Macau: Global gaming gains

Regarding these companies' stocks, Moon notes, "MGM shares have been in rally mode since late August, surging more than 110% along the support of their 10-week moving average. The stock benefits from short-term support as well and is currently retesting its 10-day trendline as it counts its chips near all-time-high territory.

"As contrarians," she explains, "we like to see signs of skepticism on an uptrending security as a sign that not everyone has bought into the underlying instrument's rally. On MGM, options players are flashing their bearish teeth."

Indeed, based on the stock's put/call open interest ratio, she sees a near-term extreme in pessimism among the speculative crowd. In addition, she notes that over 6% of MGM's float has been sold short. For those comfortable with options, she says, "A nice short-term play, currently worth about $4 in intrinsic value, is the March 65 call."

As for Las Vegas Sands, she says, "The stock has been on a tear ever since the stock debuted for public trading in late 2004. The stock has stair-stepped along its 10-week and 20-week moving averages since the final quarter of 2005."

Technically, she says, the stock's path of least resistance is higher. She explains, "Analysts are keeping their cards close to the chest on LVS, as seven of the 10 brokerages following this hot stock rate it a 'hold.' An upgrade or two could attract positive buying momentum to the shares, fueling their rally."

She adds, "The speculative crowd is notably skittish as well; for every 100 short-term call positions open, there are 165 open short-term puts." For more sophisticated options buyers she offers, "Conservative traders could consider the in-the-money June 100 call a nice play. Selling a February 95 put could also be a good strategy."

As for WYNN, which she calls the "master of luxury and excess," she notes that the stock has been a "dream" to its shareholders during the past few months. She notes, "It has rallied to a new all-time high, using its 10-week moving average to steady its footing during its latest burst of strength."

Meanwhile, she explains, "Short sellers have emerged in droves, leaving more than 15.5% of the equity's available float for public trading devoted to the short side. If the equity continues to move forward, these bearish players could scatter toward the exits, providing some additional buying momentum."

Analysts are skeptical as well, she observes, noting that Wall Street has given the stock five "holds" and two "strong sells" along with three "strong buy" ratings. She concludes, "With the stock's uptrend showing no signs of a slowdown, an upgrade or two could be in the offing. An intermediate-term, in-the-money call such as the June or September 105 contract makes a good amount of sense."

As a caveat to this trio of ideas, she notes that MGM, LVS, and WYNN will be reporting earnings reports, tentatively scheduled for February 14, February 14, and February 22. She cautions, "Volatility shifts ahead of and immediately following these earnings reports could inflate option prices or create some dramatic price movements."

Steven Halpern is the editor of TheStockAdviors.com, a free daily website that features the latest market commentary and stock ideas from the financial newsletter community.