Break-even:  I break-even on this trade if RENN closes at $5 or $7 on May 18, 2012.

Unprofitable:  I lose money on this trade if RENN closes under $5 or above $7 by May 18, 2012.  The most I can lose on this trade is the amount I paid for the Spread $.30.  

Reason I Like This Trade:  RENN has earnings after the May expiration, so anytime I can buy an earnings month and sell a front month options for as small premium as this, I think it is a good trade.  If RENN stays within a $1 range for the next 7 trading days then this trade will work out.  

UPDATE 5.10.2012  With time on my side and RENN looking as if it will not break out from $6, I will leave this Spread on until expiration.

UPDATE 5.11.2012  This spread is not increasing in value as days go by, I thought it would.  Hopefully next week the May options will Decay more.  

UPDATE 5.14.2012  With the BIG Facebook IPO on Friday, the volatility is jacked in RENN front monrth.  Hopefully the stock will not move much and this trade will be Profitable.

UPDATE 5.15.2012  This spread is finally working out the way I thought it would.  It is currently worth $.45, but as stated above I will leave it on until Friday. 

UPDATE 5.16.2012  I will once again leave this Spread on until Friday, but this Spread is currently worth $.40

UPDATE 5.21.2012  There was a reason why front month volatility in RENN, bc movement was expected.  With RENN selling off under $5, this spread went to $.25.  I need a rally higher in order and there is a chance when RENN has earnings this month.

UPDATE 5.22.2012  I am looking to take this trade off if I can get a rally in Facebook and RENN or even a POP in earnings.

UPDATE 5.24.2012  This stock has sold off and I am looking to take this position off at any rally.

UPDATE 5.29.2012  I still have this trade on and looking to work out of it for a small loser.

Read more about reason by www.keeneonthemarket.com

Sugar glimpsed the light today up .25% after hitting a 20 month low of 20.13 midday. Coffee also finished with a slight increase to 1.7505, Brazilian coffee faces a small risk of frost this year, last year freezes led to a 34 year high in prices. Among big gainers today were CFBK up 42% to 3.39 and SODA kept strong finishing up over 27% at 37.21.
Heading the losing side were MEMS and CQB down close to 40% and 30% respectively. Agrium inc, North America’s biggest farm-products retailer, reported a higher than expected quarterly result today with retail sales up 35%, however shares dropped more than 2%. Shares are up over 20% this year despite a poor showing in this sector this week.

Crude inventories jumped up to 3.7m barrels, currently operating at their highest rate of the year while gasoline inventories fell to a -2.6m barrels. While crude is still down, this report helped prop the number up slightly.

SODA is one of today’s hot stocks, which makes home carbonation kits, up as much as 23% currently at 34.21. It beat first quarter earnings and announced it expects revenue to rise 33% and earnings 50% for the year. NKBP, a Chinese pharmaceutical, is among the hottest of the day up about 22% to 4.51. Among the lows are MEMS down 35% to 2.45 after yesterday’s financial results.  Chiquita brand(CQB) is another slacker today down 29% to 5.65 after its downgrade to hold from buy.

Contributer Chris Rygh is currently pursuing his MBA in Wisconsin and has a passion for the Market. Comments can be directed to ryghcw19@uww.edu

In Asian Markets both the Nikkei and the Hang Seng Index fell closing at 9045.06 and 20,330.64 respectively. For the Nikkei this is a brand new 3 month low and for the Hang Seng this is the 5th downer in a row and its worst loss in 6 weeks.

Futures remain bleak with gold, silver and crude all lower this morning while natural gas is up over 1.5%, this has been the trending pattern for future so far this week. In the currencies realm the Euro and the pound both fell against the USD about .50% and the Brazilian Real again took a hit down 1.02% for a year-to-date slide of 4.76% against the dollar. Disney started this morning with a strong bid in premarket trade after posting a strong quarterly report yesterday evening. Disney ended up yesterday .40 to 44.70. Goldman Sachs raised AIG to Buy from neutral this morning and raised its price target to $40 from $31, according to Reuters, pointing to a positive look on its global property insurance unit.

Contributer Chris Rygh is currently pursuing his MBA in Wisconsin and has a passion for the Market. Comments can be directed to ryghcw19@uww.edu<;mailto:ryghcw19@uww.edu>;