NEW DIRECTIONAL CALL PLAYS

Costco Wholesale - COST - close: 96.06 change: +0.91

Stop Loss: 93.95
Target(s): 99.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
The recent June retail sales data for the country was a disappointment. COST's recent June same-store sales report was also came in under expectations at +3.0%. Yet this news is not slowing down the rally in COST. After consolidating sideways for a few days COST has rallied to another high. Shares look like they are headed for round-number resistance at $100.

I am suggesting small bullish positions at the open tomorrow. We'll aim for $99.75. FYI: The Point & Figure chart for COST is bullish with a $116 target.

- Suggested *SMALL* Positions -

buy the AUG $97.50 call (COST1218H97.5) current ask $0.99

Annotated Chart:

Entry on July xx at $ xx.xx
Earnings Date 10/11/12 (unconfirmed)
Average Daily Volume = 2.0 million
Listed on July 17, 2012


NEW DIRECTIONAL PUT PLAYS

Salesforce.com - CRM - close: 126.78 change: -1.21

Stop Loss: 130.25
Target(s): 111.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
CRM has not been following the market's bounce off the June lows. A couple of weeks ago CRM broke down sharply and now the stock is testing support near $125.00. It's under the 50-dma, the 200-dma, and it's building a bearish trend of lower highs. I suspect we're going to see CRM breakdown to new relative lows soon.

I am suggesting a trigger to buy puts at $124.45. The $120.00 level might offer some support but we're aiming for $111.00. FYI: The Point & Figure chart for CRM is bearish with a $108 target.

Trigger @ 124.45

- Suggested Positions -

buy the Aug $120 PUT (CRM1218T120) current ask $4.75

Annotated Chart:

Entry on July xx at $ xx.xx
Earnings Date 08/16/12 (unconfirmed)
Average Daily Volume = 1.8 million
Listed on July 17, 2012