NEW DIRECTIONAL CALL PLAYS

Deckers Outdoor - DECK - close: 62.15 change: +0.87

Stop Loss: 59.95
Target(s): 68.00
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings in late October
New Positions: Yes, see below

Company Description

Why We Like It:
DECK makes shoes. They're probably best known for their UGG brand of boots. Multiple analysts have issued positive comments on DECK in the last couple of weeks. The recent sell-off looks like profit taking after a strong run from its June lows. Traders bought the dip today near support at $60.00 and its simple 50-dma.

If DECK can build on today's bounce shares could actually see some short covering. The most recent data listed short interest at 29% of the 33 million share float. Today's high was $62.52. I am suggesting a trigger to buy calls at $62.65. If triggered our target is $68.00. However, we do not want to hold positions over the Q3 earnings report expected in late October.

Trigger @ 62.65

- Suggested Positions -

buy the NOV $65 call (DECK1316k65) current ask $3.20

Annotated Chart:

Entry on October -- at $---.--
Average Daily Volume = 1.1 million
Listed on October 09, 2013


Zimmer Holdings - ZMH - close: 84.69 change: +1.32

Stop Loss: 83.49
Target(s): 89.75
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings on Oct. 24th
New Positions: Yes, see below

Company Description

Why We Like It:
ZMH is in the healthcare sector. The company makes medical devices. The stock has managed to keep its bullish trend alive in spite of the stock market's recent pullback. ZMH was showing relative strength again today with a +1.5% gain and an attempt to breakout past resistance near $85.00.

Today's high was $85.42. I am suggesting a trigger to buy calls at $85.55. If triggered our target is $89.75. More aggressive traders could aim higher but we do not want to hold over the October 24th earnings report.

FYI: The medical device stocks could see a little volatility surrounding the political wrangling in Washington. The republicans and some democrats support repealing the recent medical device tax. Yet Senate Majority Leader Harry Reid and President Obama has rejected any suggestions to repeal this tax. It could be a bargaining chip in the negotiations between both sides over the budget and debt ceiling. Although it's worth noting that shares of ZMH have been ignoring all the drama lately.

Trigger @ 85.55

- Suggested Positions -

buy the NOV $85 call (ZMH1316k85) current ask $2.40

Annotated Chart:

Entry on October -- at $---.--
Average Daily Volume = 1.2 million
Listed on October 09, 2013