NEW DIRECTIONAL CALL PLAYS

Alnylam Pharmaceuticals - ALNY - close: 55.90 change: +0.85

Stop Loss: 53.20
Target(s): sell half at $60.0 and half at $64.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
ALNY is in the biotech industry. According to their website the company is developing novel therapeutics based on RNA interference, or RNAi. Alnylam is leading the translation of RNAi as a new class of innovative medicines with a core focus on RNAi therapeutics toward genetically defined targets for the treatment of serious, life-threatening diseases with limited treatment options for patients and their caregivers.

ALNY has been acting like a momentum stock. The challenge with biotech stocks is how reactive they are to headlines. The right headline can send them soaring. The wrong one can produce catastrophic moves lower. Right now ALNY has a bullish trend of higher lows and higher highs and it just broke out past resistance near $55.00.

I am suggesting small bullish positions to limit our risk. Thursday's intraday high was $56.44. I am suggesting a trigger at $56.50. If triggered I am suggesting we sell half of our position at $60.00 and then we'll aim for $64.00 with the other half.

Trigger @ 56.50 *small positions*

- Suggested Positions -

buy the Oct $60 call (ALNY1319j60) current ask $2.35

Annotated Chart:

Entry on September -- at $---.--
Average Daily Volume = 464 thousand
Listed on September 07, 2013


Lennox Intl. - LII - close: 70.52 change: +1.00

Stop Loss: 68.95
Target(s): 74.90
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
LII is in the industrial goods sector. The company focuses on heating, ventilation, air conditioning, and refrigeration. The big spike higher in July was a reaction to LII's earnings report. The company beat Wall Street's top and bottom line estimates. Management then raised their 2013 guidance. Shares soared toward round-number resistance at $75.00. Since then LII has corrected lower. The last couple of weeks the stock has consolidated sideways and is just now starting to breakout past resistance near $70.00.

We are suggesting a trigger to buy calls at $71.00. Our short-term target is $74.90. More aggressive traders could aim higher.

Trigger @ 71.00

- Suggested Positions -

Buy the Oct $70 call (LII1319j70) current ask $2.60

Annotated Chart:

Entry on September -- at $---.--
Average Daily Volume = 386 thousand
Listed on September 07, 2013


NEW DIRECTIONAL PUT PLAYS

Advance Auto Parts - AAP - close: 79.12 change: -0.92

Stop Loss: 80.60
Target(s): 75.10
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
AAP is a specialty retailer that operates almost 4,000 stores in 39 states. The stock peaked back in May of this year just ahead of its earnings report. Since then AAP has been underperforming the broader market. That underperformance has taken on a bearish posture with lower highs and now lower lows.

AAP has now broken down below support near $80.00, support at its exponential 200-dma and now with Friday's decline, under its simple 200-dma. Friday's intraday low was $78.91. I am suggesting a trigger to buy puts at $78.80. If triggered our target is $75.10. More aggressive traders could aim lower.

Trigger @ 78.80

- Suggested Positions -

Buy the Oct $80 PUT (AAP1319v80) current ask $2.80

Annotated Chart:

Entry on September -- at $---.--
Average Daily Volume = 640 thousand
Listed on September 07, 2013