Today's market strength was enough to fuel a few new relative highs on our play list. We had three stocks hit targets and three stocks hit triggers.


CALL Play Updates

Apple Inc. - AAPL - close: 189.27 change: -0.98 stop: 184.75

The rally might be getting a little tired. AAPL sank 0.5% after hitting new 2009 highs. Look for short-term support and a new entry point in the $186-185 zone.

Our first target to take profits (I'd exit 2/3rds of our position) is at $199.50. We will cautiously set a secondary target at $210. The P&F chart is currently forecasting a $231 target.

FYI: We will exit ahead of the October 19th earnings report. October options expire after Friday October 16th. Aggressive traders could play the October calls and I'd use the $190 strike. The rest of us will want to consider November calls and I'd use the $200 strike.

Picked on   October 06 at $190.01
Change since picked:       - 0.74
Earnings Date            10/19/09 (confirmed)
Average Daily Volume =       17.8 million  
Listed on   October 06, 2009         


Alcon Inc. - ACL - close: 140.62 change: +1.50 stop: 133.90

ACL is still gaining strength and closed over short-term resistance at the $140 level and its 10-dma. ACL has already hit our first target. Our second target is $148.00.

Picked on September 10 at $136.75
Change since picked:       + 3.87
                             /1st target hit @ 142.50 (+4.2%)
Earnings Date            10/27/09 (unconfirmed)
Average Daily Volume =        299 thousand 
Listed on September 10, 2009         


Amazon.com - AMZN - close: 95.22 change: +1.25 stop: 87.99

AMZN looked strong this morning and shares broke out to new 52-week highs over resistance at $94.50. The stock hit our trigger to buy calls at $95.05. The play is open. Short-term the stock has pulled back from its intraday highs and I wouldn't be surprised to see a dip back toward $93-92.

Our first target to take profits is at $99.90. Our second target would be $104.95. I'd aim higher but we want to exit in front of the late October earnings report.

Chart:

Picked on   October 08 at $ 95.05
Change since picked:       + 0.17
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        6.2 million  
Listed on   October 07, 2009         


Allegheny Tech. - ATI - close: 36.05 change: +0.62 stop: 31.70

Readers may want to start taking profits right here. ATI is testing resistance near $36.00. It wouldn't hurt to scale out now. The high today was $36.62.

I'm not suggesting new positions at this time. ATI has exceeded our first target. Our second and final target is $37.00.

Picked on   August 31 at $ 30.25 *triggered         
Change since picked:      + 5.80 
                               /1st target hit @ 33.85 (+11.9%)
Earnings Date           10/21/09 (unconfirmed)
Average Daily Volume =       2.7 million  
Listed on August 27, 2009         


AvalonBay - AVB - close: 73.27 change: +2.07 stop: 68.49

AVB continued to bounce and hit our trigger to buy calls at $72.60. Now that the play is open our first target is $77.75. More aggressive traders could aim higher but we don't want to hold over the early November earnings report.

Chart:

Picked on   October 08 at $ 72.60
Change since picked:       + 0.77
Earnings Date            11/04/09 (unconfirmed)
Average Daily Volume =        1.8 million  
Listed on   October 07, 2009         


Caterpillar - CAT - close: 53.09 change: +1.19 stop: 47.49

CAT continues to show relative strength and gained another 2.2% on Thursday. Please note that I'm adjusting our first target to take profits from $54.50 to $54.25.

If you are looking for a new entry point wait for another bounce near $50.00.

Our second target is $59.00 but that may be too optimistic as we plan to exit ahead of the October 20th earnings report. FYI: The P&F chart is bullish with an $85 target.

Picked on   October 01 at $ 50.00
Change since picked:       + 3.09
Earnings Date            10/20/09 (confirmed)
Average Daily Volume =         10 million  
Listed on September 19, 2009         


Core Labs - CLB - close: 106.00 change: +2.92 stop: 97.95

Another day of strength in oil helped fuel the rally for the oil service stocks. CLB broke out to new highs and hit our trigger to buy calls at $105.25. Previously I had suggested the November $100 calls (CBP-KT), which traded at $7.60 today. I would also consider the November $110 calls (CBP-KB), which are currently at $3.10.

Our first target to take profit is at $109.90. Our second target is $114.50.

Chart:

Entered on  October 08 at $105.25
Change since picked:       + 0.75
Earnings Date            10/21/09 (confirmed)
Average Daily Volume =        175 thousand 
Listed on September 23, 2009         


Canadian Nat. Res. - CNQ - close: 69.47 change: +2.78 stop: 61.90

CNQ displayed impressive relative strength with a 4.1% gain versus a 0.7% gain in the S&P 500. Shares are nearing potential resistance at $70.00 but it's worth noting that more and more of the technical indicators are improving. More conservative traders may want to raise their stops a bit.

Currently our first target is $71.50 and I'd exit at least half if not 75% of our position there. I'm setting a secondary target at $74.75.

Picked on   October 05 at $ 67.01 /gap higher entry
                                /originally listed at $65.04
Change since picked:       + 2.46
Earnings Date            11/05/09 (confirmed)
Average Daily Volume =        6.4 million  
Listed on   October 05, 2009         


Consol Energy - CNX - close: 49.51 change: +2.01 stop: 41.90

CNX has exceeded our first target. Shares rallied to round-number resistance at $50.00 and closed with a 4.2% gain. Our first target to take profits was at $48.50.

With CNX closing just under $50.00 this would be a good spot to expect a dip. The $46.00 level should offer some support. I'm raising our stop loss to $43.90.

I am raising our second target from $52.40 to $54.50. We'll plan to exit ahead of the late October earnings report.

Chart:

Picked on September 25 at $ 43.77 /gap down entry
Change since picked:       + 5.74
                                /1st target hit @ 48.50 (+10.8%)
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        3.0 million  
Listed on September 19, 2009         


Capella Education - CPLA - close: 69.82 change: +0.03 stop: 62.90

CPLA is still struggling with resistance near $70.00. I am still expecting a correction. Our trigger to buy calls is at $65.75.

If triggered our first target is $69.90. 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: 66.56 change: +1.22 stop: 63.95

DHR gained 1.8% and managed to break the three-week trendline of lower highs. I was prepared to drop it if shares didn't show strength today. I'm willing to keep it another day and probably through Monday to see if there is any follow through. DHR could feel pressure to fill the gap from this morning and that would require a dip back towards the $65.50 zone. I'm not suggesting new positions at this time.

Our first target is $69.50. The $70.00 level looks like significant resistance but we're going to set a secondary target at $72.50. 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:       + 0.19
Earnings Date            10/22/09 (confirmed)
Average Daily Volume =        2.4 million  
Listed on September 05, 2009         


Diamond Offshore - DO - close: 100.72 change: +2.67 stop: 91.95 *new*

Target achieved. Strength in crude oil fueled a rally in oil service stocks and DO broke out over round-number resistance at the $100 mark. Our first target to take profits was at $99.90.

Please note our new stop loss at $91.95. More conservative traders may want to consider a stop closer to $94.

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

Chart:

Picked on September 15 at $ 94.69 *adjusted entry point
Change since picked:       + 6.03
                               /1st target hit @ 99.90 (+5.5%)
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        1.8 million  
Listed on September 12, 2009         


Dril-Quip, Inc. - DRQ - close: 53.21 change: +1.56 stop: 46.95 *new*

Target achieved. DRQ, another oil service stock, continues to show relative strength and gained 3% on Thursday. The stock hit our first target to take profits at $53.00. I am raising our stop loss to $46.95, just a few cents under the October low.

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

Chart:

Picked on September 28 at $ 48.50
Change since picked:       + 4.71
                              /1st target hit @ 53.00 (+9.2%)
Earnings Date            11/10/09 (unconfirmed)
Average Daily Volume =        282 thousand 
Listed on September 26, 2009         


EOG Resources - EOG - close: 89.69 change: +4.98 stop: 82.49 *new*

I was bullish on EOG but I wasn't expecting shares to surge 5.8% in one day. The stock gapped open higher at $85.24 and soared toward round-number resistance at $90.00. Shares actually hit our first target to take profits at $89.90.

I am not suggesting new positions at this time. The stock is testing what should be resistance near $90.00 and EOG is probably due for some profit taking. Please note I'm upping our stop loss to $82.49.

We still have a second target at $94.75 and a third target at $99.50.

Chart:

Picked on   October 07 at $ 85.24 /gap higher entry
                               /originally listed at $84.71
Change since picked:       + 4.45
                              /1st target hit @ 89.90 (+5.4%)
Earnings Date            11/03/09 (unconfirmed)
Average Daily Volume =        2.9 million  
Listed on   October 07, 2009         


Express Scripts - ESRX - close: 78.20 change: -0.11 stop: 74.90

The action in ESRX was not very impressive today. Shares may drift toward $77.00 first before moving higher. Consider positions on another bounce near the 30-dma. Our first target is $82.50. Our second target is $84.95.

Picked on   October 06 at $ 77.42 /gap down entry
                              /originally listed at $78.04
Change since picked:       + 0.78
Earnings Date            10/28/09 (confirmed)
Average Daily Volume =        2.1 million  
Listed on   October 06, 2009         


Flowserve - FLS - close: 100.48 change: +0.79 stop: 95.90

There is no change from my comments from Wednesday.

I am suggesting an alternative entry point in case the stocks rallies from here. Open small positions (1/2 to 1/4 your normal size) if FLS trades at $102.60 or higher. If triggered at $102.60 we'll use a stop loss at $95.90. I am suggesting the November calls but my preference is for the Nov 105 calls (FLS-KA). Our first target will be $109.75.

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

Picked on September xx at $ xx.xx <-- TRIGGER @ 102.60
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: 65.28 change: -0.23 stop: 59.85

There is no change from my prior comments. Currently the plan is to buy calls at $62.50. 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         


Gold ETF - GLD - close: 103.64 change: +1.27 stop: 97.40

Gold futures continue to climb. Yesterday investors were eyeing the $1,050 level as potential round-number resistance. Gold flew right past it with a $10 rally to $1,054.80 an ounce. The reaction in the GLD produced a 1.2% gain and another new all-time high.

The plan was to buy small positions (1/2 to 1/4 normal positions) on the breakout over $100.

The weekly chart has an inverse head-and-shoulders pattern that is forecasting a huge upward target around $130ish but that could take several months to be achieved. Our shorter-term (several weeks) target is a rally to $109.90. We are still contemplating a second target.

Picked on   October 06 at $102.28
Change since picked:       + 1.35
Earnings Date            00/00/00
Average Daily Volume =       14.2 million  
Listed on   October 06, 2009         


Illumina Inc. - ILMN - close: 42.22 change: -0.23 stop: 37.75

ILMN continues to act like it wants to correct lower. I'm expecting support near $40.00. The plan is to buy calls at $40.10.

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: 53.23 change: +0.19 stop: 49.49

The major banking indices closed in the red but the IYF still managed to eke out a gain on Thursday. I'm not suggesting new positions at this time but watch the $52.00 level as short-term support. Our first target is $57.00. Our second target is $60.00.

Picked on September 15 at $ 52.60 *triggered  
Change since picked:       + 0.63
Earnings Date            00/00/00
Average Daily Volume =        5.1 million  
Listed on September 01, 2009         


PPG Inds. Inc. - PPG - close: 59.22 change: +1.35 stop: 54.95

PPG continues to rally and shares delivered a 2.3% gain. Don't be surprised to see a little resistance in the $59.50-60.50 zone. We have a week left before the company reports earnings and the plan is to exit ahead of the announcement.

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:      + 3.57
                             /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: 66.36 change: -1.42 stop: 63.75

Warning! The action in SOHU today looks like a bearish reversal. More conservative traders may want to raise their stops closer to $65.00. I'm not suggesting new positions at this time. Unfortunately I couldn't find any news to account for the sudden weakness.

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:       - 1.88
Earnings Date            10/26/09 (unconfirmed)
Average Daily Volume =        577 thousand 
Listed on September 15, 2009         


Waters Corp. - WAT - close: 57.22 change: +0.61 stop: 53.25

WAT hit a new high for the year but pared its gains by the closing bell. Broken resistance near $56.00 should offer some short-term support. The plan is to use small position sizes (1/2 to 1/4 our normal size) to minimize risk.

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:       + 1.79
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =        809 thousand 
Listed on September 12, 2009         


PUT Play Updates

BIOGEN IDEC - BIIB - close: 48.60 change: -0.57 stop: 52.15

The recent bounce in BIIB has failed near $49.50. This looks like another 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:       - 0.29
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: 28.33 change: -1.23 stop: n/a

The healthcare reform debate is heating up again and this time healthcare stocks plunged on the rhetoric. CI lost 4.1%. We are quickly running out of time before October options expire. 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:       - 1.07
Earnings Date            11/05/09 (unconfirmed)
Average Daily Volume =        3.8 million  
Listed on September 08, 2009