Trade idea after Amazon.com's good news

Amazon.com Inc. (Nasdaq: AMZN) opened at $43.77. So far today the stock has hit a low of $43.67 and a high of $45.00. As of 1:15, AMZN is trading at $44.99, up $2.58 (6.1%).

The stock is soaring to a new 52-week high today on an upgrade from Deutsche Bank Securities from hold to buy, as noted by fellow blogger Michael Fowlkes. Deutsche Bank analyst Jeetil Patel predicts that 2007 is the year for Amazon to start seeing some margin expansion. He also upped the price target from $37 to $50. The technical indicators for AMZN have been bullish and steady, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider a July bull-put credit spread below the $35 range. AMZN hasn't been below $35 since October and has shown support around $38 recently. This trade could be risky if AMZN earnings (due out on 4/24) disappoint, but even if this happens, this position could be protected by the strong historical support around $37.50, combined with the company's 200 day moving average, which is currently just above $35 and rising.

Brent Archer is an options analyst and writer at Investors Observer. Do you have any deadwood in your portfolio? Check out the 18 Warning Signs That Tell You When To Dump A Stock.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.