Editor's Note:

Bulls can declare a minor victory today. After the swarm of bearish reversals on Tuesday there was no follow through lower. The major averages found support again. We did not have any trades get stopped out.

-James

Current Portfolio:


CALL Play Updates

Baker Hughes Inc. - BHI - close: 68.81 change: -0.40

Stop Loss: 67.90
Target(s): 74.75, 79.00
Current Option Gain/Loss: -68.6% and -47.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: We had a close call with BHI today. The stock fell toward support near $68.00 as expected and hit $67.96 intraday. Our stop loss is at $67.90 and we're not out of the woods yet. The OIX and OSX oil indices rallied on Wednesday but BHI underperformed its peers. Personally, I would still be inclined to buy calls on BHI right here but readers may want to wait for a bounce first. Our targets are $74.75 and $79.00.

- Suggested Positions -

Long the March $75 calls (BHI1119C75) Entry @ $1.02

- or -

Long the April $75 calls (BHI1116D75) Entry @ $2.13

Entry on February 28th at $71.74
Earnings Date 05/04/11 (unconfirmed)
Average Daily Volume = 5.3 million
Listed on February 26th, 2010


Peabody Energy Corp. - BTU - close: 65.95 change: +0.78

Stop Loss: 61.75
Target(s): 69.75, 74.00
Current Option Gain/Loss: -48.5%, and - 4.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
03/02 update: Traders bought the dip this morning at $64.50 and BTU outperformed with a +1.1% gain. I was expecting we would see a dip closer to the $63-62 zone but readers may want to buy calls on this bounce instead, just start with small positions to limit your risk.

FYI: With less than three weeks left our out of the money March calls are going to evaporate pretty quickly.

Our first exit target is $69.75. Our second target is $74.00. The Point & Figure chart for BTU is bullish with an $80 target.

- Suggested Positions -

Long the March $70 calls (BTU1119C70) Entry @ $1.07

- or -

Long the June $70 calls (BTU1118F70) Entry @ $3.60

Entry on February 17th at $66.30
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 4.6 million
Listed on February 16th, 2010


BorgWarner - BWA - close: 75.92 change: +0.07

Stop Loss: 73.75
Target(s): 79.75, 84.50
Current Option Gain/Loss: -36.6%, and -27.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: I did not find the action on BWA today very encouraging. Readers may want to wait for shares to trade above their 10-dma (currently 77.60) before initiating new bullish positions. Our targets are $79.75 and $84.50. Our plan was to use small positions to limit our risk.

SMALL bullish positions

- Suggested Positions -

Long the March $80 calls (BWA1119C80) Entry @ $1.10

- or -

Long the April $80 calls (BWA1116D80) Entry @ $2.47

Entry on February 25th at $76.06
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on February 24th, 2010


Caterpillar Inc. - CAT - close: 100.97 change: +1.11

Stop Loss: 97.90
Target(s): 104.75, 107.50
Current Option Gain/Loss: -34.8%
2nd Option Gain/Loss: + 0.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/02 update: Bulls did indeed step up to the plate and buy CAT at support near its 30-dma and the bottom of its narrow bullish channel. Technically this would be a new bullish entry point for us to buy calls. I am suggesting the April $105 calls below.

- Suggested Positions -

Long the March $105 calls (CAT1119C105) Entry @ $1.35

- or -

Buy the April $105 calls (CAT1116D105) current ask $2.31

03/02 Buy calls on the bounce.
02/23 Triggered @ $101.00. Option @ $1.35
02/22 Still waiting for a dip to $101.00
02/12 Adjusted our trigger, targets, stop loss and strike price.

Entry on February 23 at $101.00
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 6.2 million
Listed on February 5th, 2010


Check Point Software - CHKP - close: 48.89 change: +0.27

Stop Loss: 47.90
Target(s): 54.50
Current Option Gain/Loss: -50.0%, and -35.2%
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
03/02 update: CHKP did indeed test support near $48.00. This intraday bounce could be used as a new bullish entry point. You might want to buy the April $50s instead. Our target is $54.50.

- Suggested Positions -

Long the March $50 calls (CHKP1119C50) Entry @ $1.30

- or -

Long the April $52.50 calls (CHKP1116D52.5) Entry @ $0.85

Entry on February 28th at $50.28
Earnings Date 04/26/11 (unconfirmed)
Average Daily Volume = 3.0 million
Listed on February 26th, 2010


Fastenal Co. - FAST - close: 60.59 change: +0.02

Stop Loss: 59.90
Target(s): 67.25
Current Option Gain/Loss: -88.2%, and -46.6%
2nd Position Option Gain/Loss: -50.0%, and -25.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/02 update: The rebound in FAST was pretty underwhelming today but the important issue is that shares held support at the $60.00 level. Readers could use this dip to $60 as an entry point but cautious traders may want to wait for a bounce first.

Readers may want to keep in mind that the most recent data listed short interest at 13.6% of the 132 million-share float.

- Suggested Positions -

Long the March $65 calls (FAST1119C65) Entry @ $0.85

- or -

Long the May $65 calls (FAST1121E65) Entry @ $2.25

-2nd Entry as of listed 2/24, Entered 2/25-

Long the March $65 calls (FAST1119C65) Entry @ $0.20

- or -

Long the APRIL $65 calls (FAST1121D65) Entry @ $0.99

02/24 Buy the dip. New Entry (2nd position).
02/23 New entry point @ 60.96. March $65 call @ 0.25, May $65 call @ $1.45
02/22 Entry @ 62.99, NEW STOP @ $59.90
02/19 Adjusted entry point. Buy calls now. Very small positions
02/12 New trigger @ 61.55, new stop loss @ 59.40

Entry on February 22nd at $62.99
Earnings Date 04/12/11 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on February 8th, 2010


FactSet Research Systems - FDS - close: 103.19 change: +0.81

Stop Loss: 99.95
Target(s): 109.50
Current Option Gain/Loss: -27.9%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
03/02 update: FDS provided a +0.8% bounce to outperform the major averages. I would consider new positions here or you could wait for a rally past the $105.00 mark.

FDS is due to report earnings in mid March but we don't have a confirmed date yet. Given our wide stop loss I would consider this a slightly more aggressive trade so keep your positions small!

small positions - Suggested Positions -

Long the March $105 calls (FDS1119C105) Entry @ $2.15

Entry on March 1st at $105.01
Earnings Date 03/15/11 (unconfirmed)
Average Daily Volume = 213 thousand
Listed on February 26th, 2010


F5 Networks Inc. - FFIV - close: 113.20 change: -0.18

Stop Loss: 109.90
Target(s): 129.00
Current Option Gain/Loss: -68.5%, and -55.8%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: Traders are still selling into strength with FFIV. This does not bode well. Once again I feel compelled to issue a warning here. Readers may want to start exiting early now to salvage some capital. I still see support at $110 and it looks like FFIV is going to test it soon.

If you do buy the dip or bounce near $110 consider the March $110 or $115 calls instead of the $120 or better yet buy April options! The plan was to use small positions to limit our risk. Our target is $129.00.

SMALL bullish positions

- Suggested Positions -

Long the March $120 calls (FFIV1119C120) Entry @ $5.40

- or -

Long the April $125 calls (FFIV1116D125) Entry @ $6.80

02/28 Buy the dip, New Entry point.
02/25 FFIV gapped open higher on an upgrade.

Entry on February 25th at $121.00
Earnings Date 04/20/11 (unconfirmed)
Average Daily Volume = 3.7 million
Listed on February 24th, 2010


Fossil, Inc. - FOSL - close: 76.19 change: +1.08

Stop Loss: 72.49
Target(s): 82.00, 88.00
Current Option Gain/Loss: -21.4%, and - 7.6%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: The bounce in FOSL (+1.4%) is encouraging and what we were expecting to see once the stock tested its 50-dma (it got close). I would buy calls here on the bounce but more conservative traders may want to wait for a breakout past the 10-dma (near $77.00) before initiating new positions. Our exit targets are $82.00 and $88.00.

- Suggested Positions -

Long the March $80 calls (FOSL1119C80) Entry @ $1.40

- or -

Long the April $80 calls (FOSL1116D80) Entry @ $2.60

Entry on February 28th at $76.75
Earnings Date 05/11/11 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on February 26th, 2010


Hess Corp - HES - close: 84.51 change: -0.15

Stop Loss: 81.60
Target(s): 92.25, 98.50
Current Option Gain/Loss: -26.5%, and -24.0%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: HES tested the $83.00 level before bouncing off its lows. Shares still underperformed the energy sector. I'm taking a more aggressive stance on HES and will adjust the stop loss a little lower down to $81.60, just under the 40-dma. If we see a bounce near $82.00 I'd buy it or wait for a breakout over $86.00 again. <-- The Point & Figure chart for HES is bullish with a $107 target. -->

- Suggested Positions -

Long the April $90 calls (HES1116D90) Entry @ $2.60

- or -

Long the May $90 calls (HES1121E90) Entry @ $4.15

03/02 Adjusted stop loss to $81.60

Entry on March 1st at $87.17
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 2.9 million
Listed on February 28th, 2010


IntercontinentalExchange, Inc. - ICE - cls: 127.51 chg: +0.41

Stop Loss: 119.90
Target(s): 138.00, 148.00
Current Option Gain/Loss: -37.5%, and -29.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: ICE was making some headlines today. The company said daily volume for its futures exchanges was up 27% in February compared to a year ago. Energy futures were a hot ticket with ICE averaging 1.24 million energy futures traded every single day in February. ICE also announced a deal allowing Brazilian investors to trade ICE's European futures after getting approval from Brazil's financial regulators. Now there will be an even bigger audience for the Brent crude oil futures market.

Shares of ICE did not see a lot of action today. I would prefer to buy calls on a dip near $125 but ICE may not see a decline that low.

Bear in mind that this is an aggressive trade. The stock is volatile and there is a chance that ICE makes an acquisition bid for another exchange. If Wall Street thinks ICE is paying too much the stock will decline on the news. Our targets are $138.00 and $148.00.

I want to warn you that the March options will probably be extremely volatile.

- Suggested Positions - (Small Positions Only)

Long the March $130 calls (ICE1119C130) Entry @ $3.20

- or -

Long the April $135 calls (ICE1116D135) Entry @ $3.40

Entry on February 28th at $127.46
Earnings Date 05/04/11 (unconfirmed)
Average Daily Volume = 938 thousand
Listed on February 26th, 2010


Jones Lang Lasalle Inc. - JLL - close: 97.18 change: +1.06

Stop Loss: 93.30
Target(s): 102.50, 109.00
Current Option Gain/Loss: -34.2%, and -20.5%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: JLL delivered a nice bounce (+1.1%) but failed to breakout over short-term resistance at the 10-dma. Readers could wait for a move over this technical level or wait for a dip near $94 before initiating new call positions. We have a stop loss at $93.30. JLL has see a lot more volatility in the last month so let's keep our position size small to reduce our risk. Our targets are $102.50 and $109.00.

FYI: March options are likely to be very volatile.

- Suggested Positions - (Small Positions)

Long the March $100 calls (JLL1119C100) Entry @ $1.75

- or -

Long the April $100 calls (JLL1116D100) Entry @ $3.40

Entry on February 28th at $97.96
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 386 thousand
Listed on February 26th, 2010


3M Co. - MMM - close: 91.32 change: +0.86

Stop Loss: 88.75
Target(s): 94.50, 99.00
Current Option Gain/Loss: +29.7%, and +28.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: Bulls are still buying dips in MMM near $90 and the stock outperformed with a +0.9% gain. Volume was a little light but I would still consider new positions on this rebound.

- Suggested Positions -

Long the March $90 calls (MMM1119C90) Entry @ $1.75

- or -

Long the April $95 calls (MMM1116D95) Entry @ $0.78

Entry on February 25th at $89.75
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 3.5 million
Listed on February 24th, 2010


Nike Inc. - NKE - close: 88.33 change: +0.63

Stop Loss: 84.80
Target(s): 88.00, 91.50
Current Option Gain/Loss: + 88.9%, and +109.5%
2nd Position Gain/Loss: + 23.4%, and + 5.9%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: Bulls should find comfort in NKE's bounce today. There was no follow through on yesterday's bearish reversal pattern. Conservative traders may still want to go ahead and take profits now. I am not suggesting new positions at this time. Our final exit target is $91.50.

- Suggested Positions - (Small Positions Only!)

Long the March $85 calls (NKE1119C85) Entry @ $2.09

- or -

Long the April $90 calls (NKE1116D90) Entry @ $0.94

2nd position, buy the bounce from $85.50

Long the March $85 calls (NKE1119C85) Entry @ $3.20

- or -

Long the April $90 calls (NKE1116D90) Entry @ $1.86

02/25 New stop loss @ 84.80
02/24 New entry point, buy the bounce from $85.50, Add 2nd position
02/19 Adjusted final target to $91.50
02/18 1st Target Hit @ 88.00. March $85 call @ 3.75 (+79.4%)
02/18 1st Target Hit @ 88.00. April $90 call @ 1.80 (+91.4%)

Entry on February 15th at $85.25
Earnings Date 03/17/11 (unconfirmed)
Average Daily Volume = 2.2 million
Listed on February 9th, 2010


Occidental Petrol. - OXY - close: 100.79 change: +0.57

Stop Loss: 97.90
Target(s): 106.75, 109.75
Current Option Gain/Loss: -55.0%, and -20.1%
2nd Positions Gain/Loss: + 0.0%, and + 0.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/02 update: OXY briefly traded under technical support at the $100.00 level but managed to rebound back into positive territory. I am suggesting we take advantage of this bounce and buy the dip (I'm listing new positions below). Meanwhile the 50-dma has risen to $98.70 so I am raising our stop loss to $97.90.

Our plan was to use small positions to limit our risk. Don't forget that March calls expire in just less than three weeks. You may be more comfortable with the Aprils.

Small Bullish Positions - Suggested Positions -

Long the March $105 calls (OXY1119C105) Entry @ $1.87

- or -

Long the April $105 calls (OXY1116D105) Entry @ $2.78

-2nd Position on bounce at $100 - Entry March 3rd -

Buy the March $105 calls (OXY1119C105) current ask @ $0.89

- or -

Buy the April $105 calls (OXY1116D105) current ask @ $2.27

03/02 Buy calls on this bounce near $100 (2nd positions listed)
03/02 New stop loss at $97.90
02/28 Adjusted entry strategy. Buy calls now!

Entry on March 1st at $104.12
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 4.9 million
Listed on February 22nd, 2010


Transocean Ltd. - RIG - close: 85.47 change: +2.96

Stop Loss: 79.75
Target(s): 89.50, 94.00
Current Option Gain/Loss: +23.4%, and +15.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: It seems that investors were in a buy-the-dip mood for RIG. Shares did not see any follow through lower after yesterday's bearish reversal. Instead the stock soared +3.5% to a new multi-month closing high. I would buy calls on this bounce. Our profit targets are $89.50 and $94.00.

Please note that the March calls will likely be very volatile.

- Suggested Positions -

Long the March $85 calls (RIG1119C85) Entry @ $2.05

- or -

Long the April $85 calls (RIG1116D85) Entry @ $3.60

02/28 RIG hit our trigger @ 84.25

Entry on February 28th at $84.25
Earnings Date 05/05/11 (unconfirmed)
Average Daily Volume = 5.3 million
Listed on February 26th, 2010


Ross Stores Inc. - ROST - close: 72.03 change: +0.52

Stop Loss: 68.95
Target(s): 74.90, 77.75
Current Option Gain/Loss: -21.8%
Time Frame: 2 to 4 weeks
New Positions: see below

Comments:
03/02 update: Tomorrow could be an exciting day for shares of ROST. Several of the country's major retailers will report their February same-store sales figures. Analysts are looking for ROST to deliver +1.4% growth. Better than that and ROST should breakout higher. Naturally a miss would tend to push the stock lower. Since the results come out tomorrow morning ROST might gap open one way or the other. If the results are positive and ROST doesn't gap open I would be inclined to buy calls here. Our targets are $74.90 and $77.75. However, we will plan to exit ahead of the mid March earnings report.
The Point & Figure chart for ROST is bullish with a $97 target.

- Suggested Positions -

Long the April $75 calls (ROST1116D75) Entry @ $1.60

Entry on March 1st at $72.55
Earnings Date 03/17/11 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on February 28th, 2010


The Toronoto-Dominion Bank - TD - close: 82.67 change: +0.67

Stop Loss: 78.40
Target(s): 84.00, 89.00
Current Option Gain/Loss: +144.4%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
03/02 update: The banking stocks were laggards today but TD managed to outperform its peers with a +0.8% gain. It's nice to see a lack of follow through on yesterday's sell-off but that doesn't mean TD won't retest support near $80 soon. I am not suggesting new positions at this time.

Our targets are $84 and $89. We will plan to exit ahead of the March 11th earnings report (unconfirmed date).

- Suggested Positions -

Long the March $80.00 call (TD1119C80) Entry @ $1.35

02/28 New stop loss @ 78.40
02/26 New stop loss @ 77.90
02/16 New stop loss @ 76.90

Entry on February 11th at $78.89
Earnings Date 03/11/11 (unconfirmed)
Average Daily Volume = 583 thousand
Listed on February 10th, 2010


Proshares Ultra(long) Russell 2000 - UWM - close: 45.48 change: +0.35

Stop Loss: 43.49
Target(s): 49.75, 54.00
Current Option Gain/Loss: -34.5%, and -10.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Small Positions - UWM Position -

Long the April $48 calls (UWM1116D48) Entry @ $2.75

-2nd position (entry 2/25)-

Long the April $47 calls (UWM1116D46) Entry @ $2.50

02/26 New stop loss @ 43.49
02/25 April $47 call opened at $2.50
02/24 Add another position, April $47 calls
02/14 UWM opened at $46.90. Option opened @ $2.75

iShares Russell 2000 - IWM - close: 80.96 change: +0.34

Stop Loss: 79.20
Target(s): 84.95, 87.25
Current Option Gain/Loss: -33.3%, and - 8.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
03/02 update: So far so good. The small cap Russell 2000 and its ETFs are finding support right where they should be. Lack of follow through on yesterday's decline is encouraging. Readers could use this bounce from support as a bullish entry point to buy calls.

Small Positions - IWM Position -

Long the April $84 calls (IWM1116D84) Entry @ $1.92

-2nd position (entry 2/25)-

Long the April $82 calls (IWM1116D82) current ask @ $2.35

02/26 New stop loss @ 79.20
02/25 April $82 call opened at $2.35
02/24 Add another position (April $82 calls)
02/14 IWM opened @ 82.11. Option opened @ 1.92

UWM Entry on February 14th at $46.90
IWM Entry on February 14th at $82.11
Listed on February 12th, 2010


CBOE Market Volatility Index - VIX - close: 20.70 change: -0.31

Stop Loss: N/A
Target(s): 22.50, 28.00
Current Option Gain/Loss: -25.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/02 update: It would seem that investors are not convinced the sell-off is over. Stocks managed a bounce today but the VIX did not move very much and remains above the 20.0 mark. I don't see any changes from my prior comments. Until I see the major indices break support I would hesitate to launch positions (and of course by then it might be too late). Officially our final exit target is 28.00.

March options expire on the 16th.

- Suggested Positions -

Long the 2011 March $22.50 calls (VIX1116C22.5) Entry @ $1.60

02/28 Consider an early exit now.
02/23 1st Target Hit @ 22.50, Option @ 2.35 (+46.8%)

Entry on January 26th at $17.00
Earnings Date --/--/--
Average Daily Volume =
Listed on January 25th, 2010


Waters Corp. - WAT - close: 82.43 change: +0.39

Stop Loss: 79.80
Target(s): 86.00, 89.90
Current Option Gain/Loss: -44.4%, and -23.5%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/02 update: There was no follow through on WAT's bearish reversal from yesterday. Shares found short-term support near their 10-dma. I would be tempted to buy calls here even though a dip in the $81-80 zone would be more attractive. Our targets are $86.00 and $89.90.

FYI: The March calls will likely be very volatile.

- Suggested Positions -

Long the March $85 calls (WAT1119C85) Entry @ $0.90

- or -

Long the April $85 calls (WAT1116D85) Entry @ $1.75

Entry on February 28th at $82.61
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 876 thousand
Listed on February 26th, 2010


PUT Play Updates

Freeport-McMoran - FCX - close: 51.98 change: +0.36

Stop Loss: 55.15
Target(s): 50.25, 47.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see trigger

Comments:
03/02 update: FCX recovered from its morning lows to spend the rest of the day trading sideways. I am adjusting our entry point to buy puts from $54.00 to $53.50. We'll leave the stop loss at $55.15 for now. If triggered our first target is $50.25. Our second target is $47.00.

Trigger @ 53.50

- Suggested Positions -

Buy the April $50.00 PUTS (FCX1116P50) current ask $2.13

03/02 New trigger at $53.50
02/26 Update our trigger to buy puts at $54.00, stop 55.15

Entry on February xxth at $ xx.xx
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 14.4 million
Listed on February 19th, 2010