Editor's Note:

I am removing SWN as an active watch list candidate and we've adjusted a couple of entry points for C and CBI.



New Watch List Entries

JNPR - Juniper Networks

SBUX - Starbucks


Active Watch List Candidates

C - Citigroup, Inc.

CBI - Chicago Bridge & Iron

FL - Foot Locker, Inc.

ITW - Illinois Tool Works

STX - Seagate Tech.


Dropped Watch List Entries

We are removing SWN as a candidate tonight.



New Watch List Candidates:


Juniper Networks - JNPR - close: 22.77

Company Info

JNPR is in the technology sector. The company is a major player in the computer networking equipment and solutions industry. The stock appears to have put in a significant bottom back in October. Given the rally in JNPR investors do not seem worried that JNPR sales overseas are going to suffer from the NSA scandal that has plagued so many big tech American firms or it's possible this has been priced in.

JNPR's stock is currently testing significant resistance near $23.00 a breakout here would be bullish. The Point & Figure chart is bullish and forecasting at $29 target that could rise.

I am still worried that the market is overbought and due for a dip so more conservative investors may want to shy away from a breakout trade like this one. Plus JNPR is due to report earnings in late January but the actual date has not been confirmed yet. Investors may want to consider waiting until after JNPR reports earnings and we see how the stock fares following its results before initiating positions.

Tonight I am suggesting we wait for JNPR to close above $23.25. If this happens we can launch positions the next morning with a stop loss at $19.95. Our long-term target is the $28-30 zone.

Breakout trigger: Wait for JNPR to close above $23.25,
then buy calls the next day with a stop at $19.95

BUY the 2015 Jan $25 call (JNPR1517a25) current ask $2.49

- or -

BUY the 2016 Jan $25 call (JNPR1615a25) current ask $3.90

Chart of JNPR:

Originally listed on the Watch List: 01/05/14


Starbucks - SBUX - close: 76.95

Company Info

SBUX is currently an active LEAPStrader play but tonight I am suggesting an immediate exit. The recent action in the stock has turned bearish. I suspect that SBUX is due for a deeper correction lower. The $70.00 level and the simple 200-dma (near $70) should offer support. I am probably a bit early adding SBUX to the watch list but we're listing a buy-the-dip trigger to buy calls at $70.50 with a stop loss at $67.00.

Earnings are expected in late January but no date has been confirmed yet.

Buy-the-Dip trigger: $70.50

BUY the 2015 Jan $75 call (SBUX1517a75)

- or -

BUY the 2016 Jan $80 call (SBUX1615a80)

Chart of SBUX:

Originally listed on the Watch List: 01/05/14


Active Watch List Candidates:



Citigroup Inc. - C - close: 53.40

Comments:
01/05/14: Many of the big banking stocks have been showing relative strength. Citigroup surged on Friday with a +2.1% gain. The overall pattern for C remains bullish but I am worried the market is overbought and due for a dip. Thus I am adjusting our entry trigger on C. We'll raise it to $54.00. Wait for C to close above $54.00 and then buy calls the next day. More conservative investors may want to just wait until after C reports earnings on January 16th and watch how the market reacts to this news before considering new positions.

Earlier Comments:
Our long-term target is the $70.00 area.

Breakout trigger: Wait for C to close above $54.00
buy calls the next morning with a stop loss at $47.90

BUY the 2015 Jan $60 call (C1517a60)

- or -

BUY the 2016 Jan $60 call (C1615a60)

01/05/14 adjust the trigger to $54.00
12/08/13 if triggered start with a stop loss at $47.90
12/01/13 adjust the entry trigger: wait for a close above $53.60 instead of a close above $53.50

Originally listed on the Watch List: 11/24/13


Chicago Bridge & Iron - CBI - close: 81.23

Comments:
01/05/14: My concerns about the market possibly near a pullback will adjust our entry point strategy on CBI too. We'll move our buy-the-dip trigger from $80.25 down to $78.25. I'll adjust the stop loss to $74.45.

Earlier Comments:
Our long-term target is $98.50.

Buy-the-Dip trigger: $78.25

BUY the 2015 Jan $90 call (CBI1517a90)

01/05/14 adjust the buy-the-dip trigger to $78.25, from $80.25
adjust the stop loss to $74.45 from $74.75.

Originally listed on the Watch List: 12/22/13


Foot Locker, Inc. - FL - close: 41.25

Comments:
01/05/14: FL displayed some relative strength on Friday but the stock has spent the last two weeks churning sideways in the $40.50-41.50 zone. I don't see any changes from my prior comments. We are waiting for a correction.

I am suggesting a buy-the-dip entry point at $39.25. If triggered we'll use a stop loss at $36.75. Our target is $48.00. More aggressive traders could aim higher since the point & figure chart is forecasting a $60 target.

Buy-the-Dip trigger: $39.25

BUY the 2015 Jan $40 call (FL1517a40)

Originally listed on the Watch List: 12/29/13


Illinois Tool Works Inc. - ITW - close: 83.74

Comments:
01/05/14: I do not see any changes from last week's new watch list candidate description. When the market eventually dips, and it will, we want to be ready to buy a dip in ITW. Broken resistance near $80.00 should be support.

I am suggesting a buy-the-dip trigger at $80.25. If triggered we'll start with a stop loss at $76.85. Our long-term target is $95.00.

Buy-the-Dip trigger: $80.25

BUY the 2015 Jan $85 call (ITW1517a85)

Originally listed on the Watch List: 12/29/13


Seagate Technology - STX - close: 56.82

Comments:
01/05/14: STX displayed relative strength on Friday with a strong bounce from its 10-dma. We still don't want to chase it at current levels. I will adjust our buy-the-dip trigger from $51.00 to $52.00.

If triggered we'll use a stop loss at $46.75. Our long-term target is $65. More aggressive investors could aim higher. The point & figure chart is predicting a $77 target.

Buy-the-Dip trigger: $52.00

BUY the 2015 Jan $55 call (STX1517a55)

01/05/14 adjust the buy-the-dip trigger from $51.00 to $52.00

Originally listed on the Watch List: 12/29/13


Southwestern Energy Co. - SWN - close: 38.75

Comments:
01/05/14: SWN continues to retreat from its late December highs and resistance near $40.00. This weakness is discouraging with the stock down four days in a row. I am removing SWN as a watch list candidate. It seems unlikely that shares will breakout any time soon.

Trade did not open.

01/05/14 removed from the watch list. Trade did not open. Suggested entry point was a close over $40.50

Originally listed on the Watch List: 12/22/13