Current Portfolio:


CALL Play Updates

Edwards Lifesciences - EW - close: 62.95 change: -0.11

Stop Loss: 61.25
Target(s): 69.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
11/23 update: The EW trade is not open yet. The market continues to show weakness. Shares of EW gapped open lower. The stock fell to $61.59 intraday versus the August low of $61.63. There is still a good chance that EW Can bounce here.

I am suggesting we try again. Buy calls at the open but only if EW and the S&P 500 index both open positive. As an alternative more aggressive traders may want to use a trigger above $64.00 to open positions regardless of what the S&P 500 is doing.

Given EW's recent decline we are adjusting our stop loss down to $61.25.

*See Entry Details Above*

- Suggested Positions -

buy the DEC $65 call (EW1117L65)

- or -

buy the 2012Jan $70 call (EW1221A70)

11/23 still not open
11/22 not open yet

Entry on November xx at $ xx.xx
Earnings Date 02/02/12 (unconfirmed)
Average Daily Volume = 1.2 million
Listed on November 21, 2011


Family Dollar Stores - FDO - close: 55.90 change: -1.50

Stop Loss: 54.75
Target(s): 64.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
11/23 update: Hmm... the situation is growing worse for FDO. Yesterday's failed rally has been followed up with today's -2.6% decline. Shares are on the verge of breaking down under their 50-dma. There is still a chance that FDO might find support near $55.00 but I am starting to wonder if FDO is going to see a correction down to its trendline of higher lows, which could mean a drop toward the $54-53 zone.

At the moment we have a trigger to buy calls at $58.50. I am leaving it there tonight and we will re-evaluate our entry point strategy after Friday's session.

I am setting our exit target at $64.00 using the January calls. We will list December calls as well but you may have to exit earlier. FYI: The Point & Figure chart for FDO is bullish with a $66 target.

Trigger @ 58.50

- Suggested Positions -

buy the DEC $60 call (FDO1117L60)

- or -

buy the JAN $60 call (FDO1221A60)

11/22 not open yet

Entry on November xx at $ xx.xx
Earnings Date 01/04/12 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on November 21, 2011


JB Hunt Transport Services - JBHT - close: 42.95 change: -0.97

Stop Loss: 41.99
Target(s): 48.25
Current Option Gain/Loss: Unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Comments:
11/23 update: The Dow Jones Transportation average fell -2.4%. Shares of JBHT followed it lower with a -2.2% decline. Shares of JBHT still have a bullish trend of higher lows but if the market keeps falling then JBHT's trend may not last.

I don't see any changes from my prior comments. JBHT has resistance near $44.00. I am suggesting a trigger to open bullish positions at $44.35. If triggered our multi-week target is $48.25. JBHT doesn't move super fast so give yourself time for the trade to work. FYI: The Point & Figure chart for JBHT is bullish with a $63 target.

Trigger @ 44.35

- Suggested Positions -

buy the 2012JAN $45 call (JBHT1221A45)

Entry on November xx at $ xx.xx
Earnings Date 01/30/12 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on November 22, 2011


Phillip Morris Intl. - PM - close: 71.02 change: -0.99

Stop Loss: 69.49
Target(s): 78.50
Current Option Gain/Loss: -31.2%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
11/23 update: The stock market is accelerating lower. Today's widespread decline hit shares of PM too. The stock gapped open lower at $71.46 and closed with a -1.3% decline. At this point I am expecting a drop toward the $70.00 level, which should offer some support. Please note that our stop loss at $69.90 might be a little bit too tight. I am adjusting our stop loss to $69.49.

I would wait for PM to dip to or bounce from the $70 level before initiating new positions.

Earlier Comments:
Our multi-week target is $78.50. FYI: The Point & Figure chart for PM is bullish with a $95 target.

- Suggested Positions -

Long 2012 Jan $75 call (PM1221A75) Entry $1.12

11/23 adjusted stop loss to $69.49
11/22 trade opened. PM opened at $72.11

Entry on November 22 at $72.11
Earnings Date 02/09/12 (unconfirmed)
Average Daily Volume = 7.3 million
Listed on November 19, 2011


PUT Play Updates

Deutsche Bank - DB - close: 32.46 change: -1.13

Stop Loss: 37.55
Target(s): 30.50
Current Option Gain/Loss: Dec$35p: +61.5% & Jan$30p: +62.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/23 update: DB posted another loss. Shares gave up -3.3% and fell for the seventh time out of the last eight days. Bearish PMI data in Germany didn't help but what really shook investors was a poor demand for a Germany bond auction.

DB is short-term oversold and could see a bounce at any time. More conservative traders may want to start taking profits now. I am adjusting our stop loss down to $37.55. The newsletter's final target remains $30.50.

Earlier Comments:
Keep position size small to limit risk. This is going to be a volatile trade. FYI: The Point & Figure chart for DB is bearish with a $30 target.

- Suggested Positions - (small positions)

Long DEC $35 PUT (DB1117x35) Entry $2.60

- or -

Long JAN $30 PUT (DB1221m30) Entry $2.09

11/23 new stop loss @ 37.55
11/23 more conservative traders may want to take profits now. The Dec $35 put (+61.5%) and the Jan $30 put (+62.6%)
11/21 new stop loss @ 38.75
11/12 new stop loss @ 41.55
11/11 DB gapped open higher at $39.00

Entry on November 11 at $39.00
Earnings Date 02/02/12 (unconfirmed)
Average Daily Volume = 4.3 million
Listed on November 10, 2011


Lululemon Athletica - LULU - close: 46.70 change: -0.31

Stop Loss: 50.25
Target(s): 42.50
Current Option Gain/Loss: Dec$47.50p: + 4.5% & Jan$45p: + 4.6%
Time Frame: Seven Trading Days or 6 weeks
New Positions: see below

Comments:
11/23 update: Attention! It might be time to consider an early exit for our LULU trade. The market has been plunging this week. While LULU is down for the week the decline has been mild. Shares are slowly drifting lower inside the $48-46 zone. This doesn't bode well for the bears. Readers may want to consider an early exit now. I am not suggesting new positions. We will lower our stop loss to $50.25.

Earlier Comments:
TIME FRAME: Traders have to make a decision about their time frame with LULU. Normally I would give this trade a few weeks to work out but LULU is due to report earnings on December 1st. As a rule the newsletter almost never holds over an earnings report. At the moment we'll plan to exit this trade on November 30th if shares don't hit our exit before then.

- Suggested Positions -

Long DEC $47.50 PUT (LULU1117X47.5) Entry $3.54

- or -

Long 2012 JAN $45 PUT (LULU1221M45) Entry $3.63

11/23 new stop loss @ 50.25
11/23 LULU is not falling very fast. Readers may want to consider an early exit now.
11/21 trade opened on LULU's gap down at $47.63.

Entry on November 21 at $47.63
Earnings Date 12/01/11 (confirmed)
Average Daily Volume = 2.8 million
Listed on November 19, 2011


PACCAR Inc. - PCAR - close: 37.05 change: -0.82

Stop Loss: 40.25
Target(s): 35.50
Current Option Gain/Loss: +51.4%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/23 update: PCAR lost another -2.1% and posted its eighth decline in a row. Shares are short-term oversold and due for a bounce. I am not suggesting new positions at this time. Please note our new stop loss at $40.25.

- Suggested (Small) Positions -

Long DEC $39 PUT (PCAR1117X39) Entry $1.75

11/23 new stop loss @ 40.25
11/21 new stop loss @ 41.50

Entry on November 18 at $39.42
Earnings Date 02/01/12 (unconfirmed)
Average Daily Volume = 3.7 million
Listed on November 17, 2011


Western Digital Corp. - WDC - close: 25.59 change: -0.19

Stop Loss: 27.75
Target(s): 21.00
Current Option Gain/Loss: Dec$25p: -11.4% & Jan22.50p: + 8.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/23 update: The action in WDC remains disappointing. Shares are merely churning sideways in a narrow range. It is worth noting that the consolidation is narrowing and that should suggest a breakout one way or the other soon.

At this point I would wait for a breakdown under $25.00 before initiating new bearish positions.

Earlier Comments:
It is possible that the 2010 lows near $23.00 could be support but we're aiming for a drop to the $21.00-20.00 zone. We do want to keep our position size small because WDC has been very volatile the last few weeks.

- Suggested (Small) Positions -

Long DEC $25 PUT (WDC1117X25) Entry $1.49

- or -

Long JAN $22.50 PUT (WDC1221M22.5) Entry $1.13

Entry on November 18 at $26.04
Earnings Date 01/18/12 (unconfirmed)
Average Daily Volume = 6.4 million
Listed on November 17, 2011