New Watch List Entries

C - Citigroup

KO - The Coca-Cola Co.


Active Watch List Candidates

GLD - Gold ETF

HFC - HollyFrontier Corp

M - Macy's Inc.

VMC - Vulcan Materials Co


Dropped Watch List Entries

ADBE and SBUX have graduated to our play list.

RCL and SWN have been removed.



New Watch List Candidates:


Citigroup - C - close: 37.64

Company Info

The financial sector has been showing some strength the last three weeks. Shares of Citigroup are starting to catch up with their peers. The stock outperformed this past week with a rally off support near $34.00. Now Citigroup is nearing resistance in the $38.00-38.50 zone. A breakout here would be a new 2012 high.

I am suggesting we wait for C to close above $38.50 and then buy calls the next day. Our long-term target is the $47.50-50.00 range.

Breakout trigger: wait for a close over $38.50 (stop 34.65)

BUY the 2014 Jan $45 call (C1418a45) current ask $2.40

Chart of C:

Originally listed on the Watch List: 12/08/12


The Coca-Cola Company - KO - close: 37.71

Company Info

KO is famous for having the most valuable brand in the world. The company held a stock split earlier this year making shares more "affordable" for the average investor. The stock saw a correction from $40.50 down to $36.00 but it looks like KO has bottomed. The stock has rebounded back to resistance near $38.00 and its 100-dma.

The 100-dma is currently at $38.11. I am suggesting we wait for KO to close above $38.25 and then buy calls the next day. If triggered our long-term target is $44.00.

Breakout trigger: wait for a close over $38.25 (stop 35.75)

BUY the 2014 $40 call (KO1418a40) current ask $1.36

Chart of KO:

Originally listed on the Watch List: 12/08/12


Active Watch List Candidates:



SPDR Gold ETF - GLD - close: 165.17

Comments:
12/08/12: The GLD saw another decline this past week but traders were buying the dip on Wednesday and Thursday. I am not convinced the correction is over yet. We are still waiting for a dip to $160.00 but readers may want to jump in early and consider buying a dip or a bounce at $162.00 instead.

I am eliminating the 2013 call. We will focus on the 2014 Jan $200 call.

Buy-the-Dip trigger: $160.00 (stop loss @ 154.40)

BUY the 2014 Jan $200 call (GLD1418a200)

12/08/12 removed the 2013 call. Only use the 2014 call
11/03/12 Adjust the entry trigger down to $160.00 and the stop to $154.40
10/27/12 adjust the entry trigger to $162.00 and the stop to $154.90
10/20/12 adjust the buy-the-dip trigger to $163.00, stop to $157.75
adjust the 2013 call from Jan. $175 to June $175
09/15/12 adjust the trigger to $165.50, stop to $159.00.
09/08/12 adjust the buy-the-dip trigger to $164.00 (up from $162)

Originally listed on the Watch List: 09/01/12


HollyFrontier - HFC - close: 43.64

Comments:
12/08/12: We were expecting a pullback in HFC. Hopefully it's not over yet.

I am suggesting we buy calls when HFC dips to $42.00. We'll start with a stop loss at $39.40. Our long-term target is $49.75.

Buy-the-Dip trigger: $42.00 (stop loss @ 39.40)

BUY the 2014 Jan $50 call (1418a50)

Originally listed on the Watch List: 12/02/12


Macy's Inc. - M - close: 39.41

Comments:
12/08/12: The news on Friday was Macy's decision to raise its stock buyback program by another $1.5 billion. The stock is bouncing from the $38 level. We are still waiting for a breakout past resistance at $42.00.

I am suggesting we wait for M to close over $42.25 and then buy calls the next day. Our long-term target is $54.50.

Breakout trigger: Wait for a close over $42.25 (stop 37.90)

BUY the 2014 Jan $50 call (M1418a50)

Originally listed on the Watch List: 11/24/12


Royal Caribbean Cruises - RCL - close: 35.01

Comments:
12/08/12: RCL saw a minor pullback last week but traders bought the dip at $34.00. The trend is up but I don't want to chase it. We've been waiting for a dip to $32.25 but it seems unlikely to happen soon. Therefore I am removing RCL as a candidate. More aggressive traders may want to consider buying a breakout to new highs.

trade did not open.

12/08/12 Trade did not open. removed RCL as a candidate.

Originally listed on the Watch List: 11/03/12


Southwestern Energy - SWN - close: 34.38

Comments:
12/08/12: SWN continues to churn sideways. There appears to be support at the multi-week trend of higher lows. Yet SWN is just not moving very fast. We've been waiting for a breakout above $37.00 but it's unlikely to happen any time soon. Therefore I am removing SWN as a candidate.

trade did not open.

12/08/12 removed SWN as a candidate. trade did not open.

Originally listed on the Watch List: 10/13/12


Vulcan Materials Co. - VMC - close: 52.00

Comments:
12/08/12: We have been expecting a pullback in VMC. Shares dipped to their rising 10-dma this past week before bouncing. Hopefully the pullback is not over yet.

I am suggesting we open bullish positions on a dip at $50.25. If triggered we'll use a stop loss at $46.40. Our long-term target is $64.00 although I would expect some resistance at $60.00. FYI: The Point & Figure chart is bullish and is forecasting at $70 target.

Buy-the-Dip trigger: $50.25 (stop loss 46.40)

BUY the 2014 Jan $55 call (VMC1418a55)

Originally listed on the Watch List: 12/02/12