Editor's Note:

The S&P 500 is up five out of the last six days and today's gain has pushed the index above resistance near the 1300 level and its 50-dma. Buy-the-dip seems to be the name of the game again.

Looking at our candidates below, BHI hit our trigger to buy calls. FOSL hit our first target to take profits. INFY hit our stop loss.

-James

Current Portfolio:


CALL Play Updates

Baker Hughes - BHI - close: 71.32 change; +0.09

Stop Loss: 67.95
Target(s): 76.50, 79.75
Current Option Gain/Loss: -18.0% and -13.4%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/24 update: The action in BHI was not what I had in mind. Before the opening bell shares of BHI were upgraded by UBS to a "buy". This news lifted shares and the stock gapped open higher at $72.35. We had a trigger to buy calls at $72.25 so the play was immediately opened. Unfortunately, BHI failed to hold these gains and almost immediately plunged back under resistance at the $72.00 level and the stock closed with a very minor gain. It was not a very impressive display of strength.

Our new call play on BHI is now open but I would not launch new call positions here. The high this morning was $72.40. Let's wait for BHI to trade at $72.50 before initiating new positions. Our first target is $76.50. Our second target is $79.75. More aggressive traders could aim higher. FYI: If BHI can breakout past the $72.00 level it would create a new quadruple top breakout buy signal on its Point & Figure chart.

- Suggested Positions -

Long the April $75 calls (BHI1116D75) Entry @ $1.00

- or -

Long the May $75 calls (BHI1121E75) Entry @ $2.61

Chart:

Entry on March 24th at $72.35 *gap higher*
Earnings Date 05/03/11 (unconfirmed)
Average Daily Volume = 4.6 million
Listed on March 23rd, 2011


Baidu, Inc. - BIDU - close: 133.48 change: +0.90

Stop Loss: 119.95
Target(s): 139.00, 147.50
Current Option Gain/Loss: +109.3%, and + 65.6%
Time Frame: 4 to 5 weeks
New Positions: see below

Comments:
03/24 update: BIDU rallied to $135.00 intraday but spent most of the day hovering around the $134 level. The stock is a little bit overbought here and I wouldn't be surprised to see a correction. A dip to the $130 or $127.50 zone could be a new bullish entry point. More conservative traders might want to consider raising their stops closer to the $125 area.

Our first target to take profits is at $139.00. The high today was $133.97. We will plan to exit ahead of BIDU's late April earnings report. BIDU can be a volatile stock so I would consider this a more aggressive, higher-risk trade.

- Suggested Positions -

Long the April $130 calls (BIDU1116D130) entry @ $3.20

- or -

Long the May $135 calls (BIDU1121E135) entry @ $5.10

Entry on March 22 at $127.00
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 6.0 million
Listed on March 21st, 2010


Caterpillar Inc. - CAT - close: 108.37 change: +1.61

Stop Loss: 99.00
Target(s): 109.00, 114.00
Current Option Gain/Loss: +76.4%, and +25.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/24 update: CAT provided a bullish 2011 outlook this morning and that helped the stock rally to a new high. Shares hit $108.90 intraday and the stock closed with a +1.5% gain. I am not suggesting new positions at this time. Our first target to take profits is at $109.00. More conservative traders may want to raise their stops toward the $103 or $104 areas.

Our secondary target is $114.00.

- Suggested Positions -

Long the April $105 calls (CAT1116D105) Entry @ $3.40

- or -

Long the May $110 calls (CAT1121E110) Entry @ $3.15

Entry on March 18th at $104.99 (gap higher)
Earnings Date 04/29/11 (unconfirmed)
Average Daily Volume = 7.4 million
Listed on March 17th, 2010


Cerner Corp. - CERN - close: 108.65 change: +0.57

Stop Loss: 101.90
Target(s): 104.85, 109.50
Current Option Gain/Loss: +74.0%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/24 update: CERN is still drifting higher and shares hit $108.88 intraday. Our final target to exit is $109.50 although more aggressive traders may want to aim higher. I am not suggesting new positions at this time. Our target to exit is $109.50.

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

03/22 New stop loss @ 101.90
03/21 Adjusted final target to $109.50
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


Capital One Financial - COF - close: 51.86 change: +0.45

Stop Loss: 49.49
Target(s): 54.75, 59.00
Current Option Gain/Loss: - 2.6% and -52.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/24 update: It was a very interesting day for COF. As you may have heard recently Bank of America (BAC) made huge headlines when the Federal Reserve denied its request to raise its cash dividend, which suggests the company's balance sheets are not as healthy as its peers. Today it was unveiled that the Fed had also denied COF's request to raise its dividend. While shares of BAC have been sinking on this news, shares of COF managed a big bounce off the initial knee-jerk reaction lower.

I'm not sure I trust this move higher but COF did bounce from technical support near its 50-dma. I would be more defensive here and would hesitate to launch new positions. Furthermore the low today was $49.76. I am raising our stop loss to $49.49. Our targets are $54.75 and $59.00.

- Suggested Positions -

Long the April $50 call (COF1116D50) Entry @ $2.63

- or -

Long the April $55 call (COF1116D55) Entry @ $0.65

03/24 New stop loss @ 49.49

Entry on March 16th at $51.08
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 4.4 million
Listed on March 15th, 2010


CSX Corp. - CSX - close: 78.96 change: +0.61

Stop Loss: 73.45
Target(s): 79.90, 83.75
Current Option Gain/Loss: +42.4%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/24 update: CSX continues to inch higher and hit a new 52-week high today. On a positive note the railroad sector looks poised to rally further. Yet short-term, shares of CSX look a little overbought and due for a dip. I would wait for a dip into the $77-75 zone before considering new positions.

Our plan was to keep our position size small to limit our risk. FYI: The Point & Figure chart for CSX is bullish with a $98 target.

- Small Bullish Positions -

Long the April $80 calls (CSX111680) Entry @ $1.06

Entry on March 21 at $77.25
Earnings Date 04/13/11 (unconfirmed)
Average Daily Volume = 3.4 million
Listed on March 19th, 2010


Fossil, Inc. - FOSL - close: 85.52 change: +1.19

Stop Loss: 78.75
Target(s): 84.90, 89.75
Current Option Gain/Loss: + 75.7%, and +24.1%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/24 update: Target achieved. The rally in FOSL continued. Shares opened at $84.81 and this afternoon the stock managed to push past resistance at the $85.00 level. Our first target to take profits was hit at $84.90. The April $85 calls were near $2.75 (+66%) and the May $85 calls were near $5.60 (+28.7%). Our second and final target is $89.75.

If you're looking for a new entry point you could buy calls now on the breakout past $85.00 or hope for a dip into the $83-82 zone.

- Suggested Positions -

Long the April $85 calls (FOSL1116D85) Entry @ $1.65

- or -

Long the May $85 calls (FOSL1121E85) Entry @ $4.35

03/24 1st Target Hit @ $84.90. Options @ +66% & +28.7%

chart:

Entry on March 23 at $81.75
Earnings Date 05/10/11 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on March 22nd, 2011


Jones Lang Lasalle Inc. - JLL - close: 100.64 change: +2.15

Stop Loss: 95.40
Target(s): 102.50, 109.00
Current Option Gain/Loss: - 2.9%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/24 update: It was a strong day for JLL. Shares rallied off its 40-dma and closed back above the $100 mark with a +2.1% gain for the session. I am raising our stop loss to $95.40, just under the 50-dma. I would be tempted to launch new call positions here on today's close.

Prior Comments:
We wanted to keep our position size small to limit our risk. Our targets are $102.50 and $109.00.

- Suggested Positions - (Small Positions)

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

03/24 New stop loss @ 95.40
03/17 Exited March calls @ open, Estimated exit @ 0.10 (-94.2%)
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: 83.10 change: -0.20

Stop Loss: 78.49
Target(s): 84.95, 89.00
Current Option Gain/Loss: -32.5%
Time Frame: 4 to 7 weeks
New Positions: see trigger

Comments:
03/24 update: It turned out to be a quiet session for PII. Shares were showing some relative weakness. I wouldn't be surprised to see a dip near $82 or $80 soon. Look for the dip or a bounce from these levels before considering new bullish positions. More conservative traders might want to consider stops a little closer to the $80 level.

Our plan was to keep our position size small. FYI: The Point & Figure chart for PII is bullish with a $98 target.

- Small Positions -

Long the April $85 calls (PII1116D85) Entry @ 2.00

Entry on March 18th at $82.25
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume = 396 thousand
Listed on March 14th, 2010


Quality Systems Inc. - QSII - close: 81.59 change: +0.57

Stop Loss: 78.60
Target(s): 87.25, 94.50
Current Option Gain/Loss: -59.2%, and -16.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
03/24 update: It ha taken several days but QSII is finally above short-term resistance near $81.00. Today's rally could be used as a new bullish entry point to buy calls. The low this week thus far is $78.67. I am raising our stop loss to $78.60.

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

03/24 New stop loss @ 78.60

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


Whole Foods Market Inc. - WFMI - close: 63.18 change: +1.30

Stop Loss: 57.95
Target(s): 64.75, 69.00
Current Option Gain/Loss: +24.6%, and +17.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
03/24 update: WFMI extended its rally with a move past potential resistance at $62.00. The stock outperformed on Thursday with a +2.1% gain and shares closed at new multi-year highs. I'd probably look for dips into the $62-60 zone as a potential entry point. More conservative traders might want to ratchet up their stops.

Our upside targets are $64.75 and $69.00. FYI: The Point & Figure chart for WFMI is bullish with an $86 target.

- Suggested Positions -

Long the April $65 calls (WFMI1116D65) Entry @ $0.65

- or -

Long the May $65 calls (WFMI1121E65) Entry @ $2.25

Entry on March 21 at $61.55
Earnings Date 05/11/11 (unconfirmed)
Average Daily Volume = 1.9 million
Listed on March 19th, 2010


PUT Play Updates

Everest Re Group Ltd. - RE - close: 82.59 change: +0.56

Stop Loss: 84.25
Target(s): 76.00, 71.00
Current Option Gain/Loss: -35.0%, and -28.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
03/24 update: Lack of follow through lower on RE's recent failed rally is worrisome. Given the broader market's strength we might want to consider an early exit soon. I am not suggesting new bearish positions at this time.

Our plan was to keep our position size small to limit our risk. Our targets are $76.00 and $71.00. I would keep our position size small to limit our exposure.

- Small Bearish Positions -

Long the April $80 PUTs (RE1116P80) Entry @ $1.00

- or -

Long the May $80 PUTs (RE1121Q80) Entry @ $2.50

Entry on March 23rd at $81.43
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume = 381 thousand
Listed on March 22nd, 2011


CLOSED BEARISH PLAYS

Infosys Technologies - INFY - close: 68.25 change: +2.09

Stop Loss: 68.15
Target(s): 60.25, 57.50
Current Option Gain/Loss: -69.7%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
03/24 update: The Indian market continued to rally with a +0.8% gain but that doesn't explain the +3.1% surge in INFY. Technology stocks were the best performers today but I couldn't find any company specific headlines behind INFY's relative strength. The stock gapped open at $66.70 and rallied to its 50-dma. Our stop loss was hit at $68.15.

- Small Bearish Positions -

April $65 PUT (INFY1116P65) Entry @ $2.48, Exit @ 0.75 (-69.7%)

03/24 Stopped out @ 68.15, Option @ -69.7%

chart:

Entry on March 18th at $65.30
Earnings Date 04/15/11 (unconfirmed)
Average Daily Volume = 1.3 million
Listed on March 17th, 2010