Editor's Note:

Tuesday's session was a lot rougher than it looked. There were several downgrades this morning that exacerbated the volatility. We had a couple of stocks get stopped out due to analyst downgrades. Relative weakness in the oil service sector also stopped out a couple of trades. I removed BAX as a candidate. SPW hit our trigger this morning.

-James

Current Portfolio:


CALL Play Updates

Amazon.com Inc. - AMZN - close: 185.01 change: +0.79

Stop Loss: 176.45
Target(s): 189.50, 199.00
Current Option Gain/Loss: + 2.1%, and + 3.8%
Time Frame: 4 to 6 weeks
New Positions: See below

Comments:
01/04 update: AMZN rallied to new highs this morning, hitting $187.70, thanks to an analyst upgrade to a "buy" before the bell. Shares pared their gains and fell back into the $185-180 zone where AMZN has been trading for over a week. I would prefer to launch new bullish positions on a dip into the $182.50-180.00 zone.

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

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: 66.94 change: +0.54

Stop Loss: 62.75
Target(s): 69.00, 72.25
Current Option Gain/Loss: +60.3%, and +38.3%
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Comments:
01/04 update: BA rallied on news that CIT group had placed an order for 38 of BA's next generation 737 planes. Shares of BA briefly traded above resistance at its 200-dma. Volume was healthy. I would still expect a dip toward the $65.50 area and would look wait for new entry points there. We wanted to keep our position size small to limit our risk. We should consider this a higher-risk aggressive trade. Our first target is $69.00. Our second target is $72.25.

- Suggested Positions - (small positions only!)

Long the 2011 January 67.50 calls (BA1122a67.5) Entry @ $0.58

Long the 2011 February $70.00 calls (BA1119B70) Entry @ $0.73

Entry on January 3rd at $66.15
Earnings Date 01/26/11 (unconfirmed)
Average Daily Volume = 5.3 million
Listed on December 25th, 2010


Cummins Inc. - CMI - close: 111.60 change: -0.15

Stop Loss: 108.75
Target(s): 114.50 117.50
Current Option Gain/Loss: +20.5% and + 5.9%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: It was a volatile day for CMI. Shares fell to the $109.00 level. Traders bought the dip at $109.00 for over half an hour before CMI began to rebound. This afternoon bounce looks like a new entry point to buy calls. This remains an aggressive entry point and I'm only suggesting small positions.

FYI: I'm surprised the option prices have not seen more movement!

(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

01/04: New entry point on afternoon bounce.
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.

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: 65.41 change: -0.23

Stop Loss: 61.75
Target(s): 67.00, 69.50
Current Option Gain/Loss: -17.7% and + 4.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: Today's intraday dip and afternoon bounce from prior resistance near $65 looks like a new bullish entry point to buy calls. I will go ahead and raise our stop loss to $62.75.

- 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

01/04: New stop loss @ 62.75
01/04: New entry point on afternoon bounce near $65
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.

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: 46.73 change: +0.15

Stop Loss: 43.75
Target(s): 44.90, 48.00
Current Option Gain/Loss: +725.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: It was a relatively quiet day for CTL but shares still managed to deliver a gain. There is no change from my prior comments. Our final target is $48.00. More aggressive traders may want to aim near the $50.00 level. Just remember we have less than 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

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: 74.16 change: -1.20

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:
01/04 update: CTSH hit some profit taking today with a -1.5% loss. We want to buy calls on a dip at $72.60. We've got a tight stop loss at $71.75. Keep your position size pretty small to limit your risk.

Trigger to buy calls on the dip @ $72.60

- Suggested Positions - (small positions only)

Buy the 2011 January $75.00 calls (CTSH1122A75)

- or -

Buy the 2011 April $75.00 calls (CTSH1116D75)

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: 83.02 change: -0.57

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:
01/04 update: DE dipped under $82 before paring its losses. Aggressive traders could buy calls on this afternoon bounce. I'd rather wait for a pull back closer to $80. 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)

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: 56.12 change: -0.18

Stop Loss: 51.49
Target(s): 53.95, 58.50
Current Option Gain/Loss: +85.7% and +18.9%
Time Frame: 5 to 6 weeks
New Positions: see below

Comments:
01/04 update: After yesterday's big gain I'm not surprised to see a little profit taking in ESRX. Broken resistance near $55 should offer some support. Our final exit target is $58.50 but if you're holding the February calls you might want to consider aiming for $60.

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%)

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


FedEx Corp. - FDX - close: 93.12 change: +0.07

Stop Loss: 90.90
Target(s): 96.75, 99.75
Current Option Gain/Loss: -83.7% and -23.9%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/04 update: FDX slipped to new two-week lows before paring its losses this afternoon. I'm growing more cautious on this play and we're running out of time with less than three weeks left for our January calls. I am not suggesting new bullish positions at this time. I am almost tempted to raise our stop loss closer to $92.00.

- 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)

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: 173.08 change: +0.03

Stop Loss: 165.75
Target(s): 171.00, 179.50
Current Option Gain/Loss: +110.9% and +59.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: GS rallied to $174 this morning before paring its gains. The $171-170 zone should offer some short-term support. I am not suggesting new bullish positions at this time but nimble traders could look to buy an intraday bounce near the $170 level.

- 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

01/03: New stop loss @ 165.75
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)

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: 147.64 change: +0.16

Stop Loss: 142.99
Target(s): 152.50, 159.50
Current Option Gain/Loss: + 4.4%, and + 4.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: IBM inched higher on Tuesday and managed to close over resistance near the $147.50 mark. Readers can still buy positions here but keep your position size small. 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

01/03: New targets @ $152.50, and $159.50

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: 37.16 change: +0.08

Stop Loss: 34.90
Target(s): 39.75
Current Option Gain/Loss: -32.0% and - 5.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: JNPR is still churning sideways and the lack of movement is not good for our options. I am not suggesting new bullish positions at this time. There is still a decent chance JNPR will retest the $36-35 zone. 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)

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: 70.31 change: +0.44

Stop Loss: 67.95
Target(s): 73.25, 74.90(or 200-dma)
Current Option Gain/Loss: -34.2% and -40.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: LMT displayed a little bit of relative strength today. Shares briefly traded above technical resistance at its 100-dma. I remain cautious on this stock and would wait for a close over $70.50 before considering new positions.

- 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

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: 96.10 change: -0.62

Stop Loss: 91.75
Target(s): 99.90
Current Option Gain/Loss: +30.4% and +33.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/04 update: After MICC's recent strength I'm not surprised to see some profit taking today. Broken resistance near $94 should offer stronger support. No new positions at this time. 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

01/03: New stop loss @ 91.75, New target at $99.90

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


Transocean Ltd. - RIG - close: 69.65 change: +0.21

Stop Loss: 66.25
Target(s): 72.50, 78.25
Current Option Gain/Loss: -44.7% and -28.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/04 update: RIG did not see the same intraday swoon the rest of the market did. I remain cautious on this play and hesitate to open new bullish positions. 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%)

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


SPX Corp. - SPW - close: 70.57 change: -1.16

Stop Loss: 69.95
Target(s): 76.50, 79.75
Current Option Gain/Loss: -60.0%, and -44.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: Warning! The action today looks bearish. SPW spiked higher this morning, broke out above resistance and hit $73.11. The stock promptly reversed lower and looks headed for $70.00. Our breakout trigger to buy calls was hit at $72.60. I am not suggesting new positions at this time. Our first target is $76.50. Our longer-term target is $79.75.
FYI: The Point & Figure chart for SPW is very bullish with an $89 target.

NOTE: Just because the January calls are cheap, don't go overboard. We only have three weeks left before January options expire.

- Suggested Positions -

Long the 2011 January $75 calls (SPW1122A75) Entry @ $0.50

- or -

Long the 2011 February $75 calls (SPW1119B75) Entry @ $1.80
01/04 Triggered @ 72.60

Chart:

Entry on January 4th at $72.60
Earnings Date 02/24/11 (unconfirmed)
Average Daily Volume = 346 thousand
Listed on January 1st, 2010


Stanley Black & Decker, Inc. - SWK - close: 67.81 change: -0.26

Stop Loss: 65.75
Target(s): 69.90, 72.45
Current Option Gain/Loss: -35.7%, and - 6.8%
Time Frame: 4 to 6 weeks
New Positions: Yes

Comments:
01/04 update: Tuesday was a relatively quiet day for SWK. The stock did not see the same volatility that most of the market experienced. Shares opened at $68.15 and bounced from its rising 10-dma. I don't see any changes from my prior comments. Keep your position size small to limit your risk. Just because these call options look cheap do not go overboard. Repeat - small positions only. FYI: The Point & Figure chart for SWK is bullish with a $77 target.

- Suggested Positions -

Long the 2011 January $70 calls (SWK1122A70) Entry @ $0.70

- or -


Entry on January 4th at $68.15
Earnings Date 01/27/11 (confirmed)
Average Daily Volume = 1.6 million
Listed on January xxth, 2010


Union Pacific - UNP - close: 93.08 change: -0.61

Stop Loss: 89.75
Target(s): 96.25, 99.75
Current Option Gain/Loss: -35.5% and - 6.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/04 update: This looks like another entry point to buy calls on UNP. The stock dipped right back to support and bounced. I would buy the February calls.

- 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

01/04/11: New entry point on afternoon bounce.
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

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: 72.79 change: -0.16

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:
01/04 update: UPS is still trading sideways. Please note that I am replacing the January calls with February calls. 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 February$70.00 call (UPS1119B70)

- or -

Buy the 2011 April $75.00 call (UPS1116D75)

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: 79.12 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:
01/04 update: UTX is still going nowhere. I'm about ready to drop it and replace it with something else. Currently we're looking for a dip toward $77.00 but we may want to consider adjusting our strategy and buying a breakout over $80.00.
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)

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


Cimarex Energy Co. - XEC - close: 88.85 change: -1.15

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:
01/04 update: XEC displayed a little bit of volatility but recovered from its intraday low of $87.60. Currently we're waiting for a dip to buy calls 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)

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: 24.42 change: -0.37

Stop Loss: 26.05
Target(s): 25.10, 23.25
Current Option Gain/Loss: +66.6%
Time Frame: 2 to 3 weeks
New Positions: No

Comments:
01/04 update: EXPE rolled over near the $25.00 level and closed on its simple 200-dma. There is no change from my prior comments. No new positions at this time. Our first target has already been hit. We're currently aiming for $23.25.

FYI: Our put option hit a high of $1.55 this morning.

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

01/03/11 New stop loss @ $26.05
12/30/10 Target hit @ 25.10, option @ 0.80 (+25%)
12/30/10 new stop loss at $26.51

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

Baxter Intl. Inc. - BAX - close: 50.09 change: -0.07

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:
01/04 update: BAX continues to underperform. The stock slipped back toward the $50 level. While $50 does look like short-term support I'm concerned about the recent weakness. We will drop BAX as a bullish candidate. Shares never hit our trigger to buy calls at $52.55.

(no chart needed)

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


Fastenal Co. - FAST - close: 59.82 change: -1.03

Stop Loss: 59.40
Target(s): 64.00, 68.50
Current Option Gain/Loss: + 0.0%, and -26.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: Our aggressive entry point in FAST did not pay off. After Monday's breakout over $60.00 I suggested readers buy calls this morning. FAST opened at $60.75. Unfortunately, FAST spiked lower this morning and quickly hit our stop loss at $59.40. Our trade has been closed. I would keep FAST on your watch list for a dip or bounce in the $57-56 area.

FYI: The January $64.58 call opened at $0.20 and closed higher. The February $64.58 call opened at $0.75 and was trading near $0.55 when we were stopped out.

stopped out.

- Suggested Positions- (SMALL POSITIONS ONLY!)

Buy the 2011 January $64.58 calls (FAST1122A64.58) Entry @ $0.20

- or -

Buy the 2011 February $64.58 calls (FAST1119B64.58) Entry @ 0.75

01/04: Stopped out. January call @ $0.20 (+0.0%), Feb. call @ $0.55 (-26.6%)
01/03: New targets @ 64.00 and 68.50
01/03: New stop loss @ 59.40
01/03: New Entry Point at current levels (closed @ 60.85)
12/21: Adjusted entry point trigger from 56.00 to 56.75

Chart:

Entry on January 4th at $60.75
Earnings Date 01/19/11 (unconfirmed)
Average Daily Volume = 880 thousand
Listed on December 8th, 2010


Oceaneering International - OII - close: 72.23 change: -2.01

Stop Loss: 69.95
Target(s): 78.00, 79.95
Current Option Gain/Loss: -62.0%, -82.3%, and -35.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: Ouch! It was an ugly day for OII. The stock underperformed the market and underperformed its peers. The OSX oil services index lost -1.6%. OII fell -2.7% on no specific news. There is potential support near $70 and its 50-dma but I wouldn't count on it. Thus I'm suggesting an early exit now to salvage some of our capital.

- Closed Positions -

Buy the 2011 January $75 calls (OII1122A75) Entry @ $2.77, exit @ 1.05 (-62%)

- or -

Buy the 2011 January $80 calls (OII1122A80) Entry @ 0.85, exit @ 0.15 (-82%)

- or -

Buy the 2011 April $80 calls (OII1116D80) Entry @ 3.86, exit @ 2.50 (-35%)

01/04: Exit Early.

Chart:

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


Schlumberger Limited - SLB - close: 81.63 change: -2.02

Stop Loss: 81.65
Target(s): 89.00
Current Option Gain/Loss: -52.6%, and -44.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: Our brand new play on SLB has been stopped out. Oil service stocks underperformed the rest of the market with the OSX index sliding -1.6%. Shares of SLB underperformed its peers with a -2.4% drop. Shares fell to $80.65 intraday. Our stop loss was hit at $81.65. The breakout to new highs (where we entered) followed by the breakdown under its trend of higher lows (where we were stopped out) is very short-term bearish.

- Closed Positions -

Long the 2011 January $85 calls (SLB1122A85) Entry @ $1.90, Exit @ 0.90 (-52.6%)

- or -

Long the 2011 February $90 calls (SLB1119B90) Entry @ $1.25, Exit @ 0.70 (-44%)

01/04: Stopped out. Jan. call @ 0.90 (-52.6%), Feb. call @ 0.70 (-44%)

Chart:

Entry on January 3rd at $84.25
Earnings Date 01/21/11 (confirmed)
Average Daily Volume = 5.6 million
Listed on January 1st, 2010


Stericycle Inc. - SRCL - close: 79.26 chane: -2.39

Stop Loss: 79.40
Target(s): 84.75, 89.00
Current Option Gain/Loss: +0.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/04 update: It was an ugly day for SRCL. The stock was downgraded before the opening bell. Shares gapped open lower at $79.85. We had a trigger to buy calls at $80.75 so the play was immediately opened. A few minutes later we were stopped out at $79.40 as SRCL plunged to an intraday low of $77.29. This play has been opened and closed on the same day due to volatility.

The option opened at $0.35. Currently with SRCL at $79.26 the bid is $0.45 so it would have been higher at $79.40 but I'm not going to post a gain on this trade. We'll mark it closed at our entry point.

- Closed Position -

Buy the 2011 February $85 calls (SRCL1119B85) Entry @ 0.35, Exit @

01/04 Opened @ 79.85, Closed @ 79.40, Option @ 0.35 +0.0%

Chart:

Entry on January 4th at $79.85
Earnings Date 02/03/11 (unconfirmed)
Average Daily Volume = 543 thousand
Listed on December 29th, 2010


Vulcan Materials Co. - VMC - close: 44.46 change: +0.10

Stop Loss: 43.75
Target(s): 47.50, 49.75
Current Option Gain/Loss: -76.9%, and -34.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/04 update: Ouch! VMC was downgraded this morning. The stock reacted by gapping open lower at $43.41. Our stop loss was at $43.75 so the play should have been closed immediately. The January calls were hammered on the gap down!

(small positions only!)- Suggested Positions -

Buy the 2011 January $45 calls (VMC1122A45) Entry @ $1.30, exit @ 0.30 (-76.9%)

- or -

Buy the 2011 February $45 calls (VMC1119B45) Entry @ $2.20, exit @ 1.45 (-34.0%)

01/04: Stopped out/gap down @ 43.41.

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