Editor's Note:

The S&P 500 index is breaking out to new record highs. We are using this strength to raise stop losses on several of our active candidates.

I am also suggesting an early exit on ADI, GE, UA, and the 2014 MRK calls. Please see the individual play updates below for details.


Closed Plays



None. No closed plays this week.




Play Updates


Analog Devices - ADI - close: 44.59

Comments:
04/13/13: The rebound in the semiconductor sector stalled on Thursday and Friday. This was also evident in shares of ADI. Unfortunately the action in ADI looks worse than the SOX index. The rebound in ADI failed at its simple 40 and 50-dma. This now looks like a lower high. This looks even worse when you consider that the S&P 500 is at a new record high and even the NASDAQ is at a new multi-year high.

I am suggesting we abandon this trade and exit immediately on Monday morning at the opening bell. I am concerned that ADI is likely headed for the $40.00 level.

- Suggested Positions -
JAN 03, 2013 - entry price on ADI @ 43.60, option @ 3.10
symbol: ADI1418a45 2014 JAN $45 call - current bid/ask $ 2.85/3.00

04/13/13 exit immediately, prepare to exit on Monday morning at the open
03/29/13 ADI's CEO dies of a heart attack.
03/23/13 ADI still looks poised to retreat lower.
03/16/13 did ADI just create a new lower high?
02/09/13 new stop loss @ 41.90
adjust exit target to $49.00

Current Target:$ 49.00
Current Stop loss: 41.90
Play Entered on: 01/03/13
Originally listed on the Watch List: 12/22/12


American Intl. Group - AIG - close: 40.13

Comments:
04/13/13: The financial sector is participating in the market's rally and AIG is helping lead the charge. The rebound continues with AIG breaking out past resistance near $40.00 and hitting new two-year highs. Although you could argue with AIG at $40.13 the breakout is not very convincing (yet).

I am not suggesting new positions at this time. We are raising our stop loss to $35.75. FYI: AIG is scheduled to report earnings on May 2nd.

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

- Suggested Positions - (small positions @ first)
(closed on Dec. 24th)
May 18, 2012 - entry price on AIG @ 28.25, option @ 3.40
symbol: AIG1319A30 2013 JAN $30 call - exit @ $5.00 (+47.0%)

- or -

May 18, 2012 - entry price on AIG @ 28.25, option @ 4.20
symbol: AIG1418A35 2014 JAN $35 call - current bid/ask $ 6.95/ 7.00

04/13/13 new stop loss @ 35.75
02/02/13 new stop loss @ 34.40
01/26/13 new stop loss at $32.75
12/24/12 closed our 2013 call position at the open.
Our exit was at $5.00 (+47.0%)
12/22/12 Exit the 2013 calls immediately on Monday morning
current bid is at $4.80
..for prior updates, check older newsletters

Current Target:$ 2013 call: $37.00, 2014 calls: $42.50
Current Stop loss: 35.75
Play Entered on: 05/18/12
Originally listed on the Watch List: 04/07/12


Bank of America - BAC - close: 12.17

Comments:
04/13/13: The rally BAC has stalled. The XLF financial index is hitting new relative highs but BAC remains well below its 2013 high set in mid March. Earnings results from rivals JPM and WFC on April 12th did not have much influence. Both JPM and WFC beat estimates but Wall Street seems worried about the mortgage banking business for both banks. The number of mortgages is up but profit margins in the mortgage business are not what Wall Street was expecting. JPM's record earnings are also questionable considering that $1.15 billion of the bank's $6.5 billion net income for the quarter came from a release of its loan loss reserves.

BAC is scheduled to report earnings on April 17th, before the opening bell. Analysts expect a profit of 22 cents a share. The stock has support near $11.00, which is why our stop loss is at $10.90. More conservative traders may want to raise their stops toward $11.50 or its 100-dma. I am not suggesting new positions on BAC.

- Suggested Positions -
MAR 18, 2013 - entry price on BAC @ 12.29, option @ 0.44
symbol: BAC1418a15 2014 JAN $15 call - current bid/ask $0.35/0.36

- or -

MAR 18, 2013 - entry price on BAC @ 12.29, option @ 1.13
symbol: BAC1517a15 2015 JAN $15 call - current bid/ask $1.06/1.07

Current Target:$ 18.00
Current Stop loss: 10.90
Play Entered on: 03/18/13

Originally listed on the Watch List: 03/09/13


Bed Bath & Beyond - BBBY - close: 66.76

Comments:
04/13/13: BBBY is up exactly three dollars for the week thanks to the big bounce on Friday. The stock was quite volatile as investors reacted to the company's earnings report out on April 10th. Bottom line results were in-line with expectations at $1.68 a share. Revenues were up 24.5% to $3.4 billion, which was better than expected. Yet same-store sales growth plunged to +2.5%. If that wasn't bad enough management lowered their earnings estimates. The results were good enough to spark several price target upgrades from various analysts. Shares of BBBY gapped open higher and spiked to $68.30 on Thursday before plunging toward $64.00 and its 20-dma by Thursday's closing bell.

Thursday's session looked like a huge bearish engulfing candlestick reversal pattern. Thankfully there was no follow through and Friday saw a big rebound off its 20-dma.

I am not suggesting new positions at this time. We are raising the stop loss to $62.25.

- Suggested Positions -
MAR 21, 2013 - entry price on BBBY @ 63.06, option @ 5.20
symbol: BBBY1418a65 2014 JAN $65 call - current bid/ask $6.90/7.05

04/13/13 new stop loss @ 62.25
03/30/13 Nimble traders could exit now (for a small profit) and re-enter positions on a pullback.
03/21/13 trade opens with BBBY opening at $63.06
03/20/13 BBBY meets our entry requirement (close over $62.50) with a close at $63.34

Current Target:$ 74.50
Current Stop loss: 62.25
Play Entered on: 03/21/13
Originally listed on the Watch List: 03/16/13


Colgate-Palmolive - CL - close: 118.37

Comments:
04/13/13: CL bounced back toward its record highs set the prior week. Shares briefly tagged a new all-time high on an intraday basis. The trend is up but a failure here would look like a short-term bearish double top. Earnings are coming up on April 25th and the stock is scheduled for a stock split in May. Readers may want to consider just taking profits now to lock in gains. I am raising our stop loss to $114.35.

FYI: CL is due to report earnings on April 25th.

- Suggested Positions - (small positions)
FEB 20, 2013 - entry price on CL @ 112.00, option @ 4.20
symbol: CL1418a115 2014 JAN $115 call - current bid/ask $ 7.15/ 7.40

04/13/13 new stop loss @ 114.35
Investors may want to just take profits now with the bid on our call at $7.15.
03/30/13 new stop loss @ 109.90
03/16/13 new stop loss @ 108.40

Current Target:$ 124.50
Current Stop loss: 114.35
Play Entered on: 02/20/13
Originally listed on the Watch List: 02/16/13


Chevron Corp. - CVX - close: 119.94

Comments:
04/13/13: CVX delivered a strong four-day rebound. The stock followed the energy sector lower on Friday likely due to the big drop in crude oil prices on Friday. More conservative investors may want to raise their stop closer to the $116.00 level. Or you could take profits now with the bid on our call at $6.00.

I am not suggesting new positions at this time.

FYI: CVX is due to report earnings on April 26th.

- Suggested Positions -
JAN 14, 2013 - entry price on CVX @ 111.38, option @ 3.40
symbol: CVX1418a120 2014 JAN $120 call - current bid/ask $ 6.00/6.15

03/16/13 new stop loss @ 113.25
03/09/13 new stop loss @ 109.50
02/02/13 do not be surprised to see a pullback now that earnings have been announced.

Current Target:$124.50
Current Stop loss: 113.25
Play Entered on: 01/14/13
Originally listed on the Watch List: 12/22/12


Dollar Tree, Inc. - DLTR - close: 47.82

Comments:
04/13/13: Hmm... I am surprised that DLTR is bouncing. Shares displayed some volatility midweek as investors reacted to earnings from rival Family Dollar stores (FDO). FDO missed the earnings estimate and guided lower. Yet traders bought the dip in both FDO and DLTR. The rebound in DLTR helps negate the bearish reversal pattern created a week ago on its weekly chart.

I am cautiously bullish here but I am not suggesting new positions. We will raise the stop loss to $44.75.

- Suggested Positions -
FEB 28, 2013 - entry price on DLTR @ 45.25, option @ 4.76
symbol:DLTR1418a45 2014 JAN $45 call - current bid/ask $ 6.10/6.30

04/13/13 new stop loss @ 44.75
03/30/13 new stop loss @ 43.45
More conservative investors might want to take profits as DLTR moves into the $49-50 zone.
03/16/13 new stop loss @ 41.40
02/28/13 trade opened following gap higher, above our trigger

Current Target: $53.50
Current Stop loss: 44.75
Play Entered on: 02/28/13
Originally listed on the Watch List: 02/23/13


General Electric - GE - close: 23.46

Comments:
04/13/13: It was an up week for GE, which isn't surprising given the strength in big caps. The company is scheduled to report earnings on April 19th, which is Friday. I am growing cautious on the market even though the trend is up for the S&P 500. Therefore I am suggesting we go ahead and exit our GE positions on Thursday, April 18th at the closing bell to avoid holding over GE's earnings announcement. More conservative traders could just exit now since the bid has hit $0.79 (+88%).

I am raising our stop loss to $22.65, which is just under the recent low.

- Suggested Positions -
NOV 14, 2012 - entry price on GE @ 20.25, option @ 0.42
symbol: GE1418a25 2014 JAN $25 call - current bid/ask $0.79/0.81

04/13/13 prepare to exit on Thursday, April 18th at the closing bell
new stop loss @ 22.65
03/09/13 our 2014 Jan $25 call option has doubled. Readers might want to consider taking some money off the table.
02/16/13 new stop loss @ 21.40
02/02/13 new stop loss @ 20.40
12/14/12 GE increased its dividend to 19 cents
11/24/12 new stop loss @ 19.75
11/14/12 triggered at $20.25
11/10/12 adjust the trigger down to $20.25, just above the 200-dma, stop to $19.25
10/27/12 move the buy-the-dip trigger down to $20.50
10/20/12 adjust the buy-the-dip trigger to $21.00 and our stop to $19.45

Current Target: $27.50
Current Stop loss: 22.65
Play Entered on: 11/14/12
Originally listed on the Watch List: 09/22/12


The Coca-Cola Company - KO - close: 41.08

Comments:
04/13/13: KO tagged new highs on Thursday before paring gains on Friday. The trend is up but shares of KO could be volatile this week. Investors might be tempted to sell the earnings news. KO is scheduled to report earnings on April 16th before the opening bell. Wall Street expects a profit of 45 cents a share. Our 2015 call options have already doubled (+108%) and investors may want to take profits now ahead of the report. I am not suggesting new positions.

- Suggested Positions -
(closed 2014 calls on April 1st, 2013 at the open)
FEB 12, 2013 - entry price on KO @ 38.05, option @ 1.01
symbol: KO1418a40 2014 JAN $40 call - exit $1.97 (+95.0%)

- or -

FEB 12, 2013 - entry price on KO @ 38.05, option @ 1.75
symbol: KO1517a40 2015 JAN $40 call - current bid/ask $3.65/3.80

04/01/13 exited 2014 calls at the open. Option @ $1.97 (+95.0%)
03/30/13 prepare to exit our 2014 Jan $40 calls on Monday, April 1st, 2013 at the opening bell to lock in gains. Current bid is $2.09.
03/30/13 new stop loss @ 38.25
03/23/13 new stop loss @ 37.65
Our 2014 calls have almost doubled and readers may want to take profits early right now

Current Target: $44.00
Current Stop loss: 38.25
Play Entered on: 02/12/13
Originally listed on the Watch List: 02/09/13


Macy's Inc. - M - close: 44.43

Comments:
04/13/13: Macy's rallied more than a dollar for the week to close at new multi-year highs. Short-term I would expect a pullback. The last couple of days have seen traders selling the rallies. Broken resistance near $42.00 should be support. I am not suggesting new positions at this time.

Earlier Comments:
The old all-time highs near $46.50 could be resistance but at the moment we are aiming for $48.50. FYI: The Point & Figure chart is bullish with a $53 target.

- Suggested Positions -
MAR 21, 2013 - entry price on M @ 42.22, option @ 2.85
symbol: M1418a45 2014 JAN $45 call - current bid/ask $3.65/3.75

Current Target: $48.50
Current Stop loss: 39.25
Play Entered on: 03/21/13
Originally listed on the Watch List: 03/09/13


Merck & Co. - MRK - close: 47.11

Comments:
04/13/13: MRK was a strong performer last week, gaining almost two dollars. Shares are nearing what should be resistance near $48.00 and its 2012 high. I am adjusting our exit strategy. We will go ahead and exit our 2014 Jan. $45 calls now, on Monday, April 15th at the opening bell to lock in gains. We will keep the 2015 call position open but I am moving our stop loss to $43.40 and moving the exit target to $53.50. I fully expect MRK to see significant volatility over the next several weeks. Not only is the $48 level resistance but the $50 level will likely be resistance as well. If you're holding the 2015 calls you'll need to be patient.

The company is due to report earnings on May 1st.

- Suggested Positions -
MAR 13, 2013 - entry price on MRK @ 44.54, option @ 2.06
symbol: MRK1418a45 2014 JAN $45 call - current bid/ask $3.65/3.70

- or -

MAR 13, 2013 - entry price on MRK @ 44.54, option @ 3.60
symbol: MRK1517a45 2015 JAN $45 call - current bid/ask $5.10/5.20

04/13/13 prepare to exit 2014 calls on Monday, April 15th at the opening bell.
new stop loss @ 43.40 and new target of $53.50 for 2015 calls.
03/30/13 MRK is not participating in the market's rally or drug sector rally. Investors will want to turn more defensive here.
03/16/13 use the dip to $44.00 as another entry point to buy calls
03/13/13 trade opens with MRK gapping down at $44.54
03/12/13 MRK gaps open higher and closed at $45.04, above our suggested entry (close above $44.25).

Current Target: $53.50
Current Stop loss: 43.40
Play Entered on: 03/13/13
Originally listed on the Watch List: 02/23/13


Starbucks Corp. - SBUX - close: 59.09

Comments:
04/13/13: The dip buying in SBUX has finally produced a bullish breakout. Shares hit new 11-month highs but stalled at round-number resistance near $60.00. I am expecting SBUX to push past potential resistance at $60.00 but the all-time high near $62.00 could be another matter. I am adjusting our exit target down to $61.50. I am adjusting the stop loss to $54.75.

FYI: SBUX is scheduled to report earnings on April 25th.

- Suggested Positions -
DEC 07, 2012 - entry price on SBUX @ 53.43, option @ 3.80
symbol:SBUX1418a60 2014 JAN $60 call - current bid/ask $ 4.30/ 4.40

04/13/13 new stop loss @ 54.75, adjust target to $61.50
03/09/13 new stop loss @ 52.75
01/05/13 new stop loss @ 49.85

Current Target:$ 61.50
Current Stop loss: 54.75
Play Entered on: 12/07/12
Originally listed on the Watch List: 12/02/12


The Charles Schwab Corp. - SCHW - close: 17.28

Comments:
04/13/13: SCHW delivered a nice four-day rally before succumbing to profit taking on Friday. Shares are likely to be volatile on Monday. The company is scheduled to report earnings on April 15th. The announcement is before the opening bell. Analysts are looking for a profit of 16 cents a share. I am not suggesting new positions at this time.

Earlier Comments:
Our long-term target is $18.75. More aggressive traders can aim higher. The Point & Figure chart is bullish with a $24 target.

- Suggested *SMALL* Positions -
JAN 23, 2013 - entry price on SCHW @ 15.74, option @ 0.80
symbol:SCHW1418a17 2014 JAN $17 call - current bid/ask $ 1.45/ 1.65

03/09/13 new stop loss @ 15.90, our call option has more than doubled and readers may want to take profits now.
02/23/13 new stop loss @ $15.20
02/19/13 sold half at the open: option bid @ $1.25 (+56.2%)
02/16/13 prepare to sell half of our position on Tuesday morning, Feb. 19th at the opening bell
02/09/13 investors may want to consider exiting now to book a profit and then jump back in on a correction.

Current Target: $18.75
Current Stop loss: 15.90
Play Entered on: 01/23/13
Originally listed on the Watch List: 01/19/13


Under Armour, Inc. - UA - close: 57.00

Comments:
04/13/13: Wow! UA was a bright spot in the market with a $4.00 gain for the week (about +7.5%). The stock is up several days in a row and definitely looks short-term overbought here. Investors may want to take profits immediately to lock in gains.

UA is scheduled to report earnings on April 19th. I strongly suspect that after such a sharp run up higher we will see shares give into profit taking following its report. Therefore I am suggesting we plan on exiting our UA positions on Thursday, April 18th at the closing bell to avoid holding over the announcement. Furthermore I am lowering our exit target down to $59.00 just in case the rally continues, we might be able to exit prior to Thursday. I am also raising our stop loss to $53.75.

Earlier Comments:
It's also worth noting that UA has relatively high short interest at 18% of the 79.8 million share float. A breakout past resistance could also fuel some short covering.

- Suggested *SMALL* Positions -
APR 02, 2013 - entry price on UA @ 52.50, option @ 3.15
symbol: UA1418a60 2014 JAN $60 call - current bid/ask $ 5.40/ 5.60

04/13/13 new stop loss at $53.75, adjust target to $59.00,
prepare to exit on Thursday, April 18th if UA does not hit our target by then.
04/02/13 triggered at $52.50

Current Target: $59.00
Current Stop loss: 53.75
Play Entered on: 04/02/13
Originally listed on the Watch List: 03/30/13


Wal-Mart Stores - WMT - close: 78.56

Comments:
04/13/13: There seems to be no slowing the rally in WMT. Shares of this retail titan have broken out to new all-time, record highs. The stock is actually looking overbought here. WMT is up four weeks in a row and up seven out of the last eight week. I suspect the $80.00 level will be round-number resistance and the stock will see a correction lower. More conservative investors may want to take profits now, especially if you're holding the 2014 calls.

I am not suggesting new positions at this time. I am raising the stop loss to $73.45.

- Suggested Positions -
MAR 05, 2013 - entry price on WMT @ 73.47, option @ 3.10
symbol: WMT1418a75 2014 JAN $75 call - current bid/ask $ 5.85/5.95

- or -

MAR 05, 2013 - entry price on WMT @ 73.47, option @ 2.97
symbol: WMT1517a80 2015 JAN $80 call - current bid/ask $ 5.25/5.40

04/13/13 new stop loss @ 73.45
04/06/13 new stop loss @ 71.40
03/30/13 new stop loss @ 69.45

Current Target: $85.00-90.00 range
Current Stop loss: 73.45
Play Entered on: 03/05/13
Originally listed on the Watch List: 02/02/13