Option Investor
Newsletter

Daily Newsletter, Tuesday, 3/3/2015

Table of Contents

  1. Market Wrap
  2. New Plays
  3. In Play Updates and Reviews

Market Wrap

Surprised?

by Jim Brown

Click here to email Jim Brown

Nobody should have been surprised with Nasdaq 5,000 triggering a sell the news event. It was a major psychological level and a good place for bulls to take profits and bears to launch new shorts. Now the battle is in progress to see which side is the eventual victor in this tug of war.

Market Statistics

The Nasdaq traded over 5,000 for about 45 minutes on Monday and closed at 5,008.10 on a closing day short squeeze. This is the equivalent of a runner breaking the tape at the end of a race. The goal was achieved and now it was time to rest. The profit taking was minor and no harm was done.

On the economic front there was nothing to depress the market. The ISM New York for February actually rose from 671.1 to 677.5 after a minor -2 point dip in January. The current conditions component soared from 44.5 to 63.1 while the six-month outlook component rose slightly from 66.9 to 71.7. However, the employment component declined from 55.4 and into contraction at 49.3. The quantity of purchase component collapsed from 69.0 to 54.8.

Analysts blamed weather for the weakness in the internals and this time I believe them. Weather in the northeast was terrible in February.

The vehicle sales data for February disappointed with a decline from 16.7 million to 16.2 million. Analysts were expecting 16.7 million. Auto sales declined from an annualized rate of 7.5 million to 7.2 million. Light truck sales declined from 9.1 to 9.0 million. The weakness was blamed on weather and I think everyone would agree with that. It is tough to sell cars in 20 degree weather and blowing snow. Sales are expected to rebound in March and April as spring weather brings out the buyers in force.

The big economic reports begin on Wednesday with the ADP Employment and Fed Beige Book. Estimates are for a minor decline in jobs from 213,000 to 210,000. I promise you if job gains decline any estimate miss will immediately be blamed on weather. That is the catch all excuse this month and I am sure we will see it used several more times this week.


We report on the economic reports every week and I am sure most readers skip the boring economic section. However, everyone should be paying attention this week. Since February 2nd there have been 42 reports where the numbers came in weaker than expected and only 7 where the numbers met or beat estimates. In any normal market this would be big news but the race to Nasdaq 5,000 and the various geopolitical events and Fed testimony seem to have attracted the most attention.

How stable can the economy be where an entire month of reports missed estimates? The Atlanta Fed is now projecting Q1 GDP will grow only +1.2% and half what the consensus is expecting at +2.4%. Also, their forecasts are still declining.


ZeroHedge List of Reports that Missed Estimates:

1. Personal Spending
2. Construction Spending
3. ISM New York
4. Factory Orders
5. Ward's Domestic Vehicle Sales
6. ADP Employment
7. Challenger Job Cuts
8. Initial Jobless Claims
9. Nonfarm Productivity
10. Trade Balance
11. Unemployment Rate
12. Labor Market Conditions Index
13. NFIB Small Business Optimism
14. Wholesale Inventories
15. Wholesale Sales
16. IBD Economic Optimism
17. Mortgage Apps
18. Retail Sales
19. Bloomberg Consumer Comfort
20. Business Inventories
21. UMich Consumer Sentiment
22. Empire Manufacturing
23. NAHB Homebuilder Confidence
24. Housing Starts
25. Building Permits
26. PPI
27. Industrial Production
28. Capacity Utilization
29. Manufacturing Production
30. Dallas Fed
31. Chicago Fed NAI
32. Existing Home Sales
33. Consumer Confidence
34. Richmond Fed
35. Personal Consumption
36. ISM Milwaukee
37. Chicago PMI
38. Pending Home Sales
39. Personal Income
40. Personal Spending
41. Construction Spending
42. ISM Manufacturing

Reports that Beat Estimates

1. Markit Services PMI
2. Nonfarm Payrolls
3. JOLTS
4. Case-Shiller Home Price
5. Q4 GDP Revision (but notably lower)
6. Markit Manufacturing PMI

In stock news Target (TGT) is planning $2 billion in cost cuts over the next two years through corporate restructuring and other improvements. The company will eliminate "several thousand" headquarters positions over the next two years. The company also plans to invest about $2.1 billion in capex including a $1 billion investment in technology and supply chain improvements. The company will reduce the focus to a handful of key product lines and bolster its online business.

The company said it would earn between $4.45 and $4.65 in 2015 and that compares to analyst estimates of $4.51. Same store sales in 2015 are expected to rise 1.5% to 2.5%. Sales in 2016 are expected to rise +10% and they are projecting $2 billion in share buybacks in 2015 and $3 billion a year every year beginning in 2016. Shares rallied $2 at the close.


Shares of Seagate (STX) declined -4.5% after Bank of America put an underperform (sell) rating on the disk drive maker. Shares of Seagate have been weak since December and they missed on earnings in late January.


Tivo (TIVO) shares rallied about 7% in afterhours after they reported earnings of 7 cents compared to estimates for 4 cents. Tivo said net subscriber additions in Q4 rose +340,000 compared to 319,000 in the year ago quarter. This was the fourth best quarter in the last seven years in terms of net subscriber additions. Also, expenses incurred in acquiring these subscribers declined -25%. Revenue rose +7.3% to $114.1 million and blew away estimates for $89.9 million.


Orexigen Therapeutics (OREX) shares rallied +32% after the company said their diet pill also had positive cardiovascular benefits. Patients on the drug Contrave had fewer major adverse cardiovascular events and fewer cardiovascular deaths than patients on a placebo. The study covered 8,910 obese patients. The drug is designed to reduce appetite and control cravings. The positive cardiovascular results were unexpected and appeared to be unrelated to weight change. The FDA has asked the company to organize another study to confirm the results.


Alibaba (BABA) shares fell again with a -3% drop on news Taiwan had told Alibaba it had six months to get out of the country because it did not confirm to the country's reporting rules. Alibaba had registered in Taiwan under an alias that was registered in Singapore. Taiwan said the company had "hidden" its status as a mainland based company by using the Singapore based alias.

There was also a Wall street Journal article claiming that some Alibaba sellers had been faking orders to make their products appear more desirable. Fake orders, called "brushing" in China, involves paying people to pretend to be customers and allowing vendors to inflate sales figures and boost their standing in the marketplace. Alibaba gives high volume sellers prominence on the website. The fake orders are basically a form of false advertising, which is prohibited in the U.S. and China.

With almost daily headlines that reflect badly on BABA and the 429 million share lockup expiration on the 18th the stock is really under pressure and it closed at a new low.


Human resource service company TriNet Group (TNET) reported earnings of 26 cents compared to estimates for 37 cents. Shares of TNET hit a new high in regular trading to close at $37.88 but that was quickly erased in afterhours with a -$6 drop to $31.75. Their earnings release was filled with accomplishments but traders were not impressed. After increasing revenues +33% in 2014 they predicted +15% growth for 2015.


Sharea of Ambarella (AMBA) rallied +$3.50 in afterhours to a new high after the company reported a +161% increase in earnings to 68 cents compared to estimates for 48 cents. Revenue of $64.7 million beat estimates for $56.6 million. Ambarella makes the video compression chips for GoPro cameras. The company is already looking past GoPro cameras for other niche markets and they are focusing on drones, wearable cameras, security cameras and automotive cameras that take HD video. Ambarella already makes video chips used in broadcasting TV programs worldwide. On Monday Chinese smartphone manufacturer Xiaomi will launch its own Yi wearable action camera using Ambarella's chips. Shares of AMBA should be bought on any decent pullback.


Lumber Liquidators (LL) tried to rebound today after a -40% drop since Wednesday. The program 60 Minutes did an story on them over the weekend claiming they were buying wood from China that did not meet California EPA rules for chemical content. Excess chemicals like formaldehyde then evaporate into the air in the home and can cause cancer and other diseases. LL claims the testing used by 60 Minutes personnel was not accurate and did not conform to California laws.

Janey Capital upgraded the retailer to buy saying the 60 Minutes claims were overblown and the sell off was overdone. Montgomery Scott also issued a buy rating for the same reasons. The Janey analyst said even if the claims were true the net benefit to LL from buying the cheaper wood was in the range of only $4-$6 million and he doubted the company would have risked the future of the company and possible jail time for the officers for that small amount of money.

Morgan Stanley removed their price target on LL saying we don't know what the company is worth today. Either the accusations are untrue and LL will survive or they are true and the 100,000+ suits that will appear will put the company out of business. There are already suits being filed demanding the flooring be torn out and alternate flooring installed. With more than 100,000 homes in California with LL flooring that would be a terminal disaster for LL.

Nearly all analysts that commented said even if the story proved to be untrue the reputation risk for LL would hamper sales for a long time.

If for no other reason readers should look at the chart as a good reason to always have a stop loss on any position.


Best Buy (BBY) raised its dividend by 21% to 23 cents and will pay a one-time special dividend of 51 cents using the proceeds from some legal settlements over LCD pricing. The payouts will be on April 24th to holders as of March 24th. The company also said it increased online sales to 9.8% from 7% of total sales. Net income rose +77% to $519 million or $1.48 per share for the quarter. Analysts expected $1.38. Revenue of $14.21 billion just missed estimates of $14.41 billion. Same store sales rose +2%. Best Buy expects to buyback $1 billion in shares over the next 3 years. Remember this was a chain facing bankruptcy just a couple years ago.


Thank you President Obama. That is probably what Smith & Wesson (SWHC) employees say to themselves as they leave work every day. The president has prompted the biggest increase in the sale of firearms of any other person. Every attempt to ban something or comment about gun control send buyers racing to the store to buy more while they still can. Smith posted earnings of 20 cents for Q4 compared to analyst estimates for 11 cents. Revenue of $130.6 million also beat estimates for $124.6 million. S&W raised guidance for the current quarter to a range of 29-31 cents. Analysts were expecting 27 cents.

On a side note President Obama has been unsuccessful in attempting to ban modern sporting rifles so now the ATF is trying to ban the ammunition for those rifles. This will not only cause every available bullet to be immediately bought off retailer shelves but also cause another round of frantic gun buying before the next executive order hits the headlines.


Markets

The markets pulled back from their record highs on Tuesday but it was a small decline. This was expected as I cautioned last week. However, the indexes finished well off their lows. The Dow nearly -150 points at its lows and rebounded to lose only -85. The S&P rebounded +9 from its lows to lose only -9 for the day and close at 2,107.

With the markets at record highs after four weeks of gains we should expect 2-3 days of profit taking and consolidation. The S&P dipped to support at 2,100 and resistance is still strong at 2,117. That gives us a narrow range of movement and I would not be surprised to see us trade down to 2,085. I believe the dip buyers are alive and well and we will see further gains over the next couple weeks. However, once option expiration arrives I do expect another dip that could be substantial. We have not had a real 10% correction on the S&P since 2011 and with the economic reports weakening and earnings expected to fall in Q1 and Q2 there are plenty of reasons for portfolio managers to tread lightly heading into summer.


The Dow rallied to a new high at 18,288 on Monday with a gain of +155 points. After giving back -85 today that means we are still up +70 for the week. We really can't complain. The big decliners today were the big winners on Monday. That is the way it is supposed to work. Most of the Dow components traded relatively flat and it would be hard to say today's sell off was broad based.

This was simply profit taking that could last a couple more days. With the payroll numbers this week, the bank stress tests and the Fed Beige Book there is plenty of uncertainty to cause cautious investors to pocket some profits.

Initial support is now 18,130 and resistance 18,260.



The Nasdaq declined but Apple did not. Apple has refused to dip below $128 for the last three days and that is positive for the Nasdaq. As long as Apple refuses to give back more of its gains the Nasdaq will have support to help fight off any further losses by other companies. Unfortunately Apple could easily stand to give back another $10 of the February gains. It just depends on how strongly the Apple faithful feel about next week's new product announcement. Historically Apple shares decline after announcements on a sell the news event.

The Nasdaq Composite has pretty decent support at 4,950 and today's low was 4,956. We know where resistance is and that is 5,000 and 5,048 the record high close. The Nasdaq could easily move sideways for a couple days before mounting another run at the record high and I doubt anyone would complain.



The Russell 2000 small caps are holding their gains and that is positive for market sentiment. The index gave back -8 points to 1,234 but still held above support at 1,230. As long as the Russell does not break down it suggests fund manager sentiment remains positive.


I continue to have a positive bias on the market as long as the S&P remains above 2,085. We were due for some profit taking and we basically gave back half of Monday's gains. I don't see that as a problem. I believe the dip buyers are alive and well until proven wrong. Any weak payroll numbers should be chalked up to severe winter weather and ignored.

I have to share this news headline because it is so unbelievable that it makes my head spin. America needs to organize a coalition that will actively pursue ISIS until they are eliminated. A mother braved almost certain death to find her son that was being held hostage by ISIS. She went to ISIS headquarters and asked to see him. Instead of just killing her outright they rolled out their "red carpet" and asked her to relax and have a meal while her son was being brought to her. They brought her cups of tea and a meal of rice, meat and soup. She thought they were being especially kind. After the meal she asked to see her son. They laughed and said, "You have just eaten him." They had butchered him on her arrival and prepared the meat for her meal. Somebody needs to kill these people and do it quickly. Link to story

Enter passively, exit aggressively!

Jim Brown

Send Jim an email

 

 


New Plays

Short Squeeze In Progress

by James Brown

Click here to email James Brown


NEW BULLISH Plays

Theravance Inc. - THRX - close: 19.56 change: +0.34

Stop Loss: 17.75
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on March -- at $---.--
Listed on March 3, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 1.0 million
New Positions: Yes, see below

Company Description

Why We Like It:
Biotech stocks were huge performers last year. One biotech that underperformed its peers and the broader market was THRX. It looks like the bear market in THRX is over. Shares have been surging from their February lows.

A concise summary of who THRX and what they do is the following, "Theravance (NASDAQ: THRX), A Royalty Management Company, is focused on stockholder returns by: maximizing the potential value of our respiratory assets partnered with GlaxoSmithKline plc (GSK), providing capital returns to our stockholders and reducing the overall corporate cost of capital."

If you would like a more detailed description of who they are and what biotech assets they are trying to leverage the company has provided this description: "Theravance, Inc. is focused on maximizing the potential value of the respiratory assets partnered with Glaxo Group Limited (GSK), including RELVAR®/BREO® ELLIPTA® and ANORO® ELLIPTA®, with the intention of providing capital returns to stockholders. Under the Long-Acting Beta2 Agonist (LABA) Collaboration Agreement with GSK, Theravance is eligible to receive the associated royalty revenues from RELVAR®/BREO® ELLIPTA® (fluticasone furoate/vilanterol, "FF/VI"), ANORO® ELLIPTA® (umeclidinium bromide/vilanterol, "UMEC/VI") and if approved and commercialized, VI monotherapy. Theravance is also entitled to a 15% economic interest in any future payments made by GSK under agreements entered into prior to the spin-off of Theravance Biopharma, and since assigned to Theravance Respiratory Company, LLC, relating to the combination of UMEC/VI/FF and the Bifunctional Muscarinic Antagonist-Beta2 Agonist (MABA) program, as monotherapy and in combination with other therapeutically active components, such as an inhaled corticosteroid, and any other product or combination of products that may be discovered and developed in the future under these agreements with GSK (other than RELVAR®/BREO® ELLIPTA®, ANORO® ELLIPTA® and VI monotherapy)."

We are adding THRX as a momentum play. This appears to be a short squeeze in progress. Biotech stocks delivered steady consistent gains in the first half of February but then started to see upward momentum fade. THRX did consolidate a little bit the rally started anew this week and today's display of relative strength (+1.7%) also produced a bullish breakout above technical resistance at its simple 200-dma.

THRX has about 60.7 million shares outstanding. Short interest is about 50% of the float. THRX has already rallied from about $10.60 to $19.50 in just the last four and a half weeks. Right now it's hovering just below significant resistance at the $20.00 mark. A breakout here could spark another leg higher.

Regular readers know that we consider biotech stocks more aggressive, higher-risk trades. The right or wrong headline could send shares gapping open up or down in a big way. Stop losses don't always work. THRX should definitely be considered a more aggressive trade. It does have options available but after the recent rally the option spreads are too wide to trade.

Tonight we are suggesting a trigger to launch small bullish positions at $20.10 with an initial stop loss at $17.75.

Trigger @ $20.10 *small positions to limit risk*

- Suggested Positions -

Buy THRX stock @ (trigger)

Intraday Chart:

Daily Chart:



In Play Updates and Reviews

Stocks See Widespread Profit Taking

by James Brown

Click here to email James Brown

Editor's Note:
Investors were in the mood to do a little profit taking after yesterday's broad-based rally. Airlines and energy stocks seemed to be the exceptions.

ABT hit our new stop loss.


Current Portfolio:


BULLISH Play Updates

Anthera Pharmaceuticals - ANTH - close: 5.10 change: +0.17

Stop Loss: 4.58
Target(s): To Be Determined
Current Option Gain/Loss: +1.0%
Entry on February 26 at $5.05
Listed on February 25, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 715 thousand
New Positions: see below

Comments:
03/03/15: Traders bought the dip near ANTH's 10-dma and shares rebounded to a +3.4% gain. The close back above $5.00 is encouraging. If both the NASDAQ and ANTH are positive tomorrow I would be tempted to launch new positions above $5.11.

Earlier Comments: February 25, 2015:
Biotech stocks were outperformers last year and they continue to outperform the broader market in 2015. One biotech stock that did not participate in last year's rally was ANTH. The stock was actually on the verge of being delisted from the NASDAQ. That changed with the company' recent press release.

According to the company, "Anthera Pharmaceuticals is a biopharmaceutical company focused on developing and commercializing products to treat serious and life-threatening diseases, including lupus, lupus with glomerulonephritis, IgA nephropathy, and exocrine pancreatic insufficiency due to cystic fibrosis."

The press release that changed the stock's direction came out on February 10th. ANTH announced "successful completion of an interim analysis of its Phase 3 trial (CHABLIS-SC1) of blisibimod in patients with Systemic Lupus Erythematosus and that the study should continue to completion as planned. An independent statistician conducted the interim futility analysis for the CHABLIS-SC1 study, evaluating the SRI-6 response at the 24 week time point. Enrollment in the trial is projected to conclude in mid-2015."

What is blisibimod? In the press release the company states, "Anthera is developing blisibimod, a selective inhibitor of B-cell activating factor (BAFF), to explore its clinical utility in various autoimmune diseases including systemic lupus erythematosus (SLE) and IgA nephropathy. Blisibimod is a novel FC-fusion protein, or peptibody, and is distinct from an antibody. BAFF is a tumor necrosis family member and is critical to the development, maintenance and survival of B-cells. Abnormal elevations of B-cells and BAFF may lead to an overactive immune response, which can damage normal healthy tissues and organ systems. Multiple clinical studies with BAFF antagonists have reported the potential benefit of BAFF inhibitors in treating patients with lupus and IgAN." You can read the entire press release here.

SLE can be hard to diagnose. Current estimates suggest 300,000 and up to 1.5 million people in America suffer with SLE. Most of them are women.

The stock exploded higher on this positive clinical trial data. Shares have essentially doubled. Momentum suggest this rally will continue. Regular readers know that we consider biotech stocks higher-risk and more aggressive trades. The right or wrong headline can send a stock soaring or crashing. We could see shares gap up or down at any time. I definitely consider ANTH a higher-risk, aggressive trade.

Today the stock appears to be coiling for a bullish breakout past round-number resistance in the $5.00 area. I am suggesting small bullish positions if ANTH can trade at $5.05 or higher (although if shares gap open too high you may want to hesitate on launching positions).

*small positions* - Suggested Positions -

Long ANTH stock @ $5.05

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

Long Apr $5 CALL (ANTH150417C5) entry $1.10

02/26/15 triggered @ $5.05
Option Format: symbol-year-month-day-call-strike


Cree, Inc. - CREE - close: 39.49 change: -0.01

Stop Loss: 36.25
Target(s): To Be Determined
Current Option Gain/Loss: +8.0%
Entry on February 05 at $36.55
Listed on February 03, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 2.8 million
New Positions: see below

Comments:
03/03/15: CREE ignored the market's weakness today and continued its sideways consolidation. There is no change from my recent comments. The stock has a significant amount of short interest (about 20% of the float). A breakout higher, above resistance near $40.00, could spark a short squeeze.

Earlier Comments: February 3, 2015:
Shares of CREE might be seeing a turnaround. The company is part of the technology sector. According to a press release, "Cree is leading the LED lighting revolution and making energy-wasting traditional lighting technologies obsolete through the use of energy-efficient, mercury-free LED lighting. Cree is a market-leading innovator of lighting-class LEDs, lighting products and semiconductor products for power and radio frequency (RF) applications."

Last year was pretty rough on CREE investors. The trouble started back in 2013. Earnings have been sour. Management had developed a habit of missing earnings estimates and then guiding lower. However, after guiding lower the last two quarters in a row CREE finally offered the market some bullish guidance.

Their most recent earnings report was January 20th. Earnings came in at $0.33 a share. That's significant below the year ago period of $0.46 but their 33-cent profit beat Wall Street estimates by 11 cents. Revenues were essentially flat at $413 million.

CREE offered guidance (currently in their Q3) of $0.21-0.25 a share. That compares to analysts' estimates of $0.21. They're forecasting revenues in the $395-414 million range versus estimates of $405 million.

The last few months have been very volatile for CREE but the rally has created a buy signal on the point & figure chart that is forecasting a long-term $56 target. More importantly CREE appears to be breaking out past its long-term trend line of resistance (see weekly chart below). If this rally continues CREE could see a short squeeze. The most recent data listed short interest at 23% of the 109 million share float.

Tonight I am suggesting a trigger to open bullish positions at $36.55. We'll start this trade with a stop loss at $33.90.

- Suggested Positions -

Long CREE stock @ $36.55

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

Long MAR $35 CALL (CREE150320C35) entry $2.80

02/28/15 new stop @ 36.25
02/12/15 new stop @ 34.85
02/05/15 triggered @ 36.55
Option Format: symbol-year-month-day-call-strike


FireEye, Inc. - FEYE - close: 45.07 change: +0.25

Stop Loss: 42.25
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on February -- at $---.--
Listed on February 26, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 6.8 million
New Positions: Yes, see below

Comments:
03/03/15: FEYE displayed some strength today but shares are still churning sideways in the $43-46 zone. We are on the sidelines waiting for a new high.

Earlier Comments: February 26,
The cyber attack on media giant Sony last year was headline news for weeks. It was a major warning bell for corporations around the world to spend more on cyber security. Today it still seems like every week we hear about some high-profile cyber attack. Online criminals and saboteurs are growing more sophisticated and that's fueling corporate demand for high-tech defenses.

The company describes itself as, "FireEye has invented a purpose-built, virtual machine-based security platform that provides real-time threat protection to enterprises and governments worldwide against the next generation of cyber attacks. These highly sophisticated cyber attacks easily circumvent traditional signature-based defenses, such as next-generation firewalls, IPS, anti-virus, and gateways. The FireEye Threat Prevention Platform provides real-time, dynamic threat protection without the use of signatures to protect an organization across the primary threat vectors and across the different stages of an attack life cycle. The core of the FireEye platform is a virtual execution engine, complemented by dynamic threat intelligence, to identify and block cyber attacks in real time. FireEye has over 3,100 customers across 67 countries, including over 200 of the Fortune 500."

The stock was a real high flyer in late 2013. Shares began to fade in early 2014 and then really got crushed when FEYE issued an earnings warning in May 2014. FEYE spent the rest of 2014 consolidating sideways in a very wide $25-40 trading range.

This year FEYE's stock has seen a reversal of fortunes. Suddenly shares are soaring and up more than +40% thanks to better than expected earnings results. FEYE's most recent earnings report was February 11th. Earnings improved from a loss of 50 cents a year ago to a loss of 38 cents in the fourth quarter, which was eleven cents better than expected. Revenues soared a whopping +149% to $143 million, which was above expectations.

Management guided 2015 earnings and revenues essentially in-line with consensus. The company is forecasting revenues in the $605-625 million range. FEYE expects a 2015 loss of $1.80 to $1.90 per share. Gross margins are expected to be in the 71-75 percent range.

Analysts have expressed concern with the surge in FEYE's spending but management said they are spending in-line with the company's growth. FEYE CEO Dave DeWalt said FEYE saw its growth double in 2014 and is up tenfold in the last three years.

Above average short interest in the stock helped fuel the rally from $36 to $46 in February. The most recent data listed short interest is still at 20% of the 126 million share float. Today shares of FEYE are hovering just below last week's high above $46.00. The intraday high today was $46.44. Tonight we're suggesting small bullish positions if FEYE can trade at $46.65 or higher.

I do consider this a more aggressive, higher-risk trade because shares of FEYE can be volatile. Normal April and May options are not available yet so we'll use June options (if you trade options).

Trigger @ $46.65 *small positions*

- Suggested Positions -

Buy FEYE stock @ (trigger)

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

Buy the Jun $50 CALL (FEYE150619C50)

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


Johnson Controls Inc. - JCI - close: 51.45 change: -0.45

Stop Loss: 49.65
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on March -- at $---.--
Listed on March 2, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 3.5 million
New Positions: Yes, see below

Comments:
03/03/15: JCI gave back about half of yesterday's gains. Bigger picture the dip today was minor. We want to see a breakout past resistance near $52.00. Our suggested entry point is $52.15.

Trade Description: March 2, 2015:
JCI is in the consumer goods business. A large chunk of their sales is in the auto parts industry. Right now auto-part stocks have been showing relative strength.

According to the company, "Johnson Controls is a global diversified technology and industrial leader serving customers in more than 150 countries. Our 170,000 employees create quality products, services and solutions to optimize energy and operational efficiencies of buildings; lead-acid automotive batteries and advanced batteries for hybrid and electric vehicles; and interior systems for automobiles."

The earnings picture last year was not that hot. Back in April 2014 JCI actually lowered guidance for their third quarter and fiscal 2014. The next two quarters were pretty bland. However, the earnings picture began to improve when JCI reported results last October. Their 2014 Q4 numbers beat analysts' estimates on the bottom line.

JCI held their annual investor day on December 2nd. Management said, "We believe initiatives to improve the profitability of our businesses continue to gain momentum. Our 2014 results provide a foundation that we believe will position us to deliver record sales and earnings in 2015." JCI expects steady growth and minor margin improvement in the auto seating business. Their power solutions business should grow faster (about +5.5%) and margins should improve about 50 basis points to 18.5%.

JCI's next earnings report was their first quarter of 2015. Their announcement on January 22nd showed earnings grew +20% to $0.79 a share, beating expectations. Revenues were up +5% but when you account for currency adjustments they were up less than 1% but still above analysts' estimates. It's the first time they beat the revenue estimate in a while. Their Q1 results were driving by a strong performance in China where sales surged +15%.

JCI's Chairman and CEO Alex Molinaroli said, "Profitability improved significantly in the quarter, as we benefitted from higher volumes and our continuing focus on execution improvements. The results in the quarter are better than the expectations we provided at our analyst day in December.

The company also announced a joint venture agreement. According to the press release JCI and "Hitachi, Ltd. and Hitachi Appliances, Inc. signed a definitive agreement on January 21, 2015 to form a previously announced global joint venture that will bring customers world-class variable refrigerant flow (VRF) technology, as well as room air conditioners and absorption chillers to meet increasing demands for energy efficient air conditioning options. The Johnson Controls-Hitachi joint venture is expected to have 2016 sales of approximately $3.0 billion. The formation of the joint venture is expected to close in the fourth quarter of fiscal 2015, pending regulatory approvals." JCI will own 60% of the business.

Technically shares of JCI have been in rally mode following their earnings report. Investors have been buying the dips and now JCI is challenging major resistance in the $52.00 area. The point & figure chart is bullish and forecasting a long-term target at $67.00. On the weekly chart (see below) JCI has formed an inverse head-and-shoulders pattern, which is bullish. Tonight we are suggesting a trigger to launch bullish positions at $52.15.

Trigger @ $52.15

- Suggested Positions -

Buy JCI stock @ (trigger)

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

Buy the Jul $55 CALL (JCI150717C55)

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


Linear Technology Corp. - LLTC - close: 48.20 change: -1.35

Stop Loss: 44.90
Target(s): To Be Determined
Current Option Gain/Loss: +1.8%
Entry on February 11 at $47.35
Listed on February 10, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 2.7 million
New Positions: see below

Comments:
03/03/15: Ouch! It looks like yesterday's rally to new highs was just a head fake. LLTC completely erased yesterday's rally with a drop back toward short-term support near $48.00. I am not suggesting new positions at this time.

Earlier Comments: February 10, 2015:
LLTC is part of the technology sector. The company makes an array of semiconductor products.

According to the company, "Linear Technology Corporation, a member of the S&P 500, has been designing, manufacturing and marketing a broad line of high performance analog integrated circuits for major companies worldwide for over three decades. The Company’s products provide an essential bridge between our analog world and the digital electronics in communications, networking, industrial, automotive, computer, medical, instrumentation, consumer, and military and aerospace systems. Linear Technology produces power management, data conversion, signal conditioning, RF and interface ICs, µModule® subsystems, and wireless sensor network products."

Back in October 2014 LLTC reported earnings that were in-line with estimates but management guided lower. They tried to soften this disappointing news by announced a 10 million share stock buyback program over the next two years (the company has about 239 million shares outstanding).

The earnings picture improved with their most recent report. LLTC reported Q4 earnings (its fiscal Q2) on January 13th. Earnings were up +16% from a year ago with a profit of $0.51 a share. That was two cents above estimates. Revenues were up +5.4% to $352.5 million, which was just a hair below expectations.

The company has retired its debt and management said they plan to increase the amount of cash they return to shareholders. With their earnings report they also announced the Board of Directors had bumped their quarterly dividend from $0.27 to $0.30. That's the 23rd year in a row LLTC has raised its dividend. Management also offered a bullish outlook on their current quarter. LLTC now expects revenues to improve +4% to +7% sequentially. That's about $366-377 million, which is above the $364 million analyst estimate.

Technically shares of LLTC have been consolidating sideways below resistance in the $47.00-47.25 zone for about eight weeks. If you look closely you can see an inverse head-and-shoulders pattern (a bullish formation). The stock was definitely showing some relative strength today with a +2.7% gain. Now LLTC is poised for a bullish breakout past resistance. We are suggesting a trigger to open bullish positions at $47.35.

- Suggested Positions -

Long LLTC stock @ $47.35

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

Long May $50 CALL (LLTC150515C50) entry $0.85

02/11/15 triggered @ $47.35
Option Format: symbol-year-month-day-call-strike


Luxoft Holding - LXFT - close: 49.85 change: -1.62

Stop Loss: 47.40
Target(s): To Be Determined
Current Option Gain/Loss: -0.8%
Entry on February 24 at $50.25
Listed on February 19, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 241 thousand
New Positions: see below

Comments:
03/03/15: LXFT delivered a disappointing session. The opening rally reversed and shares underperformed the market with a -3.1% decline. It did not help that stock markets in Europe were down across the board. Today's decline is a little ominous since LXFT has now broken down below its 10-dma and the $50.00 mark. More conservative investors will want to consider an early exit now to cut their losses. I am not suggesting new positions.

Earlier Comments: February 19, 2015:
LXFT is a technology company with a stock hitting all-time highs. You may not be familiar with LXFT since the company became public in mid 2013. "Luxoft Holding, Inc. is a leading provider of software development services and innovative IT solutions to a global client base consisting primarily of large multinational corporations." The company sells its services around the globe as it "develops its solutions and delivers its services from 18 dedicated delivery centers worldwide. It has over 8,600 employees across 22 offices in 14 countries in the North America, Mexico, Western and Eastern Europe, and Asia Pacific."

Last year shares of LXFT closed virtually unchanged for all of 2014. That surprises me. The company has raised its earnings guidance the last four quarterly reports in a row. They have beaten Wall Street's estimates on both the top and bottom line the last three quarters in a row.

On the daily chart you can see the big rally on February 12th. That was a reaction to LXFT's most recent earnings report. Management said earnings grew +50% to $0.81 a share last quarter. That was 21 cents above analysts' expectations. Revenues rose +31.8% to $145.75 million, also above estimates. LXFT raised their 2015 guidance from $2.00 a share to $2.15.

The stock is up significantly from its late January low near $37.00 so it wasn't a surprise to see shares correct after trading near $50 on February 13th (last Friday). What's interesting is how fast traders bought the dip. LXFT is now challenging round-number, psychological resistance at $50.00 again.

Tonight I am suggesting small bullish if LXFT can breakout higher. We'll start with an entry trigger at $50.25. We're not setting a target tonight but the point & figure chart is very bullish and forecasting a long-term target of $76.00.

Please note I am labeling this a slightly more aggressive trade and thus we want to keep our position size small to limit risk. Not only has LXFT been volatile the last couple of weeks but it might have exposure to geopolitical risk with Russia. LXFT is headquartered in Switzerland and does business around the globe. They are a subsidiary of IBS Group, which is a Russian company. LXFT also does business in Ukraine. Shares dropped sharply last March as the Ukraine situation heated up. Right now the most recent cease-fire attempt in Eastern Ukraine appears to have failed. That could prompt more sanctions from the West against Russia. We can't tell if new sanctions would hurt LXFT or not but it remains a potential risk.

*small positions to limit risk* - Suggested Positions -

Long LXFT stock @ $50.25

03/03/15 Today's decline looks ominous. Readers may want to consider an early exit
02/24/15 triggered @ $50.25


Microchip Technology - MCHP - close: 51.43 change: -0.98

Stop Loss: 49.25
Target(s): To Be Determined
Current Option Gain/Loss: +0.5%
Entry on February 24 at $51.15
Listed on February 21, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 2.8 million
New Positions: see below

Comments:
03/03/15: MCHP did not escape the market's decline today. Shares reversed yesterday's rally with a drop back toward short-term support at its 10-dma. If this level fails the next support level is the $50.00 mark.

Earlier Comments: February 21, 2015:
Semiconductor stocks have been big winners for investors over the last couple of years. Last year saw sales for the whole industry hit a record-breaking $335 billion. That's up almost +10% from 2013. While the SOX semiconductor index is currently trading at multi-year highs it did see a sharp sell-off in October 2014. That was thanks to MCHP.

MCHP is considered a bellwether for the industry. According to the company, "Microchip Technology Incorporated is a leading provider of microcontroller, mixed-signal, analog and Flash-IP solutions, providing low-risk product development, lower total system cost and faster time to market for thousands of diverse customer applications worldwide. Headquartered in Chandler, Arizona, Microchip offers outstanding technical support along with dependable delivery and quality."

Last October MCHP shocked the market when they lowered their earnings guidance and warned of an industry wide slowdown. This sparked an industry-wide sell-off. Shares of MCHP plunged. The stock spent the rest of the year trying to climb out of that hole. By the end of 2014 the stock had recovered enough to close essentially breakeven on the year.

Helping shares recover was an update in December. Management provided a slightly better earnings and revenue picture. MCHP said that business had improved significantly from early October. They now believed that the worst of the industry downturn was already behind them. This helped fuel gains for the semiconductor stocks while MCHP shares languished.

Fortunately today MCHP is playing catch up to its peers. The company reported its Q3 2015 results on January 29th. Wall Street was expecting a profit of $0.62 a share on revenues of $525.5 million. MCHP beat estimates with $0.64 a share as revenues grew +11.1% to $535.8 million.

MCHP said that calendar year 2014 was a strong one for their microcontroller business, which was up +13.8% overall. Their 8-bit, 16-bit, and 32-bit microcontroller segments all hit record sales with 16-bit sales up +27.7% and 32-bit sales up +41%. Management said overall they did witness broad-based growth across all their product lines. MCHP then raised their dividend and raised their guidance. They expected Q4 2015 earnings (current quarter) to be in the $0.65-0.67 range and revenues in the $541-551.9 million range. That's above analysts' estimates of $0.65 and $538.8 million.

Steve Sanghi, MCHP's President and CEO, commented on their quarterly results, "We are very pleased with our execution in the December quarter. Our original revenue guidance was to be down 4.5% sequentially and in early December we improved our guidance for revenue to be down only 3.5% at the midpoint. Our actual non-GAAP revenue results were down only 1.9%, which was better than what is seasonally normal. Calendar year 2014 was Microchip's first year above the $2 billion revenue mark and was up 12.8% from calendar year 2013 as a result of very strong performance from our microcontroller and analog product lines."

Investors cheered and the stock has soared from a low near $44 in early February to a new multi-year high above resistance at $50.00. The point & figure chart is forecasting a target at $56.00. Tonight we are suggesting a trigger to open bullish positions at $51.15.

- Suggested Positions -

Long MCHP stock @ $51.15

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

Long Apr $50 CALL (mchp150417C50) entry $2.40

02/24/15 triggered @ 51.15
Option Format: symbol-year-month-day-call-strike


Altria Group Inc. - MO - close: 56.46 change: -0.04

Stop Loss: 53.85
Target(s): To Be Determined
Current Option Gain/Loss: +2.2%
Entry on February 12 at $55.25
Listed on February 11, 2015
Time Frame: 10 to 16 weeks
Average Daily Volume = 7.8 million
New Positions: see below

Comments:
03/03/15: Shares of MO held up reasonably well today. The stock bounced near $56.00 and closed back near its highs. No new positions at this time.

Earlier Comments: February 11, 2015:
The yield on the U.S. 10-year note is trading just below 2%. Two weeks ago the 30-year U.S. note had dropped to multi-decade lows. Yields on sovereign debt from healthy European countries like Germany are trading near all-time lows near zero. Last week saw yields on huge European corporate debt, like Nestle, actually go negative.

Super low or negative yields paints a picture that investors are nervous. Smart money is looking for safety. They would rather park their money in bonds with little to zero yield (or even negative yield in some cases) just to know their money is safe. This is one reason why shares of MO look so attractive. Even at all-time highs, like it is now, MO has a 3.9% dividend yield.

The traditional cigarette industry is slowly dying. That's a good thing since the practice is so poisonous. The cigarette industry saw the volume of cigarettes decline -2.5% in the Q4 2014 and down -3.5% in all of 2014. The drop in volume for MO was not quite that bad. Yet even though the number of cigarettes being sold is falling the company continues to make money and a lot of money at that!

One secret to MO's profitability has been price increases and stealing market share from its rivals. A strong stock buyback program also helped its earnings numbers. Last quarter the company spent $260 million buying about 5.3 million shares of its stock. This helped boost its earnings per share growth to +15.8% in the fourth quarter. Results were $0.66 a share, in-line with estimates. Revenues grew +4.7% to $4.61 billion, which beat analysts' expectations.

Almost 90% of MO's business is still in the smokeable category (i.e. traditional cigarettes). They managed +3.3% revenue growth even though their volumes were down -1.7%. They're also seeing growth in their smokeless products, namely the e-cigarette business. Management offered bullish guidance of +7% to +9% growth in their earnings per share for 2015.

MO is likely to stay a popular investment among yield-conscious traders, especially since their business is so addictive, I mean predictable. The stock has been consolidating sideways in the $53.00-55.00 zone the last couple of weeks. Today shares displayed relative strength with a surge toward the top of this range. We want to be ready if MO breaks out. Tonight I am suggesting a trigger to open bullish positions at $55.25. Keep in mind that MO is something of a slow-moving stock. We will need to be patient for this trade to pay off.

- Suggested Positions -

Long MO stock @ $55.25

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

Long JUN $55 CALL (MO150619C55) entry $2.00

02/14/15 new stop @ 53.85
02/12/15 triggered @ 55.25
Option Format: symbol-year-month-day-call-strike


Neurocrine Biosciences - NBIX - close: 40.86 change: +0.43

Stop Loss: 38.45
Target(s): To Be Determined
Current Option Gain/Loss: +8.5%
Entry on February 17 at $37.65
Listed on February 14, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 937 thousand
New Positions: see below

Comments:
03/03/15: Traders jumped in to buy the dip again near NBIX's rising 10-dma. The stock rebounded to close at new highs. Tonight we are updating the stop loss to $38.45. I am not suggesting new positions at this time.

Earlier Comments: February 14, 2015:
Biotech stocks were big performers last year outpacing the broader market. It looks like that outperformance will continue in 2015 with the major biotech indices and ETFs already up +5% to +7% this year. One biotech that's really outperforming its peers in NBIX, with shares already up more than +60% in 2015.

According to the company's marketing materials, "Neurocrine Biosciences, Inc. discovers and develops innovative and life-changing pharmaceuticals, in diseases with high unmet medical needs, through its novel R&D platform, focused on neurological and endocrine based diseases and disorders. The Company's two lead late-stage clinical programs are elagolix, a gonadotropin-releasing hormone antagonist for women's health that is partnered with AbbVie Inc., and a wholly owned vesicular monoamine transporter 2 inhibitor for the treatment of movement disorders. Neurocrine intends to maintain certain commercial rights to its VMAT2 inhibitor for evolution into a fully-integrated pharmaceutical company."

NBIX has two therapies planned for phase III trials in 2015. You can see NBIX's pipeline on this web page.

The drug making headlines for NBIX this year is Elagolix, a treatment for endometriosis. Shares of NBIX soared on January 8th after the company and its partner on this treatment, AbbVie, announced positive results for their latest Phase 3 trials. Endometriosis could affect up to 10% of all women in their reproductive years. That's a pretty big market. You can see why Wall Street is so excited about this news and sent shares of NBIX soaring.

Make no mistake, this is an aggressive, higher-risk trade. Biotech stocks can be volatile. The right or wrong headline can send the stock soaring or crashing. NBIX is already very, very overbought with a run from $20 to $37 since its early January lows. Yet that doesn't mean it won't keep running. Sometimes biotech stocks have a mind of their own. There is not any clear resistance. You have to go back more than ten years and you might find resistance in the $42.50-45.00 area. Should this rally continue NBIX could see more short covering. The most recent data listed short interest at 12% of the small 66 million share float.

I'm going to repeat myself. This is an aggressive play. NBIX does have options but the spreads are too wide to trade. The intraday bounce on Friday looks like a test of short-term support near $35.00. You can see on the intraday chart that NBIX has a very short-term pattern of lower highs. Therefore, we are suggesting a trigger to open small bullish positions at $37.65. If triggered we'll start with a stop loss at $34.90.

*small positions to limit risk* - Suggested Positions -

Long NBIX stock @ $37.65

03/03/15 new stop @ 38.45
03/02/15 new stop @ 35.75
02/17/15 after the close, announces a secondary offering
02/17/15 triggered @ 37.65
Option Format: symbol-year-month-day-call-strike


Total System Services - TSS - close: 38.17 change: -0.56

Stop Loss: 36.85
Target(s): To Be Determined
Current Option Gain/Loss: +3.0%
Entry on February 13 at $37.05
Listed on February 05, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 883 thousand
New Positions: see below

Comments:
03/03/15: Just like the NASDAQ, shares of TSS retreated from new highs. Unfortunately TSS underperformed the market with a -1.4% decline. Shares are nearing what should be short-term support at $38.00 and its 10-dma. If this level breaks down the next support level could be $37.00. I am not suggesting new positions at this time.

Earlier Comments: February 5, 2015:
Financial stocks as a group have struggled this year. The sector is down about -4% in 2015. Yet shares of TSS is up +6.4% and trading near all-time highs.

According to a company press release, "At TSYS® (TSS), we believe payments should revolve around people, not the other way around. We call this belief "People-Centered Payments®." By putting people at the center of every decision we make, TSYS supports financial institutions, businesses and governments in more than 80 countries. Through NetSpend®, A TSYS Company, we empower consumers with the convenience, security, and freedom to be self-banked. TSYS offers issuer services and merchant payment acceptance for credit, debit, prepaid, healthcare and business solutions. TSYS' headquarters are located in Columbus, Ga., U.S.A., with local offices spread across the Americas, EMEA and Asia-Pacific."

The last few earnings reports from TSS have come in better than expected. Their most recent earnings report was January 27th. TSS' CEO said, "We finished 2014 on a high note. Organic revenue grew 5.8%, year over year, with total revenues growing 18.5% and revenues before reimbursable items up 20.2%."

Wall Street was looking for a Q4 profit of $0.53 a share on revenues of $620.4 million. TSS delivered a profit of $0.58 with revenues climbing almost 9% to $635 million. The company's guidance was only in-line with Wall Street estimates but that didn't stop shares from soaring on the news. TSS management also announced a new 20 million share stock buyback program. That's significant since the company only has 183 million shares outstanding.

The stock's up trend has created a buy signal on the point & figure chart pointing to at $40.00 target. The last few days have seen traders buying the dip. TSS looks like it's coiling for a breakout past the $37.00 level.

Given the stock's recent volatility I am labeling this a more aggressive, higher-risk trade. Tonight we are suggesting a trigger at $37.05 to buy the stock.

- Suggested Positions -

Long shares of TSS @ 37.05

03/02/15 new stop @ 36.85
02/28/15 new stop @ 36.40
02/21/15 Caution: TSS is starting to look short-term overbought.
02/13/15 triggered @ 37.05




BEARISH Play Updates

Five Below, Inc. - FIVE - close: 31.41 change: -0.34

Stop Loss: 33.15
Target(s): To Be Determined
Current Option Gain/Loss: +0.1%
Entry on March 03 at $31.45
Listed on February 28, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 1.2 million
New Positions: see below

Comments:
03/03/15: Our bearish play on FIVE is now open. Shares continued to sink and hit our suggested entry point at $31.45. I would consider new positions at current levels. There is no change from my earlier comments.

Earlier Comments: February 28, 2015:
Five Below is struggling. Consumer spending accounts for almost 70% of the U.S. economy. FIVE has chosen to carve out a niche between the $1.00 store-model and discount variety stores. Considering the drop in gasoline prices from a year ago, business should be good. Low-income consumers have more money to spend. Unfortunately we are not seeing a lot of evidence that consumers are spending the money they save at the gas pump, at least they're not spending it on merchandise.

If you're not familiar with FIVE the company describes itself as "Five Below is a rapidly growing specialty value retailer offering a broad range of trend-right, high-quality merchandise targeted at the teen and pre-teen customer. Five Below offers a dynamic, edited assortment of exciting products in a fun and differentiated store environment, all priced at $5 and below, including select brands and licensed merchandise across a number of category worlds: Style, Room, Sports, Tech, Crafts, Party, Candy, and Now." They currently have about 304 locations in 19 states.

Right now the trend is not FIVE's friend. In September 2014 they reported Q2 results and guided lower for the third quarter. On December 4th FIVE reported their 2014 Q3 numbers with earnings in-line with estimates. Revenues were up +24.7% from a year ago to $138 million, just a hair above expectations. However, management lowered their guidance again. You can see how investors reacted with the big drop on December 5th.

Shares got clobbered again on January 9th. That's because FIVE lowered guidance! That's the third time since September they have lowered guidance. If FIVE is struggling to generate sales now with low gas prices and consumer confidence near 11-year highs what are they going to do when gas prices rebound?

You can see that shares of FIVE did not have much of a bounce following the January sell-off. The stock now has a bearish trend of lower highs as traders sell the rallies. Currently FIVE is breaking down below support near $32.00. The next support level could be $30.00 or it could be the late 2012 lows near $28.00 or it could be the all-time low near $25.00. The point & figure chart is bearish and forecasting at $26.00 target.

The stock is definitely underperforming the market and investor sentiment has soured. The stock is likely headed for the mid $20s. I will caution readers that short interest is almost 19% of the 51.9 million share float. That could generate volatility. You may want to use small positions to limit your risk or use put options to limit your risk. Tonight we are suggesting a trigger to launch bearish positions at $31.45.

- Suggested Positions -

Short FIVE stock @ $31.45

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

Long Apr $30 PUT (FIVE150417P30) entry $1.40

03/03/15 triggered @ $31.45
Option Format: symbol-year-month-day-call-strike



CLOSED BULLISH PLAYS

Abbott Laboratories - ABT - close: 47.09 change: -0.13

Stop Loss: 46.85
Target(s): To Be Determined
Current Option Gain/Loss: +0.4%
Entry on February 19 at $46.65
Listed on February 17, 2015
Time Frame: 8 to 12 weeks
Average Daily Volume = 5.34 million
New Positions: see below

Comments:
03/03/15: The market wide pullback today was too much for ABT. Shares broke down under short-term support at its 10-dma and hit our new stop at $46.85. However, it's worth noting that traders did buy the dip near the late December high (possible support).

- Suggested Positions -

Long ABT stock @ $46.65 exit $46.85 (+0.4%)

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

AUG $50 CALL (ABT150821C50) entry $0.91 exit $0.87 (-4.4%)

03/03/15 stopped out
03/02/15 new stop @ 46.85
02/19/15 triggered @ $46.65
Option Format: symbol-year-month-day-call-strike

chart: