NEW DIRECTIONAL CALL PLAYS

Celgene Corp. - CELG - close: 80.50 change: +1.82

Stop Loss: 77.95
Target(s): 84.50 & 87.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Biotech stock CELG was showing relative strength on Monday. The stock is breaking out from a two-week trading range and past round-number resistance at $80.00. I am suggesting we buy calls at the open tomorrow with a stop loss at $77.95. Please note that I am setting two targets. We'll take money off the table at $84.50 and our final target will be $87.50.

FYI: There was an article out today suggesting that CELG could present new data on the development of a new blood cancer drug tomorrow. This new drug is not expected to receive FDA approval until February. Investors should be note that biotech stocks can be volatile and any clinical trial data, good or bad, could move the stock big either direction. More conservative traders may want to wait until Wednesday before considering new positions.

- Suggested Positions -

buy 2013 Jan $82.50 call (CELG1319a82.5) current ask $1.71

Annotated Chart:

Entry on December xx at $ xx.xx
Average Daily Volume = 3.0 million
Listed on December 10, 2012


iShares Russell 2000 - IWM - close: 82.54 change: +0.36

Stop Loss: 81.20
Target(s): 86.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
After breaking out past the two-month trend of lower highs, the small cap ETF has spent the last week and a half consolidating sideways. If shares can breakout it could make a run towards its 2012 highs. I am suggesting a trigger to buy calls at $82.85. If triggered our target is $86.00.

Trigger @ $82.85

- Suggested Positions -

buy the 2013 Jan $84 call (IWM1319a84) current ask $1.00

Annotated Chart:

Entry on December xx at $ xx.xx
Average Daily Volume = 38 million
Listed on December 10, 2012