Trumps Better Than Expected Earnings As Stocks Falter” the next.

I’m sure you’ll agree investors are bipolar.  They’re reacting in very different ways to similar news from one day to the next.

The problem is the markets lack momentum right now.

To be sure, bulls and bears both have their arguments.  But big money players aren’t buying into either with much conviction.  Without institutional investors pushing their weight around, the markets lack the momentum needed to break out of its current rut.

What’s the solution to investing in these volatile but directionless markets?

In a word… Patience.

As a subscriber to Elite Option Trader, you’re part of a select group of people who have the tools to make huge sums of money in any market.  But you’ve also got to give the strategy time to work.

I can’t stress this point enough.  We can give you the tools but you have to find the patience within yourself.

When you do, you’ll be better off than most investors out there.  And a much more successful investor in the end.

I’m working on a handful of groundbreaking trades.  You’ll see them over the next few weeks… So hold onto your hat.  This is going to be exciting!

Let’s move onto the updates…

Position Updates

Just a quick note:  Remember, we won’t update every open position every week.  I try to focus on the positions that have some significant news or price movement.

  BRCM November 2010 $39 Calls
BRCM delivered a top-notch quarter.  They handily beat analysts’ revenue and earnings estimates.  And management increased their guidance for full year revenue. I’m expecting BRCM to keep on rolling.  Hold tight for now.  Resistance is at $40 and $45.  Support is at $32 and $29.

  SBUX October 2010 $25 Calls
SBUX is hovering around $25 after releasing their quarterly earnings.  Overall it was a good but not great quarter.  As expected, expansion into international markets is driving dramatic earnings growth.  A few analysts are questioning SBUX’s growth potential.  I think they’re way off base.  SBUX has a high ceiling.  Aggressive traders should continue holding for further gains.  Resistance is at $26.25 and $28.  Support is at $23 and $22.10.

  JNJ October 2010 $62.50 Calls
JNJ’s rebounding like a charging rhino from their disappointing earnings.  It’s just not possible for this time-tested powerhouse to be down and out for very long.  Look, their products just keep selling.  Once the recall fades into memory, it will be full throttle ahead.  Resistance is at $62.50 and $65.  Support is at $57.50 and $55.

  ENS September 2010 $22.50 Puts
ENS made a dramatic move this week.  But it doesn’t have anything to do with ENS in particular.  You see, their entire industry got a nice bump from speculation of increased demand for batteries in electric cars.  Let’s hold off on making any changes until ENS reports earnings in a few weeks.  Resistance is at $25.50 and $27.  Support is at $20 and $19.

  ASIA October 2010 $30 Calls
ASIA vaulted over the 200-day moving average this week.  And it looks like it’s poised to continue its turbocharged run higher.  The payoff could come later today when they report quarterly earnings.  Resistance is at $29.50 and $32.  Support is at $18 and $16.

Category: EOT Update