Editor's Note:

The stock market has been very resilient. The jobs number on Friday morning was a huge miss. Yet stocks rebounded off their morning lows. It could have been significantly worse. The lack of selling is bullish.

We are going to take a more aggressive approach to new plays and adjust some triggers on the current play list. Stocks remain overbought so readers will want to strongly consider keeping your position size small to limit risk. Earnings season is about to start and we could see a spike in volatility.

- James


NEW DIRECTIONAL CALL PLAYS

Agrium Inc. - AGU - close: 89.80 change: +1.17

Stop Loss: 85.90
Target(s): 94.00, 98.00
Current Option Gain/Loss: + 0.0%
Time Frame: 4 to 5 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
The fertilizer and agricultural chemical names have been on the rise. Analysts are expecting demand and prices for fertilizer to rise over the next several months. It looks like shares of AGU are breaking out over multiple layers of resistance. Shares have yet to break the trend of lower highs but we're suggesting an aggressive entry point now at current levels. AGU rebounded sharply off its Friday morning lows. We'll use a stop loss at $85.90. Our exit targets are $94.00 and $98.00. FYI: The Point & Figure chart for AGU is bullish with a $104 target.

- Suggested Positions -

buy the AUG $90 call (AGU1120H90) current ask $3.60

- or -

buy the AUG $95 call (AGU1120H95) current ask $1.55

Annotated Chart:

Entry on July 11 at $ xx.xx
Earnings Date 08/03/11 (unconfirmed)
Average Daily Volume = 1.7 million
Listed on July 9, 2011


Panera Bread Co. - PNRA - close: 131.94 change: -0.02

Stop Loss: 127.95
Target(s): 138.50, 144.00
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
PNRA has rallied to new highs with a move past resistance at $130.00. Lately consumer-related stocks have been performing very well. Friday's jobs data failed to kill the up trend. PNRA actually has significant short interest and could see a short squeeze higher.

I am suggesting bullish call positions now. Our targets are $138.50 and $144.00 but we do not want to hold over the late July earnings report.

FYI: The most recent data listed short interest at 8.6% of the small 28.2 million-share float. Investors might also note that the Point & Figure chart for PNRA is bullish with a $166 target.

- Suggested Positions -

buy the AUG $135 call (PNRA1120H135) current ask $3.80

Annotated Chart:

Entry on July 11 at $ xx.xx
Earnings Date 07/26/11 (unconfirmed)
Average Daily Volume = 337 thousand
Listed on July 9, 2011


Starbucks Corp. - SBUX - close: 40.35 change: +0.03

Stop Loss: 39.45
Target(s): 44.00
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Shares of coffee giant SBUX are holding up pretty in spite of some negative news lately. The stock and the restaurant industry were downgraded by Goldman Sachs on Thursday. The same day there was word of a strike by union SBUX employees in Chile. The stock rallied in spite of these headlines. Keep in mind that SBUX only has 31 stores in the country of Chile versus 17,000 worldwide. Only a third of their Chile employees are in a union.

Consumer-related names have been performing very, very well. SBUX has rallied past key resistance at $38.00 and $40.00 and hit new all-time highs this past week. I am somewhat concerned that SBUX is short-term overbought. Therefore readers will want to keep our position size small to limit risk. I would much prefer to open positions on a dip near support at $38.00 but that may not happen any time soon. Tonight I am suggesting bullish positions now with a stop loss at $39.45. Aggressive traders may want to put their stop loss under support at $38.00. We do not want to hold positions over the late July earnings report.

- Suggested (Small) Positions -

buy the AUG $40.00 call (SBUX1120H40) current ask $1.69

Annotated Chart:

Entry on July 11 at $ xx.xx
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume = 6.8 million
Listed on July 9, 2011


VMware, Inc. - VMW - close: 105.00 change: +2.02

Stop Loss: 99.75
Target(s): 109.75, 114.00
Current Option Gain/Loss: + 0.0%
Time Frame: seven trading days
New Positions: Yes, see below

Company Description

Why We Like It:
Technology stocks have been some of the market's best performers. VMW has managed to rally to new all-time, record highs. Traders immediately bought the dip on Friday morning and VMW actually closed up on the session. With VMW past major resistance at $100 the stock could see a strong rally into its earnings report.

We only have seven trading days. VMW is due to report earnings on July 19th and we do not want to hold over the announcement. I would keep positions small. VMW can be a little volatile. I am listing our stop at $99.75. Our targets are $109.75 and $114.00.

- Suggested Positions -

buy the AUG $110 call (VMW1120H110) current ask $3.90

Annotated Chart:

Entry on July 11 at $ xx.xx
Earnings Date 07/19/11 (confirmed)
Average Daily Volume = 1.9 million
Listed on July 9, 2011