Editor's Note:

The S&P 500 and NASDAQ both fell toward significant support. Meanwhile gold and silver continue to plunge.

ORLY, QQQ, and PNRA all hit our triggers. DE was stopped out. FO was closed early as planned.

-James

Current Portfolio:


CALL Play Updates

Apple Inc. - AAPL - close: 349.57 change: +1.37

Stop Loss: 334.40
Target(s): 359.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see trigger

Comments:
05/04 update: AAPL displayed some impressive relative strength today. The rest of the market was sinking but AAPL eked out a gain. The stock garnered an 'outperform' rating this morning with a $450 target.

Readers may want to consider buying calls on AAPL right now. The S&P 500 dipped toward support near 1340 and bounced. The NASDAQ composite did the say with a dip toward 2800. Nimble traders may want to try and buy calls near the $346-345 zone. An alternative entry point would be a move past resistance near $355. I am keeping our buy-the-dip trigger at $341.00 for another day and we'll re-evaluate again tomorrow.

Our upside target is $359.00. More aggressive traders could aim higher. A breakout past the February highs near $365 might portend a run toward the $400 level.

Buy-the-dip Trigger @ $341.00

- Suggested Positions -

Buy the June $350 calls (AAPL1118F350)

Entry on May xxth at $ xx.xx
Earnings Date 07/20/11 (unconfirmed)
Average Daily Volume = 16.6 million
Listed on May 2nd, 2011


Fastenal Co. - FAST - close: 66.22 change: -0.03

Stop Loss: 63.75
Target(s): 69.50, 74.00
Current Option Gain/Loss: -18.1% & -26.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/04 update: FAST held up reasonably well. The stock held technical support at its 30-dma. The fact that FAST didn't see much of a drop is bullish. Readers can launch positions here or still wait for a dip near $65.00.

More conservative traders might want to raise their stops. Our targets are $69.50 and $74.00. We should expect the $70.00 area to offer some resistance and FAST will likely pull back on the first test of $70.

FYI: FAST is due to split 2-for-1 on May 23rd. Plus, the Point & Figure chart for FAST is bullish with a $72 target.

- Suggested Positions -

Long the May $65.00 calls (FAST1121E65) Entry @ $2.20

- or -

Long the June $70.00 calls (FAST1118F70) Entry @ $0.75

Entry on April 26th at $66.25
Earnings Date 04/12/11 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on April 23rd, 2011


Google Inc. - GOOG - close: 535.79 change: +1.90

Stop Loss: 518.75
Target(s): 549.00, 558.00
Current Option Gain/Loss: - 6.6%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
05/04 update: GOOG managed to ignore the market's decline. Shares churned sideways this morning and eventually closed in positive territory. I am not suggesting new positions at this time.

Currently our targets are at $549.00 and $558.00. FYI: The high today was $545.73.

Prior Comments:
This is a very aggressive, higher-risk trade. Keep positions small.

(Very Small Positions) Suggested Positions:

Long the May $550 call (GOOG1121E550) Entry @ $3.00

04/30 Adjusted exit strategy. First target at $549.00. Final target at $558.00.

Entry on April 25th at $525.25
Earnings Date 04/14/11 (confirmed)
Average Daily Volume = 3.3 million
Listed on April 23rd, 2011


International Business Machines - IBM - close: 170.62 change: -2.25

Stop Loss: 164.75
Target(s): 174.00, 179.50
Current Option Gain/Loss: Unopened
Time Frame: 6 to 9 weeks
New Positions: Yes, see Trigger

Comments:
05/04 update: IBM is finally starting to see some profit taking. Shares did seem to find some support near $170 and its 10-dma. I am suggesting we buy calls on a dip at $167.50. If triggered we'll use a stop loss at $164.75. Our targets are $174.00 and $179.50. FYI: The Point & Figure chart for IBM is bullish with a $208 target.

Buy-the-Dip Trigger @ 167.50

- Suggested Positions -

Buy the June $170 calls (IBM1118F170)

Entry on April xxth at $ xx.xx
Earnings Date 04/19/11
Average Daily Volume = 4.8 million
Listed on April 27th, 2011


Intuit - INTU - close: 54.55 change: -0.68

Stop Loss: 53.45
Target(s): 58.75
Current Option Gain/Loss: -45.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
05/04 update: INTU almost hit our stop today. Shares dipped toward their 30-dma and slipped to $53.56 at its lows. Shares managed to pare its losses but now the bottom of its prior range could be resistance. I am not suggesting new positions at this time. We do not want to hold over the mid May earnings date.

I would keep our position size small to limit our risk (1/2 or less than your normal trade size).

- Suggested Positions -

Long the May $55.00 call (INTU1121E55) Entry @ $2.40

04/30 Adjusted target to $58.75

Entry on April 20th at $55.25
Earnings Date 05/19/11 (unconfirmed)
Average Daily Volume = 2.4 million
Listed on April 14th, 2011


Jos. A Bank Clothiers - JOSB - close: 50.70 change: -0.36

Stop Loss: 49.95
Target(s): 59.50
Current Option Gain/Loss: - 92.8% and -57.1%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
05/04 update: JOSB dipped closer toward support near $50 and shares were slowly bouncing off their lows into the closing bell. Tomorrow the retail sector could see some volatility (up or down) as investors react to April's same-store sales data released from several retailers before the bell. I would still consider new positions with JOSB near support in the $51-50 zone but I would keep position sizes small to limit risk.

FYI: The most recent data listed short interest in JOSB at more than 21% of the small 27.3 million-share float. Together the increase the risk of a short squeeze.

- Suggested Positions -

Long the May $55 calls (JOSB1121E55) entry @ $0.70

- or -

Long the June $55 calls (JOSB1118F55) entry @ $1.75

Entry on April 26th at $52.75
Earnings Date 06/02/11 (unconfirmed)
Average Daily Volume = 510 thousand
Listed on April 25th, 2011


O'Reilly Automotive - ORLY - close: 59.65 change: -0.02

Stop Loss: 57.75
Target(s): 62.75, 67.25
Current Option Gain/Loss: -23.8% & - 9.0%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/04 update: Warning! The action in ORLY today looks like a short-term top and bearish reversal pattern. Unfortunately, shares briefly traded above resistance at $60.00 and hit our trigger to buy calls at $60.15. Our play has been opened but I am not suggesting new positions at this time. ORLY has some short-term support near $59.00 and $58.00. The plan was to keep our position size small to limit our risk.

- Suggested (Small) Positions -

Long the May $60 calls (ORLY1121E60) Entry @ $1.05

- or -

Long the June $60 calls (ORLY1118F60) Entry @ $1.65

chart:

Entry on May 4th at $60.15
Earnings Date 04/27/11
Average Daily Volume = 1.1 million
Listed on April 30th, 2011


Powershares QQQ ETF - QQQ - close: 58.60 change: -0.09

Stop Loss: 56.45
Target(s): 64.00
Current Option Gain/Loss: + 6.7% & - 5.0%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
05/04 update: The QQQ's decline on Wednesday was just enough to hit our buy-the-dip trigger at $58.15. If you missed the entry point I would still consider new positions now. Our upside target is $64.00. The Qs don't move very fast so we'll have to be patient.

- Suggested Positions -

Long the June $60 calls (QQQ1118F60) Entry @ 0.59

- or -

Long the July $60 calls (QQQ1116G60) Entry @ 1.00

chart:

Entry on May 4th at $58.15
Earnings Date --/--/--
Average Daily Volume = 50 million
Listed on April 30th, 2011


Ross Stores Inc. - ROST - close: 73.45 change: +0.10

Stop Loss: 69.75
Target(s): 77.25, 79.50
Current Option Gain/Loss: + 6.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
05/04 update: ROST is holding up pretty well. Shares managed a bounce from their 10-dma today. The retail stocks could see some volatility tomorrow as traders react to the April same-store sales numbers tomorrow. Assuming ROST doesn't spike lower tomorrow morning on negative sales data I would use this dip as a new entry point to buy calls. We do not want to hold over the mid May earnings report.

Our first target is $77.25. Our secondary target is $79.50. FYI: The Point & Figure chart for ROST is bullish with a $97 target.

- Suggested Positions -

Long the May $72.50 calls (ROST1121E72.5) Entry @ $2.25

Entry on April 28th at $73.55
Earnings Date 05/19/11 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on April 23rd, 2011


United Technologies Corp. - UTX - close: 89.38 change: -0.47

Stop Loss: 83.49
Target(s): 89.50, 94.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see trigger

Comments:
05/04 update: There is still no change from my prior comments on UTX. The $90 level looks like potential resistance. We want to buy calls on a dip at $86.50. If triggered at $86.50 we'll use a stop loss at $83.49. Our targets are $89.50 and $94.00.

Buy-the-dip Trigger @ $86.50

- Suggested Positions -

Buy the June $90 calls (UTX1118F90)

Entry on April xxth at $ xx.xx
Earnings Date 04/20/11
Average Daily Volume = 3.7 million
Listed on April 27th, 2011


PUT Play Updates

Apollo Group Inc. - APOL - close: 40.20 change: -0.39

Stop Loss: 42.11
Target(s): 38.15, 35.50
Current Option Gain/Loss: - 2.4%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
05/04 update: APOL is still trading inside the $41-40 zone but the stock was drifting lower the entire session. I am not suggesting new bearish positions at this time. I am lowering our stop loss to $42.11.

- Suggested Positions -

Long the May $40.00 puts (APOL1121Q40) Entry @ $1.24

05/03 new stop loss @ 42.11
05/03 Readers may want to exit early here.
04/19 New stop loss @ 42.55

Entry on April 13th at $41.21
Earnings Date 06/30/11 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on April 12th, 2011


Panera Bread Co. - PNRA - close: 118.52 change: +1.32

Stop Loss: 123.25
Target(s): 110.50, 102.50
Current Option Gain/Loss: + 3.1%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
05/04 update: Bingo! We were expecting a little bounce in PNRA and we got it. Shares were showing relative strength today, which is a little worrisome given the market's decline, but the bigger picture for PNRA hasn't changed. The $120 level should be resistance. Our trigger to buy puts was hit at $119.00 and I would still consider new put positions now. We'll use a stop loss at $123.25. Our targets are the 100-dma (currently near $112.00, we'll take profits at $112.50) and the $102.50 level.

Suggested Positions

Long the June $110 PUTS (PNRA1118R110) Entry @ $1.60

chart:

Entry on May 4th at $119.00
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume = 647 thousand
Listed on May 3rd, 2011


iShares Silver Trust - SLV - close: 38.27 change: -2.31

Stop Loss: n/a
Target(s): 40.15 & 36.25
Current Option Gain/Loss: +112.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/04 update: The sell-off in silver continues. The price of silver fell another -7% today on top of the previous two declines. You might think that after a -20% plunge from its highs set last week that silver would be oversold and due for a bounce. However, the CME just announced another rise in margin requirements, the fourth one in recent days. Thus silver is likely to drop significantly again tomorrow. If that wasn't enough the CME is raising margin requirements again on Monday. I think this will be the fifth increase in a month. Tonight's increase ups margin requirements to $18,900 per contract. Monday's raises it to $21,600. I believe a year ago the requirement was only $4,500.

Our final target is $36.25 for the SLV ETF. More conservative traders may want an exit target closer to $37.00 while aggressive traders could aim more for the $35 level or lower. I am not suggesting new positions at this time.

(Small Positions) Suggested Positions -

Long the July $40.00 PUT (SLV1116S40) Entry @ $2.05

05/03 1st target hit @ 40.15, Option @ $3.70 (+80.4%)
05/02 Silver dropped and the SLV gapped open lower at $44.10.

Entry on May 2 at $44.10
Earnings Date --/--/--
Average Daily Volume = 79 million
Listed on April 30th, 2011


CLOSED BULLISH PLAYS

Deere & Co - DE - close: 93.03 change: -1.95

Stop Loss: 92.49
Target(s): 99.70, $104.00
Current Option Gain/Loss: -55.2%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
05/04 update: The market's sell-off on Wednesday was too much for DE. Shares fell through short-term support near $94 and $93 and its 50-dma. Our stop loss was hit at $92.49. The intraday low was $91.72.

- Suggested Positions -

May $97.50 call (DE1121E97.5) Entry @ $1.61, Exit @ 0.72 (-55.2%)

05/04 Stopped out @ 92.49, Option @ -55.2%
04/30 Adjusted targets to $99.70 and $104.00.

chart:

Entry on April 21st at $95.25
Earnings Date 05/18/11 (unconfirmed)
Average Daily Volume = 3.8 million
Listed on April 20th, 2011


Fortune Brands - FO - close: 64.65 change: +0.14

Stop Loss: 63.45
Target(s): 67.50, 69.75
Current Option Gain/Loss: - 20.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
05/04 update: Traders bought the dip again near support at the $64.00 level. FO even managed a gain on such a down day for the markets. Yet we're out of time. Our plan was to exit today at the closing bell to avoid holding over earnings.

(Small Positions) - Suggested Positions -

May $65.00 call (FO1121E65) Entry @ $1.00, Exit $0.80 (-20%)

05/04 Planned Exit. Option @ -20%
05/03 Plan on exiting tomorrow at the closing bell.
05/03 New stop loss @ 63.45

chart:

Entry on April 26th at $64.00
Earnings Date 05/05/11 (confirmed)
Average Daily Volume = 973 thousand
Listed on April 5th, 2011