NEW DIRECTIONAL CALL PLAYS

O'Reilly Automotive - ORLY - close: 135.99 change: +0.51

Stop Loss: 133.90
Target(s): 144.00
Current Option Gain/Loss: Unopened
Time Frame: Exit PRIOR to earnings on February 5th
New Positions: Yes, see below

Company Description

Why We Like It:
ORLY is in the services sector. The company operates a chain of auto parts stores with over 4,000 locations. Last October shares of ORLY had rallied to new highs only to collapse on disappointing Q4 earnings guidance. The stock has since made its way back to those October highs. Today's move was enough to tag new all-time highs. I suspect that ORLY will see another pre-earnings run up with earnings scheduled for early February. Today's high was $136.44. I am suggesting a trigger to buy calls at $136.55. If triggered our target is $144.00 but we will plan on exiting prior to the earnings report on February 5th.

Trigger @ 136.55

- Suggested Positions -

Buy the Feb $140 call (ORLY1422B140) current ask $2.50

Annotated Chart:

Weekly Chart:

Entry on January -- at $---.--
Average Daily Volume = 545 thousand
Listed on January 21, 2014


NASDAQ-100 ETF - QQQ - close: 88.55 change: +0.67

Stop Loss: 86.75
Target(s): 94.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
The QQQ is an ETF designed to track the NASDAQ-100 index. That is the largest 100 companies listed on the NASDAQ exchange by market cap. The NASDAQ-100 has been showing relative strength this year with the QQQ closing today at a new 13-year high. I would use small positions. Even though the trend is higher there is a pattern of higher highs we should be aware of. I am setting an optimistic, multi-week target of $94.00. Let's wait for a new high and use an entry trigger at $88.75.

Trigger @ 88.75 *small positions*

- Suggested Positions -

Buy the Mar $90 call (QQQ1422C90) current ask $1.16

Annotated Chart:

Entry on January -- at $---.--
Average Daily Volume = 29 million
Listed on January 21, 2014