CALL Play Updates

EQUINIX Inc. - EQIX - close: 104.62 change: -1.75 stop: 99.75

The profit taking in EQIX continues. Look for support near $100. I am not suggesting new bullish positions at this time. Our target is $109.50. The plan was to use small position sizes.

Entry  on  December 09 at $103.02
Change since picked:       + 1.60
Earnings Date            02/10/10 (unconfirmed)
Average Daily Volume =        501 thousand 
Listed on  December 09, 2009         


Infosys Tech. - INFY - close: 54.25 change: -0.18 stop: 49.90

Thursday produced a very minor decline in INFY. There is no change from my prior comments. I am not suggesting new positions at this time but a bounce near $52.50-53.00 could be a new entry point. Our first target to take profits is at $55.75. Our second and final target is $59.50. We will plan to exit ahead of the January 12th earnings report.

Entry  on  December 05 at $ 51.88 /gap down entry point
                           /originally listed at $52.46
Change since picked:       + 2.37
Earnings Date            01/12/10 (confirmed)
Average Daily Volume =        1.4 million  
Listed on  December 05, 2009         


General Dynamics - GD - close: 68.51 change: -0.94 stop: 67.45

GD has pulled back toward broken resistance in the $68.50 region. This should be a new bullish entry point although given the market's weakness today you may want to wait for a bounce first before initiating positions.

Our first target to take profits in GD is $74.95. FYI: The Point & Figure chart is bullish with a $105 target.

Entry  on  December 14 at $ 70.66 (half position)
Change since picked:       - 2.15
Earnings Date            01/27/10 (unconfirmed)
Average Daily Volume =        1.6 million  
Listed on  December 14, 2009         


Mosaic - MOS - close: 56.03 change: -3.65 stop: 57.95

Fertilizer stocks were down on news that one of their peers is close to bring more supply on to the market. MOS has broken down from its sideways consolidation. If we don't see a bounce soon I'll drop it as a bullish candidate. The plan is to buy calls if MOS hits $62.55. Our first target is $69.50.

Entry  on  December xx at $ xx.xx <-- TRIGGER @ 62.55
Change since picked:       + 0.00
Earnings Date            01/05/10 (unconfirmed)
Average Daily Volume =        5.8 million  
Listed on  December 16, 2009         


MSC Industrial Direct - MSM - close: 46.70 change: -0.43 stop: 44.90

There is no change from my prior comments on MSM. Tomorrow is our last day for December options.

Picked on  November 17 at $ 46.62
Change since picked:       + 0.08
Earnings Date            01/07/10 (unconfirmed)
Average Daily Volume =        513 thousand 
Listed on  November 17, 2009         


Norfolk Southern - NSC - close: 52.06 change: -0.80 stop: 49.75

The transports were not immune to the selling pressure on Thursday. The railroad index lost 1.4%. NSC fell 1.5%. There is no change from my previous comments. I want to see a new relative high (53.25) or a close over $53.00 before launching new positions. Our first target is now $56.50. Our second and final target is $59.50. 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:       + 0.22
Earnings Date            01/27/10 (unconfirmed)
Average Daily Volume =        5.4 million  
Listed on  November 21, 2009         


Precision Castparts - PCP - close: 110.72 change: -0.43 stop: 107.25

PCP has pulled back toward short-term, round-number support at $110. I'm suggesting readers look for support in the $110-109 zone. We can use a rebound in this area as a new bullish entry point. PCP has already hit our first target at $112.45. Our second target is $118.75. The Point & Figure chart is bullish with a $131 target.

Picked on  December 01 at $107.35
Change since picked:       + 3.37
                            /1st target hit $112.45 (+4.7%)
Earnings Date            01/20/10 (unconfirmed)
Average Daily Volume =        817 thousand 
Listed on  November 28, 2009         


Stifel Financial - SF - close: 57.37 change: +0.11 stop: 54.95

SF is not showing any weakness and remains near its 2009 highs. I want to see a little more confirmation so I'm suggesting a trigger to buy calls at $58.05. If triggered our first target is $64.50. Our time frame is January expiration. The P&F chart is bullish and points to a $70 target.

Entry  on  December xx at $ xx.xx <-- TRIGGER @ 58.05
Change since picked:       + 0.00
Earnings Date            02/11/10 (unconfirmed)
Average Daily Volume =        207 thousand 
Listed on  December 16, 2009         


UnitedHealth Group - UNH - close: 31.82 change: -0.38 stop: 27.99

UNH is short-term overbought so a little correction would be healthy. I'd consider buying new call positions on a dip or bounce near $30.50-30.00.

Our first target is $34.00. Our longer-term target is $36.00. Our time frame is several weeks. If you buy March calls you might want to think about holding over the late January earnings report.

Entry  on  December 10 at $ 30.31 
Change since picked:       + 1.51
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =        819 thousand 
Listed on  December 10, 2009         


United Tech. - UTX - close: 69.58 change: -0.67 stop: 67.45

UTX should have some short-term support near $69.00. If that fails look to the rising 30-dma near $68.10. Wait for a bounce or a new rise over $70.25 before initiating new positions. Our first target is $74.75. The Point & Figure chart is bullish with a $95.00 target.

Entry  on  December 15 at $ 70.25
Change since picked:       - 0.67
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =        4.0 million  
Listed on  December 12, 2009         


Valmont Industries - VMI - close: 80.13 change: -1.37 stop: 78.45

VMI has pulled back to what should be round-number support near $80.00. Traders could use a bounce from here as a new entry point but I would hesitate to launch new positions if the major averages are sinking. Our first target to take profits is at $84.90. Our second target is $88.75. FYI: The most recent data list short interest at 9% of the very small 20.1 million-share float.

Entry  on  December 10 at $ 81.00
Change since picked:       - 0.87
Earnings Date            02/10/10 (unconfirmed)
Average Daily Volume =        238 thousand 
Listed on  December 05, 2009         


Vertex Pharma - VRTX - close: 41.13 change: -1.38 stop: 38.90

A little profit taking in VRTX would be normal and shares gave up 3.2% after hitting new highs yesterday. The stock should find new support in the $40.50-40.00 zone. Our target to exit is at $44.25. My time frame is several weeks.

Entry  on  December 03 at $ 40.25
Change since picked:       + 0.88
Earnings Date            02/09/10 (unconfirmed)
Average Daily Volume =        3.2 million  
Listed on  November 23, 2009         


Weyerhaeuser - WY - close: 42.99 change: -1.00 stop: 40.75

Right now I'm watching to see if WY can hold support near $42.00 or will it dip toward $40.00. We don't have an official entry point on WY at the moment. Be patient and wait. We'll either pick an entry or drop WY in the weekend letter.

Entry  on  December 14 at $ xx.xx 
Change since picked:       + 0.00
Earnings Date            02/05/10 (unconfirmed)
Average Daily Volume =        1.6 million  
Listed on  December 14, 2009         


PUT Play Updates

Freeport McMoran - FCX - close: 75.96 change: -3.49 stop: 80.55

Another new high in the dollar pushed commodities lower. This in turn sent FCX to a 4.3% decline. The stock hit new relative lows, which bodes well for our play.

Remember, we should consider this an aggressive, higher-risk trade because the dollar, commodities, and shares of FCX can be somewhat volatile. The plan was to use very small positions to limit risk. Our first target is $72.50. I'm adding a second target at $68.50.

Entry  on  December 12 at $ 76.81 
Change since picked:       - 0.85
Earnings Date            01/26/10 (unconfirmed)
Average Daily Volume =       12.6 million  
Listed on  December 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.)

Apple Inc. - AAPL - close: 191.86 change: -3.17 stop: n/a

AAPL under performed the broader market with a 1.6% loss. That could change tomorrow. Smartphone rival RIMM reported earnings after the bell and RIMM is up big on its results. A positive report from RIMM is being interpreted as bullish for AAPL and shares of AAPL are up slightly after hours. I am not suggesting new strangle positions at this time.

We have an aggressive December strangle and a less aggressive January strangle. The options in the December strangle were the December $210 calls (AJL-LV) and the December $190 puts (APV-XR). Our estimated cost is $3.83. We will try and recoup some capital if either option hits $3.00.

The options in the January strangle were January $220 calls (AJL-LV) and the January $180 puts (APV-XR). Our estimated cost is $5.60. We want to sell if either option hits $10.00 or more.

Picked on  November 30 at $199.91
Change since picked:       - 8.05
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =       15.1 million  
Listed on  November 30, 2009         


Goldman Sachs - GS - close: 160.93 change: -4.06 stop: n/a

This is it. Tomorrow is our last day. If we're lucky GS will break support at the $160 level and we'll be able to sell the December $160 puts for something.

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 may want to sell if either option hits $3.50 or higher just to recoup some capital.

Picked on  November 21 at $171.67 /gap open entry
Change since picked:       -10.74
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: 37.03 change: -0.91 stop: n/a

It's amazing. The S&P 500 has gone absolutely no where in the last six weeks. This trade is dead and we're just watching the clock.

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.

Picked on  November 11 at $ 37.08
Change since picked:       - 0.05
Earnings Date            --/--/--
Average Daily Volume =         32 million  
Listed on  November 11, 2009         


United Parcel Service - UPS - close: 58.23 change: -0.77 stop: n/a

Rival FDX reported earnings and issued a profit warning. This took FDX and UPS down today. Our December strangle is dead and will expire after Friday.

December Strangle
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. At this time we want to sell if either option turns positive again.

January Strangle
The options suggested for the January strangle were the January $60.00 calls (UPS-AL) and the January $55.00 puts (UPS-MK). Our estimated cost was $1.35. I would plan to sell if either option hit $3.50 or more.

Picked on  November 21 at $ 57.99 /gap open entry
Change since picked:       + 0.24 
Earnings Date            02/02/10 (unconfirmed)
Average Daily Volume =        4.7 million  
Listed on  November 21, 2009         


CLOSED BULLISH PLAYS

Capella Education - CPLA - close: 74.87 change: -1.64 stop: 74.90

Something happened to CPLA in the last 30 minutes of trading. Earlier in the session the stock had bounced from the $76.00 level but in the last half our shares plunged to $74.12. We had just raised our stop loss to $74.90 so the play is closed.

Chart:

Picked on  November 24 at $ 72.55
Change since picked:       + 2.35 <-- stopped out @ 74.90 (+3.2%)
Earnings Date            02/11/10 (unconfirmed)
Average Daily Volume =        126 thousand 
Listed on  November 24, 2009         


F5 Networks - FFIV - close: 50.31 change: -0.71 stop: 49.75

The action in FFIV looked bearish yesterday so we raised our stop to $49.75. This morning's weakness was enough to push FFIV to $49.50 so our call play is closed. I'd keep FFIV on your watch list for a breakout past $52.00 again.

Chart:

Entry  on  December 09 at $ 52.08
Change since picked:       - 2.33 <-- stopped out @ 49.75 (-4.4%)
Earnings Date            01/20/10 (unconfirmed)
Average Daily Volume =        1.2 million  
Listed on  December 09, 2009         


CLOSED BEARISH PLAYS

Goldman Sachs - GS - close: 160.93 change: -4.06 stop: 170.25

We are out of time. December options expire after Friday. The goal was to exit if GS hit $160.55. The low today was $160.83. I'm suggesting we exit immediately.

Chart:

Picked on  November 25 at $168.75
Change since picked:       - 7.82 <-- exit @ 160.93 (-4.6%)
Earnings Date            12/15/09 (unconfirmed, could be in January)
Average Daily Volume =        9.5 million  
Listed on  November 21, 2009