Editor's Note:

Overall most of our bullish candidates managed to recoup most if not all of the prior week's sell-off. A few have rallied to new highs.

I am concerned that the market could see more volatility this week.


Closed Plays


TOL hit our stop loss.



Play Updates


BB&T Corp. - BBT - close: 37.93

Comments:
04/20/14: BBT was bouncing along with the market until Thursday. Shares lost -3.5% in reaction to its earnings report. Wall Street was expecting a profit of $0.70 a share on revenues of $2.31 billion. BBT delivered 69 cents on revenues of $2.29 billion. The stock dropped toward its 100-dma near $37.70 before bouncing. I suspect this is just a one-day reaction to the earnings news. However, more conservative traders may want to raise their stop loss toward Thursday's low ($37.60). I am not suggesting new positions at this time.

- Suggested Positions -
DEC 17, 2013 - entry price on BBT @ 35.81, option @ 0.99
symbol: BBT1517a40 2015 JAN $40 call - current bid/ask $1.18/1.23

04/17/14 BBT drops on its earnings report
04/06/14 new stop @ 36.90
03/30/14 new stop @ 36.40
03/23/14 adjust exit target to $44.00
03/16/14 BBT has formed a potential bearish double top.
03/02/14 new stop loss @ 35.80
02/03/14 conservative investors may want to exit now to avoid a potential loss (or raise their stop loss)
01/12/14 new stop loss @ 34.90

Current Target: BBT @ 44.00
Current Stop loss: 36.90
Play Entered on: 12/17/13
Originally listed on the Watch List: 12/15/13


Caterpillar Inc. - CAT - close: 102.83

Comments:
04/20/14: CAT spent the week churning sideways but did manage a gain for the week. Shares look like they are coiling for a breakout higher. However, the stock might be stuck moving sideways until it reports earnings on April 24th. Wall Street expects a profit of $1.23 a share. More conservative traders may want to move their stop loss closer to the 50-dma (near $98.00) just in case CAT disappoints on the earnings report.

I am not suggesting new positions ahead of earnings.

Earlier Comments:
Our long-term target is the $115-125 zone. Currently CAT's point & figure chart is bullish with a $126 target.

- Suggested Positions -
APR 03, 2014 - entry price on CAT @ 101.92, option @ 3.50*
symbol: CAT1517a110 2015 JAN $110 call - current bid/ask $3.65/3.75

- or -

APR 03, 2014 - entry price on CAT @ 101.92, option @ 7.40*
symbol: CAT1615a110 2016 JAN $110 call - current bid/ask $7.35/7.60

04/03/14 trade opens. CAT @ 101.92
*option entry price is an estimate since the option did not trade at the time our play was opened.
04/02/14 CAT meets our entry trigger with a close above $101.00

Current Target: CAT @ 115.00-125.00 zone
Current Stop loss: 94.90
Play Entered on: 04/03/14
Originally listed on the Watch List: 03/30/14


Chicago Bridge & Iron - CBI - close: 86.50

Comments:
04/20/14: After a big drop two weeks ago CBI produced an equally big bounce last week. I would expect shares to move sideways until CBI reports earnings on April 23rd. Analysts are expecting a profit of $1.10 a share. I am not suggesting new positions ahead of the earnings report.

- Suggested Positions -
MAR 07, 2014 - entry price on CBI @ 85.52, option @ 6.85
symbol: CBI1517a90 2015 JAN $90 call - current bid/ask $6.50/6.90

- or -

MAR 07, 2014 - entry price on CBI @ 85.52, option @ 8.50
symbol: CBI1615a100 2016 JAN $100 call - current bid/ask $8.10/8.90

03/07/14 trade opens with CBI @ $85.52
03/06/14 CBI closes above our entry requirement of $85.00

Current Target: CBI @ 99.50
Current Stop loss: 79.45
Play Entered on: 03/07/14
Originally listed on the Watch List: 03/02/14


The Walt Disney Co. - DIS - close: 79.99

Comments:
04/20/14: It's another big summer for movies and DIS is still raking in money from its recent hit Captain America: The Winter Soldier. DIS has several films coming out with potential hits like Maleficient and Guardians of the Galaxy. Meanwhile the stock has bounced from technical support at its simple 100-dma and rallied back to resistance near $80 and its 50-dma. I am not expecting DIS to make any significant progress until after the company reports earnings on May 6th.

- Suggested Positions -
OCT 23, 2013 - entry price on DIS @ 68.81, option @ 3.70
symbol: DIS1517a75 2015 JAN $75 call - current bid/ask $ 9.05/ 9.20

04/13/14 investors may want to take profits now. DIS could be headed for $70.00
03/09/14 new stop loss @ 74.75, traders may want to take some money off the table here. DIS is overbought and due for a dip.
03/02/14 new stop loss @ 71.75
02/16/14 more conservative traders may want to take profits now.
We are adjusting our long-term target from $84 to $89
01/05/14 new stop loss @ 69.40
12/29/13 new stop loss @ 67.40
12/08/13 new stop loss @ 65.75
11/24/13 new stop loss @ 64.75

Current Target: DIS @ 89.00
Current Stop loss: 74.75
Play Entered on: 10/23/13
Originally listed on the Watch List: 10/13/13


Honeywell Intl. - HON - close: 93.10

Comments:
04/20/14: HON retested support near $90.00 and bounced. The company reported earnings on Thursday. Wall Street was looking for a profit of $1.26 a share on revenues of $9.74 billion. HON delivered $1.28 a share but revenues only hit $9.68 billion. Management did offer bullish guidance and raised the low end of its prior 2014 guidance estimates. The company is planning to spent $10 billion over the next few years on acquisitions and said they were "cautiously optimistic on the macro environment" at the end of the first quarter.

The long-term trend is still up but HON still has some resistance in the $95 area. I am not suggesting new positions at this time.

- Suggested Positions -
(closed the 2014 calls on May 20th at the open)
MAY 07, 2013 - entry price on HON @ 76.20, option @ 2.68
symbol: HON1418a80 2014 JAN $80 call - exit $5.10 (+90.2%)

- or -

MAY 07, 2013 - entry price on HON @ 76.20, option @ 4.10
symbol: HON1517a85 2015 JAN $85 call - current bid/ask $10.40/10.95

03/02/14 new stop loss @ 89.75, adjust target to $99.00
02/09/14 new stop loss @ 87.45
12/29/13 new stop loss @ 84.85
12/22/13 adjust the exit target to $98.00
...please see earlier newsletter for prior comments...
The plan was to use small positions to limit our risk.

Current Target: exit when HON hits $99.00
Current Stop loss: 89.75
Play Entered on: 05/07/13
Originally listed on the Watch List: 05/04/13



Joy Global Inc. - JOY - close: 61.55

Comments:
04/20/14: JOY spent the week consolidating sideways in the $60-62 zone. Shares are still respecting the 10-dma as short-term support so the trend remains higher. I don't see any changes from last week's comments.

- Suggested Positions -
APR 08, 2014 - entry price on JOY @ 60.75, option @ 4.40
symbol: JOY1517a65 2015 JAN $65 call - current bid/ask $ 4.35/ 4.55

- or -

APR 08, 2014 - entry price on JOY @ 60.75, option @ 6.05
symbol: JOY1615a70 2016 JAN $70 call - current bid/ask $ 5.65/ 6.00

04/08/14 JOY hit our entry trigger at $60.75

Current Target: We're aiming for the $75-80 zone
Current Stop loss: 55.75
Play Entered on: 04/08/13
Originally listed on the Watch List: 04/06/14


KLA-Tencor - KLAC - close: 66.11

Comments:
04/20/14: KLAC spent most of the week consolidating sideways between support near $65.00 and resistance at its 50-dma (currently near $66.65) . KLAC did see some volatility on Wednesday. Chip maker ASML lowered its Q2 sales outlook on Wednesday and many of its rivals, including KLAC, dropped on this news. Shares of KLAC fell toward short-term support near $64 and its 150-dma before bouncing. The actual low was $63.96. Our stop loss is at $63.90 so it was a close call.

KLAC is scheduled to report earnings on April 24th. Wall Street is looking for a profit of $1.11 a share. I am not suggesting new positions ahead of earnings.

- Suggested Positions -
MAR 13, 2014 - entry price on KLAC @ 67.63, option @ 4.50*
symbol:KLAC1517a70 2015 JAN $70 call - current bid/ask $ 3.30/3.50

- or -

MAR 13, 2014 - entry price on KLAC @ 67.63, option @ 5.50*
symbol:KLAC1615a75 2016 JAN $75 call - current bid/ask $ 4.30/4.60

03/23/14 new stop loss @ 63.90
03/13/14 trade opens with KLAC @ 67.63
03/12/14 KLAC closes @ 67.63, above our suggested entry, a close above $67.50
Current Target: exit calls when KLAC hits $79.00
Current Stop loss: 63.90
Play Entered on: 03/13/14
Originally listed on the Watch List: 03/02/14


NuStar Energy - NS - close: 55.10

Comments:
04/20/14: It was another quiet week for NS. Shares did test its recent highs with an intraday rally on Thursday but gains faded ahead of the long weekend. NS is consolidating sideways along the $55.00 level. Investors may want to wait for a close above $56.00 before initiating new positions. I would wait until after we see the market's reaction to NS earnings before launching new trades here.

NS is due to report earnings on April 23rd and analysts are expecting a profit of 40 cents a share.

Earlier Comments:
Our target is $64.50. More aggressive investors with a longer time frame may want to aim higher since the point & figure chart is targeting an $87 target.

- Suggested Positions -
APR 04, 2014 - entry price on NS @ 55.25, option @ 3.10*
symbol: NS1517a55 2015 JAN $55 call - current bid/ask $ 2.80/3.20

04/04/14 our play opens. NS @ 55.25
*option entry price is an estimate since the option did not trade at the time our play was opened.
04/03/14 NS closes above $55.25
Current Target: exit calls when NS hits $64.50
Current Stop loss: 51.75
Play Entered on: 04/04/14
Originally listed on the Watch List: 03/23/14


QUALCOMM Inc. - QCOM - close: 81.32

Comments:
04/20/14: QCOM was up every day last week and closed at new multi-year highs. I am raising our stop loss to $74.70. More conservative investors may want to raise their stop closer to April's lows in the $77.50 area. QCOM could see more volatility this week after the company reports earnings on April 23rd. Wall Street expects a profit of $1.22 a share. I am not suggesting new positions at this time.

- Suggested Positions -
NOV 15, 2013 - entry price on QCOM @ 71.34, option @ 4.90
symbol: QCOM1517a75 2015 JAN $75 call - current bid/ask $8.85/9.00

04/20/14 new stop @ 74.70
03/30/14 new stop @ 73.75
03/23/14 new stop @ 71.75
03/04/14 QCOM raises dividend and buyback program
02/19/14 QCOM being investigated by Chinese authorities
01/19/14 new stop loss @ 69.45
12/08/13 new stop loss @ 67.75
11/15/13 trade opens. QCOM @ 71.34
11/14/13 QCOM closes above entry trigger (above 70.50)

Current Target: $85.00
Current Stop loss: 74.70
Play Entered on: 11/15/13
Originally listed on the Watch List: 11/03/13


Western Digital Corp. - WDC - close: 91.05

Comments:
04/20/14: WDC is holding up well. Shares managed to erase the prior week's losses. The stock looks poised to breakout past short-term resistance near $92.00 soon. I doubt we will see WDC above the April high near $95 before they report earnings on April 30th.

I am not suggesting new positions at this time.

- Suggested Positions -
APR 01, 2014 - entry price on WDC @ 92.56, option @ 6.85*
symbol: WDC1517a100 2015 JAN $100 call - current bid/ask $5.90/6.10

- or -

APR 01, 2014 - entry price on WDC @ 92.56, option @ 9.65*
symbol: WDC1615a110 2016 JAN $110 call - current bid/ask $8.20/8.45

04/01/14 trade opens. WDC opened @ 92.56
*option entry price is an estimate since the option did not trade at the time our play was opened.
03/31/14 WDC meets entry requirement with close above $91.25

Current Target: WDC @ $110.00
Current Stop loss: 85.75
Play Entered on: 04/01/14
Originally listed on the Watch List: 03/30/14


Wells Fargo & Co. - WFC - close: 48.93

Comments:
04/20/14: The financial sector as a whole was up four days in a row last week. Yet some of the big banks struggled. The rebound in WFC has stalled near $49. I am not convinced the correction is over for WFC. I would watch for support in the $46-47 area.

- Suggested Positions -
DEC 26, 2013 - entry price on WFC @ 45.50, option @ 1.50
symbol: WFC1517a50 2015 JAN $50 call - current bid/ask $ 2.15/2.20

-- or --

DEC 26, 2013 - entry price on WFC @ 45.50, option @ 2.95*
symbol: WFC1615a50 2016 JAN $50 call - current bid/ask $ 3.90/4.00

04/06/14 WFC looks poised for a pullback
03/30/14 new stop loss @ 44.80
03/09/14 new stop loss @ 43.90
01/19/14 new stop loss @ 42.90
12/26/13 trade opens with WFC @ $45.50
*option entry price is an estimate since the option did not trade at the time our play was opened.
12/24/13 WFC closed @ 45.39, above our trigger at $45.25

Current Target: Exit WFC hits $54.50
Current Stop loss: 44.80
Play Entered on: 12/26/13
Originally listed on the Watch List: 12/08/13



CLOSED Plays


Toll Brothers - TOL - close: 34.16

Comments:
04/20/14: I warned investors last week that our TOL trade was probably dead. The industry has not been performing well. The latest builder sentiment survey from the National Association of Home Builders was another disappointment. The April reading improved to 47, up from March's 46, but readings below 50 suggest home builders believe market conditions are poor. Analysts had been expecting a rise to 50.

Shares of TOL hit our stop loss at $34.40 on Tuesday, April 15th.

- Suggested Positions -
FEB 27, 2014 - entry price on TOL @ 38.72, option @ 4.25*
symbol: TOL1517a40 2015 JAN $40 call - exit $1.75** (-58.8%)

- or -

FEB 27, 2014 - entry price on TOL @ 38.72, option @ 5.35*
symbol: TOL1615a45 2016 JAN $45 call - exit $2.50** (-53.2%)

04/15/14 stopped out
**option exit price is an estimate since the option did not trade at the time our play was closed.
04/13/14 TOL looks poised to hit our stop at $34.40
03/30/14 new stop @ 34.40
02/27/14 trade opens with TOL @ 38.72
*option entry price is an estimate since the option did not trade at the time our play was opened.
02/26/14 TOL closes above our trigger (38.50)

Chart of TOL:

Current Target: RYL @ $49.00
Current Stop loss: 34.40
Play Entered on: 02/27/14
Originally listed on the Watch List: 02/16/14