NEW BULLISH Plays

E*TRADE Financial - ETFC - close: 23.52 change: -0.21

Stop Loss: 22.80
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on September -- at $---.--
Listed on September 22, 2014
Time Frame: 8 to 12 weeks
Average Daily Volume = 2.5 million
New Positions: Yes, see below

Company Description

Why We Like It:
ETFC was founded back in 1982. The company really gained steam during the boom of Internet trading in the 1990s. Today they compete with a suite of online brokerage, investing and related banking solutions.

Trading volumes are not what they used to be. As a matter of fact volumes have been pretty anemic but that hasn't slowed the market's rally. Lack of volume does impact the brokers. Daily trading volume for ETFC has consistently been below the prior year's level.

Wall Street might be overlooking the drop in volumes in favor of ETFC's account growth. They have been consistently adding about 30,000 new accounts a month the last several months.

Technically shares of ETFC appear to be breaking out from their April-August consolidation. Traders just bought the dip near its rising 10-dma today. If this bounce continues we want to hop on board.

Tonight we're suggesting a trigger to open bullish positions at $23.85. I'm not suggesting an exit target yet but the point & figure chart is bullish and forecasting a long-term $33 target.

Trigger @ $23.85

- Suggested Positions -

Buy ETFC stock @ (trigger)

- (or for more adventurous traders, try this option) -

Buy the 2015 Jan $25 call (ETFC150117C25) current ask $0.97

Option Format: symbol-year-month-day-call-strike

Annotated Chart:

Weekly Chart:


NEW BEARISH Plays

Johnson Controls Inc. - JCI - close: 45.70 change: -0.80

Stop Loss: 47.10
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on September -- at $---.--
Listed on September 22, 2014
Time Frame: 8 to 12 weeks
Average Daily Volume = 2.5 million
New Positions: Yes, see below

Company Description

Why We Like It:
The auto part makers were a bright spot in the market for quite a while. Yet JCI has been underperforming its peers for weeks. Now the whole group has reversed sharply lower.

Investors might be growing cautious as earnings growth slows down. Investor's Business Daily noted that the forecast for some of these auto parts makers is getting softer.

Technically the group appears to be rolling over and JCI could be leading the way lower with a bearish breakdown under a long-term trend of higher lows. It doesn't help that JCI now has a "death cross" with the 50-dma falling under its 200-dma, which itself is starting to roll over.

Today's low was $45.66. We are suggesting a trigger for bearish positions at $45.40.

Trigger @ $45.40

- Suggested Positions -

Short JCI stock @ (trigger)

- (or for more adventurous traders, try this option) -

Buy the 2015 Jan $45 PUT (JCI150117P45) current ask $1.85

Option Format: symbol-year-month-day-call-strike

Annotated Chart:

Weekly Chart: