NEW DIRECTIONAL CALL PLAYS

Ross Stores Inc. - ROST - close: 89.62 change: +0.21

Stop Loss: 87.75
Target(s): 94.75
Current Option Gain/Loss: Unopened
Time Frame: up to earnings on Nov. 17th
New Positions: Yes, see below

Company Description

Why We Like It:
Shares of ROST have been pretty resistant to the market's volatile swings lately. The stock's recent consolidation has narrowed and ROST looks poised to breakout past resistance at $90.00. If that occurs shares could see a strong pre-earnings run up.

I am suggesting a trigger to open bullish positions at $90.10. If triggered we will use a stop loss at $87.75 and aim for the $94.75 level. More aggressive traders could aim higher. There is a trading maxim that says stocks that rally past $90 usually hit $100. Please note that we do not want to hold over the November 17th earnings report.

I am listing November calls and December calls. November calls will expire after November 18th but we're planning to exit prior to Nov. 17th. We can use them but they will be more volatile.

FYI: The Point & Figure chart for ROST is bullish with a $118 target.

Trigger @ $90.10

- Suggested Positions -

buy the NOV $90 call (ROST1119K90) current ask $2.10

- or -

buy the DEC $92.50 call (ROST1117L92.5) current ask $2.20

Annotated Chart:

Entry on November xx at $ xx.xx
Earnings Date 11/17/11 (confirmed)
Average Daily Volume = 1.0 million
Listed on November 7, 2011