Editor's Note:

Just an FYI, some of the stocks at the top of my personal watch list are: OII, SRCL, WSO, and TSCO.

- James


NEW DIRECTIONAL CALL PLAYS

Panera Bread Co. - PNRA - close: 121.83 change: +0.99

Stop Loss: 119.00
Target(s): 129.50, 134.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 5 weeks
New Positions: Yes, see TRIGGER

Company Description

Why We Like It:
There has been growing concern over the last several months that rising food prices would hurt the big food franchises. Yet so far shares of PNRA are not showing a lot of weakness. Either Wall Street doesn't think this food inflation is going to squeeze margins or investors must believe PNRA can pass along the higher costs to its consumers. Currently shares have rallied to the top of its recent trading range and resistance near $122-123.

I am suggesting a trigger at $123.55 to open small bullish positions in PNRA. If triggered we will start with a stop loss at $118.00. More conservative traders may want to consider a stop closer to $120.00. Our upside targets are $129.50 and $134.50. We do not want to hold over the late April earnings report but that date is currently unconfirmed.

FYI: PNRA is currently trading in the $120 area. The last time the company had a stock split it was back in June 2005 with shares in the $120s. You never know when they might announce a split although if they do it would probably be with their earnings report.

Trigger @ $123.55

- Suggested Positions -

Buy the April $125 call (PNRA1116D125) current ask $1.70

- or -

Buy the May $130 call (PNRA1121E130) current ask $2.80

Annotated Chart:

Entry on March xxth at $ xx.xx
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 363 thousand
Listed on March 26th, 2011


Wellpoint Inc. - WLP - close: 69.34 change: +0.57

Stop Loss: 65.75
Target(s): 72.25, 74.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 5 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
WLP is a large health benefits company and healthcare stocks have been showing relative strength. Shares of WLP tested major resistance near $70.00 on Friday. We want to hop on board this healthcare train but not at current prices. I am suggesting we buy calls on a dip at $68.25 with a stop loss at $65.75. Alternatively nimble traders may want to be ready to buy a breakout past the $70.00 mark.

If we are triggered at $68.25 our targets are $72.25 and $74.75. We do not want to hold over the late April earnings report.

FYI: Readers may want to keep their position size small. If WLP reverses lower following Friday's test of resistance at $70 it could look like a big, bearish double top pattern on the weekly chart.

Trigger @ 68.25

- Suggested Positions -

Buy the April $70 call (WLP1116D70) current ask $1.23

- or -

Buy the May $70 call (WLP1121E70) current ask $2.45

Annotated Chart:

Entry on March xxth at $ xx.xx
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 3.4 million
Listed on March 26th, 2011