Editor's Note:

The Q1 earnings season has begun. Results from individual equities could produce wild volatility and influence rivals in the same sector. Cautious traders may want to consider the idea of protective puts on your long-term LEAPS positions prior to an earnings release.

-James


Closed Plays


BVN and USG have been closed.


Play Updates


Arch Coal Inc. - ACI - close: 33.74

04/16 update: Coal stocks saw a rough start to the week but managed to bounce off their Tuesday lows. ACI seems to be lagging behind some of its peers. I remain cautious here because ACI is due to report earnings on April 26th. If the company disappoints that could push the stock out of its $31-36 trading range. Currently we have a stop loss at $29.75. More aggressive traders may want to widen that to just under the simple 200-dma. I am not suggesting new positions at this time. We'll re-evaluate after the market gets a chance to react to earnings.

- Current Positions -
Nov 22, 2010 - entry price on ACI @ 30.15, option @ 3.90
symbol: ACI1221A35 2012 JAN $35 call - current bid/ask $ 3.90/ 4.00

- or -

Nov 22, 2010 - entry price on ACI @ 30.15, option @ 5.15
symbol: ACI1319A35 2013 JAN $35 call - current bid/ask $ 6.15/ 6.70

03/05/11 New stop loss @ 29.75
01/22/11 New stop loss @ 27.75
01/15/11 New stop loss @ 28.90
01/01/11 new stop loss @ 29.75
12/25/10 New stop loss @ 28.75
11/22/10 Play opened. ACI @ $30.15

Current Target: $39.75
Current Stop loss: 29.75
Play Entered on: 11/22/10
Originally listed in the New Plays 11/20/10


AK Steel Holding - AKS - close: 15.35

04/16 update: The sell-off in AKS has stalled at round-number support near the $15.00 level. Shares have found new resistance near $15.50, which is coincidentally where the 50-dma and 100-dma are converging. I wouldn't be surprised to see AKS churn sideways until the company reports earnings on April 26th. I am not suggesting new bullish positions at this time.

AKS can be volatile so our plan was to limit our risk by keeping our position size small. Our long-term target is the $25.00 area.

- Current Positions -
Feb 22, 2011 - entry price on AKS @ 16.10, option @ 1.55
symbol: AKS1221A20 2012 JAN $20 call - current bid/ask $ 0.88/ 0.94

- or -

Feb 22, 2011 - entry price on AKS @ 16.10, option @ 2.95
symbol: AKS1319A20 2013 JAN $20 call - current bid/ask $ 1.92/ 2.05

Current Target: $25.00
Current Stop loss: 13.90
Play Entered on: 02/22/11
Originally listed on the Watch List: 12/25/10


Allegheny Technology - ATI - close: 67.41

04/16 update: ATI slipped toward $62 last week before the stock began to recover. On Friday shares were showing relative strength and a rally past short-term resistance near $65.00 and a small cloud of moving averages. I would still expect some resistance in the $69-70 zone but a breakout past $70.00 would be very positive for the bulls. I am not suggesting new positions ahead of earnings. ATI is due to report earnings on April 27th.

- Suggested Positions -
Mar 10, 2011 - entry price on ATI @ 60.78, option @ 6.40
symbol: ATI1221A70 2012 JAN $70 call - current bid/ask $ 8.00/ 8.20

- or -

Mar 10, 2011 - entry price on ATI @ 60.78, option @ 10.20
symbol: ATI1319A70 2013 JAN $70 call - current bid/ask $10.90/13.50

04/02/11 New stop loss @ 59.00

Current Target: $75.00, and $85.00
Current Stop loss: 59.00
Play Entered on: 03/10/11
Originally listed on the Watch List: 02/05/11


BE Aerospace Inc. - BEAV - close: 36.66

04/16 update: This past week was pretty quiet after all the volatility in early April. BEAV has been slowly consolidating lower toward support near $36.00 and its 50-dma. Technicals are mixed right now but the stock looks poised to bounce. I am not suggesting new long-term positions right now but readers may want to consider a short-term trade. You could buy calls now with a tight stop under $35.50 and aim for the $39-40 area.

Earnings are coming up on April 25th and more conservative traders may want to exit early ahead of earnings to avoid the risk. Remember, our target to exit is the $40.00 mark.

- Current Positions -
Feb 23, 2011 - entry price on BEAV @ 34.00, option @ 2.75
symbol: BEAV1116G35 2011 JUL $35 call - current bid/ask $ 3.30/ 3.50

04/09/11 New stop loss @ 32.95
04/02/11 New stop loss @ 31.95

Current Target: $40.00
Current Stop loss: 32.95
Play Entered on: 02/23/11
Originally listed on the Watch List: 01/22/11


Bristol-Myers Squibb Company - BMY - close: 27.88 04/16 update: BMY continues to show relative strength. The stock has been going up almost the entire month of April. Now shares are resting just underneath significant resistance at the $28.00 level. If the stock market can rally higher from current levels then BMY has a good chance of breaking out. If the market falters then I would expect BMY to consolidate lower. I am not suggesting new positions at this time. BMY is due to report earnings on April 28th.

Our long-term targets is $32.00. Investors might want to consider turning this trade into a calendar spread or vertical spread to maximize its potential.

- Suggested Positions -
Mar 14, 2011 - entry price on BMY @ 26.14, option @ 1.13
symbol: BMY1221A27.5 2012 JAN $27.50 call - current bid/ask $ 1.86/ 1.91

- or -

Mar 14, 2011 - entry price on BMY @ 26.14, option @ 1.63
symbol: BMY1319A27.5 2013 JAN $27.50 call - current bid/ask $ 2.50/ 2.61

Current Target: $32.00
Current Stop loss: 24.95
Play Entered on: 03/14/11
Originally listed in the New Plays 03/12/11


Berkshire Hathaway - BRK.B - close: 80.89

04/16 update: April has not been good to Berkshire. Shares of BRK.B have been falling almost all month. They tried to find support near $82 and the 200-dma but that support broke this past week. Now BRK.B is nearing potential round-number support at $80.00 but we might want to eye a drop toward price support from late last year closer to $79.00.

With the short-term trend still down I am not suggesting new bullish positions at this time.

- Current Positions -
Oct 29, 2010 - entry price on BRK.B @ 79.00, option @ 5.00
symbol: BRKB1221A90 2012 JAN $90 call - current bid/ask $ 2.70/ 2.84

01/22/11 2011 January calls expired (-100%)
12/11/10 New stop loss @ 77.75.
11/20/10 New entry point on bounce from 200-dma
11/20/10 New stop @ 75.75
10/29/10 Play triggered on dip at $79.00.

Current Target: $ 99.00
Current Stop loss: 77.75
Play Entered on: 10/29/10
Originally listed on the Watch List 09/11/10


BorgWarner Inc. - BWA - close: 71.98

04/16 update: It has been an extremely ugly month for BWA thus far. I warned readers about the bearish reversal BWA produced in the first week of April. This past week's decline would confirm the reversal. Yet now the stock is hovering near support near $70.00. Shares are oversold and due for a bounce. Odds are the reason BWA is selling off is worries about Japan's disaster and how it will affect the auto supply chain across the U.S. and around the globe.

I am not suggesting new bullish positions at this time. BWA is due to an oversold bounce and if it fails near the $75.00 level then more conservative traders may want to exit early! Earnings are coming up on April 28th.

Prior Comments:
BWA has been volatile lately so we have a wide (aggressive) stop loss at $69.75. Our targets are optimistic at $88.00 and at $99.00. Keep in mind our plan was to use small positions to limit our risk.

- Current Positions -
Feb 23, 2011 - entry price on BWA @ 74.00, option @ 4.20
symbol: BWA1116G80 2011 JUL $80 call - current bid/ask $ 1.80/ 2.00

Current Target: $88.00, $99.00
Current Stop loss: 69.75
Play Entered on: 02/23/11
Originally listed on the Watch List: 02/05/11


Citigroup, Inc. - C - close: 4.42

04/16 update: The first week of Q1 earnings has not been impressive. Investors have been selling the news no matter what the news is. Both JPM and BAC reported last week and both stocks led the banking sector lower. This week is Citigroup's turn to report earnings. The company announces on April 18th and Wall Street is expecting a profit of 9 cents a share. I am not suggesting new positions in front of earnings. More conservative traders may want to inch up their stops closer to the simple 200-dma or the March low.

We still have about three weeks left before Citigroup's 10-for-1 reverse stock split. The reverse split will occur after trading closes on May 6th and C will start trading at the new price on Monday, May 9th.

- Current Positions -
Feb 23, 2011 - entry price on Citigroup stock (C) @ 4.60

- or -

Feb 23, 2011 - entry price on C @ 4.60, option @ $0.48
symbol: C1221A5 2012 JAN $5 call - current bid/ask $ 0.19/ 0.21

- or -

Feb 23, 2011 - entry price on C @ 4.60, option @ $0.85
symbol: C1319A5 2013 JAN $5 call - current bid/ask $ 0.50/ 0.52

Current Target: $6.50, and $7.75
Current Stop loss: 4.19
Play Entered on: 02/23/11
Originally listed on the Watch List: 02/19/11


CACI International - CACI - close: 60.42

04/16 update: This past week saw traders buy the dip near short-term support at $59.00 and technical support near its rising 50-dma. CACI looks poised to rally from current levels. However, I remain cautious as we move into earnings season. FYI: CACI is due to report earnings on May 4th.

Earlier Comments:
I do consider this a more aggressive trade and if we keep our position size small we can limit our risk. The March low was close to $57.00. I'm listing our stop loss at $56.75. Our first upside target is $69.00. CACI doesn't have LEAPS so we'll have to use the 2011 September calls.

- Current (small) Positions -
Apr 4, 2011 - entry price on CACI @ 62.04, option @ 3.30
symbol: CACI1117I65 2011 SEP $65 call - current bid/ask $ 2.05/ 2.25

Current Target: $69.00
Current Stop loss: 56.75
Play Entered on: 04/04/11
Originally listed on the Watch List: 02/12/11


Canadian Natl. Railway Co. - CNI - close: 72.70

04/16 update: I am growing worried about CNI. The railroad index started to bounce this past week. Not so for CNI. Shares have continued to sink and have broken under the simple 50-dma. Previously I suggested we look for a dip near $72.50 as a new entry point but this relative weakness in the stock is a concern! Readers may want to wait for a dip or a bounce from the $70.00 level and its 100-dma before considering new positions. Our long-term target is $89.00. FYI: Earnings are due on April 26th.

- Current Positions -
Feb 28, 2011 - entry price on CNI @ 72.39, option @ 2.90
symbol: CNI1221A80 2012 JAN $80 call - current bid/ask $ 2.40/ 2.60

04/02/11 New stop loss @ 69.00

Current Target: $89.00
Current Stop loss: 67.00
Play Entered on: 02/28/11
Originally listed in the New Plays 02/26/11


Costco Wholesale - COST - close: 76.97

04/16 update: COST is looking resilient as it holds on to its gains from early April. Traders were buying the dip near $76 this past week. The recent action is encouraging I would still be tempted to launch positions near the $76-75 zone. More conservative traders could wait for a dip and bounce from $74.00 and/or its 50-dma instead. Readers may want to start small and slowly build up a position. Our long-term targets are $89.50 and $99.00.

- Current Positions -
Apr 7, 2011 - entry price on COST @ 76.37, option @ 3.80
symbol:COST1221A80 2012 JAN $80 call - current bid/ask $ 3.95/ 4.05

- or -

Apr 7, 2011 - entry price on COST @ 76.37, option @ 5.05
symbol:COST1319A85 2013 JAN $85 call - current bid/ask $ 5.00/ 5.25

Current Target: $89.50, 99.00
Current Stop loss: 69.95
Play Entered on: 04/07/11
Originally listed on the Watch List: 01/29/11


Walt Disney Co. - DIS - close: 41.52

04/16 update: No surprises yet. We've been expecting DIS to correct lower toward $40 for a long time. The stock is down two weeks in a row. Shares should find some support near $40.00. If that fails then the $38.00 level should be much stronger support, bolstered by the simple 200-dma. I am not suggesting new positions at this time. FYI: DIS is due to report earnings on May 10th.

- Current Positions -
Oct 27, 2010 - entry price on DIS @ 35.60, option @ 2.23
symbol: DIS1221A40 2012 JAN $40 call - current bid/ask $ 4.40/ 4.50

- or -

Oct 27, 2010 - entry price on DIS @ 35.60, option @ 3.63
symbol: DIS1319A40 2013 JAN $40 call - current bid/ask $ 6.40/ 6.60

02/12/11 New stop loss @ 37.85
02/09/11 1st Target Hit. Options @ +137% and +103%
02/05/11 New stop loss @ 35.75
01/08/11 New stop loss @ 34.95
01/08/11 Target changed to $43.00 and $46.00
10/27/10 Play opened, DIS opened @ $35.60

Current Target(s): $43.00, 49.00
Current Stop loss: 37.85
Play Entered on: 10/27/10
Originally listed on the Watch List 10/24/10


Brinker International - EAT - close: 25.18

04/16 update: After the bearish reversal two weeks ago it looked like bulls were in trouble on Monday when EAT continued to sink. Fortunately, traders started buying the dip on Tuesday morning. EAT is now up four days in a row and look poised to challenge resistance near $26.00 soon. I am not suggesting new bullish positions at this time. EAT is due to report earnings on April 27th.

- Current Positions -
Feb 23, 2011 - entry price on EAT @ 22.50, option @ $ 1.10
symbol: EAT1116G25 2011 JUL $25 call - current bid/ask $ 1.65/ 1.85

04/02/11 New stop @ 22.90
03/26/11 New stop @ $21.95

Current Target: $29.50
Current Stop loss: 22.90
Play Entered on: 02/23/11
Originally listed on the Watch List: 02/12/11


Ford Motor Co - F - close: 14.71

04/16 update: Investors are still nervous about how the Japan disaster might affect the global supply chain for auto manufacturing. Ford claims there will be no impact so far, aside from a couple of paint colors produced in Japan. However, news that Ford was widening a prior recall on faulty airbags to more than one million vehicles did not inspire any confidence last week.

Shares spent the last few days bouncing between support near $14.50 and its simple 200-dma and short-term resistance near $15.00. I remain longer-term bullish on Ford but short-term the stock is struggling. While Ford should have support near $14.00, a close under the 200-dma would be bad for investor sentiment. More conservative traders may want to consider a higher stop loss. Our stop is still at $12.95. There is no firm earnings date yet for Ford but the company should announce in late April. Readers may want to wait until after we see market reaction to Ford's earnings before re-evaluating a potential entry.

Our long-term exit targets are $19.75 and $24.00.

- Suggested Positions -
Feb 28, 2011 - entry price on F @ 15.29, option @ 2.17
symbol: F1221A15 2012 JAN $15 call - current bid/ask $ 1.61/ 1.65

- or -

Feb 28, 2011 - entry price on F @ 15.29, option @ 1.50
symbol: F1319A20 2013 JAN $20 call - current bid/ask $ 1.15/ 1.20

03/26/11 New stop loss @ $12.95

Current Target: $19.75, and $24.00
Current Stop loss: 12.95
Play Entered on: 02/28/11
Originally listed in the New Plays 02/26/11


Fiserv, Inc. - FISV - close: 63.13

04/16 update: After more than two weeks consolidating sideways it looks like shares of FISV are finally ready to rally again. The stock was showing relative strength on Friday and looks poised to challenge its highs near $64 soon. I would be tempted to buy calls on a close over the $64.00 mark. However, readers may want to wait until after we see reaction to its earnings report before considering new positions. FISV is due to report earnings on April 27th.

- Suggested Positions -
Feb 14, 2011 - entry price on FISV @ 62.30, option @ 3.20
symbol: FISV1117I65 2011 SEP $65 call - current bid/ask $ 2.65/ 2.90

Current Target: $74.75
Current Stop loss: 57.50
Play Entered on: 02/14/11
Originally listed on the Watch List: 01/29/11
Originally listed in the New Plays 02/12/11


SPDR Gold ETF - GLD - close: 145.05

04/16 update: Worries about inflation and weakness in the U.S. dollar have fueled new all-time highs for gold and silver prices. The GLD closed near potential resistance at $145.00 on Friday but it seems to be aiming for the bigger round number at $150.00. I have to admit that I have been thinking about raising our final exit target on GLD for a long time. I suspect that the GLD could see a rally into the $155-165 range but I don't want to fall into the trap of getting too greedy.

I am suggesting that more conservative traders plan on exiting at $149.00. The newsletter will try and let it ride but we'll try and mitigate our risk by trailing up the stop loss. Tonight we'll move the stop loss to $139.40. We'll tentatively set our final target to $159.00.

FYI: Our protective April put we bought months ago has finally expired. I am adding the cost of the put to our initial entry price, which will adjust our final gains.

- Current Positions -
Aug 6, 2010 - entry price on GLD @ 118.00, option @ 12.45*
symbol: GLD1221A130 2012 Jan $130 call - current bid/ask $18.50/18.80

*Adjusted entry price from $10.75 to $12.45.

04/16/11 New stop loss @ 139.40, new exit target @ $159
*04/16/11 April put has expired. $1.70 added to our cost.
02/26/11 New stop loss @ 127.00
01/18/11 GLD opened at $133.63. April $125 put opened at $1.70
01/15/11 Added April Puts to protect ourselves from further declines.
01/08/11 Expecting a correction toward $125
11/09/10 Target hit - GLD opened at $138.70, 2011 Mar. Call opened @ $20.00 (+159%)
11/06/10 new stop @ 123.40
10/30/10 New stop @ 121.00. Readers may want to exit ahead of FOMC meeting
10/02/10 Sell half of the 2011 March calls, option @ 12.70 (+64.9%)
10/02/10 New stop $ 118.49
09/25/10 New stop @ 116.45, new target 138.50

Chart of GLD:

Current Target(s): $149.00
Current Stop loss: 127.00
Play Entered on: 08/06/10
Originally listed on the Watch List 06/05/10


Goodyear Tire - GT - close: 15.15

04/16 update: GT has been consolidating sideways for about five weeks now. The fact that traders bought the dip again near $14.50 is encouraging but I am reluctant to launch new positions here. Our long-term target is $18.50.

- Current Positions -
Feb 23, 2011 - entry price on GT @ 13.50, option @ 1.90
symbol: GT1221A15 2012 JAN $15 call - current bid/ask $ 2.45/ 2.55

- or -

Feb 23, 2011 - entry price on GT @ 13.50, option @ 2.90
symbol: GT1319A15 2013 JAN $15 call - current bid/ask $ 3.70/ 3.90

03/26/11 New stop loss @ 12.75

Current Target: $18.50
Current Stop loss: 12.75
Play Entered on: 02/23/11
Originally listed on the Watch List: 02/19/11


James River Coal Co. - JRCC - close: 22.31

04/16 update: Coal stocks have been struggling in the month of April but it looks like JRCC may have found a short-term bottom near $21.80 this past week. The stock hit our trigger to buy the dip at $22.50 on April 12th. The 2012 January $25 call was trading near $3.10 and the 2013 $27.50 call was at $4.70. We can still launch positions now. Or you can wait, since there is still a decent chance that JRCC might test support near $20.00 again. At the moment we have a stop loss at $19.90. Our long-term target is $29.50. We do want to keep our position size small to limit our risk.

- Current Positions -
Apr 12, 2011 - entry price on JRCC @ 22.50, option @ 3.10
symbol: JRCC1221A25 2012 JAN $25 call - current bid/ask $ 2.40/ 2.90

- or -

Apr 12, 2011 - entry price on JRCC @ 22.50, option @ 4.70
symbol: JRCC1319A27 2013 JAN $27 call - current bid/ask $ 3.50/ 5.60

Chart of JRCC:

Current Target: $29.50
Current Stop loss: 19.90
Play Entered on: 04/12/11
Originally listed on the Watch List: 01/22/11


KeyCorp - KEY - close: 8.82

04/16 update: It proved to be another quiet week for shares of KEYN. On the positive side the stock did not react to the sell-off in JPM and BAC and weakness in the banking sector indices. KEY is due to report earnings on April 18th. Wall Street is looking for a profit of 16 cents a share. I am not suggesting new bullish positions in front of earnings. We can re-evaluate after we see the market's reaction to KEY's results.

Prior Comments:
We have a stop loss at $7.85. More conservative traders may want a stop closer to the 200-dma or the $8.25 level instead. Our long-term targets are $12 and $14.

- Current Positions -
Mar 17, 2011 - entry price on KEY @ 8.60, option @ 0.87
symbol: KEY1221A10 2012 JAN $10 call - current bid/ask $ 0.57/ 0.61

- or -

Mar 17, 2011 - entry price on KEY @ 8.60, option @ 1.35
symbol: KEY1319A10 2013 JAN $10 call - current bid/ask $ 0.94/ 1.23

Current Target(s): $12.00, 14.00
Current Stop loss: 7.85
Play Entered on: 03/17/11
Originally listed on the Watch List: 02/26/11


L-3 Communications - LLL - close: 76.14

04/16 update: Ouch! It was a rough week for defense stocks and LLL. The fight over the U.S. budget isn't over and the massive amount of money that the U.S. spends on defense is threatened by those seeking to cut expenses. I am concerned that the budget cut issue and likely prospect that defense spending will get trimmed could be a major overhang for LLL. Therefore we need to start looking for an exit.

More conservative traders could exit right now. I'm suggesting we wait. After a sharp drop on Wednesday and Thursday it looks like LLL is trying to bounce. Let's plan to exit on a bounce at $77.75 since the $78.00 level is probably new overhead resistance. Earnings are coming up on April 21st and cautious traders will definitely want to consider an early exit before LLL reports results.

I am not suggesting new positions at this time.

- Current Positions -
Nov 11, 2010 - entry price on LLL @ 71.87, option @ 5.80
symbol: LLL1221A75 2012 Jan $75 call - current bid/ask $ 6.10/ 6.30

04/16/11 Plan on an exit soon! New exit target 77.75
03/26/11 New stop loss @ 74.75
02/12/11 New stop loss @ 73.75
02/05/11 There was no follow through lower.
01/29/11 LLL is correcting lower!
01/08/11 Take Profits Early. LLL @ 78.23. Option @ $8.50 (+46.5%)
01/08/11 New stop loss @ 69.90
11/11/10 Play triggered with LLL's gap open @ 71.87

Current Target(s): $77.75
Current Stop loss: 73.75
Play Entered on: 11/11/10
Originally listed on the Watch List 11/06/10


Monsanto Co. - MON - close: 67.33

04/16 update: We need to stay defensive on MON. The stock was upgraded on Monday but the rally stalled at $68.00. Then on Tuesday shares rallied on rumors that BASF might try to acquire MON. That rebound failed at resistance near $70.00. Since then shares have been slipping on very light volume.

Once again I'm suggesting that more conservative traders may want to consider an early exit. I am not suggesting new positions at this time. If the weakness continues I'm expecting a correction toward support near the $63.00-62.50 area and its 200-dma.

Prior Comments:
Our plan was to keep our position size small to limit our risk since MON can be so volatile at times. Our long-term targets are the $85-90 zone.

- Current (SMALL) Positions -
Mar 15, 2011 - entry price on MON @ 65.50, option @ 6.75
symbol: MON1221A70 2012 JAN $70 call - current bid/ask $ 6.05/ 6.20

- or -

Mar 15, 2011 - entry price on MON @ 65.50, option @ 8.75
symbol: MON1319A75 2013 JAN $75 call - current bid/ask $ 7.45/ 8.15

04/09/11 New stop loss @ 61.75, Readers may want to exit early now.

Current Target(s): $85.00
Current Stop loss: 59.90
Play Entered on: 03/15/11
Originally listed on the Watch List: 01/08/11


Petroleo Brasileiro (a.k.a. Petrobras) - PBR - close: 37.81

04/16 update: Our buy-the-dip entry point in PBR was hit on April 12th but it looks like we should have held out for a lower entry point. The Brazilian stock market sold off hard this past week on worries about demand for commodities. Shares of PBR produced a sharp decline and hit our buy-the-dip trigger at $39.00 and kept right on going. PBR is starting to see a little oversold bounce near $37 and its 100-dma. Unfortunately the sharp sell-off has produced a rather bearish picture. I suspect that PBR could be poised to test the $36.00 level or at least its 200-dma near $36.25 before bouncing. I am suggesting readers wait for a dip near the 200-dma before considering any new bullish positions.

We have a stop loss at $35.75. The plan was to keep our position size small because PBR can be a volatile stock. Our long-term target is $53.00.

- Current (SMALL) Positions -
Apr 12, 2011 - entry price on PBR @ 39.00, option @ 3.35
symbol: PBR1221A40 2012 JAN $40 call - current bid/ask $ 2.75/ 2.80

- or -

Apr 12, 2011 - entry price on PBR @ 39.00, option @ 3.15
symbol: PBR1319A45 2013 JAN $45 call - current bid/ask $ 2.80/ 2.94

Chart of PBR:

Current Target(s): $53.00
Current Stop loss: 35.75
Play Entered on: 04/12/11
Originally listed on the Watch List: 03/26/11


PACCAR Inc. - PCAR - close: 51.43

04/16 update: It looks like the correction in PCAR might be over. Shares slipped under support near $50.00 and its 50 and 200-dma this past week. Yet traders were in a buying mood on Thursday and Friday. Stock was produced a big bounce on Friday (+2.8%). Does somebody know something about the upcoming earnings report? PCAR is due to report earnings on April 19th and Wall Street is expecting a profit of 49 cents a share.

Normally I would be tempted to buy this bounce from support near $50.00 but with earnings this close I would wait. We want to wait and see what the market reaction is to the earnings data. More conservative traders will want to seriously consider a higher stop loss, maybe close to $46.00 or the March low.

FYI: If looks like PCAR must have had some sort of special dividend to create these odd strike prices. Instead of a normal $55.00 strike price PCAR has $54.70 strikes.

- Current (SMALL) Positions -
Mar 21, 2011 - entry price on PCAR @ 50.75, option @ 3.70
PCAR1221A54.7 2012 JAN $54.70 call - current bid/ask $ 3.70/ 3.90

- or -

Mar 21, 2011 - entry price on PCAR @ 50.75, option @ 8.00
PCAR1319A54.7 2013 JAN $54.70 call - current bid/ask $ 5.50/ 7.10

Current Target(s): $58.00, 64.00
Current Stop loss: 44.95
Play Entered on: 03/21/11
Originally listed on the Watch List: 03/19/11


Scotts Miracle Grow Co. - SMG - close: 57.38

04/16 update: Bingo! The action this past week in SMG looks like a new bullish entry point. I've been warning readers to look for a dip into the $57.00-55.00 zone. Shares fell to $55.43 on Thursday before rebounding near their 50-dma. I would still consider new positions now but I want to warn you. The market could be volatile these next two weeks as investors react to earnings data. SMG is due to report earnings on May 3rd.

Earlier Comments:
We want to keep our position size small to limit our risk. SMG doesn't have LEAPS so we'll have to buy September calls. Our target is the $65-70 zone.

- Current (SMALL) Positions -
Mar 25, 2011 - entry price on SMG @ 58.00, option @ 3.00
SMG1117I60 2011 SEP $60 call - current bid/ask $ 1.95/ 2.40

Current Target(s): $65.00-70.00
Current Stop loss: 53.75
Play Entered on: 03/25/11
Originally listed on the Watch List: 03/05/11


Southwestern Energy Co. - SWN - close: 39.96

04/16 update: Whew! SWN gave us a scare this past week with a breakdown under support at $40.00. Then SWN fell under its 50-dma, and then under its 100-dma, and under its exponential 200-dma. The stock found support at $38.00 before finally bouncing. Shares are testing $40.00 again but this time $40 is resistance.

Personally, I would prefer to see a close over $40.50 before considering new bullish positions on SWN. Readers may want to wait until after the earnings report on April 28th before considering new positions. Our long-term target is the $50-52.50 zone.

- Current (SMALL) Positions -
Apr 7, 2011 - entry price on SWN @ 40.50, option @ 2.90
SWN1221A45 2012 JAN $45 call - current bid/ask $ 2.56/ 2.64

- or -

Apr 7, 2011 - entry price on SWN @ 40.50, option @ 5.85
SWN1319A45 2013 JAN $45 call - current bid/ask $ 4.80/ 6.20

Current Target(s): $50.00-52.50
Current Stop loss: 36.75
Play Entered on: 04/07/11
Originally listed on the Watch List: 04/02/11


Teva Pharmaceuticals - TEVA - close: 50.01

04/16 update: News that rival Biogen (BIIB) reported positive results from a phase III study on a pill form treatment for multiple sclerosis sent shares of TEVA lower last Monday. TEVA is developing its own treatment and the news definitely puts BIIB in the lead. Shares of TEVA rebounded off its lows last week but the stock has been stuck under resistance at its 50-dma for the entire month of April. The short-tern trend of lower highs does not bode well for TEVA. I am very tempted to abandon ship and just exit early right now to avoid or minimize any losses. I am not suggesting new bullish positions at this time.

Earlier Comments:
We wanted to keep our position size small to limit our risk.

- Current Positions -
Mar 11, 2011 - entry price on TEVA @ 49.00, option @ 2.40
symbol: TEVA1221A55 2012 JAN $55 call - current bid/ask $ 2.03/ 2.09

- or -

Mar 11, 2011 - entry price on TEVA @ 49.00, option @ 3.35
symbol: TEVA1319A60 2013 JAN $60 call - current bid/ask $ 2.78/ 3.05

04/09 New stop loss @ 46.90
03/19 New stop loss at $45.90

Current Target(s): $56.00 & 62.50
Current Stop loss: 45.90
Play Entered on: 03/11/11
Originally listed on the Watch List: 01/29/11


CLOSED Plays


Compania de Minas Buenaventura - BVN - close: 39.21

04/16 update: It was a frustrating week for BVN bulls. Gold and silver are surging to new all-time highs and yet BVN has plunged to new eight-month lows. Our stop loss was hit at $38.95 on April 13th. The June $50 calls had a bid near $0.10 at the time. It looks like someone bought the dip the very next day with a big surge in volume but BVN continues to look weak.

It would appear that the reason BVN has been sinking is due to growing fears about the upcoming presidential election. According to a Reuters article Ollanta Humala, the Nationalist candidate, one the first round of Peru's presidential election and now faces a run-off versus right-wing candidate Keiko Fujimori. The markets are worried that if Humala wins his policies might be unfriendly to business and have a direct impact on the mining industry as he seeks to raise royalties.

Earlier Comments:
I cautioned readers that our entry point at $45 was an aggressive, higher-risk trade. Our plan was to open small (half) positions to limit our risk.

- Current Positions -
Jan 5, 2011 - entry price on BVN @ 45.00, option @ 3.90
symbol: BVN1119F50 2011 JUN $50 call - exit @ 0.10 (-97.4%)

04/13: Stopped out @ 38.95 (option -97.4%)
01/22: Adjust the stop loss to $38.95
01/05: Play is opened at $45.00 (small positions only)

Chart of BVN:

Current Target: $ 54.75
Current Stop loss: 38.95
Play Entered on: 01/05/11
Originally listed on the Watch List --/--/--


U S G Corp. - USG - close: 16.14

04/16 update: I am giving up on USG. The stock has been going nowhere the last couple of months. If you look at the action in the past two weeks USG has developed a bearish trend of lower highs. Earnings are coming up this week and I do not want the added risk of holding over the earnings report. I'm suggesting an early exit now to minimize our losses.

- Current Positions -
Dec 20, 2010 - entry price on USG @ 15.25, option @ 1.50*
symbol: USG1221A20 2012 Jan $20 call - bid @ $1.10 (-36.3%)

- or -

Dec 20, 2010 - entry price on USG @ 15.25, option @ 3.00
symbol: USG1319A20 2013 Jan $20 call - bid @ $2.30 (-23.3%)

04/16/11 Exit Early! Options @ -36.3% and -23.3%
02/12/11 Take Profits (sell half) Options @ +93.3%, +50%
02/12/11 New stop loss @ 15.45
12/20/10 Play triggered at $15.25
*entry price is an estimate.

Chart of USG:

Current Target(s): $--.--, 2nd target: 24.75
Current Stop loss: 15.45
Play Entered on: 12/20/10
Originally listed on the Watch List: 12/11/10