CALL Play Updates

FUQI Intl. - FUQI - close: 20.33 change: +0.91 stop: 18.45

As expected FUQI did rally higher but shares topped out at $20.48 today. The breakout over $20.00 is bullish and more aggressive traders may want to go ahead and jump into call positions now. With the 50-dma sliding lower today's gain is technically a breakout over this moving average as well. I'm suggesting we stick to the original plan and use a trigger to buy calls (very small positions) at $20.51. More conservative traders could even up their trigger to $20.75 in attempt to avoid getting triggered on a minor spike higher. If we are triggered our target is $24.75. This is an aggressive, higher-risk trade.

Entry  on   January xx at $ xx.xx <-- TRIGGER @ 20.51  (small positions 1/4)
Change since picked: + 0.00
Earnings Date 03/31/10 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on January 04, 2010


Intl. Business Mach. - IBM - close: 130.85 change: -1.60 stop: 128.90

IBM under performed today and erased Monday's gains. The stock did start to bounce near support at $130 and I would consider this dip a new entry point to buy calls but the relative weakness makes me more cautious.

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: - 0.70
Earnings Date 01/19/10 (unconfirmed)
Average Daily Volume = 5.8 million
Listed on December 26, 2009


Infosys Tech. - INFY - close: 56.98 change: +0.22 stop: 53.85

INFY eked out another new high but shares struggled with the $57.00 level all day long. There is no change from my prior comments although more conservative traders may want to up their stops closer to $55.00. The plan is to exit ahead of the January 12th earnings report if INFY doesn't hit our target first. INFY has already hit our first target at $55.75. Our second and final target is $59.50.

Entry  on  December 05 at $ 51.88 /gap down entry point
/originally listed at $52.46
Change since picked: + 5.10
/1st target hit @ 55.75 (+7.4%)
Earnings Date 01/12/10 (confirmed)
Average Daily Volume = 1.4 million
Listed on December 05, 2009


J.P.Morgan Chase - JPM - close: 43.68 change: +0.83 stop: 41.40

Banks were some of the best performers on Tuesday and JPM extended its gains with another 1.9% rally. Shares have now cleared technical resistance at all of its significant moving averages (today is broke out past the 100-dma).

The target for our aggressive, short-term trade is the $46.90 level. The plan is to exit ahead of earnings but I'm considering holding a small position over the earnings report.

Entry  on   January 04 at $ 42.85 (small positions 1/2)
Change since picked: + 0.83
Earnings Date 01/15/10 (confirmed)
Average Daily Volume = 31.6 million
Listed on January 04, 2010


L-3 Communications - LLL - close: 87.37 change: -0.60 stop: 84.90

The new short-term sideways consolidation in LLL is developing a trend of lower highs. More conservative traders may want to raise their stops. I am not suggesting new positions at this time.

I did label 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: + 0.57
Earnings Date 01/28/10 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on December 26, 2009


NUCOR Corp. - NUE - close: 48.12 change: +0.33 stop: 43.90

Metal stocks were showing strength and NUE managed a 0.69% gain. There is no change from my prior comments. More conservative traders might want to raise their stops toward $45.00. Our 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: + 2.27
Earnings Date 01/28/10 (unconfirmed)
Average Daily Volume = 4.5 million
Listed on December 22, 2009


Precision Castparts - PCP - close: 114.44 change: +1.90 stop: 109.45

PCP's rebound continues and the stock added 1.68% on pretty good volume. Shares are nearing potential resistance at last month's highs near $115.60. PCP has already hit our first target at $112.45. Our second target is $118.75. More aggressive traders may want to aim higher but I would not hold over the late January earnings report.

Picked on  December 01 at $107.35
Change since picked: + 7.09
/1st target hit $112.45 (+4.7%)
Earnings Date 01/20/10 (unconfirmed)
Average Daily Volume = 817 thousand
Listed on November 28, 2009


UnitedHealth Group - UNH - close: 31.48 change: -0.05 stop: 28.90

UNH is still trying to bounce but shares struggled at the $32.00 level today. Volume was above average, which is a little bit worrisome considering the stock's decline. There is no change from my prior comments. I am not suggesting new positions at these levels.

This was a "lottery ticket" style of play. We knew it was risky given all the political ups and downs for the healthcare bill. Our time frame was several weeks and we listed January and March calls. At this time if you choose to open new positions I'd use March calls but that would require holding over the late January earnings report (to get the most out of your March calls). Our first target is $34.00. Our longer-term target is $36.00.

Entry  on  December 10 at $ 30.31 
Change since picked: + 1.17
Earnings Date 01/21/10 (unconfirmed)
Average Daily Volume = 819 thousand
Listed on December 10, 2009


Volatility Index - VIX - close: 19.35 change: -0.69 stop: 18.95

It is not looking good for our VIX call play. The tone this week (it's only Tuesday) has been bullish. If we get stopped out tomorrow I would consider re-launching a VIX call play on Thursday to capture any post-jobs report volatility. I'm not suggesting new positions at this time.

Our first target to take profits is at 27.50. Our second target is 32.50. We gave ourselves a relatively wide stop loss at $18.95.

Entry  on   January 02 at $ 21.68 
Change since picked: - 2.33
Earnings Date --/--/--
Average Daily Volume = --- million
Listed on January 02, 2010


Whirlpool - WHR - close: 81.78 change: -0.17 stop: 79.45

WHR did not see any follow through on yesterday's bounce. Instead we got another dip toward $80.50 before shares decided to bounce. Readers looking for a new bullish entry point may be better off to wait for a move over $82.25 or $82.5 before initiating positions. WHR has already hit our first target at $84.75. Our second target is $89.00.

Entry  on  December 19 at $ 80.76 /gap higher entry
Change since picked: + 1.02
/1st target hit $84.75 (+4.9%)
Earnings Date 02/08/10 (unconfirmed)
Average Daily Volume = 1.6 million
Listed on December 19, 2009


Zebra Technologies - ZBRA - close: 28.62 change: -0.05 stop: 27.70

Uh-oh! Today could be a short-term top/failed rally pattern. Shares spiked to $29.37 this morning and then gave it all back to close in the red. That's not bullish! I am not suggesting new positions at this time. Our first target is $30.00. Our second target is $32.00 but that looks pretty aggressive and we may end up exiting early if the market does correct.

Entry  on  December 30 at $ 28.39 
Change since picked: + 0.23
Earnings Date 02/09/10 (unconfirmed)
Average Daily Volume = 166 thousand
Listed on December 30, 2009


PUT Play Updates

Fedex Corp. - FDX - close: 84.54 change: +1.09 stop: 85.51

FDX is bouncing from its 50-dma but shares are still inside their sideways trading range. Right now our plan is to buy puts on a breakdown with a trigger at $81.90. If the stock reverses higher and breaks out then we might want to buy calls on a move over $86.00. If triggered at $81.90 our first target is $78.10 near the rising 100-dma. Our second target is $75.10. More aggressive traders could aim for the November 2009 lows near $72.00.

Entry  on   January xx at $ xx.xx <-- TRIGGER @ 81.90
Change since picked: + 0.00
Earnings Date 03/18/10 (unconfirmed)
Average Daily Volume = 3.3 million
Listed on January 02, 2010


Flowserve - FLS - close: 98.09 change: +1.08 stop: 98.25

This is definitely starting to look a bullish breakout in FLS with the stock breaking the trend of lower highs. However, the stock continues to have significant overhead resistance near $100 and its 50-dma. If shares do breakout past $100 we might want to switch directions and buy calls. For now the plan is to buy puts if FLS hits $93.85. If triggered our first target is the long-term trendline of higher lows, which places our exit around $88.50. I'm suggesting we exit 2/3rds to 3/4ths of our position at $88.50. We'll keep a small position and aim for $85.15.

Entry  on   January xx at $ xx.xx <-- TRIGGER @ 93.85
Change since picked: + 0.00
Earnings Date 02/24/10 (unconfirmed)
Average Daily Volume = 612 thousand
Listed on January 02, 2010


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.)

United Parcel Service - UPS - close: 58.28 change: +0.10 stop: n/a

Odds of success with this strangle play are dwindling fast with UPS stuck in a multi-week trading range. 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: + 0.29
Earnings Date 02/02/10 (unconfirmed)
Average Daily Volume = 4.7 million
Listed on November 21, 2009


CLOSED BULLISH PLAYS

Stifel Financial - SF - close: 56.99 change: -2.13 stop: 56.45

Some happened to SF today but I can't find the news or reason behind the sharp decline. The stock plunged from $59 to $55.73 before paring its losses. That was enough to hit our stop loss at $56.45 and close the play.

Chart:

Entry  on  December 22 at $ 58.05
Change since picked: - 1.60 <-- stopped @ 56.45 (-2.7%)
Earnings Date 02/11/10 (unconfirmed)
Average Daily Volume = 207 thousand
Listed on December 16, 2009