NEW DIRECTIONAL CALL PLAYS

PVH Corp. - PVH - close: 136.02 change: +1.33

Stop Loss: 132.95
Target(s): 147.50
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
PVH is in the consumer goods sector. The company makes apparel and markets them through well known brands like Calvin Klein, Tommy Hilfiger, Van Heusen, IZOD, Bass, and more. The company's most recent earnings report was early December. PVH beat estimates but management guided lower. Normally an earnings warning would be the kiss of death for a stock but PVH did not see that much of a sell off. Investors actually bought the dip near its rising 50-dma. Since then shares have garnered some bullish analyst comments.

The stock has since rallied to new all-time highs with shares pushing past resistance near $135.00. You can also see on the weekly chart below that PVH is in a long-term bullish channel.

I am suggesting a trigger to buy calls at $136.55. If triggered our multi-week target is $147.50. Do not be surprised if we see PVH temporarily stall near the $140 level, which could be round-number resistance. More aggressive investors with a longer time frame might want to aim higher since the Point & Figure chart for PVH is bullish with a $172 target.

Trigger @ 136.55

- Suggested Positions -

buy the Feb $140 call (PVH1422B140) current ask $3.30

Annotated Chart:

Weekly Chart:

Entry on December -- at $---.--
Average Daily Volume = 939 thousand
Listed on December 31, 2013


Salix Pharmaceuticals - SLXP - close: 89.94 change: +1.14

Stop Loss: 87.40
Target(s): 98.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
SLXP is in the healthcare sector. The company manufacturers drugs and medical devices. Shares of SLXP surged back in November but not due to its earnings news. The stock rallied on news the company was buying Santarus (SNTS) For $2.6 billion. The acquisition should be accretive to earnings. Wall Street seems to have blessed the deal.

Now after spending the last several weeks consolidating sideways it would appear that SLXP is poised to breakout past resistance at the $90.00 level. If shares can breakout past $90 the next major milestone would be the $100 mark.

I am suggesting a trigger to buy calls at $90.25. If triggered our multi-week target is $98.50.

Trigger @ 90.25

- Suggested Positions -

buy the Feb $95 call (SLXP1422B95) current ask $2.35

Annotated Chart:

Entry on December -- at $---.--
Average Daily Volume = 790 thousand
Listed on December 31, 2013