Trade of the Week (SONC) 2.1.2012

Reason I like this Trade: There are unusual options activity orders then there was this order in SONC.  A customer bought 4100 March 7.5 Calls for $.25 and that was 75 times usual volume, yes 75 times usual volume.  I like to give my trades more time, so I bought the June 7.5 Calls for $.45.  This is a great risk vs reward and it seems as if the stock is breaking out and can trade up to the $8 level again.  I will look to piece out of these Calls if the stock trades higher, but I am very confident with this trade.  Please feel free to email me with any questions at  [email protected].

UPDATE 2.2.2012 I took 20% of my position off for a 33% profit, but I am holding the rest for more upside.  This was a great trade and I still think it will work out.  These Calls are currently worth $.65

UPDATE 2.3.2012 With the stock exploding more than 7% these Calls have doubled from $.45 and today traded $.85.  I will leave these on for more upside and a break to $8.20.
 
UPDATE 2.6.2012 The stock is not moving much today, so I will leave this trade on and since they do not have earnings until April I will leave this trade on.  

UPDATE 2.7.2012 With stock ripping higher and hitting my first target of $8.20, these Calls are now worth $1.20.  I took another piece off and a have half of my position left.  This was the “Trade of the Week” and is working out as planned.  

UPDATE 2.14.2012 This would have been an example of the
trade of the week, only the biggest highest probable trades.  These Calls are still worth $.95 and good for a HUGE winner.

UPDATE 2.15.2012 This would have been an example of the trade of the week, only the biggest highest probable trades.  These Calls are still worth $1.05 and good for a HUGE winner.  

UPDATE 2.22.2012 This would have been an example of the trade of the week, only the biggest highest probable trades.  These Calls are still worth $1.05 and good for a HUGE winner.

UPDATE 2.27.2012 As I talk about, I get bored very easily, so I sold 75% of my positon remaining for $.90 and will move to the next trade.  I stay have a partial position, but another HUGE winner at KOTM.

UPDATE 2.28.2012 With SONC raging higher, these Calls are worth $1.05 and I took my Calls off a little too soon.  I am offering 25% of my Calls remaining for $1.20

UPDATE 3.9.2012 I sold 90% off my position for a HUGE profit and I am still long a small position.  These Calls are worth $.50, another reason taking profits and moving on never killed anyone.

 

From the Chart Room | AlexKOTM
Just a quick few things about his Chart, All of which are great attributes for a stock ready to breakout.
1.Stock has been “basing” for more than 3 months.
2.We are really close to key resistance levels being breached to the upside (trendlines & cloud)
3.Strong above average Buying Volume today, Also we are moving strongly away from a high volume point of control level at 6.75. Next significant Volume at price level is 9.00.
4. DMI Buy Signal, Money Flow Bullish
sonc