Editor's Note:

News that Italian Prime Minister Berlusconi might step down helped fuel market gains.

We had both our COG and ROST trades opened today.

-James

Current Portfolio:


CALL Play Updates

Cabot Oil & Gas - COG - close: 83.00 change: -0.67

Stop Loss: 79.65
Target(s): 89.75
Current Option Gain/Loss: Nov$85c: -34.1% & Dec$90c: - 4.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/08 update: Our trade on COG is open but shares reversed lower after failing near the $85 level this morning. I would still consider new positions now or you could wait for a bounce from the $81-80 zone instead. Remember, this is an aggressive, higher-risk trade so let's keep our position size small.

I am listing both November and December calls but bear in mind that Novembers will expire in about two weeks. FYI: The Point & Figure chart for COG is bullish with a $116 target.

(small positions)

- Suggested Positions -

Long NOV $85 call (COG1119K85) Entry $2.58

- or -

Long DEC $90 call (COG1117L90) Entry $2.45

11/08 trade opened.
11/07 not open yet. try again

Entry on November 08 at $84.66
Earnings Date 02/22/12 (unconfirmed)
Average Daily Volume = 2.6 million
Listed on November 5, 2011


Costco Wholesale - COST - close: 85.00 change: +1.08

Stop Loss: 81.80
Target(s): 97.50
Current Option Gain/Loss: Nov$85 call: -28.2% & Jan $90 call: +13.8%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
11/08 update: The trading action in COST seems to be improving. Traders bought the dip near its 30 and 40-dma. The stock's afternoon rally appears to have broken the short-term trendline of lower highs. I would use this move as a new bullish entry point to buy calls. More conservative trades could wait for a close over $86.25 instead.

Earlier Comments:
Our multi-week exit target is $97.50. Cautious traders will want to consider an exit near $90 or $94 instead. Keep positions small.

(small positions)- Suggested Positions -

Long NOV $85 call (COST1119K85) Entry $1.52

- or -

Long 2012 Jan $90 call (COST1221A90) Entry $1.01

11/01 COST bounced at short-term support near $82 but readers may want to exit positions early right now
10/27 trade opened on gap higher at $85.00
10/26 Adjusted entry point strategy. Buy calls tomorrow if COST and S&P 500 index open positive. New stop loss at $81.80.

Entry on October 27 at $85.00
Earnings Date 12/07/11 (unconfirmed)
Average Daily Volume = 2.9 million
Listed on October 22, 2011


SPDR Gold Shares - GLD - close: 173.53 change: -1.45

Stop Loss: 164.95
Target(s): 182.50
Current Option Gain/Loss: +26.6%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
11/08 update: Gold futures briefly traded over $1,800 an ounce but gold failed to hold these gains. As stocks rallied on news that Italian Prime Minister Berlusconi could resign soon the metals reversed lower. The GLD lost -0.8%. That's not a big drop and you could argue gold was due for a little profit taking. I don't see any changes from my prior comments. If you're looking for a new entry point consider waiting for a dip or a bounce near the $170 level.

Cautious traders might also want to consider an exit target near $179.00 instead. Our target is $182.50.

- Suggested Positions - (Small Positions)

Long 2012 Jan $175 call (GLD1221A175) Entry $6.00

11/07 new stop loss @ 164.95

Entry on November 2 at $168.59
Earnings Date --/--/--
Average Daily Volume = 15.3 million
Listed on November 1, 2011


Goldman Sachs - GS - close: 108.58 change: +3.01

Stop Loss: 99.75
Target(s): 113.75
Current Option Gain/Loss: +51.4%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
11/08 update: GS displayed some relative strength today with a +2.8% gain. The stock appears to have broken out from its $102-108 trading range but we'll need to see some follow through higher tomorrow. Our exit target remains the $113.75 mark. More aggressive traders may want to aim for the simple 100-dma or the recent highs near $117.50-118.00 instead.

Please note that we're raising our stop loss to $99.75.

Earlier Comments:
We do want to keep our position small because GS can be a volatile stock.

- Suggested Positions - (small positions)

Long NOV $105 call (GS1119K105) Entry $3.40

11/08 new stop loss @ 99.75
11/02 corrected our entry price for the correct November call
11/01 new stop loss @ 97.45
11/01 GS gapped open lower at $103.49, under our trigger. Play opened.

Entry on November 1 at $103.49
Earnings Date 01/19/12 (unconfirmed)
Average Daily Volume = 8.5 million
Listed on October 31, 2011


McDonald's Corp. - MCD - close: 94.60 change: -0.02

Stop Loss: 91.60
Target(s): 99.75
Current Option Gain/Loss: Nov95c: +14.2% & Dec95c: + 1.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/08 update: MCD rallied to a new high at $95.45 before pulling back to settle virtually unchanged on the session. The move higher was a reaction to news out of MCD that worldwide same-store sales rose +5.5% in October. I would still consider new positions now at current levels.

Earlier Comments:
I am suggesting small positions to limit our risk. We will list both November calls and Decembers, but keep in mind that Novembers will expire in about two weeks. FYI: The Point & Figure chart for MCD is bullish with a $112 target.

(small positions)- Suggested Positions -

Long NOV $95 call (MCD1119K95) Entry $0.70

- or -

Long DEC $95 call (MCD1117L95) Entry $1.55

11/07 MCD hit our trigger at $94.05

Entry on November 7 at $94.05
Earnings Date 01/24/12 (unconfirmed)
Average Daily Volume = 6.0 million
Listed on November 5, 2011


Ross Stores Inc. - ROST - close: 90.32 change: +0.70

Stop Loss: 87.75
Target(s): 94.75
Current Option Gain/Loss: Nov90c: -18.0% & Dec92.50c: -16.0%
Time Frame: up to earnings on Nov. 17th
New Positions: see below

Comments:
11/08 update: ROST has broken out past resistance at $90.00 and hit our trigger to open positions at $90.10. Unfortunately it looks like the call options we picked saw a gap higher this morning. I would still consider new positions at current levels. Our target is $94.75 but more aggressive traders could aim higher. Please note that we do not want to hold over the November 17th earnings report.

I am listing November calls and December calls. November calls will expire after November 18th but we're planning to exit prior to Nov. 17th. We can use them but they will be more volatile.

FYI: The Point & Figure chart for ROST is bullish with a $118 target.

- Suggested Positions -

Long NOV $90 call (ROST1119K90) Entry $2.50

- or -

Long DEC $92.50 call (ROST1117L92.5) Entry $2.50

11/08 trade opened.

Entry on November 08 at $90.10
Earnings Date 11/17/11 (confirmed)
Average Daily Volume = 1.0 million
Listed on November 7, 2011


Schnitzer Steel Industries - SCHN - close: 48.84 change: +0.79

Stop Loss: 44.49
Target(s): 51.90
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/08 update: SCHN continues to churn sideways under resistance near $50.00 and its exponential 200-dma. I am not suggesting new positions at this time. Our exit target is $51.90. If you think SCHN can breakout past its simple 200-dma as well then you may want to aim higher.

Earlier Comments:
FYI: The Point & Figure chart for SCHN is bullish with a $61 target.

- Suggested Positions -

Long DEC $50 call (SCHN1117L50) Entry $2.50

11/05 adjusted exit target to $51.90
11/03 SCHN gapped open at $48.38

Entry on November 3 at $48.38
Earnings Date 01/05/12 (unconfirmed)
Average Daily Volume = 311 thousand
Listed on November 2, 2011


Tech Data Corp - TECD - close: 50.16 change: +0.43

Stop Loss: 47.49
Target(s): 53.75
Current Option Gain/Loss: -21.0%
Time Frame: up to November earnings
New Positions: see below

Comments:
11/08 update: Traders bought the dip midday but TECD is still stuck in a sideways consolidation. I am still tempted to buy calls here since TECD seems to be building on a bullish trend of higher lows. Readers may want to wait for a rally past $50.75 as their entry point instead.

Earlier Comments:
Our target is $53.75. Don't be surprised if the $52.00 level acts as short-term resistance. FYI: The Point & Figure chart for TECD is bullish with a $67 target.

- Suggested Positions -

Long DEC $50 call (TECD1117L50) Entry $2.85

11/03 TECD gapped open at $50.03

Entry on November 3 at $50.03
Earnings Date 11/21/11 (confirmed)
Average Daily Volume = 650 thousand
Listed on November 2, 2011


Under Armour, Inc. - UA - close: 83.50 change: -0.80

Stop Loss: 80.90
Target(s): 92.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
11/08 update: UA dipped to $81.00 before bouncing back into positive territory. Aggressive traders may want to go ahead and buy this bounce. I am suggesting we adjust our trigger from $86.25 to $85.25 and we can move our stop loss down to $80.90.

Earlier Comments:
We do want to keep our position size small to limit risk since UA can be a volatile stock. FYI: The Point & Figure chart for UA is bullish with a $106 target.

Trigger @ 85.25 (small positions)

- Suggested Positions -

buy the DEC $90 call (UA1117L90)

11/08 adjusted entry trigger from $86.25 to 85.25 and moved stop loss from $81.90 to $80.90.

Entry on November xx at $ xx.xx
Earnings Date 01/26/12 (unconfirmed)
Average Daily Volume = 1.4 million
Listed on November 5, 2011


Visa, Inc. - V - close: 94.54 change: +1.58

Stop Loss: 89.75
Target(s): 99.75
Current Option Gain/Loss: Nov$95c: +27.2% & Dec$95c: +12.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/08 update: Visa was showing a little bit of relative strength today with a +1.6% gain. Yet shares remain inside their trading range. Readers might want to buy calls on a breakout past the $95.00 level or the highs near $96.00. We are raising our stop loss up to $89.75.

- Suggested Positions -

Long Nov. $95 call (V1119K95) Entry $1.10

- or -

Long Dec. $95 call (V1117L95) Entry $2.75

11/08 new stop loss @ 89.75
11/01 new stop loss @ 88.75
11/01 Visa gapped lower at $91.16
10/31 adjusted trigger to $92.25

Entry on November 1 at $91.16
Earnings Date 10/26/11
Average Daily Volume = 5.0 million
Listed on October 29, 2011


VMware, Inc. - VMW - close: 100.77 change: +1.18

Stop Loss: 97.40
Target(s): 107.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
11/08 update: Wow! I am surprised that our trade in VMW is not open yet. We set our new trigger to buy calls at $101.00 and shares hit $100.99 today. Odds look pretty good that VMW will hit $101.00 tomorrow.

Our target is $107.75 and I am raising our stop loss to $97.40.

Trigger @ $101.00

- Suggested Positions -

buy the DEC $105 call (VMW1117L105)

11/08 adjust stop loss to $97.40.
11/07 Adjust strategy. Instead of buy the dip at $97.00 we want to buy calls on a rally at $101.00. Stop loss at $96.75. Target 107.75.

Entry on November xx at $ xx.xx
Earnings Date 01/24/11 (unconfirmed)
Average Daily Volume = 2.2 million
Listed on November 3, 2011


PUT Play Updates

Shutterfly, Inc. - SFLY - close: 39.90 change: -1.21

Stop Loss: 43.15
Target(s): 35.25
Current Option Gain/Loss: +26.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/08 update: So far so good. SFLY underperformed the market again. Today's session produced a -2.9% decline and a breakdown under round-number support at $40.00. We are lowering our stop loss to $43.15. Our exit target remains $35.25 for now but with November puts I am thinking we might want to exit before the week is out.

Earlier Comments:
FYI: The spread on our put is a bit wide, which makes an impact on our gain/loss for this trade.

The $40 level could offer potential support but we're aiming for $35.25 as our exit target.

- Suggested Positions -

Long NOV $40 PUT (SFLY1119W40) Entry $0.95

11/08 new stop loss @ 43.15
11/01 new stop loss @ 44.15

Entry on October 28 at $42.88
Earnings Date 10/26/11 (confirmed)
Average Daily Volume = 1.1 million
Listed on October 27, 2011