Editor's Note:

There are plenty of opinions on the market's recent weakness. Some are crying that today's huge drop at the open was capitulation. Others are suggesting the market correction is just getting started. While the bounce off the lows could offer opportunity the short-term trend for stocks has developed a bearish pattern of lower highs and lower lows. We had several plays get stopped out today. A handful of our candidates gapped open lower under our stop losses.

It doesn't matter if you're trading calls or puts I would keep your position size small to limit your exposure.

-James

Current Portfolio:


CALL Play Updates

Cerner Corp. - CERN - close: 103.53 change: +0.33

Stop Loss: 99.45
Target(s): 104.85, 109.00
Current Option Gain/Loss: -35.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: CERN is still holding up well. Shares gapped open lower at $101.18 but managed to rebound near $100.50. I would still consider new bullish positions here or you could wait for a dip closer to the $100.00 mark or the 50-dma (near $98.67). Keep in mind that our stop loss is currently at $99.45.

Our second and final target is $109.00.

FYI: I want to point out that the most recent data (as of Feb. 15th) listed short interest at 13.9% of CERN's 70-million share float. That definitely seems like a high amount of shorts and fuel for a short squeeze. Plus, the Point & Figure chart for CERN is bullish with a $115 target and what appears to be a relatively fresh quadruple top breakout buy signal.

- Suggested Positions -

Long the April $105 calls (CERN1116D105) Entry @ $2.70

03/12 New stop loss @ 99.45
03/04 1st Target Hit @ $104.85, Option @ $3.15 (+16.6%)

Entry on March 3rd at $102.62
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 600 thousand
Listed on March 2nd, 2010


Citrix Systems Inc. - CTXS - close: 69.34 change: -1.752

Stop Loss: 67.90
Target(s): 77.00, 79.90
Current Option Gain/Loss: -50.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/15 update: CTXS broke down under the $70.00 level but found support at its 50-dma. The intraday low was $68.19. Unfortunately the afternoon rebound in CTXS failed at the $70.00 mark. Readers could launch positions here but you might want to wait for a new rise past $70.00 to reaffirm the trend higher.

I do consider this a slightly more aggressive trade. Our targets are $77.00 and $79.90. The Point & Figure chart for CTXS is bullish with a $94 target.

- Small Bullish Positions -

Long the April $75 calls (CTXS1116D75) Entry @ $2.20

03/12 New stop loss @ 67.90

Entry on March 7th at $71.89
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on March 5th, 2010


Fossil, Inc. - FOSL - close: 82.55 change: +0.12

Stop Loss: 79.40
Target(s): 82.00, 88.00
Current Option Gain/Loss: +107.1%, and + 96.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: We are still in this trade but only by the skin of our teeth. Shares of FOSL gapped open lower at $79.78 and fell to $79.41 before bouncing. Our stop loss is at $79.40. FOSL saw a strong intraday bounce and actually closed in positive territory. I would be tempted to buy this bounce but at the moment S&P futures are trending lower in after hours action. Readers will want to stay cautious tomorrow. Conservative trades will want to seriously consider an early exit right now! Our final target is $88.00.

- Suggested Positions -

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

- or -

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

03/09 New stop loss @ 79.40
03/05 New stop loss @ 76.75
03/05 1st Target Hit @ $82.00, Options @ +142% and +92.3%
03/03 new stop loss @ 74.75

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


Jones Lang Lasalle Inc. - JLL - close: 96.41 change: -2.13

Stop Loss: 93.85
Target(s): 102.50, 109.00
Current Option Gain/Loss: -85.7%, and -17.6%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: JLL gapped open lower but found support at the bottom of its trading range near $94.00. This also happens to be technical support at the 50-dma. The intraday bounce looks like a new bullish entry point. However, market futures are trending lower after hours. Readers may want to look for another dip into the $95-94 zone and initiate positions then.

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

03/10 New stop loss @ 93.85

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


Polaris Industries, Inc. - PII - close: 80.12 change: -0.11

Stop Loss: 78.49
Target(s): 84.95, 89.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 7 weeks
New Positions: Yes, see trigger

Comments:
03/15 update: PII did not see that much volatility. The drop to $78 and bounce is consistent with what appears to be a bull-flag type of consolidation in PII. Aggressive traders could buy this bounce with a stop loss under today's low. I am suggesting readers wait for the breakout over $82.00. The newsletter has a trigger at $82.25. If triggered our targets are $84.95 and $89.00. FYI: The Point & Figure chart for PII is bullish with a $98 target.

Trigger @ 82.25

- Suggested Positions -

Buy the April $85 calls (PII1116D85) current ask 1.50

Entry on March xxth at $ xx.xx
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 396 thousand
Listed on March 14th, 2010


Quality Systems Inc. - QSII - close: 79.73 change: -1.31

Stop Loss: 77.90
Target(s): 87.25, 94.50
Current Option Gain/Loss: -40.7%, and -16.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: The big gap down in the NASDAQ this morning definitely took its toll on QSII. Shares of QSII opened lower at $79.37 but managed to bounce off its rising 40-dma. Unfortunately, like so many other stocks today, prior support acted as new resistance late this afternoon. QSII struggled with the $80 level and its 30-dma overhead. Readers may want to wait for a new close over the $81.50 level before initiating new positions. You might want to consider raising your stop loss toward today's low of $78.66.

Prior Comments:
FYI: Readers will be interested to note that the most recent data listed short interest in QSII at almost 28% of the very small 17.5 million-share float. That's definitely a recipe for a short squeeze. Plus, the Point & Figure chart for QSII is bullish with a $119 target.

- Suggested Positions -

Long the April $85 calls (QSII1116D85) Entry @ $1.35

- or -

Long the June $85 calls (QSII1118F85) Entry @ $3.40

Entry on March 4th at $81.44
Earnings Date 05/31/11 (unconfirmed)
Average Daily Volume = 154 thousand
Listed on March 3rd, 2010


Stericycle Inc. - SRCL - close: 86.54 change: -1.38

Stop Loss: 84.95
Target(s): 94.00, 99.00
Current Option Gain/Loss: -32.2%, and -30.4%
Time Frame: 6 to 8 weeks
New Positions: see trigger

Comments:
03/15 update: SRCL did not see that much weakness. Shares gapped open lower and hit a new four-day low (85.29) before paring its losses. I wouldn't be surprised to see another dip toward $85.00 and its 30-dma. Readers can look for the dip near $85.00 or wait for another rally past $88.00 as potential entry points.

Our targets are $94.00 and $99.00. The $90 level could be round-number resistance but after four weeks of consolidating sideways I'm not expecting $90 to be an issue. Let's keep our position size small to limit our risk.

- Suggested (SMALL) Positions -

Long the April $90 calls (SRCL1116D90) Entry @ 1.55

- or -

Long the May $95 calls (SRCL1121E95) Entry @ 1.15

Entry on March 14th at $88.25
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 481 thousand
Listed on March 9th, 2010


PUT Play Updates

Joy Global Inc. - JOYG - close: 89.56 change: -1.05

Stop Loss: 93.75
Target(s): 85.25
Current Option Gain/Loss: - 2.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
03/15 update: Stay defensive on this trade. The market weakness pushed JOYG to gap open lower but the stock found support and bounced at last week's lows. That's a potentially bullish development. I remain hesitant to launch new bearish positions here. Please note our new stop loss at $93.75. More conservative traders may want to move their stop closer to the $92.50 or $92.00 levels.

Our target is $85.25. Aggressive traders could aim for the $84 lows or a drop closer to $80.

- Suggested Positions -

Long the April $85 puts (JOYG1116P85) Entry @ $2.50

03/15 New stop @ 93.75

Entry on March 11th at $90.00
Earnings Date 06/02/11 (unconfirmed)
Average Daily Volume = 3.4 million
Listed on March 10th, 2010


CLOSED BULLISH PLAYS

Apple Inc. - AAPL - close: 353.56 change: +1.57

Stop Loss: 344.00
Target(s): 364.00, 379.00
Current Option Gain/Loss: -40.5%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/15 update: It was a rough day for the stock market with the Dow Jones Industrials plunging nearly 300 points. I believe the sell-off in AAPL today had nothing to do with APPL and everything to do with investors over-reacting and the just widespread market weakness.

Shares of AAPL gapped open lower at $342.10, which was under our stop loss at $344.00 so the play was closed immediately. Traders bought the dip near $340 and the stock bounced back nearly to $348 before closing under its 50-dma, which is now technical overhead resistance.

Prior Comments:
This is an aggressive, higher-risk trade so we want to keep our position size small to try and limit our risk. FYI: The Point & Figure chart for AAPL is bullish with a $448 target.

- Small Bullish Positions -

April $365 calls (AAPL1116D365) Entry @ $6.00, Exit @ $3.57 (-40.5%)

03/15 Stopped out on gap down. Options @ -40.5%

chart:

Entry on March 14th at $353.18
Earnings Date 04/19/11 (unconfirmed)
Average Daily Volume = 18 million
Listed on March 12th, 2010


Cognizant Technology Solutions - CTSH - close: 74.00 change: -1.37

Stop Loss: 74.75
Target(s): 82.25, 84.75
Current Option Gain/Loss: -72.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
03/15 update: The big gap down for the NASDAQ on Tuesday morning wreaked havoc on tech stocks. Shares of CTSH opened at $72.67, well below our stop loss at $74.75. CTSH plunged to $70.53, under its 100-dma, on an intraday basis before bouncing back to trim its losses. Our play was closed at the open.

- Suggested Positions -

April $80 calls (CTSH1116D80) Entry @ $1.80, Exit @ 0.50 (-72.2%)

03/15 Stopped out on gap down @ 72.67, Option @ -72.2%

chart:

Entry on March 9th at $78.25
Earnings Date 05/04/11 (unconfirmed)
Average Daily Volume = 2.2 million
Listed on March 8th, 2010


Fastenal Co. - FAST - close: 60.51 change: -0.74

Stop Loss: 59.90
Target(s): 67.25
Current Option Gain/Loss: - 100%, and -66.6%
2nd Position Option Gain/Loss: - 100%, and -64.6%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/15 update: FAST is another casualty of the market's morning weakness. Shares gapped open lower at $59.41, which was under our stop at $59.90. Shares bounced back intraday but failed at the 50-dma.

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 -

March $65 calls (FAST1119C65) Entry @ $0.85, exit @ -100%

- or -

May $65 calls (FAST1121E65) Entry @ $2.25, exit near $0.75 (-66.6%)

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

March $65 calls (FAST1119C65) Entry @ $0.20, Exit @ -100%

- or -

APRIL $65 calls (FAST1121D65) Entry @ $0.99, Exit @ 0.35 (-64.6%)

03/15 Stopped out on gap down. Options @ -100%, -66.6%, -100%, -64.4%
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

chart:

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


3M Co. - MMM - close: 89.50 change: -1.52

Stop Loss: 88.75
Target(s): 94.50, 99.00
Current Option Gain/Loss: - 69.7%, and - 38.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: It can be tough being a Dow Industrials component when the index is down almost -300 like it was Tuesday morning. Shares of MMM opened at $89.05 and quickly fell toward short-term support near $88.00 and its 100-dma before bouncing. It's worth noting that the bounce failed late Tuesday afternoon at $90 and its 50-dma. Our stop loss was hit early this morning at $88.75.

- Suggested Positions -

March $90 calls (MMM1119C90) Entry @ $1.75, Exit @ 0.53 (-69.7%)

- or -

April $95 calls (MMM1116D95) Entry @ $0.78, Exit @ 0.48 (-38.4%)

03/15 Stopped out @ 88.75, Options @ -69.7% & -38.4%

chart:

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: 85.33 change: -0.88

Stop Loss: 84.80
Target(s): 88.00, 91.50
Current Option Gain/Loss: - 33.4%, and - 4.2%
2nd Position Gain/Loss: - 56.5%, and - 51.6%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: The action in NKE was a familiar story. Shares gapped open lower, under support near $85 and its 50 and 100-dma. The opening trade of $84.63 was below our stop loss at $84.80 so the play was closed immediately. Shares bounced off their intraday lows but prior support acted as new resistance.

- Suggested Positions - (Small Positions Only!)

March $85 calls (NKE1119C85) Entry @ $2.09, Exit @ $1.39 (-33.4%)

- or -

April $90 calls (NKE1116D90) Entry @ $0.94, Exit @ $0.90 (-4.2%)

2nd position, buy the bounce from $85.50

March $85 calls (NKE1119C85) Entry @ $3.20, Exit @ $1.39 (-56.5%)

- or -

April $90 calls (NKE1116D90) Entry @ $1.86, Exit @ $0.90 (-51.6%)

03/15 Stopped out on gap down. Options @ -33%, -4%, -56%, -52%
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%)

chart:

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


Norfolk Southern Corp. - NSC - close: 65.56 change: -0.37

Stop Loss: 63.90
Target(s): 69.75, 74.00
Current Option Gain/Loss: -33.6%, and -54.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: We almost escaped without getting stopped out but NSC opened lower at $64.05 and hit $63.90 before bouncing back. Our stop loss was hit at $63.90 closing this trade. Readers may want to keep NSC on their watch list another move higher past $66 and 67 could be a new bullish entry point.

- Suggested Positions -

April $65 calls (NSC1116D65) Entry @ $2.50, Exit @ $1.66 (-33.6%)

- or -

April $70 calls (NSC1116D70) Entry @ $0.70, Exit @ $0.32 (-54.2%)

03/15 Stopped out, Options @ -33.6%, -54.2%

chart:

Entry on March 14th at $65.84
Earnings Date 04/27/11 (unconfirmed)
Average Daily Volume = 3.1 million
Listed on March 12th, 2010


Waters Corp. - WAT - close: 82.70 change: -2.03

Stop Loss: 83.40
Target(s): 86.00, 89.90
Current Option Gain/Loss: - 72.2%, and - 25.7%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/15 update: Ouch! Support at $84.00 could not hold WAT given the tidal wave of weakness in the market this morning. Shares of WAT gapped open lower at $82.50, which was under our stop loss of $83.40.

Readers may want to keep WAT on their watch list since the stock managed an intraday bounce off its 30-dma and should still have support near the $80 level.

- Suggested Positions -

March $85 calls (WAT1119C85) Entry @ $0.90, Exit @ 0.25 (-72.2%)

- or -

April $85 calls (WAT1116D85) Entry @ $1.75, Exit @ 1.30 (-25.7%)

03/15 Stopped out, gap down. Options @ -72.2%, -25.7%
03/12 New stop loss @ 83.40
03/10 New stop loss @ 82.80
03/05 New stop loss @ 81.80
03/04 1st Target Hit @ $86.00. Options @ +100%, and +57.1%
The March $85 was bid near $1.80, the April $85s near $2.75.

chart:

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


Wynn Resorts Ltd. - WYNN - clos: 121.17 change: -2.82

Stop Loss: 119.75
Target(s): 129.75, 137.50
Current Option Gain/Loss: -40.1%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/15 update: Our aggressive trade on WYNN has not panned out. The stock could not hold support near $120 and its 50-dma given the huge market declines at the open on Tuesday morning. Shares of WYNN gapped down at $120.17 and quickly hit our stop loss at $119.75 as it fell to $117.21 intraday.

Prior comments:
We want to keep our position size small to limit our risk.

- small bullish positions -

April $130 calls (WYNN1116D130) Entry @ $2.84, Exit @ $1.70 (-40.1%)

03/15 Stopped out, Option @ -40.1%

chart:

Entry on March 14th at $122.48
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 1.8 million
Listed on March 12th, 2010