It looks like investors are not that concerned about the Dubai World problem. Traders bought the dip midday and stocks posted gains by the closing bell.


CALL Play Updates

Capella Education - CPLA - close: 71.28 change: +0.23 stop: 69.65 *new*

CPLA has produced a two-week correction but traders bought the bounce from support near $70.00 and its rising 50-dma. The low was actually $69.70. I see the rebound from $70 as a new bullish entry point. Right now the December $75 calls are $0.75 each. If you were waiting for an entry this is it. We can up our stop loss to $69.65. If you open positions now you can take profits at $74.90. I do consider this an aggressive, higher-risk trade. Currently the Point & Figure chart is bullish with an $85 target. The target for our earlier position is $79.50.

Picked on  November 24 at $ 72.55
Change since picked:       - 1.27
Earnings Date            02/11/10 (unconfirmed)
Average Daily Volume =        126 thousand 
Listed on  November 24, 2009         


Gold ETF - GLD - close: 115.64 change: +0.58 stop: 109.49

Friday's bounce in the dollar is fading and gold posted another gain. The GLD was up 0.5% on Monday. I am repeating my comments from earlier that more conservative traders will want to seriously consider an early exit right now to lock in a gain.

Last week I lowered our final exit target to $118.50. I am not suggesting new positions at this time.

Picked on   October 06 at $102.28
Change since picked:       +13.36
                               /1st target hit @ 109.50 (+7.0%)
Earnings Date            00/00/00
Average Daily Volume =       14.2 million  
Listed on   October 06, 2009         


MSC Industrial Direct - MSM - close: 45.90 change: -0.31 stop: 44.90 *new*

This could be another entry point in MSM. Traders bought the dip near at $45.39. I have been suggesting a bounce near $45 as a new entry point. At this point I'm upping our stop loss to $44.90. Our first target is $49.75. Our second target is $52.50.

Picked on  November 17 at $ 46.62
Change since picked:       - 0.72
Earnings Date            01/07/10 (unconfirmed)
Average Daily Volume =        513 thousand 
Listed on  November 17, 2009         


Norfolk Southern - NSC - close: 51.40 change: +0.21 stop: 49.75

NSC managed a bounce but it barely kept pace with the S&P 500. I'm still suggesting readers wait for more relative strength (like a new relative high) before launching new positions.

Our first target to take profits is at $54.90. Our second target is $58.50. Our time frame is several weeks. FYI: The Point & Figure chart is bullish with a $65 target.

Picked on  November 21 at $ 51.84 (small positions)/gap higher entry
Change since picked:       - 0.44
Earnings Date            01/27/10 (unconfirmed)
Average Daily Volume =        5.4 million  
Listed on  November 21, 2009         


Precision Castparts - PCP - close: 103.68 change: -1.59 stop: 103.49

PCP under performed the market on Monday with a 1.5% decline. I didn't see any news to account for this relative weakness.

I am suggesting a trigger to buy calls at $107.35. If triggered our first target to take profits is at $112.45. Our second target is $118.75. The Point & Figure chart is bullish with a $131 target.

Picked on  November xx at $ xx.xx <-- TRIGGER @ 107.35
Change since picked:       + 0.00
Earnings Date            01/20/10 (unconfirmed)
Average Daily Volume =        817 thousand 
Listed on  November 28, 2009         


Vertex Pharma - VRTX - close: 38.82 change: -0.18 stop: 38.49

Investors are still buying the dip in the $38.50-39.00 zone but VRTX can't seem to break the short-term bearish trend of lower highs. You can see the simple 10-dma putting pressure on the stock. Our plan hasn't changed. I'm suggesting a trigger to buy calls at $40.25. We'll use a stop under last week's low. Our target to exit is at $44.25. My time frame is several weeks.

Picked on  November xx at $ xx.xx <-- TRIGGER @ 40.25
Change since picked:       + 0.00
Earnings Date            02/09/10 (unconfirmed)
Average Daily Volume =        3.2 million  
Listed on  November 23, 2009         


PUT Play Updates

FISERV Inc. - FISV - close: 46.24 change: -0.05 stop: 48.55

FISV slipped to $45.55 and bounced. I would not be surprised to see a little oversold bounce from here. Over the weekend I suggested that more patient traders wait for a failed rally in the $47.50-48.00 zone, which will probably happen. I would expect a bounce on the first touch at the $45 level. The P&F chart is bearish with a $41 target. I'm listing our exit target at $42.25. More aggressive traders could aim for the $40 level.

Picked on  November 28 at $ 46.29
Change since picked:       - 0.05
Earnings Date            02/02/10 (unconfirmed)
Average Daily Volume =        1.4 million  
Listed on  November 28, 2009         


Green Mountain Coffee Roasters - GMCR - cls: 62.98 chg: +0.03 stop: 71.05

Monday turned out to be a quiet session for GMCR with shares churning in a narrow range. I don't see any changes from my prior comments.

This is a higher-risk trade. GMCR has extremely high short interest. Our first target is $60.25. Our second target is $55.50.

Picked on  November 19 at $ 64.75
Change since picked:       - 1.77
Earnings Date            01/28/10 (unconfirmed)
Average Daily Volume =        1.5 million  
Listed on  November 18, 2009         


Goldman Sachs - GS - close: 169.66 change: +5.85 stop: 176.05

Banking stocks rallied sharply when it looked like the Dubai World crisis might be contained. Shares of GS completely erased Friday's losses with a 3.5% rally toward resistance near $170.00. Previously I suggested that GS would try and fill the gap and it has now. Wait for the bounce to roll over before considering new positions. Our first target is $155.50. More aggressive traders could aim for the $150 area or the simple 200-dma.

Picked on  November 25 at $168.75
Change since picked:       + 0.91
Earnings Date            12/15/09 (unconfirmed, could be in January)
Average Daily Volume =        9.5 million  
Listed on  November 21, 2009         


iShares Biotech - IBB - close: 78.41 change: +0.06 stop: 80.05

Biotech stocks under performed the major indices on Monday. Shares of the IBB remain under their trendline of lower highs. Yet I remain cautious here and see no changes from my weekend update. I am not suggesting new bearish positions at this time. We may want to consider switching directions and buy calls if the IBB can close over resistance at $80.00.

The biotech stocks can be a volatile group so I'm suggesting small positions. Our target is near the November lows at $73.50.

Picked on  November 19 at $ 77.18 /gap down entry point
                             /originally listed at $77.86
Change since picked:       + 1.23
Earnings Date            --/--/--
Average Daily Volume =        4.9 million  
Listed on  November 19, 2009         


Northern Trust - NTRS - close: 49.49 change: +1.80 stop: 50.26

The bounce in the financials was widespread and NTRS saw short covering lift it to a 3.7% gain. The close over $49.00 is short-term bullish and more conservative traders will want to seriously consider an early exit right here. I'm not suggesting new positions at this time. Our first target is $45.85. Our second target is $41.00. The Point & Figure chart is bearish and its target has fallen from $39 down to $35 in just the last few days.

Picked on  November 12 at $ 49.18
Change since picked:       + 0.31 
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =        3.0 million  
Listed on  November 12, 2009         


Research In Motion - RIMM - close: 57.89 change: -0.25 stop: 62.75

Big cap tech giant RIMM continues to under perform. The early morning rally failed under the $60 level. RIMM is nearing potential support at a trendline from the March lows. I'm not suggesting new positions at this time. Our first target is $55.25. Our second target is $50.50. RIMM can be a volatile stock so I'm suggesting smaller position sizes.

Picked on  November 16 at $ 61.80
Change since picked:       - 3.91
Earnings Date            12/17/09 (unconfirmed)
Average Daily Volume =       18.9 million  
Listed on  November 12, 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.)

Goldman Sachs - GS - close: 169.66 change: +5.85 stop: n/a

The big bounce in GS really doesn't help. We need the stock to pick a direction and run. We've got three weeks left before December options expire. I am no longer suggesting new strangle positions on the stock.

The options suggested were the December $180 calls (GPY-LP) and the December $160 puts (GPY-XL). Our estimated cost is about $4.61. We want to sell if either option hits $9.00 or higher.

Picked on  November 21 at $171.67 /gap open entry
Change since picked:       - 2.01
Earnings Date            12/15/09 (unconfirmed, could be January)
Average Daily Volume =        9.5 million  
Listed on  November 21, 2009         


Ultra(Long)-S&P500 - SSO - close: 36.90 change: +0.24 stop: n/a

The SSO is still stuck in a $36-38 trading range. I'm not suggesting new strangle positions at this time.

The options suggested for this strangle were the December $40 calls (SUC-LN) and the December $34 puts (SOJ-XH). Our estimated cost was $1.70. We want to sell if either option hits $3.00 or higher.

Picked on  November 11 at $ 37.08
Change since picked:       - 0.18
Earnings Date            --/--/--
Average Daily Volume =         32 million  
Listed on  November 11, 2009         


United Parcel Service - UPS - close: 57.47 change: +0.04 stop: n/a

It was a very quiet day for UPS with the stock trading in a $1.00 range and closing nearly unchanged on the session. The close here at $57.50 is a new entry point for strangle positions. I'd limit new positions to the $58.00-56.00 zone.

The options suggested for this trade were the December $60 calls (UPS-LL) and the December $55 puts (UPS-XK). Our estimated cost is $1.05. We want to sell if either option hits $3.00 or more.

Picked on  November 21 at $ 57.99 /gap open entry
Change since picked:       - 0.52
Earnings Date            02/02/10 (unconfirmed)
Average Daily Volume =        4.7 million  
Listed on  November 21, 2009