Editor's Note:

The stock market meandered sideways the last couple of weeks of 2010 holding on to healthy gains for the year. Unfortunately, it's been a rather boring and uneventful second half of December, which is not necessarily a good thing if you're long options. Hopefully now that we're in a new year investors will return from their holidays ready and we will see this market start moving again.

-James

Current Portfolio:


CALL Play Updates

Amazon.com Inc. - AMZN - close: 180.00 change: -2.75

Stop Loss: 176.45
Target(s): 189.50, 199.00
Current Option Gain/Loss: -41.7%, and -20.7%
Time Frame: 4 to 6 weeks
New Positions: See below

Comments:
01/01 update: Friday was a rough day for AMZN but not totally unexpected. I cautioned readers that we might see another entry point near $180 and we got it on Friday. Shares lost -1.5% with some year-end profit taking. I would use this dip as a new entry point to buy calls.

We want to keep our position size small. AMZN can be a volatile stock. Our upside targets are $189.50 and $199.00.

- Suggested (SMALL) positions -

Long the 2011 January $190 calls (AMZN1122A190) Entry @ $2.35

- or -

Long the 2011 February $200 calls (AMZN1119B200) Entry @ $3.85

Chart:

Entry on December 28th at $182.10
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume = 5.0 million
Listed on December 27th, 2010


Boeing Co. - BA - close: 65.26 change: +0.25

Stop Loss: 62.75
Target(s): 69.00, 72.25
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: BA is still drifting higher with a bullish trend of higher lows but the stock has yet to breakthrough the $65.50 level. The 200-dma is slowly rolling over, which is a longer-term bearish problem. There is still opportunity to catch a short-term move higher if BA can breakout. Keep your position size small to limit your risk!

I'm suggesting a trigger to buy calls at $65.50. We'll use a stop loss under the recent low at $62.75. There is additional resistance at the 200-dma near the $67 level. We should consider this a higher-risk aggressive trade. Our first target is $69.00. Our second target is $72.25.

Trigger @ 65.50

- Suggested Positions - (small positions only!)

Buy the 2011 January 67.50 calls (BA1122a67.5) current ask $0.64

Buy the 2011 February $70.00 calls (BA1119B70) current ask $0.77

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 01/26/11 (unconfirmed)
Average Daily Volume = 5.3 million
Listed on December 25th, 2010


Baxter Intl. Inc. - BAX - close: 50.62 change: -0.10

Stop Loss: 49.90
Target(s): 55.50, 57.50
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: On a very short-term basis the action in BAX is starting to look a little bearish. If the stock closes under $50.00 we will drop it as a bullish candidate. Currently we're still waiting for a breakout higher.

I am suggesting a trigger to buy calls at $52.55. If triggered our first target is $55.75. Our second target is $57.50. I would consider this a higher-risk trade. If you look at the weekly chart of BAX you can draw a trendline across the long-term highs and the trend is lower. BAX could see additional resistance near $55.00. Keep your position size small.

Trigger @ 52.55

- Suggested Positions - (small positions only!)

Buy the 2011 February $55 calls (BAX1119B55)

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume = 3.3 million
Listed on December 25th, 2010


Cummins Inc. - CMI - close: 110.01 change: -0.15

Stop Loss: 108.75
Target(s): 114.50 117.50
Current Option Gain/Loss: -15.1% and - 9.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: CMI saw some volatility around 10:00 a.m. this morning. Shares spiked from their lows of the day toward its 2010 highs set a week ago near $111.80. Unfortunately the gains faded just as fast as they appeared. Readers could still buy options here but you may want to wait for a close over $111.00 or even a new high over $112.00. I am adjusting our targets to $114.50 and $117.50. This remains an aggressive entry point and I'm only suggesting small positions.

(small positions only to limit our risk)

- Suggested Positions -
Buy the 2011 January $115 calls (CMI1122A115) Entry @ $1.12

- or -

Buy the 2011 March $115 calls (CMI1119C115) Entry @ $4.73

01/01: Adjusted targets to $114.50, 117.50
12/27: CMI opens at $110.18
12/25: Buy calls now at current levels (small positions)
12/21: New entry point @ $110.25, New stop @ 108.75, New option strikes.

Chart:

Entry on December 27th at $110.18
Earnings Date 02/02/11 (unconfirmed)
Average Daily Volume = 1.8 million
Listed on December 11th, 2010


CSX Corp. - CSX - close: 64.61 change: +0.15

Stop Loss: 61.75
Target(s): 67.00, 69.50
Current Option Gain/Loss: -20.5% and - 7.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: CSX is still melting higher but shares were unable to breakout past their early December highs on Friday. I remain bullish on CSX and would be tempted to buy calls here. Or you could wait for a close over $64.80. More conservative traders might want to raise their stops closer to the mid December lows near $62.90. If you do open new positions I would buy the February (or longer) calls.

- Current Positions - (We only have a small position open)

Buy the 2011 January $65 calls (CSX1122A65) Entry @ $1.75

- or -

Buy the 2011 February $65 calls (CSX1119B65) Entry @ $2.49

12/25: new stop loss @ 61.75
12/13: CSX opened at $64.39
12/11: New Entry Point Strategy. Buy half now.
12/11: New targets: 67.00, 69.50
12/02: New trigger @ 62.50.
12/01: New trigger @ 62.25, New stop @ 59.90, New targets.

Chart:

Entry on December 13th at $64.39
Earnings Date 01/18/11 (unconfirmed)
Average Daily Volume = 5.9 million
Listed on November 23rd, 2010


CenturyLink, Inc. - CTL - close: 46.17 change: -0.19

Stop Loss: 43.75
Target(s): 44.90, 48.00
Current Option Gain/Loss: +600.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: Shares of CTL spent the entire week between $46.00 and $46.70. While the larger trend is up shares could correct toward $45 or $44 at any time. Readers may want to consider locking in gains soon. Our final exit is currently $48.00. More aggressive traders may want to aim near the $50.00 level. Just remember we only have three weeks left. I am not suggesting new positions at this time.

FYI: Investors should know that CTL is currently involved with a $10.6 billion stock-swap merger with Qwest Communications (Q). The merger isn't supposed to be completed until the first half of 2011. The trend for both stocks is up and naturally looks very similar following the M&A announcement.

Current Position:
Long the 2011 January $45.00 calls (CTL1122A45) Entry @ 0.20

12/21: Adjusted final target to $48.00
12/14: New stop loss @ 43.75
12/13: First Target Hit @ $44.90, option @ $0.85 (+325%)
12/01: Adjusted secondary target to $49.00

Chart:

Entry on November 29th at $42.55
Earnings Date 02/22/11
Average Daily Volume = 3.0 million
Listed on November 27th, 2010


Cognizant Technology Solutions - CTSH - close: 73.29 change: -0.55

Stop Loss: 71.75
Target(s): 74.70, 79.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: As expected CTSH is pulling back from the $75 level. The stock should find some support near $72.00. I am moving our trigger up to $72.25 but we're also moving our stop loss to $71.75. I want to really limit our risk. If this stock decides to correct it could fall toward its 50-dma. I'm adjusting our first target to $74.70. Keep your position size pretty small to limit your risk.

Trigger to buy calls on the dip @ $72.25 <-- new trigger

- Suggested Positions - (small positions only)

Buy the 2011 January $75.00 calls (CTSH1122A75)

- or -

Buy the 2011 April $75.00 calls (CTSH1116D75)

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 02/09/11 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on December 18th, 2010


Deere & Co - DE - close: 83.05 change: -0.25

Stop Loss: 78.95
Target(s): 84.50, 89.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: DE flirted with a breakdown under short-term support at $83 on Friday. We want to see a correction back toward $80 and the bottom of its rising bullish channel. I'm suggesting a trigger to buy calls at $80.50. If triggered we'll use a stop loss at $78.95, just under the 50-dma.
FYI: The Point & Figure chart for DE is pretty bullish with a $100 target.

Buy-the-Dip Trigger @ 80.50

- Suggested Positions -

Buy the 2011 February $80 calls (DE1119B80)

- or -

Buy the 2011 February $85 calls (DE1119B85)

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 02/16/11 (unconfirmed)
Average Daily Volume = 3.4 million
Listed on December 30th, 2010


Express Scripts - ESRX - close: 54.05 change: -0.03

Stop Loss: 51.49
Target(s): 53.95, 58.50
Current Option Gain/Loss: + 2.8% and -33.3%
Time Frame: 5 to 6 weeks
New Positions: see below

Comments:
01/01 update: The recent action in ESRX is bearish with a trend of lower highs and lower lows. Traders did buy the dip on Friday near its rising 40-dma but I would not launch new positions here. If ESRX doesn't show some relative strength soon I'm inclined to close this play early. More conservative traders might want to raise their stop loss. Our final exit target is $58.50.

FYI: The point & figure chart for ESRX is forecasting a very bullish, long-term target of $80.

We currently only have half a position open.

Current Position:
Long the 2011 January $52.50 calls (ESRX1122A52.5) Entry @ $2.10

- or -

Second Position (small position):

Long the 2011 February $55.00 calls (ESRX1119B55) current ask $2.22

12/25: new stop loss @ 51.49
12/20: Suggested new positions with Feb. 55 calls.
12/18: Adjusted final exit target to $58.50
12/16: New stop loss @ 51.25
12/07: Exit the December calls. option @ $2.01 (+64.7%)
12/01: First Target Hit @ $53.95. Dec's @ $2.20 (+80.3%). Jan's @ $3.10 (+47.6%)

Chart:

Entry on November 18th at $51.81
Earnings Date 02/24/11
Average Daily Volume = 4.3 million
Listed on November 17th, 2010


Fastenal Co. - FAST - close: 59.91 change: -0.20

Stop Loss: 53.75
Target(s): 59.95, 62.50
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: FAST is still hovering near the $60.00 level. I would much rather wait for a correction lower but it may not happen. Aggressive traders might want to consider buying calls on a move over the $60.50 level (with a much higher stop loss). I'm not quite ready to chase it but the stock has spent a couple of weeks digesting its gains with a sideways move under the $60 level. I'm leaving our buy-the-dip trigger at $56.75 for now.

FYI: FAST announced a special, one-time cash dividend of 42-cents on November 18th and all of the option strikes have been adjusted for this 42-cent dividend.

Trigger @ 56.75

Suggested Positions:
Buy the 2011 January $54.58 calls (FAST1122A54.58)

- or -

Buy the 2011 February $59.58 calls (FAST1119B59.58)

12/21: Adjusted entry point trigger from 56.00 to 56.75

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 01/19/11 (unconfirmed)
Average Daily Volume = 880 thousand
Listed on December 8th, 2010


FedEx Corp. - FDX - close: 93.01 change: +0.05

Stop Loss: 90.90
Target(s): 96.75, 99.75
Current Option Gain/Loss: -76.2% and -21.6%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/01 update: All right, FDX should be rested and ready to run. The stock has spent almost the entire month of December consolidating sideways. The high on Friday was $93.41. I have been suggesting readers wait for a move over $93.50 or even $94.00 before launching new bullish positions. When that does happen I would buy the February or April calls (I'm looking at the February $95 calls, currently trading at $2.42).

- Suggested Positions (only small positions so far) -

Buy the 2011 January $100 call (FDX1122A100) Entry @ $0.80

- or

Buy the 2011 April $100 call (FDX1116D100) Entry @ $2.96

12/17: FDX opens at $94.23 - our entry point.
12/16: Adjusted Entry - initiate small positions now (@ Friday's open)

Chart:

Entry on December 17th at $94.23
Earnings Date 12/16/10 (confirmed)
Average Daily Volume = 2.1 million
Listed on November 29th, 2010


Goldman Sachs - GS - close: 168.16 change: +0.52

Stop Loss: 162.95
Target(s): 171.00, 179.50
Current Option Gain/Loss: +18.1% and +20.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: There has not been much follow through on the failed rally in GS a few days ago. That's a good sign. I would still expect a pull back toward the rising 50-dma currently near $164. Wait for that dip before you consider new positions. GS has already hit our first target at $171.00. Right now our final target is $179.50.
FYI: The Point & Figure chart for GS is forecasting a very bullish $224 long-term target.

- Suggested Positions (only small positions so far) -

Buy the 2011 January $170 calls (GS1122A170) Entry @ $2.75

- or -

Buy the 2011 April $175 calls (GS1116D175) Entry @ $5.27

12/28: 1st Target Hit @ 171.00, Jan. call @ $4.75 (+72.7%), April call @ $7.35 (+39.4%)
12/22: New stop loss @ 162.95
12/17: GS opened at $163.92
12/16: Adjusted Entry - initiate small positions now (@ Friday's open)

Chart:

Entry on December 17th at $163.92
Earnings Date 01/18/11 (unconfirmed)
Average Daily Volume = 7.2 million
Listed on December 2nd, 2010


International Business Machines - IBM - close: 146.76 change: +0.09

Stop Loss: 142.99
Target(s): 149.90, 157.50
Current Option Gain/Loss: - 1.5%, and + 0.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: IBM provided us another entry point with the intraday dip to $146.00 on Friday. I would still consider new positions now at current levels. Alternatively you could wait for a move past short-term resistance at $147.50. Our first target to take profits is at $149.90. FYI: The Point & Figure chart on IBM is forecasting a long-term target of $196.

- Suggested Positions -

Long the 2011 January $150 calls (IBM1122A150) Entry @ $1.35

- or -

Long the 2011 April $155 calls (IBM1116D155) Entry @ $2.25

Chart:

Entry on December 29th at $146.75
Earnings Date 01/18/11 (unconfirmed)
Average Daily Volume = 4.7 million
Listed on December 14th, 2010


Juniper Networks - JNPR - close: 36.92 change: -0.25

Stop Loss: 34.90
Target(s): 39.75
Current Option Gain/Loss: -33.3% and - 8.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: I think we were two weeks too early to launch positions in JNPR. Shares have continued to consolidate sideways. I've been expecting a dip into the $36-35 zone. Readers could also watch for a dip toward technical support at the rising 30-dma. Wait for the dip before considering new positions. Our first target is $39.75.

- Suggested Positions (only small positions so far) -

Buy the 2011 January $38.00 calls (JNPR1122A38) Entry @ $0.78

- or -

Buy the 2011 April $40.00 calls (JNPR1116D40) Entry @ $1.50
12/17: JNPR opens at $36.91
12/16: Adjusted Entry - initiate small positions now (@ Friday's open)

Chart:

Entry on December 17th at $36.91
Earnings Date 01/25/11 (unconfirmed)
Average Daily Volume = 5.5 million
Listed on December 11th, 2010


Lockheed Martin Corp. - LMT - close: 69.91 change: +1.22

Stop Loss: 67.95
Target(s): 73.25, 74.90(or 200-dma)
Current Option Gain/Loss: -42.8% and -45.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: There was no news to explain the sudden relative strength in shares of LMT. I'm not complaining but the stock really outperformed the rest of the market with a +1.7% gain and above average volume. I'm still cautious on this stock. Wait for a move over $70.50 before considering new bullish positions. I'm adding a secondary target of $74.90 (or the 200-dma).

- Suggested Positions -

Buy the 2011 January $70.00 calls (LMT1122A70) Entry @ $1.75

- or -

Buy the 2011 March $75.00 calls (LMT1119C75) Entry @ $1.00

Chart:

Entry on December 17th at $70.28
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume = 1.7 million
Listed on December 16th, 2010


Millicom Intl. Cellular - MICC - close: 95.60 change: +0.34

Stop Loss: 89.75
Target(s): 99.50
Current Option Gain/Loss: + 6.5% and +21.2%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/01 update: MICC continues to rally and closed near six-week highs on Friday. I would still consider new positions here. I am tempted to raise our stop loss toward the $91 or $92 levels. Our exit target is $99.50. Aggressive traders could aim for the 2010 highs near $102.50.

FYI: It looks like MICC must have had a special dividend because several of the options have odd strike prices ending in .40.

- Suggested Positions -

Long the 2011 January 95.40 calls (MICC1122A95.4) Entry @ $2.30

- or -

Long the 2011 April $100.00 calls (MICC1116D100) Entry @ $3.30

Chart:

Entry on December 23rd at $94.23
Earnings Date 02/09/11 (unconfirmed)
Average Daily Volume = 518 thousand
Listed on December 22nd, 2010


Netflix Inc. - NFLX - close: 175.70 change: -4.10

Stop Loss: 174.90
Target(s): 199.50, 219.50
Current Option Gain/Loss: -73.1% and -53.9%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: Uh-oh! I have to issue a warning here. The action in NFLX on Friday was pretty bearish. The stock broke down under its trend of higher lows and it broke down under technical support near its 50-dma. This is also a bearish breakdown under the bottom of its rising bullish channel. The low on Friday was $175.53 and our stop is at $174.90. Readers will want to seriously consider an early exit right now. We knew this was a high-risk, aggressive trade so I'm going to let it ride and see if NFLX recovers from the $175 level on Monday. Volume remains very low due to the holidays and the big move lower might have been exaggerated by the lack of volume. Really aggressive traders might want to start looking at put options to capture the breakdown.

One possible reason for the relative weakness on Friday was news that a California Judge has granted class-action status to a lawsuit against Wal-Mart (WMT) and NetFlix for an "alleged conspiracy to monopolize the market for online DVD rentals" (source: Bloomberg). I am not suggesting new bullish positions at this time. If there is any follow through on Monday we'll get stopped out.

Previous Comments:
Make no mistake, this is a very aggressive, higher-risk trade. I suggest readers keep their positions pretty small to limit your risk. Our first target is $199.50. Our second target is $219.50.

- Suggested Positions (small positions only) -

Long the 2011 January $200 calls (NFLX1122A200) Entry @ $4.35

- or -

Long the 2011 February $220 calls (NFLX1119b220) Entry @ $5.75

Chart:

Entry on December 22nd at $187.12
Earnings Date 01/26/11 (unconfirmed)
Average Daily Volume = 7.5 million
Listed on December 21st, 2010


Oceaneering International - OII - close: 73.63 change: -0.14

Stop Loss: 69.95
Target(s): 78.00, 79.95
Current Option Gain/Loss: -36.8%, -52.9%, and -19.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: The OSX oil service index managed a gain but OII did not. Shares of this stock have been consolidating sideways for most of December. At this point I would rather see a move or a close over $75.00 before we consider new bullish positions. Our first target is $78.00.

- Suggested Positions -

Buy the 2011 January $75 calls (OII1122A75) Entry @ $2.77

- or -

Buy the 2011 January $80 calls (OII1122A80) Entry @ 0.85

- or -

Buy the 2011 April $80 calls (OII1116D80) Entry @ 3.86

Chart:

Entry on December 23rd at $75.28
Earnings Date 02/17/11 (unconfirmed)
Average Daily Volume = 584 thousand
Listed on December 4th, 2010


Transocean Ltd. - RIG - close: 69.51 change: +0.38

Stop Loss: 66.25
Target(s): 72.50, 78.25
Current Option Gain/Loss: -47.4% and -33.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/01 update: RIG is still trying to bounce after testing its 50-dma on the 29th. Readers could buy calls on this bounce but I remain somewhat cautious. You might want to wait for a move over $70.00 or over $71.00 before considering new positions again. Our final target is $78.25.

- Current Positions -
Long the 2011 January $70.00 calls (RIG1122A70) Entry @ $2.95

- Second Position -
Long the 2011 February $75.00 calls (RIG1119B75) Entry @ $1.80

12/17/10 Entry on Feb. calls @ $1.80
12/16/10 New Entry Point (buy February calls) - buy the dip.
12/11/10 New target 78.25, new stop loss $66.25
12/03/10 Target hit @ $72.50, option @ $4.95 (+67.7%)

Chart:

Entry on November 30th at $68.18
Earnings Date 02/24/11 (unconfirmed)
Average Daily Volume = 6.3 million
Listed on November 29th, 2010


Stericycle Inc. - SRCL - close: 80.92 chane: -0.50

Stop Loss: 79.40
Target(s): 84.75, 89.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Comments:
01/01 update: SRCL is almost there! We want to see a dip toward $80.00 and it's getting closer. The low on Friday was $80.77. Our entry point to buy calls is at $80.75. Readers might want to wait and see if we get a better entry point closer to $80.00 before launching positions. If triggered we'll use a stop loss at $79.40. Our targets are $84.75 and $89.00.

Trigger @ 80.75

- Suggested Position -

Buy the 2011 February $85 calls (SRCL1119B85) current ask $1.25

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 02/03/11 (unconfirmed)
Average Daily Volume = 543 thousand
Listed on December 29th, 2010


Union Pacific - UNP - close: 92.66 change: +0.60

Stop Loss: 89.75
Target(s): 96.25, 99.75
Current Option Gain/Loss: -35.5% and - 6.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/01 update: UNP is still slowly drifting higher. This move over $92.50 looks like a new entry point to buy calls. I would buy the February $95 calls here currently trading at $2.23 (ask).

- Current position -
Suggested Position:
Buy the 2011 January $95 calls (UNP1122A95) Entry @ $1.52

Second Position
Buy the 2011 February $95 calls (UNP1119B95) Entry @ $2.33

01/01/11: UNP is giving us another entry point.
12/21/10: UNP provides another entry point.
12/17/10: Entry on Feb. calls @ $2.33
12/16/10: New Entry point: buy February calls
12/16/10: New stop loss @ 89.75

Chart:

Entry on November 30th at $89.83
Earnings Date 01/20/11
Average Daily Volume = 2.9 million
Listed on November 20th, 2010


United Parcel Service - UPS - close: 72.58 change: -0.10

Stop Loss: 66.85
Target(s): 74.75, 78.50
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
01/01 update: Surprise, surprise, there was no real change in shares of UPS on Friday. The stock has been consolidating sideways for a few weeks. Odds favor a pull back toward support at $70.00 but it may not happen. I'm suggesting a trigger to buy calls at $70.25. More aggressive traders could consider a move over $74.00 as a potential entry point. I'm considering raising our buy-the-dip trigger toward $72.25.

Trigger @ 70.25

Suggested Position:
Buy the 2011 January $70.00 call (UPS1122A70)

- or -

Buy the 2011 April $75.00 call (UPS1116D75)

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 02/01/10 (unconfirmed)
Average Daily Volume = 3.9 million
Listed on December 6th, 2010


United Technology Corp. - UTX - close: 78.72 change: -0.13

Stop Loss: 73.90
Target(s): 81.50, 84.75
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: UTX recovered from its intraday weakness on Friday. We're still waiting for a dip near $77.00. Keep an eye on its rising 50-dma for support. Our plan is to launch bullish positions on a dip at $77.10.
FYI: The Point & Figure chart is bullish with a $91 target for UTX.

Trigger to buy calls @ $77.10

Suggested Position: Buy the 2011 January $80 calls (UTX1122A80)

- or -

Suggested Position: Buy the 2011 February $80 calls (UTX1119B80)

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 01/26/11 (unconfirmed)
Average Daily Volume = 3.2 million
Listed on December 4th, 2010


Vulcan Materials Co. - VMC - close: 44.36 change: -0.47

Stop Loss: 43.75
Target(s): 47.50, 49.75
Current Option Gain/Loss: -23.0%, and -11.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/01 update: Well if you missed our entry point the first time VMC is offering us another one with a pull back toward support near $44.00 and its simple 200-dma. More conservative traders could wait for a move over the simple 10-dma before initiating positions. Our first target to take profits is at $47.50. Our second target is $49.75.

(small positions only!)- Suggested Positions -

Buy the 2011 January $45 calls (VMC1122A45) Entry @ $1.30

- or -

Buy the 2011 February $45 calls (VMC1119B45) Entry @ $2.20

Chart:

Entry on December 30th at $45.02
Earnings Date 02/07/11 (unconfirmed)
Average Daily Volume = 1.5 million
Listed on December 13th, 2010


Cimarex Energy Co. - XEC - close: 88.53 change: -1.02

Stop Loss: 84.75
Target(s): 89.90, 94.25
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Comments:
01/01 update: Are you ready? It looks like XEC is about to move on us. Shares produced a little failed rally on Thursday and now Friday's session saw a follow through decline. This would suggest the stock is ready for a little correction toward the bottom of its bullish channel. I am suggesting we open bullish positions on a dip at $86.50. More conservative traders could wait for a dip closer to $85.00. We want to keep our position size pretty small to limit our risk.

Trigger @ 86.50

- Suggested Positions -
Buy the 2011 January $90 calls (XEC1122A90)

- or - Buy the 2011 February $90 calls (XEC1119B90)

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 02/17/11 (unconfirmed)
Average Daily Volume = 907 thousand
Listed on December 1st, 2010


PUT Play Updates

Expedia Inc. - EXPE - close: 25.09 change: -0.19

Stop Loss: 26.51
Target(s): 25.10, 23.25
Current Option Gain/Loss: +25.0%
Time Frame: 2 to 3 weeks
New Positions: No

Comments:
01/01 update: EXPE sank again on Friday but shares found support at the exponential 200-dma again. I am not suggesting new bearish positions at this time. Our first target has been hit. We're currently aiming for $23.25.

Current Position: Buy the 2011 January $25 Put (EXPE1122M25) Entry @ $0.60

12/30/10 Target hit @ 25.10, option @ 0.80 (+25%)
12/30/10 new stop loss at $26.51

Chart:

Entry on December 8th at $26.88
Earnings Date 02/10/11 (unconfirmed)
Average Daily Volume = 2.5 million
Listed on December 7th, 2010


CLOSED BULLISH PLAYS

Panera Break Co. - PNRA - close: 101.21 change: -1.08

Stop Loss: 103.90
Target(s): 109.95, 114.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
01/01 update: PNRA has continued to correct lower. The stock might see some support near the $100 mark or the 50-dma. We might want to keep it on our watch list. Our trigger to buy calls at $107.15 was never hit. I'm dropping it as a bullish candidate.

Chart:

Entry on December xxth at $ xx.xx
Earnings Date 02/10/11 (unconfirmed)
Average Daily Volume = 389 thousand
Listed on December 20th, 2010