NEW DIRECTIONAL CALL PLAYS

Fastenal Co. - FAST - close: 65.54 change: +0.70

Stop Loss: 63.75
Target(s): 69.50, 74.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see Trigger

Company Description

Why We Like It:
The U.S. real estate market is not improving but that isn't stopping the rally in shares of this construction materials supplier. FAST is building on its bullish trend of higher lows and higher highs. Aggressive traders may want to buy calls now. I would prefer to see a rally past short-term resistance at $66.00 so I am suggesting a trigger to buy calls at $66.25. If triggered our targets are $69.50 and $74.00. We should expect the $70.00 area to offer some resistance and FAST will likely pull back on the first test of $70.

FYI: FAST is due to split 2-for-1 on May 23rd. Plus, the Point & Figure chart for FAST is bullish with a $72 target.

Trigger @ $66.25

- Suggested Positions -

Buy the May $65.00 calls (FAST1121E65) current ask $1.90

- or -

Buy the June $70.00 calls (FAST1118F70) current ask $0.70

Annotated Chart:

Entry on April xxth at $ xx.xx
Earnings Date 04/12/11 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on April 23rd, 2011


Google Inc. - GOOG - close: 525.10 change: -0.63

Stop Loss: 518.75
Target(s): 558.00
Current Option Gain/Loss: + 0.0%
Time Frame: 2 to 3 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
There are plenty of doubts and concerns over Google, especially following all of the selling after its earnings report. On a short-term basis the stock is oversold and due for a bounce. You'll notice on the weekly chart below that the selling has paused at its trendline of higher lows. If there was a spot to bet on a bounce this is it. Please note that this is a very aggressive and speculative play. We'll try and limit our risk with very small positions and a tight stop loss under last week's low. Our plan is to ride an oversold bounce back toward resistance near its 200-dma. I'm setting our exit target a $558.00. More aggressive traders could aim for GOOG to fill the gap and rise into the $565-570 area.

I am suggesting call positions now. As an alternative entry you could wait for a rally past $531 again.

FYI: If something happens on Monday morning and GOOG gaps open under $519.00 then we will not open positions.

(Very Small Positions) Suggested Positions:

Buy the May $550 call (GOOG1121E550) current ask $3.10

Weekly Chart of GOOG:

Daily Chart of GOOG:

Entry on April 25th at $ xx.xx
Earnings Date 04/14/11 (confirmed)
Average Daily Volume = 3.3 million
Listed on April 23rd, 2011


Ross Stores Inc. - ROST - close: 72.26 change: -0.20

Stop Loss: 69.75
Target(s): 77.25, 79.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see Trigger

Company Description

Why We Like It:
Retail names have been very resilient in the face of rising gasoline prices. Shares of ROST look poised to breakout from their multi-week consolidation under resistance in the $72.50-73.00 zone. I am suggesting we buy calls on a breakout with a trigger to open positions at $73.55. We do not want to hold over the mid May earnings report so I am suggesting we use the May calls, which expire after the 20th.

If triggered our first target is $77.25. Our secondary target is $79.50. FYI: The Point & Figure chart for ROST is bullish with a $97 target.

Trigger @ $73.55

- Suggested Positions -

Buy the May $72.50 calls (ROST1121E72.5) current ask $1.75

Annotated Chart:

Entry on April xxth at $ xx.xx
Earnings Date 05/19/11 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on April 23rd, 2011