Editor's Note:

It was a rough week for some of our bullish candidates. Market volatility and investor reaction to earnings news is pushing stocks lower. We saw multiple trades get stopped out this past week.

We also closed our 2013 calls on Visa (see play update for details).


Closed Plays


CVX, EMN, KMB, MON, TWX were stopped out.


Play Updates


American Intl. Group - AIG - close: 34.14

Comments:
10/27/12: Shares of AIG followed the financial sector lower. The stock spent much of the week consolidating sideways in the $34.50-35.00 zone. I would expect AIG to continue moving sideways until its earnings report. AIG is scheduled to announce earnings on November 1st, after the closing bell. Wall Street is looking for earnings of 87 cents a share.

I am not suggesting new positions in front of earnings.

Earlier Comments:
Our plan was to keep our initial position size small to limit our risk. We want to exit our 2013 calls when AIG hits $39.00. We will plan on exiting our 2014 calls when shares hit $42.50.

- Suggested Positions - (small positions @ first)
May 18, 2012 - entry price on AIG @ 28.25, option @ 3.40
symbol: AIG1319A30 2013 JAN $30 call - current bid/ask $ 5.25/ 5.30

- or -

May 18, 2012 - entry price on AIG @ 28.25, option @ 4.20
symbol: AIG1418A35 2014 JAN $35 call - current bid/ask $ 4.75/ 4.90

10/06/12 adjusting our exit targets. Plan on exiting our 2013 calls when AIG hits $39.00. We'll exit our 2014 calls when AIG hits $42.50
09/08/12 Treasury has announced an $18 billion sale of AIG stock
08/18/12 new stop loss @ 29.45
06/16/12 new stop loss @ 26.95
05/18/12 triggered at $28.25
05/05/12 The U.S. government is planning to sell 164 million shares at $30.50 and AIG will probably gap down on this news.
Move the trigger down to $28.25, and move the stop loss to $25.75.
04/28/12 adjust buy-the-dip trigger to $30.00 and stop to $27.40

Current Target:$ 39.00
Current Stop loss: 29.45
Play Entered on: 05/18/12
Originally listed on the Watch List: 04/07/12


Bank of America - BAC - close: 9.12

Comments:
10/27/12: We only have about three more months on our BAC trade if you're holding the 2013 January calls. On a short-term basis the stock is breaking down from a sideways consolidation. I would not be surprised to see a correction lower toward the $8.50 level but it's possible the stock finds support at the rising 50-dma.

I am not suggesting new positions at this time. With the 2013 January calls, any decline is going to hurt the calls pretty hard.

Earlier Comments:
Currently we do not have a specific exit target. The plan has been to exit in the $12.00-15.00 zone.

- Suggested Positions -

AUG 29, 2011 - entry price on BAC @ 8.10, option @ 1.50
symbol: BAC1319A10 2013 JAN $10 call - current bid/ask $ 0.28/ 0.29
(No stop loss on this position)

(2nd Position, bought the dip at $5.15)

NOV 23, 2011 - entry price on BAC @ 5.15, option @ 0.35
symbol: BAC1319A10 2013 JAN $10 call - current bid/ask $ 0.28/ 0.29
(no stop loss on this position)

09/08/12 BAC is breaking out. Consider buying 2014 calls on a dip near the $8.50-8.40 area
07/21/12 BAC reported earnings this past week and investors have decided to sell the news. The stock looks vulnerable here and readers may want to exit early!
05/19/12 BAC has pulled back to the 61.8% retracement
03/17/12 BAC has broken out from its multi-week trading range. Broken resistance near $8.30 should be new support.
...look for earlier comments in prior updates...

Current Target: $12.00-to-$15.00
Current Stop loss: see details above
Play Entered on: 08/29/11
Originally listed in the New Plays 08/27/11


Capital One Financial Corp. - COF - close: 60.00

Comments:
10/27/12: COF delivered a choppy week with a sideways consolidation in the $59-60.50 area. COF might try and fill the gap with a dip to $58.00. Nimble traders could buy a dip or a bounce off the $58.00 level.

Earlier Comments:
The P&F chart is bullish with a $71 target. We are aiming for $74.00.

Earlier Comments:
COF can be somewhat volatile so we want to keep our position size small. We'll have to keep an eye on potential resistance at $70.00.

- Suggested Positions - (small positions)
OCT 22, 2012 - entry price on COF @ 61.14, option @ 5.65
symbol: COF1418a65 2014 JAN $65 call - current bid/ask $ 5.20/ 5.45

Current Target:$ 74.00
Current Stop loss: 56.85
Play Entered on: 10/22/12
Originally listed on the Watch List: 10/06/12


Discover Financial - DFS - close: 40.25

Comments:
10/27/12: DFS eked out a gain for the week. Yet for the most part shares are just churning sideways. DFS still has a bullish trend of higher lows for now. If the market's descent accelerates I would expect DFS to eventually breakdown. There is likely short-term support at $38.00 and $37.00. I am not suggesting new positions.

We still have the 2014 calls and we're aiming for $44.00.

- Suggested Positions -
(Closed on Sept. 27th)
JUL 05, 2012 - entry price on DFS @ 35.28, option @ 2.15
symbol: DFS1319A37 2013 JAN $37 call - exit $3.70 (+72.0%)

- or -

JUL 05, 2012 - entry price on DFS @ 35.28, option @ 3.40
symbol: DFS1418A40 2014 JAN $40 call - current bid/ask $5.10/5.40

09/29/12 new stop loss @ 35.75
09/27/12 hits our $39.75 target to exit 2013 calls (option @ $3.70)
09/27/12 DFS beats Wall Street's earnings estimates
09/22/12 more conservative traders may want to exit right now or before DFS reports earnings on Sep 27th.
08/25/12 new stop loss @ 34.75
08/25/12 adjusted targets to $39.75 (2013 calls), $44 (2014 calls)
08/18/12 new stop loss @ 33.45
...see prior updates for early comments.

Current Target: $39.75 for the 2013 call2, $44.00 for the 2014s
Current Stop loss: 35.75
Play Entered on: 07/05/12
Originally listed on the Watch List: 06/02/12


Family Dollar Stores - FDO - close: 65.60

Comments:
10/27/12: FDO briefly traded under the $64.00 level this past week before reversing higher. While the stock is bouncing off its lows there is still technical resistance directly overhead with the 100-dma and 150-dma in the $66-67 area. The larger, longer-term trend of higher lows remains intact for now. I am not suggesting new positions at this time.

- Suggested Positions -
OCT 12, 2012 - entry price on FDO @ 65.88, option @ 1.70
symbol: FDO1320d75 2013 APR $75 call - current bid/ask $1.15/1.40

10/20/12 adjust stop loss to $62.95

Current Target: $74.50
Current Stop loss: 62.95
Play Entered on: 10/12/12
Originally listed on the Watch List: 10/06/12


Joy Global, Inc - JOY - close: 61.55

Comments:
10/27/12: JOY posted a loss for the week. Yet shares are bouncing off its intraweek lows. Friday saw some volatility with JOY surging higher on rumors the company was a takeover target.

If the market decline continues we can look for likely support at the 50-dma. We still have the stop loss at $54.75 but more conservative traders may want to adjust their stop higher.

- Suggested Positions -
SEP 25, 2012 - entry price on JOY @ 57.50, option @ 7.50
symbol: JOY1418A70 2014 JAN $70 call - current bid/ask $7.65/8.00

10/26/12 JOY seeing volatility on rumors it is a takeover target
09/25/12 triggered on a dip at $57.50
09/22/12 adjust entry to buy a dip at $57.50, stop to $53.90

Current Target: $78.50
Current Stop loss: 54.75
Play Entered on: 09/25/12
Originally listed on the Watch List: 09/15/12


Lennar Corp. - LEN - close: 37.02

Comments:
10/27/12: Homebuilders were not immune to the market's decline this past week. LEN did pull back but the long-term up trend is still in place. Look for short-term support near $36.00. I don't see any changes from my prior comments.

Earlier Comments:
I do think the $40.00 level is likely resistance and LEN will probably see a pullback on its initial test of $40.00. Keep in mind that we also have more than a year for our 2014 calls to work.

- Suggested Positions -
(target for 2013 calls was hit at $36.00 on 09/14/2012)
AUG 17, 2012 - entry price on LEN @ 32.72, option @ 2.07
symbol: LEN1319A35 2013 JAN $35 call - exit $3.70 (+78.7%)

- or -

AUG 17, 2012 - entry price on LEN @ 32.72, option @ 3.39
symbol: LEN1418A40 2014 JAN $40 call - current bid/ask $5.15/5.40

10/20/12 new stop loss @ 33.90, adjust exit target on 2014 calls to $44.00
09/24/12 LEN reported earnings, investors sell the news
09/22/12 new stop loss @ 33.40
09/15/12 new stop loss @ 31.40
09/14/12 2013 call target hit at $36.00, option @ 3.70 (+78.7%)
...

Current Target: $ 36.00(2013 calls), $44.00 (2014 call)
Current Stop loss: 33.90
Play Entered on: 08/17/12
Originally listed on the Watch List: 08/11/12


Pfizer Inc. - PFE - close: 25.43

Comments:
10/27/12: PFE saw a pullback to support near $25.00 before traders bought the dip. Shares are likely to see more volatility this week. PFE is due to report earnings on October 30th, before the opening bell. Analysts are expecting a profit of 52 cents a share. I suspect that if PFE disappoints the stock could drop back toward support near $24.00.

I am not suggesting new positions at this time.

- Suggested Positions -
Jul 18, 2012 - entry price on PFE @ 23.53, option @ 1.30
symbol: PFE1418A25 2014 JAN $25 call - current bid/ask $ 1.95/ 2.01

10/20/12 new stop loss @ 23.90
10/06/12 new stop loss @ 23.40
09/29/12 new stop loss @ 22.75
09/22/12 new stop loss @ 22.45
09/08/12 new stop loss @ 21.90
08/06/12 new stop loss @ 21.35
07/18/12 trade opens. PFE @ 23.53
07/17/12 PFE meets our entry requirements (close over $23.40)
06/23/12 removed the 2013 call. We'll only play the 2014s
04/28/12 do not launch positions prior to the earnings report on May 1st.

Current Target: $28.00
Current Stop loss: 23.90
Play Entered on: 07/18/12
Originally listed on the Watch List: 04/21/12


SIRIUS XM Radio - SIRI - close: 2.82

Comments:
10/27/12: Shares of SIRI are holding up pretty well considering some major headlines last week. The company's CEO Mel Karmazin announced he was stepping down early next year. That could have sparked a major sell-off in SIRI. Yet the stock held up well, which may have been due to an increase in rumors that Liberty Media (LMCA) is planning to take a majority stake in SIRI soon. We might get more news when SIRI reports earnings on October 30th, before the opening bell.

After such a dramatic rally off its June lows, I suspect the earnings report could be an excuse to sell and take profits unless SIRI really blows away the estimate. I am not suggesting new positions at this time. Our long-term target is $3.90.

- Suggested Positions -
OCT 04, 2012 - entry price on SIRI @ 2.75, option @ 0.38
symbol:SIRI1418A3 2014 JAN $3.00 call - current bid/ask $ 0.41/ 0.42

- or -

Buy the Stock: Entry @ $2.75 on Oct. 4th, 2012

10/20/12 warning! SIRI is up five weeks in a row and growing overbought. The stock could see a sell-off on its earnings report

Current Target: $ 3.90
Current Stop loss: 2.29
Play Entered on: 10/04/12
Originally listed on the Watch List: 09/29/12


Spreadtrum Communications - SPRD - close: 22.70

Comments:
10/27/12: SPRD is showing relative strength. While most of the market is down over the last few weeks SPRD is actually up three weeks in a row. This last week saw a breakout past resistance at $22.00.

I am not suggesting new positions at this time. Earnings are expected on November 8th.

- Suggested Positions -
Sep 07, 2012 - entry price on SPRD @ 20.59, option @ 1.95
symbol:SPRD1319a22.5 2013 JAN $22.5 call - current bid/ask $ 2.15/ 2.30

10/27/12 SPRD has reversed higher and broken through resistance
10/06/12 SPRD looks vulnerable. Investors may want to exit early

Current Target: $24.00
Current Stop loss: 18.90
Play Entered on: 09/07/12
Originally listed on the Watch List: 08/25/12


U.S. Bancorp - USB - close: 33.15

Comments:
10/27/12: USB gave back more than a dollar last week. I warned investors to expect a dip toward the $33-32 zone. Shares are testing $33.00 now. Currently I am expecting the 200-dma and 200-ema, which are nearing $32, to act as support. I am not suggesting new positions at this time.

- Suggested Positions -
Jul 20, 2012 - entry price on USB @ 33.62, option @ 1.39
symbol: USB1319A35 2013 JAN $35 call - current bid/ask $ 0.52/ 0.54

- or -

Jul 20, 2012 - entry price on USB @ 33.62, option @ 3.10
symbol: USB1418A35 2014 JAN $35 call - current bid/ask $ 2.27/ 2.34

09/15/12 new stop loss @ 31.40
07/20/12 trade opens Friday morning
07/19/12 USB closes above our trigger <33.50
07/14/12 adjusted strategy: wait for a close over $33.50, stop 29.90
06/30/12 readers might want to consider an alternative entry point
06/23/12 adjust entry trigger to $29.00, stop to 26.40
06/02/12 adjust entry trigger to $28.00

Current Target: $39.50
Current Stop loss: 31.40
Play Entered on: 07/20/12
Originally listed on the Watch List: 05/19/12


Visa, Inc. - V - close: 138.31

Comments:
10/27/12: Visa found new short-term support near the $136.00 level. The stock has been trying to bounce from its Tuesday lows but the 20-dma is now acting as short-term resistance. I will confess it looks like a potential bear-flag pattern and if that's true then Visa could be headed for the $133-132 area. The stock could definitely see some volatility when Visa announces earnings on Oct. 31st, after the closing bell. Wall Street is looking for a profit of $1.50 a share.

I am not suggesting new positions at this time. Last week the plan was to close our 2013 calls on Monday, October 22nd at the opening bell. Unfortunately for us the call gapped down on the 22nd with a drop from $8.90 to open at $8.15 (minus the spread our exit was $7.95).

FYI: Visa is scheduled to report earnings on Oct. 31st.

Earlier Comments:
Our long-term target is $149.00 (although we'll likely exit our 2013 calls before V reaches our target).

- Suggested Positions -
(Closed the 2013 calls on Oct. 22nd at the open)
JUL 03, 2012 - entry price on V @ 126.49, option @ 5.85
symbol: V1319A135 2013 JAN $135 call - exit @ $7.95 (+35.8%)

- or -

JUL 03, 2012 - entry price on V @ 126.49, option @ 11.95
symbol: V1418A140 2014 JAN $140 call - current bid/ask $16.30/16.65

10/22/12 closed 2013 Jan call at the open
10/20/12 prepare to exit our 2013 calls at the open on Monday
10/13/12 readers may want to take profits early if you're holding the 2013 calls.
10/06/12 new stop loss @ 129.00
08/06/12 new stop loss @ 119.75
07/16/12 V pops on news of a settlement in 7-year lawsuit
07/03/12 trade opens with Visa at $126.49
07/02/12 Visa closes above our trigger @ 125.50

Current Target: $149.00
Current Stop loss: 129.00
Play Entered on: 07/03/12
Originally listed on the Watch List: 06/30/12


Wells Fargo & Co - WFC - close: 33.97

Comments:
10/27/12: WFC looks a lot like the other big banks with a new trend of lower highs developing. I have been warning readers to expect a drop toward $33.00, which should act as likely support with help from the simple 200-dma. I am still expecting that dip. More aggressive traders may want to widen their stop loss. I am not suggesting new positions at this time.

- Suggested Positions -
SEP 14, 2012 - entry price on WFC @ 35.60, option @ 2.26
symbol: WFC1418a40 2014 JAN $40 call - current bid/ask $ 1.44/ 1.48

Current Target: $44.00
Current Stop loss: 32.75
Play Entered on: 09/14/12
Originally listed on the Watch List: 08/06/12


CLOSED Plays


Chevron Corp. - CVX - close: 111.18

Comments:
10/27/12: Weakness in the oil stocks continued early last week. CVX produced a sharp two-day plunge on Monday and Tuesday. Shares hit our stop loss at $109.75 on Tuesday, Oct. 23rd. Since then CVX has started to bounce but I would wait for a new close over $115 before considering new positions.

FYI: CVX is due to report earnings on Nov. 2nd.

- Suggested (small) Positions -
Sep 12, 2012 - entry price on CVX @ 114.23, option @ 5.60
symbol: CVX1418a125 2014 JAN $125 Call - exit $3.00 (-46.4%)

10/23/12 stopped out at $109.75,
10/10/12 CVX gaps down following lowered guidance
10/09/12 CVX lowers earnings guidance
09/15/12 new stop loss at $109.75
09/12/12 trade opened with CVX at $114.23
09/11/12 CVX closed over $114.00
09/07/12 CVX closed at $114.00. Wait for a close over $114.00.
Current bid/ask on our option is $5.75/5.90.

Chart of CVX:

Current Target: $129.00
Current Stop loss: 109.75
Play Entered on: 09/12/12
Originally listed on the Watch List: 09/01/12


Eastman Chemical Co. - EMN - close: 60.19

Comments:
10/27/12: It was a volatile week for EMN. Monday-through-Thursday saw a drop from $56.00 to $53.00. Yet EMN soared +12% on Friday following its better than expected earnings report on Thursday night after the closing bell. The company beat estimates by 15 cents and raised their guidance. That news was enough to push EMN to a new all-time high. Unfortunately, the breakdown under support at $54.00 on Thursday hit our stop loss at $53.75.

- Suggested Positions -
SEP 07, 2012 - entry price on EMN @ 56.64, option @ 2.50
symbol: EMN1319a60 2013 JAN $60 call - exit $1.00 (-60.0%)

- or -

SEP 07, 2012 - entry price on EMN @ 56.64, option @ 5.55
symbol: EMN1418a65 2014 JAN $65 call - exit $3.40 (-38.7%)

10/25/12 stopped out at $53.75
10/20/12 new stop loss @ 53.75

Chart of EMN:

Current Target: $69.00
Current Stop loss: 53.75
Play Entered on: 09/07/12
Originally listed on the Watch List: 08/18/12


Kimberly-Clark - KMB - close: 82.75

Comments:
10/27/12: Ouch! KMB lost four dollars last week. The stock is now down six days in a row. The company reported earnings on October 24th, before the opening bell. KMB beat estimates by two cents, but missed the revenue estimate. Management's guidance was actually bullish but the stock sold off anyway. Our stop loss was hit at $82.90 on Oct. 25th. KMB is now nearing the next level of support at the $82.00 level.

- Suggested Positions -
OCT 02, 2012 - entry price on KMB @ 86.71, option @ 3.95
symbol: KMB1418A90 2014 JAN $90 call - exit $1.90 (-51.8%)

10/25/12 stopped out at $82.90
10/13/12 adjust stop loss to $82.90

Chart of KMB:

Current Target: $99.00
Current Stop loss: 82.90
Play Entered on: 10/02/12
Originally listed on the Watch List: 09/29/12


Monsanto Co. - MON - close: 86.60

Comments:
10/27/12: I've been cautious on MON for a while. Last week I warned readers that MON would likely hit our stop. We actually raised our stop last week to $87.45. It seemed better to get stopped out early and consider buying a bounce near $80 or its 200-dma versus moving the stop loss lower and giving MON room too much room to maneuver and risk seeing the decline accelerate.

MON broke short-term support near $88 and its 50-dma. Before the week was over MON hit our new stop at $87.45 on Oct. 23rd.

- Suggested Positions -
Jul 17, 2012 - entry price on MON @ 85.84, option @ 4.35
symbol: MON1319A90 2013 JAN $90 call - exit $2.72 (-37.4%)

- or -

Jul 17, 2012 - entry price on MON @ 85.84, option @ 6.50
symbol: MON1418A100 2014 JAN $100 call - exit $5.20 (-20.0%)

10/23/12 stopped out at $87.45
10/20/12 new stop loss @ 87.45
10/03/12 MON reported earnings
09/22/12 new stop loss @ 84.75
09/08/12 new stop loss @ 83.75
08/25/12 adjust expectations, look for a dip toward $82
08/11/12 look for a pullback toward $84 soon
07/17/12 trade opens with MON at $85.84
07/16/12 MON closes above our entry requirement ($85.25)

Chart of MON:

Current Target: $99.50
Current Stop loss: 87.45
Play Entered on: 07/17/12
Originally listed on the Watch List: 07/14/12


Time Warner - TWX - close: 43.64

Comments:
10/27/12: I expressed my concern a week ago that TWX might have been forming a top. That's why we raised the stop loss to $43.75 last weekend. The market's big drop on Tuesday morning produced a gap down in TWX. The stock was holding support near $44.00 but TWX eventually hit our stop loss at $43.75 on Oct. 25th.

Long-term I suspect TWX has additional upside but shares might correct lower toward $40.00 before revering higher again. I'd keep TWX on your radar screen.

- Suggested Positions -
(closed 2013 call on Sep 24th)
Aug 03, 2012 - entry price on TWX @ 40.66, option @ 1.79
symbol: TWX1319A42 2013 JAN $42 call - exit $4.55 (+154.1%)

- or -

Aug 03, 2012 - entry price on TWX @ 40.66, option @ 2.85
symbol: TWX1419A45 2014 JAN $45 call - exit $3.55 (+24.5%)

10/25/12 stopped out at $43.75
10/20/12 new stop loss @ 43.75
10/06/12 new stop loss @ 42.45
09/24/12 closed 2013 calls at the open ($4.55, +154.1%)
09/22/12 new stop loss @ 40.75.
Plan on exiting our 2013 calls on Monday morning at the open
09/08/12 new stop loss @ 39.85
08/11/12 readers might want to lock in gains now (+49% on the 2013 calls) in just two weeks and then jump back in on a correction in the stock.
08/03/12 TWX opens at $40.66 (trade opens)
08/02/12 TWX meets our entry requirement with a close over $40.50

Chart of TWX:

Current Target: $49.00
Current Stop loss: 43.75
Play Entered on: 08/03/12
Originally listed on the Watch List: 07/21/12