NEW DIRECTIONAL CALL PLAYS

Lockheed Martin - LMT - close: 102.87 change: +0.98

Stop Loss: 101.45
Target(s): 109.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
The sequestration budget cuts have not had any lasting impact on shares of LMT. The stock is showing lots of upward momentum. Traders have been buying the dip at the rising 10-dma. Now LMT is poised to break out past resistance near $103.00 and hit new four-year highs.

I am suggesting a trigger to buy calls at $103.05. If triggered our multi-week target is $109.00.

Trigger @ 103.05

- Suggested Positions -

buy the Jun $105 call (LMT1322F105) current ask $0.65

Annotated Chart:

Entry on May -- at $---.--
Average Daily Volume = 1.7 million
Listed on May 14 2013


Energy ETF - XLE - close: 81.40 change: +1.14

Stop Loss: 79.45
Target(s): 89.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
XLE is an oil and energy ETF. There are just over 40 components but the two largest holdings are XOM and CVX, which together make up more than 30% of its holdings. The strength in the energy sector has pushed the XLE past resistance near $80.00 and past resistance at its 2011 highs. This looks like a new bullish entry point. We want to see a little bit more confirmation. I am suggesting a trigger to buy calls at $81.55. If triggered our multi-week target is $89.00. The $90.00 level was major resistance back in 2008 and will probably be a hurdle for the ETF to cross.

Trigger @ 81.55

- Suggested Positions -

buy the Jun $85 call (XLE1322F85) current ask $0.39

- or -

buy the Sep $85 call (XLE1321i85) current ask $1.63

Annotated Chart:

Weekly Chart:

Entry on May -- at $---.--
Average Daily Volume = 13.0 million
Listed on May 14 2013