NEW BULLISH Plays

Starbucks Corp. - SBUX - close: 45.78 change: -0.16

Stop Loss: 43.75
Target(s): 49.75
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
SBUX tagged another new all-time high this morning before succumbing to the market's widespread profit taking. The stock is showing a little relative strength by only falling -0.3% versus -1.2% in the S&P 500 today. SBUX could benefit from end of quarter window dressing the next couple of days.

Broken resistance near $45.00 should be new support. The same can be said for the $44 level. I am suggesting we open bullish positions tomorrow morning but only if both SBUX and the S&P 500 index open positive. If triggered we'll use a stop loss at $43.75. Our multi-week target is $49.75. FYI: The Point & Figure chart for SBUX is bullish with a long-term $75 target.

*See Entry Details Above*

Suggested Position: buy SBUX stock @ the open

- or -

buy the FEB $47 call (SBUX1218B47) ask $1.39

Annotated chart:

Entry on December xx at $ xx.xx
Earnings Date 01/25/12 (unconfirmed)
Average Daily Volume = 5.1 million
Listed on December 28, 2011


NEW BEARISH Plays

EZchip Semiconductor - EZCH - close: 28.42 change: -1.29

Stop Loss: 30.10
Target(s): 25.50
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
EZCH is a semiconductor company specializing in networking equipment. Looking at the big picture it seems that EZCH has produced a major double top on its weekly chart. More recently EZCH has been churning sideways for over two weeks in the $29-30 zone. Today's -4.3% drop is a bearish breakdown.

I am suggesting small bearish positions now with a stop loss at $30.10. The $26.60 level has been support in the past but we're aiming for $25.50. More aggressive trades may want to aim for $23 over the next several weeks. FYI: The Point & Figure chart for EZCH is bearish with a $24 target.

Suggested Position: short EZCH @ the open

- or -

buy the Jan $28 PUT (EZCH1221M28) ask $1.10

Annotated chart:

Weekly chart:

Entry on December xx at $ xx.xx
Earnings Date 02/08/12 (unconfirmed)
Average Daily Volume = 280 thousand
Listed on December 28, 2011