NEW DIRECTIONAL PUT PLAYS

Illinois Tool Works - ITW - close: 50.29 change: -0.94

Stop Loss: 51.65
Target(s): 45.50
Current Option Gain/Loss: Unopened
Time Frame: exit prior to the July 24th earnings report
New Positions: Yes, see below

Company Description

Why We Like It:
Industrial good stocks continue to sink as investors digest nearly continuous news that the U.S., Europe and China are all slowing down. Shares of ITW have just recently broken down under technical support at its 300-dma and 200-dma. Now ITW is testing round-number support at $50.00.

I am suggesting a trigger to buy puts at $49.75. If triggered we'll ust a stop loss at $51.65 (above today's high). Our target is $45.50 but we'll plan to exit prior to the July 24th earnings report.

Trigger @ 49.75

- Suggested Positions -

buy the Aug $50 PUT (ITW1218T50) current ask $1.55

Annotated Chart:

Entry on July xx at $ xx.xx
Earnings Date 07/24/12 (confirmed)
Average Daily Volume = 3.4 million
Listed on July 11, 2012


WABCO Holdings - WBC - close: 48.09 change: -1.10

Stop Loss: 50.05
Target(s): 44.00 & 41.00
Current Option Gain/Loss: Unopened
Time Frame: exit prior to the July 27th earnings report
New Positions: Yes, see below

Company Description

Why We Like It:
A slowing economy and slowing vehicle sales are a tough combination for the likes of WBC. Shares are trading near the bottom of their $48-54 trading range. If WBC breaks down from here it could signal a drop toward $40.00.

I am suggesting a trigger to buy puts at $47.40. We'll set our first target at $44.00 and our second target at $41.00.

Trigger @ 47.40

- Suggested Positions -

buy the Aug $45 put (WBC1218T45) current ask $1.60

Annotated Chart:

Entry on July xx at $ xx.xx
Earnings Date 07/27/12 (confirmed)
Average Daily Volume = 648 thousand
Listed on July 11, 2012