NEW DIRECTIONAL CALL PLAYS

Goldman Sachs - GS - close: 161.89 change: +2.98

Stop Loss: 157.00
Target(s): 169.75
Current Option Gain/Loss: Unopened
Time Frame: about two weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
On Monday I mentioned GS was on my watch list for a breakout past short-term resistance at $162.00. Financials were showing relative strength today and GS is now testing resistance at $162.00 and its simple 50-dma. A breakout could portend a move toward $170 or higher. Yet we only have a couple of weeks before GS reports earnings and we do not want to hold over the event.

I am suggesting a trigger to buy calls at $162.50. Our target will be $169.75. Since we plan to exit before April 19th and April options expire after April 20th I am suggesting April options but these will be much more volatile than May or later options.

Trigger @ $162.50

- Suggested Positions -

Buy the April $165.00 call (GS1116D165) current ask $1.04

Annotated Chart:

Entry on April xxth at $ xx.xx
Earnings Date 04/19/11 (confirmed)
Average Daily Volume = 4.3 million
Listed on April 6th, 2011