Current Portfolio:


CALL Play Updates

Cameron International - CAM - close 36.33 change -0.31 stop 35.45

Target(s): 37.85, 38.40, 39.10, 39.50
Key Support/Resistance Areas: 45.00, 42.50, 41.00, 38.75, 36.00
Current Gain/Loss: -63%
Time Frame: Several weeks
New Positions: Yes

Comments:
8/25: CAM came close to hitting our stop this morning but reversed. My comments haven't changed much. I suggest readers use strength in the stock and consider exiting positions as time decay will start to affect the option premium. Our targets were adjusted yesterday and remain the same except I have lowered the first target by 10 cents.

8/24: CAM hung tough today but closed below its upward trend line and the 50-day SMA. It did close above the key resistance level of $36.00 so it is do or die time for bounce. I'm looking for a bounce back up to its 20 and 100-SMA's. But I'm concerned about time decay negatively affecting our option premium so I suggest readers begin to exit positions on any strength or by using our adjusted targets above.

8/23: CAM is maintaining its upward trend line from the 7/1 lows and closed above its 50-day SMA. The stock has support at this level and should bounce if the broader market cooperates. However, I'm concerned about time decay negatively affecting our option premium. I've adjusted our targets and I suggest readers begin to exit positions on any strength in CAM, or tighten stops to protect capital.

Current Position: Long September $40.00 CALL, entry was $0.95

Entry on August 16, 2010
Earnings Date 11/3/2010 (unconfirmed)
Average Daily Volume: 4.6 million
Listed on August 14, 2010


FMC Technologies, Inc - FTI - close 61.79 change -0.21 stop 58.25

Target(s): 65.25 (hit), 67.00, 68.75
Key Support/Resistance Areas: 69.00, 65.50, 62.40, 59.00
Current Gain/Loss: -18%
Time Frame: Several weeks
New Positions: Yes, with a tight stop

Comments:
8/25: FTI made a double bottom with Tuesday's lows and closed near its highs of the day. Broader market strength will do wonders for our position and the fact that crude oil gained today on bearish inventory data should be good for FTI. But now we need follow through. This is not a bad spot to open new positions with tight stops.

8/24: After gapping lower FTI was bought the entire day and managed to post a gain while the broader market was very weak. The bullish trend in the stock remains in tact as described below. Traders may want to consider exiting FTI on a move up towards its 20-day SMA near $63.00 as it will be tough for the stock to buck the broader market trend too long.

8/23: FTI is maintaining its upward trend line from its 6/8 lows and is above its 100-day, 200-day and 50-day SMA's. The stock's trend is up but we still need the broader market behind us if FTI is going to reach our targets. Our $65.25 target was hit on 8/17 and still remains valid.

Current Position: Long October $70.00 CALL, entry was at $1.10

Entry on August 16, 2010
Earnings 10/27/2010 (unconfirmed)
Average Daily Volume: 1.5 million
Listed on August 14, 2010


Panera Bread Co. - PNRA - close: 78.93 change: +0.84 stop: 72.40

Target(s): 77.00, 78.50
Key Support/Resistance Areas: 73.00, 76.00, 80.00, 85.00, 88.50
Current Gain/Loss: N/A
Time Frame: 2 to 3 weeks
New Positions: Yes, see trigger

Comments:
8/25: I suggest we change the strategy on this play and initiate long positions in PNRA on weakness rather than strength. There is no doubt PNRA is a relative strong performer but trading it against the broader market trend on a break out is higher risk. I suggest we keep this active into next week and use a trigger of $74.75 to initiate long positions. This is near the 200-day SMA and we could easily get there if the market sells off in the coming days. I've also updated the suggested option to October. More nimble traders could consider a position on a breakout but I like the risk/reward set-up better on weakness for a swing trade.

8/21: This is a relative strength play. PNRA has been out performing the market the past few days. Now the stock is testing resistance near $80.00. The high on Aug. 18th was $80.56. I am suggesting we buy calls at $80.75 and target a move toward resistance at $85.00 (exit target $84.90). This should be a relatively short-term play if we are triggered.

Suggested Position: Buy October $80.00 CALL, estimated ask at entry $1.75

Entry on August XX
Earnings Date 10/27/10
Average Daily Volume 562,000
Listed on August 21, 2010


UnitedHealth Group Inc - UNH - close 31.96 change +0.92 stop 31.33 *NEW*

Target(s): 31.50 (hit), 31.90 (hit), 32.45, 33.15
Key Support/Resistance Areas: 35.00, 34.40, 33.50, 31.50
Current Gain/Loss: -20%
Time Frame: 1 to 2 weeks
New Positions: No

Comments:
8/25: UNH made a comeback today gaining nearly +3%. I'm still looking for an exit and have tightened the stop to $31.33. I've also narrowed our next target to $32.45 and would be inclined to exit if it is hit. This should get us to breakeven or better on the trade.

8/24: UNH closed below critical support at $31.50 and readers should consider exiting positions to preserve capital. The stock closed above its 100 and 50-day SMA but below its 200 and 20-day SMA. I suggest using $31.50 or $31.95 as possible targets. We have September options and need to begin to protect the time value remaining in them. I've adjusted the targets above.

8/23: UNH closed at the critical support level of $31.50 so it is do or die time for a bounce. Readers should consider exiting positions, especially if UNH begins to bounce.

Current Position: Long September $32.00 CALL, entry was at $1.25

Entry on August 17, 2010
Earnings Date 10/19/2010 (unconfirmed)
Average Daily Volume: 8.5 million
Listed on August 16, 2010


PUT Play Updates

Abercrombie & Fitch - ANF - close 35.60 change +0.63 stop 38.40

Target(s): 33.00, 31.50
Key Support/Resistance Areas: 38.20, 37.25, 32.75, 34.00, 30.50
Current Gain/Loss: -9%
Time Frame: Several weeks
New Positions: Yes

Comments:
8/25: We are short ANF and I am expecting a move down to $33.00 and eventually $31.50. The broader market needs to cooperate and I think any bounces will be will be short lived. ANF has a lot of overhead resistance to keep bounces in check. My comments below remain valid.

8/24: We are back with a consumer name in the retail space. Retailers are weak and ANF looks ready for a drop if the broader market cooperates. This company is one of the more bloated retail names out there and trades at high PE ratio of 26. Technically the stock has broken out of a bear flag that formed in July and August off of the decline from its April highs. ANF is also consolidating below its broken trend line from the 11/08 lows (see dashed line) and volume is picking up which indicates sellers are overwhelming buyers. I suggest we initiate short positions now or on any strength in the stock. We'll use stop of $38.40. Our targets are $33.00 and $31.50.

Current Position: Long October $34.00 PUT, entry was at $2.10

Entry on August 25, 2010
Earnings: 11/11/10 (unconfirmed)
Average Daily Volume: 3.5 million
Listed on August 24, 2010


Apple, Inc - AAPL - close 242.89 change +2.96 stop 256.50 *NEW*

Target(s): 240.00 (hit), 233.00, 226.00
Key Support/Resistance Areas: 266, 258, 256, 246, 240, 231, 235
Current Gain/Loss: +5%
Time Frame: Several weeks
New Positions: Yes

Comments:
8/25: If the broader market bounces here AAPL will most likely rally up to fill the gap down from yesterday. But I think bounces will be short lived so I suggest we be patient and be ready to take profits when AAPL approaches our targets.

8/24: We are short AAPL as our trigger to initiate positions was hit at the open. This is the lowest closing price in AAPL since 5/20. Anyone who has initiated long positions in AAPL since April is hoping and praying AAPL comes back and if the weakness continues I'm expecting stops to get hit. This should send AAPL down to test its 200-day SMA which is just below our primary target of $233. This is where I suggest taking profits or tightening stops to protect them.

8/23: AAPL lost -1.54% (or $3.84). Our comments from the weekend remain the same except I believe more aggressive traders can short AAPL on any strength. We have two official entry points to buy puts - at a bounce near $254.00 (lowered $3) or at a breakdown at $244.00. If AAPL hits $244.00 we'll adjust the stop loss down to $256.00.

Current Position: Long October $230.00 PUT, entry was at $6.90

Entry on August xx
Earnings: 10/21/10 (unconfirmed)
Average Daily Volume: 23 million
Listed on August 14, 2010


FASTENAL Co. - FAST - close: 45.90 change: -0.37 stop: 50.40

Target(s): 44.80, 43.50, 41.00
Key Support/Resistance Areas: 50.00, 48-47, 200-dma, 40.00
Current Gain/Loss: +8%
Time Frame: 3 to 4 weeks
New Positions: Yes

Comments:
8/25: FAST closed down despite a rally off of the lows in the broader market. This is relative weakness and when things turn back down FAST should approach our targets quickly.

8/24: Our short positions were triggered at $46.50 in FAST this morning. The stock is well below its 200-day SMA and may bounce to retest it from below. This may provide another entry point. I've added $44.80 as a near term target and is an area to consider taking profits or tightening stops to protect them.

8/23: We are waiting to be triggered but more aggressive traders should still consider new bearish positions now or on any strength in the stock. Our trigger remains the same at $46.50 but I suggest the November options to limit time decay on this position.

Current Position: Long November $45.00 PUT, entry was at $2.50

Entry on August 24, 2010
Earnings Date 10/12/10
Average Daily Volume = 839,000
Listed on August 19, 2010


NUCOR Corp. - NUE - close 36.68 change +0.00 stop 40.55

Target(s): 36.05 (hit), 35.25, 31.90
Key Support/Resistance Areas: 43.00, 40.30, 37.00, 35.00
Option Current Gain/Loss: +33%
Time Frame: 4 to 6 weeks
New Positions: Yes

Comments:
8/25: NUE opened lower and quickly traded to our $36.05 target. Positions could have been closed at $1.55 which would have been a +60% gain. NUE printed another 52-week low and continues to look vulnerable so I stick with the plan and give this some time to work, but we may have to be patient.

8/24: NUE closed at a new 52-week low today and looks vulnerable. We now have a +33% gain so protecting profits is suggested. Ultimately NUE looks headed towards our $35.25 target but taking profits on the way is a good idea. I'm going to add $36.05 as an immediate target.

8/23: We are looking for continued weakness in NUE and need to break below $36.95 which should get the stock moving towards our targets.

Current Position: Long October $35.00 PUT, entry was at $0.96

Entry on August 20, 2010
Earnings Date 10/21/10
Average Daily Volume = 2.9 million
Listed on August 19, 2010


Occidental Petrol. - OXY - close: 74.02 change: -1.55 stop: 78.51

Target(s): 71.60, 67.50
Key Support/Resistance Areas: 75-74.00, 70.00, 65.00
Current Gain/Loss: +1%
Time Frame: Several Weeks
New Positions: Yes, on strength

Comments:
8/25: Finally, OXY triggered our entry. I suggest we keep our target relatively tight on this trade and exit positions or tighten stops to protect profits if OXY hits our first target of $71.60. This is just above the 52-week low and the stock could bounce. I have also heard many of the talking heads on TV mention OXY as a buy, however, the sellers are in control right now. But the lower the stock goes it may interest buyers and I don't want to caught shorting a potential bottom.

8/23 & 8/24: We are waiting for the adjusted strategy from the weekend to trigger our entry. All of the comments below remain the same. 8/21: There is no change from Thursday's update. Oil and the oil sector continue to look weak. Odds are growing that OXY will breakdown. We have two entry points. One possible entry is at $77.50. Another is at $73.50. If triggered at $73.50 we'll change the stop loss to $78.51. Plus we'll change the targets to $70.25 and $66.00 if triggered on the breakdown.

8/19: I am adjusting the strategy on this play. Instead of waiting for a bounce toward $77.50 (which still works as an entry point) I am adding a breakdown trigger to buy puts at $73.50. The recent low was $73.90 and so far traders have continued to buy OXY near support at $74.00. If we are triggered at $73.50 we'll move the stop loss down to $78.51. I'm adjusting our targets to $70.25 and $66.00 if triggered at $73.50. We can keep the bounce trigger to buy puts at $77.50, if hit we'll use a stop loss at $81.05.

Current Position: Long OXY November $70.00 PUT, entry was at $3.45

Entry on August 25, 2010
Earnings Date 10/21/10 (unconfirmed)
Average Daily Volume 4.4 million
Listed on August 7th, 2010


Procter & Gamble - PG - close: 59.67 change: +0.01 stop: 63.26

Target(s): 59.50 (hit), 59.20, 58.05, 55.25
Key Support/Resistance Areas: 59.00, 61.00
Current Gain/Loss: -11%
Time Frame: 2 to 3 weeks
New Positions: Yes, with November options

Comments:
8/24 & 8/25: My comments from below remain the same. I suggest readers begin exit PG to prevent time decay from accelerating. Another strategy would be to roll current positions into the November strikes and give this time to work.

8/23: PG has a lot of support at $59.00 and our options will begin to suffer from time decay. PG looks like it has further room to the downside but time is not on our side. As such, I suggest readers begin to look for an exit using the targets listed above. Another strategy would be to roll current positions into the November strikes and give this time to work.

8/19: Shares of PG have been forming a top for over eight months now. If the stock breaks down under support near $59.00 it would forecast a drop toward $54.00. Readers can choose to open positions near $61-62 but I would prefer to see a breakdown under $59.00. Please note I have adjusted our exit targets to $58.05 and $55.25. FYI: If you launch new positions I would buy the Novembers.

Current Position: Long September $57.50 PUT, entry was at $0.36

Entry on August 10, 2010
Earnings Date 10/28/10 (unconfirmed)
Average Daily Volume 2.5 million
Listed on August 7th, 2010


CLOSED BULLISH PLAYS

SPDR Gold Trust - GLD - close 121.36 change +1.00 stop 115.95

Target(s): 121.25, 123.00, 125.00
Key Support/Resistance Areas: 123.00, 119.10, 116.50, 113.50
Current Gain/Loss: +55.6%
Time Frame: Several weeks
New Positions: No

Comments:
8/25: We've been looking for an exit in GLD and it hit our target of $121.25 so we are flat the position for +55% gain. I still think gold has more room to run but I would rather play it with later dated options, expiring in Nov or Dec perhaps, to prevent imminent accelerating time decay in our September options. I suspect there will be a pullback prior to gold printing new all time highs so we may revisit this play again. Although GLD only gained $1.47 from our entry, our calls gained $1.00 so it was good time to exit for a gain.

8/24: GLD gapped lower and was bought the entire day. My comments from last have not changed.

8/23: I suggest readers begin to look for an exit in GLD to prevent time decay from eating away at our option premium. I've adjusted the targets above and suggest readers use these levels to take profits or tighten stops to protect them.

Closed Position: Long GLD September $120.00 CALL at $2.80, entry was at $1.80

Annotated Chart:

Entry on August 12, 2010
Earnings Date N/A (unconfirmed)
Average Daily Volume: 12.4 million
Listed on August 10, 2010


Monsanto Co. - MON - close 55.86 change -0.07 stop 55.75

Target(s): 61.25, 63.75, 65.90,
Key Support/Resistance Areas: 66.00, 62.30, 58.50, 56.00
Final Gain/Loss: -55%
Time Frame: 1 to 3 weeks
New Positions: No

Comments:
8/25: Our stop was hit on MON during the early morning weakness. The opening range was even taken out as described below so it we have stepped aside with a loss. Unfortunately, MON finally did reverse and retraced just about all of the early losses. Long positions in MON could be considered now with a stop under the 50-day SMA. I like the risk reward set-up as I think MON has a lot of potential.

8/24: MON is nearing our stop and it appears headed for the 50-day SMA. We will most likely be stopped out of this position tomorrow if the broader market is weak. If the stock opens near or below our stop tomorrow I suggest waiting for the opening 15 or 30 minute range to settle in before doing anything. Then place a new stop underneath that opening range to see if MON reverses from there. This is designed to keep us in the position longer and looking for a better exit.

8/23: MON is consolidating between its 50-day and 100-day SMA's. I remain bullish on the agriculture sector but broader market strength would do wonders for our position. I've added $61.25 as an immediate target which is a good area to take profits or tighten stops to protect them.

Closed Position: Long October $62.50 CALL at $0.75, entry was at $1.65

Annotated Chart:

Entry on August 19, 2010
Earnings Date 10/6/2010 (unconfirmed)
Average Daily Volume: 7.2 million
Listed on August 18, 2010


CLOSED BEARISH PLAYS

Intl. Bus. Machine - IBM - close 125.27 change +0.37 stop 130.51

Target(s): 123.50, 122.00
Key Support/Resistance Areas: 130.00, 127.00, 123.00, 121.00
Current Gain/Loss: +86.7%
Time Frame: 2 weeks
New Positions: Yes

Comments:
8/25: Per last night's updates IBM was closed at the open this morning for a +86.7% gain. The stock gapped down and that was just about the lowest price of the day so we booked a nice winner. I think IBM can be shorted again if it bounces from here, perhaps into the $128 area where it will test all of its SMA's from below. IBM lost over $4 from our entry and with time decay imminent in September options it is time to book the gain.

8/24: IBM lost -1.57% and is headed to our $123.50 target. We currently have a gain of +74% and I think it is prudent to either tighten stops or take profits now as opposed to try to squeeze out more gains and risk a reversal, especially since our options will start to suffer from time decay if we sit and do nothing through a bounce. IBM also closed right on its upward trend line from the flash crash lows so there could be a bounce here. I suggest we take profits at the open tomorrow and book the gain.

8/23: We are long IBM puts and are expecting a move down to the $123 level. The stock drifted lower the entire day and our position has gained +24%. I've adjusted our $123 target up 50 cents and added $122 as a more aggressive target. I suggest we take profits and/or tighten stops as IBM trades down to these levels.

Closed Position: Long IBM September $125 PUT at $2.85, entry was at $1.53

Annotated Chart:

Entry on August 23, 2010
Earnings Date 10/18/10
Average Daily Volume = 5.4 million
Listed on August 21, 2010