CALL Play Updates

Alcon Inc. - ACL - close: 136.60 change: +0.37 stop: 133.90

ACL is still under performing the market during this two-day bounce. Readers may want to take a more conservative approach to launching new positions and wait for a new move over $138.50 or $140.00. ACL has already hit our first target. Our second target is $148.00.

Picked on September 10 at $136.75
Change since picked:       - 0.15
                             /1st target hit @ 142.50 (+4.2%)
Earnings Date            10/27/09 (unconfirmed)
Average Daily Volume =        299 thousand 
Listed on September 10, 2009         


Allegheny Tech. - ATI - close: 35.24 change: +0.61 stop: 31.70

ATI rallied toward resistance near $36.00 this morning and stalled. Short-term ATI might see another dip toward the $34.00-33.50 zone before moving higher. I'm not suggesting new positions at this time. ATI has exceeded our first target. We're currently aiming for $37.00.

Picked on   August 31 at $ 30.25 *triggered         
Change since picked:      + 4.99 
                               /1st target hit @ 33.85 (+11.9%)
Earnings Date           10/21/09 (unconfirmed)
Average Daily Volume =       2.7 million  
Listed on August 27, 2009         


Caterpillar - CAT - close: 51.70 change: +0.95 stop: 47.49

CAT gapped open higher, rallied to $52.39 and then pared its gains. I'm still bullish here but readers may want to wait for dips in the $51.00-50.00 zone as an entry point.

Our first target is $54.50. Our second target is $59.00. FYI: The P&F chart is bullish with an $85 target.

Picked on   October 01 at $ 50.00
Change since picked:       + 1.70
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =         10 million  
Listed on September 19, 2009         


Core Labs - CLB - close: 102.63 change: +1.24 stop: 93.90

We may need to adjust our strategy for entering bullish positions on CLB. Currently the plan is to buy calls on a dip at $96.00. I'm starting to think we may want to buy calls on another dip near $99.00 or a breakout over $104-105.

Picked on September xx at $ xx.xx <-- TRIGGER @ 96.00
Change since picked:       + 0.00
Earnings Date            10/21/09 (unconfirmed)
Average Daily Volume =        175 thousand 
Listed on September 23, 2009         


Canadian Nat. Res. - CNQ - close: 66.82 change: +1.78 stop: 61.90

CNQ rallied like we thought it would but unfortunately the stock gapped open higher at $67.01 this morning. I've adjusted our entry point. I would still consider new bullish positions on a dip near $65.00. Our first target is $71.50.

Picked on   October 05 at $ 67.01 /gap higher entry
                                /originally listed at $65.04
Change since picked:       - 0.19
Earnings Date            11/05/09 (confirmed)
Average Daily Volume =        6.4 million  
Listed on   October 05, 2009         


Consol Energy - CNX - close: 47.55 change: +2.03 stop: 41.90 *new*

The rally in CNX continues and shares are close to hitting our first target at $48.50. Readers can use dips near $45.00 as a new entry point. I'm raising the stop loss to $41.90.

Our first target is $48.50. Our second target is $52.40. We'll plan to exit ahead of the late October earnings report. FYI: The Point & Figure chart is forecasting a $73 target.

Picked on September 25 at $ 43.77 /gap down entry
Change since picked:       + 3.78
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        3.0 million  
Listed on September 19, 2009         


Capella Education - CPLA - close: 69.64 change: +1.16 stop: 62.90

CPLA continues to show strength but the stock is now testing round-number resistance near $70.00. This would be a logical place to see a little correction. I am raising our trigger to buy a dip from $65.25 to $65.75. I'm raising the stop loss to $62.90.

If triggered our first target is $69.75. Our secondary target is $74.00 but we'll exit ahead of the late October earnings report. FYI: The Point & Figure chart is bullish with an $82 target.

Trading note: CPLA doesn't have a lot of volume and neither do the options. I would keep positions small.

Picked on   October xx at $ xx.xx <-- TRIGGER $65.75
Change since picked:       + 0.00
Earnings Date            10/27/09 (unconfirmed)
Average Daily Volume =        145 thousand 
Listed on   October 03, 2009         


Danaher Corp. - DHR - close: 65.52 change: +0.48 stop: 63.95

DHR managed a 0.7% bounce but failed to break the short-term bearish trend of lower highs. The move is disappointing and more conservative traders may want to exit early. I'm not suggesting new positions at this time.

Our first target is $69.50. The Point & Figure chart is bullish with a $77 target. Currently we only have half a position open to limit our risk given the aggressive entry point.

Picked on September 05 at $ 66.37 (buy 1/2 position)
               /originally listed at $65.76, gap higher entry @ 66.37
Change since picked:       - 0.85
Earnings Date            10/22/09 (confirmed)
Average Daily Volume =        2.4 million  
Listed on September 05, 2009         


Diamond Offshore - DO - close: 96.96 change: +2.79 stop: 89.75

DO managed to hit new 2009 highs at $97.70. The stock might try and fill the gap from this morning and readers could use a dip near $94.00 as a new entry point.

Our first target is $99.90. Our second target is $104.50. More aggressive traders can aim for $110. The P&F chart is forecasting a $114 target. The plan was to use small position sizes.

Picked on September 15 at $ 94.69 *adjusted entry point
Change since picked:       + 2.27
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        1.8 million  
Listed on September 12, 2009         


Dril-Quip, Inc. - DRQ - close: 51.15 change: +1.61 stop: 45.90

DRQ also rallied to new one-year highs. The close above the $50.00 mark is bullish.

More conservative traders may want to raise their stops toward $47.00.

Our first target is $53.00. Our second target is $57.50. The Point & Figure chart is bullish with a $65.00 target.

Picked on September 28 at $ 48.50
Change since picked:       + 2.65
Earnings Date            11/10/09 (unconfirmed)
Average Daily Volume =        282 thousand 
Listed on September 26, 2009         


Flowserve - FLS - close: 100.62 change: +1.33 stop: 89.40

We may want to change our entry point strategy on FLS soon. Right now the plan is to buy calls on a dip at $91.00. We might want to reconsider and use a breakout over $102.50 or another dip near $96.00 as a bullish entry point.

We will plan to exit ahead of the late October earnings report.

Picked on September xx at $ xx.xx <-- TRIGGER @ 91.00
Change since picked:       + 0.00
Earnings Date            10/28/09 (unconfirmed)
Average Daily Volume =        1.2 million  
Listed on September 19, 2009         


General Dynamic - GD - close: 65.92 change: +1.15 stop: 59.85

GD is rising to new one-year highs. I am raising our trigger to buy calls to $62.50 and I'm raising the stop loss to $59.85.

Our first target is $66.00.

Picked on September xx at $ xx.xx <-- TRIGGER @ 62.50
Change since picked:       + 0.00
Earnings Date            10/28/09 (unconfirmed)
Average Daily Volume =        2.3 million  
Listed on September 09, 2009         


Illumina Inc. - ILMN - close: 43.14 change: +0.23 stop: 37.75

I am raising our trigger to buy calls from $39.10 to $40.10. We'll adjust the stop loss to $37.75.

If we are triggered at $40.10 our first target is $44.00. We plan to exit before the October earnings report.

Picked on September xx at $ xx.xx <-- TRIGGER @ 40.10
Change since picked:       + 0.00
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =        1.6 million  
Listed on September 26, 2009         


iShares Financials - IYF - close: 52.52 change: +0.59 stop: 49.49

Financials appear to be breaking out from a bull-flag pattern. The action today was bullish. The IYF gapped higher, but retraced its steps to fill the gap and then rallied back into the closing bell. I see this as a new bullish entry point. Our first target is $57.00. Our second target is $60.00.

Picked on September 15 at $ 52.60 *triggered  
Change since picked:       - 0.08
Earnings Date            00/00/00
Average Daily Volume =        5.1 million  
Listed on September 01, 2009         


PPG Inds. Inc. - PPG - close: 58.03 change: +0.49 stop: 54.95

PPG did rally past the $58.50 level but it failed to close above it. The short-term action looks bullish. If you open new positions now do so with a small position size.

PPG has already exceeded our first target and we're currently aiming for $63.00.

Picked on   August 28 at $ 55.65
Change since picked:      + 2.38
                             /1st target exceeded @ 60.05 (7.9%)
Earnings Date           10/15/09 (confirmed)
Average Daily Volume =       1.6 million  
Listed on August 27, 2009         


SOHU.com Inc. - SOHU - close: 67.06 change: +1.61 stop: 63.75

This looks like a new entry point on SOHU. Shares are bouncing from previous resistance and what should be short-term support at $66.00. We are planning to exit ahead of the late October earnings report so consider the November $70 calls (TKZ-KN).

Our first target is $72.50. Our second target is $77.00.

Picked on   October 01 at $ 68.24 /gap open entry
                                 (small positions 1/2 to 1/4)
Change since picked:       - 1.18
Earnings Date            10/26/09 (unconfirmed)
Average Daily Volume =        577 thousand 
Listed on September 15, 2009         


Waters Corp. - WAT - close: 56.21 change: +0.73 stop: 53.25 *new*

The close over $56.00 is a bullish sign for WAT. Friday's low was $53.50. I'm raising our stop loss to $53.25. I would still open new positions now. Our plan is to use small position sizes (1/2 to 1/4 our normal size).

Our first target is $59.50. We do not want to hold over the mid October earnings report.

Picked on September 28 at $ 55.43 *new entry
Change since picked:       + 0.78
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =        809 thousand 
Listed on September 12, 2009         


PUT Play Updates

BIOGEN IDEC - BIIB - close: 49.02 change: +0.48 stop: 52.15

BIIB delivered a 0.9% bounce but the rally struggled near $49.50 and its 50-dma and 200-dma. A failed rally near $50.00 could be used as a new bearish entry point.

Don't forget - this is a higher-risk play because we're choosing to hold over the earnings report!

Our first target to take profits is at $44.50. Our second target is $40.50. FYI: The P&F chart is bearish with a $36 target.

Picked on   October 03 at $ 48.89
Change since picked:       + 0.13
Earnings Date            10/15/09 (unconfirmed)
Average Daily Volume =        2.6 million  
Listed on   October 03, 2009         


Strangle & Spread Play Updates

(What is a strangle? It's when a trader buys an out-of-the-money (OTM) call and an OTM put on the same stock. The strategy is neutral. You do not care what direction the stock moves as long as the move is big enough to make your investment profitable.)

Cigna Corp. - CI - close: 28.68 change: -0.02 stop: n/a

CI under performed the market today but the short-term consolidation is starting to look more bullish. I'm not suggesting new positions at this time.

The options I suggested were the October $35 calls (CI-JG) and the October $25 puts (CI-VE). Our estimated cost was $1.20. We want to sell if either option hits $2.50 or higher. The closer we can open this trade to $30.00 the better.

Picked on September 08 at $ 29.40
Change since picked:       - 0.72
Earnings Date            11/05/09 (unconfirmed)
Average Daily Volume =        3.8 million  
Listed on September 08, 2009         


CLOSED BULLISH PLAYS

Compass Minerals - CMP - close: 62.34 chg: +2.16 stop: 56.40

Target achieved. At first glance I thought there was a bad tick in CMP. Yet shares really did trade to $64.99. Our second and final target was $64.00. The trend is still up so readers may not want to exit and just let it ride although you may want to use a higher stop loss.

Chart:

Picked on September 03 at $ 55.55
Change since picked:       + 8.45 <-- exit 64.00 (+15.2%)
                               /1st target hit @ 59.75 (+7.5%)
Earnings Date            10/27/09 (unconfirmed)
Average Daily Volume =        415 thousand 
Listed on September 02, 2009         


CLOSED BEARISH PLAYS

Amazon.com - AMZN - close: 90.91 chg: +2.24 stop: 92.55

I think it's prudent for traders to abandon ship with our AMZN put play. The market's showing a lot more resilience than expected. AMZN's close back above $90.00 is bullish. Another failed rally at $94.00 could be used as a bearish entry point but in this market environment I'd be looking for a breakout over $94.00.

Chart:

Picked on   October 03 at $ 89.85
Change since picked:       + 1.06 <-- exit early (+1.1%)
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        6.2 million  
Listed on   October 03, 2009