CALL Play Updates

EQUINIX Inc. - EQIX - close: 106.84 change: -1.16 stop: 102.75

On a short-term basis EQIX is starting to look a little top heavy. The stock broke through short-term technical support at its rising 10-dma today. I wouldn't be surprised to see a correction toward the $105-104 zone but more conservative traders may want to go ahead and take profits now!

Our first target is $109.50. Our second target is $113.50. The plan was to use small position sizes to limit risk. I am not suggesting new positions at this time.

Entry  on  December 09 at $103.02
Change since picked:       + 3.82 
Earnings Date            02/10/10 (unconfirmed)
Average Daily Volume =        501 thousand 
Listed on  December 09, 2009         


Intl. Business Mach. - IBM - close: 132.57 change: +0.72 stop: 128.40 *new*

IBM displayed some relative strength on Wednesday with a 0.5% gain after traders bought the dip at $130.68 this morning.

I had a reader email asking about IBM and my thoughts on January. If the market does see a correction in mid January then yes I would expect IBM to follow the market lower. The question then is when will stocks correct? Right now the trend is up and the first week of January should see new inflows of money into the market. So I would start to turn very cautious on stocks around Thursday, January 7th. Investors could get nervous ahead of the next jobs report due out Friday, Jan. 8th. Once the jobs news is out the following week would be a prime target for all those investors waiting to lock in gains from 2009 to go ahead and sell. Now remember, this is just a guess. Stocks could tank next Monday but I suspect odds are stronger for a pullback following the jobs report. This outlook holds true for all the stocks on our play list.

Now can IBM hit our target between now and Friday, January 8th? Absolutely! It could hit our first target tomorrow. Our second target is a bit more optimistic and we may have to exit early. I am raising our stop loss to $128.40.

Our first target is $134.95. Our second target is $139.00. Our time frame is about four weeks. We do not want to hold over IBM's earnings report.

Entry  on  December 28 at $131.55
Change since picked:       + 1.02
Earnings Date            01/19/10 (unconfirmed)
Average Daily Volume =        5.8 million  
Listed on  December 26, 2009         


Infosys Tech. - INFY - close: 55.71 change: +0.14 stop: 51.95

Traders bought the dip near INFY's 10-dma again. Holding above the $55.00 level as new support is a good sign. I am not suggesting new positions at this time. INFY has already hit our first target 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:       + 3.83
                            /1st target hit @ 55.75 (+7.4%)
Earnings Date            01/12/10 (confirmed)
Average Daily Volume =        1.4 million  
Listed on  December 05, 2009         


L-3 Communications - LLL - close: 88.50 change: +1.32 stop: 84.40 *new*

Shares of LLL popped higher this morning on news that airports around the world and here in the U.S. were upping their security hardware with new technology. LLL spiked to $89.23 before paring its gains. I am raising our stop loss to $84.40. We should consider this an aggressive, higher-risk trade. Our first target to take profits is at $89.95. Our second and final target is $94.00. We want to exit ahead of the late January earnings report. FYI: The Point & Figure chart is bullish with a $104 target.

Entry  on  December 28 at $ 86.80 
Change since picked:       + 1.70
Earnings Date            01/28/10 (unconfirmed)
Average Daily Volume =        1.0 million  
Listed on  December 26, 2009         


Mettler Toledo - MTD - close: 105.97 change: +0.04 stop: 99.45

MTD remains stuck in its $105-107 trading range. There was virtually no change today. More conservative traders may want to adjust their stops higher toward $102.50 or even $105. We will leave our stop at $99.45 for now. Our first target is $109.00.

Entry  on  December 19 at $102.66 (small positions) /gap down entry
Change since picked:       + 3.31
Earnings Date            02/04/10 (unconfirmed)
Average Daily Volume =        106 thousand
Listed on  December 19, 2009         


Norfolk Southern - NSC - close: 53.24 change: -0.06 stop: 50.95

The railroads aren't moving this week and NSC is sinking closer toward short-term support near $53.00. I am tempted to raise our stop loss toward $52.00. 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:       + 1.40
Earnings Date            01/27/10 (unconfirmed)
Average Daily Volume =        5.4 million  
Listed on  November 21, 2009         


NUCOR Corp. - NUE - close: 47.06 change: +1.00 stop: 42.75

NUE spiked lower this morning only to bounce back and out perform the rest of the market with a 2.1% gain. I am raising our stop loss up to $43.90. The $45 and $44 levels should offer some support. Our multi-week target is $49.50. We will plan to exit ahead of the late January earnings report.

Entry  on  December 22 at $ 45.85 (1/2 position or less) /gap higher entry
Change since picked:       + 1.21
Earnings Date            01/28/10 (unconfirmed)
Average Daily Volume =        4.5 million  
Listed on  December 22, 2009         


Precision Castparts - PCP - close: 111.75 change: -0.82 stop: 107.25

Hmm... Momemtnum in PCP is definitely waning. Shares have broken the 10-dma and now they're testing the 21-dma. At this point I would expect a dip toward $110 and possibly $107.50. A normal 38.2% Fib retracement would pull PCP toward the $107.50 region. With less than three weeks left to go for January options more cautious traders may want to exit early right now. I'm not suggesting new positions at this time. PCP has already hit our first target at $112.45. Our second target is $118.75. The Point & Figure chart is bullish with a $157 target (it was $131).

Picked on  December 01 at $107.35
Change since picked:       + 4.40
                            /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: 59.33 change: +0.24 stop: 54.95

SF displayed some relative strength and closed at new 52-week highs. 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 22 at $ 58.05
Change since picked:       + 1.28
Earnings Date            02/11/10 (unconfirmed)
Average Daily Volume =        207 thousand 
Listed on  December 16, 2009         


UnitedHealth Group - UNH - close: 31.01 change: +0.16 stop: 28.90 *new*

UNH dipped to $30.60 and bounced. I've been suggesting readers use a dip near $30.00 as a new entry point. I suspect that UNH could still trade closer to $30.00 but if there is follow through on this bounce we may want jump on board. I am raising our stop loss to $28.90. 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:       + 0.70
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =        819 thousand 
Listed on  December 10, 2009         


United Tech. - UTX - close: 70.49 change: +0.19 stop: 67.45

UTX has found a new trading range in the $70-71 zone. The trajectory is still up and I remain bullish with the stock above $70.00 but readers may want to narrow their stop loss. 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:       + 0.24
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =        4.0 million  
Listed on  December 12, 2009         


Valmont Industries - VMI - close: 79.83 change: -0.69 stop: 78.45

I didn't see any news today for VMI but shares underperformed the market this morning and broke support near $80.00. Traders bought the dip near the 40-dma. I'm willing to hold it given the afternoon bounce but more conservative traders will want to seriously consider exiting right now. If we don't see any follow through on this bounce we'll want to exit early. 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, which suggests this stock could see a short squeeze.

Entry  on  December 10 at $ 81.00
Change since picked:       - 1.17
Earnings Date            02/10/10 (unconfirmed)
Average Daily Volume =        238 thousand 
Listed on  December 05, 2009         


Vertex Pharma - VRTX - close: 43.55 change: +0.20 stop: 41.85 *new *

VRTX hit a new high over $44.00 this morning. The intraday high was $44.04. Unfortunately shares pared their gains and the move looks like a short-term top. More conservative traders will want to seriously consider a complete exit right here. I am raising our stop loss to $41.85. I am not suggesting new positions at this time. Our target to exit is at $44.25.

Entry  on  December 03 at $ 40.25
Change since picked:       + 3.30
Earnings Date            02/09/10 (unconfirmed)
Average Daily Volume =        3.2 million  
Listed on  November 23, 2009         


Whirlpool - WHR - close: 81.73 change: -0.44 stop: 78.45 *new*

Traders bought the dip in WHR at $80.75 and then again at $81.00. This looks like a new bullish entry point but readers will want to strongly consider raising their stops toward $80.00. I am upping our stop to $78.45. WHR has already hit our first target at $84.75. Our second target is $89.00. FYI: The Point & Figure chart is bullish with a $103 target.

Entry  on  December 19 at $ 80.76 /gap higher entry
Change since picked:       + 0.97
                             /1st target hit $84.75 (+4.9%)
Earnings Date            02/08/10 (unconfirmed)
Average Daily Volume =        1.6 million  
Listed on  December 19, 2009         


PUT Play Updates

*Currently we do not have any put play updates*


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: 211.64 change: +2.54 stop: n/a

AAPL really needs to move if our strangle is going to work. We have just over two weeks left before January options expire. The stock gained 1.2% on the session. I am not suggesting new strangle positions at this time.

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:       +11.73
Earnings Date            01/21/10 (unconfirmed)
Average Daily Volume =       15.1 million  
Listed on  November 30, 2009         


United Parcel Service - UPS - close: 58.18 change: -0.37 stop: n/a

The relative strength in UPS yesterday must have been a fluke. The stock promptly gave it back today. I'm not suggesting new strangle positions.

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:       + 0.19 
Earnings Date            02/02/10 (unconfirmed)
Average Daily Volume =        4.7 million  
Listed on  November 21, 2009