NEW DIRECTIONAL CALL PLAYS

Panera Bread Co. - PNRA - close: 79.49 change: +0.84 stop: 76.45

Target(s): 84.90
Key Support/Resistance Areas: 72.50, 76.00, 80.00, 85.00, 88.50
Current Gain/Loss: %
Time Frame: two or three weeks
New Positions: Yes, see trigger

Company Description:
Panera Bread Company owns and franchises 1,399 bakery-cafes as of June 29, 2010 under the Panera Bread®, Saint Louis Bread Co.®, and Paradise Bakery & Café® names. With our identity rooted in handcrafted, fresh-baked, artisan bread, we are committed to providing great tasting, quality food that people can trust. Nearly all of our bakery-cafes have a menu highlighted by antibiotic free chicken, whole grain bread, select organic and all-natural ingredients, with zero grams of artificial trans fat per serving, which provide flavorful, wholesome offerings. (source: company press release or website)

Why We Like It:
This is a relative strength play. PNRA has been out performing the market the past few days. Now the stock is testing resistance near $80.00. The high on Aug. 18th was $80.56. I am suggesting we buy calls at $80.75 and target a move toward resistance at $85.00 (exit target $84.90). This should be a relatively short-term play if we are triggered.

Trigger @ 80.75
Suggested Position: if triggered by the Sept. $80 calls (current ask $2.35)

Annotated Chart:

Entry on April xxth at $ xx.xx
Earnings Date 10/27/10
Average Daily Volume = 562 thousand
Listed on April 21st, 2010


NEW DIRECTIONAL PUT PLAYS

Intl. Bus. Machine - IBM - close: 127.50 change: -1.40 stop: 130.51

Target(s): 123.00
Key Support/Resistance Areas: 130.00, 127.00, 123.00, 121.00
Current Gain/Loss: %
Time Frame: Two weeks
New Positions: Yes

Company Description:
International Business Machines (IBM) is a titan in the information technology space. The company has several divisions with major operations in hardware, software, and IT services.

Why We Like It:
IBM has been bouncing around the $132-120 zone for months. On a short-term basis the stock is rolling over and shares look ready to breakdown from a the current $130-127 trading range. I'm suggesting we buy puts now, ride the stock down toward $123.00. Then we can re-evaluate since it might be a good spot to consider switching directions and buying calls.

Buy puts now at current prices.

Suggested Position: Buy the September $125 put (current ask $1.81)

Annotated Chart:

Entry on April 23rd at $ xx.xx
Earnings Date 10/18/10
Average Daily Volume = 5.4 million
Listed on April 21st, 2010