Editor's Note:

Whole Foods Market (WFM) broke out to new highs on Tuesday, hitting our exit target in the process. We also saw our HUM, MHK, and TEVA plays all opened.

CSH could see some movement tomorrow on lowered guidance.

-James

Current Portfolio:


CALL Play Updates

Boeing Co. - BA - close: 75.24 change: +0.64

Stop Loss: 73.65
Target(s): 77.00
Current Option Gain/Loss: -30.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/17 update: BA rallied with stocks this morning and shares hit new relative highs near $76.00 before paring its gains. The trend is a slow melt up higher but we're rapidly running out of time. Our January options have three days left. Readers may want to exit early.

- Suggested Positions -

Long 2012Jan $75 call (BA1221A75) entry $1.08

01/17/12 only three trading days left
01/12/12 new stop loss @ 73.65
01/07/12 new stop loss @ 72.65
01/05/12 new stop loss @ 72.25
12/31/11 new stop loss @ 71.75
12/28/11 new stop loss @ 71.40
12/22/11 new stop loss @ 69.85
12/13/11 trade opened
12/12/11 adjusted stop loss to $69.25
12/12/11 trade did not open, try again.

Entry on December 13 at $71.67
Earnings Date 02/01/12 (unconfirmed)
Average Daily Volume = 6.2 million
Listed on December 10, 2011


Berkshire Hathaway Inc. - BRK.B - close: 77.77 change: -0.73

Stop Loss: 76.75
Target(s): 83.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
01/17 update: BRK.B also saw an early morning pop with the market's broad advance at the open. Shares managed to hit a new relative high and then faded. The intraday high was $78.62. Currently our plan is to buy calls at $78.75 with a stop at $76.76. More conservative traders may want to wait for BRK.B to actually close over $78.75 before initiating positions instead of using an intraday move to open positions. Our multi-week target is $83.50. We do not want to hold over the late February earnings report.

Trigger @ 78.75

- Suggested Positions -

buy the Feb $80 call (BRKB1218B80)

01/14/12 adjusted entry point strategy to use a trigger @ 78.75
01/13/12 BRK.B gapped lower, negating our entry point. Trade did not open.

Entry on January xx at $ xx.xx
Earnings Date 02/27/12 (unconfirmed)
Average Daily Volume = 4.4 million
Listed on January 12, 2012


Starwood Hotel & Resorts - HOT - close: 50.63 change: -0.68

Stop Loss: 48.75
Target(s): 55.75
Current Option Gain/Loss: -16.1%
Time Frame: exit prior to earnings
New Positions: see below

Comments:
01/17 update: Today's action in HOT doesn't bode well. A dip toward support near the 200-dma or the $50 level isn't that troubling but shares did underperform the broader market. I would wait for a bounce near $50.00 before considering new positions. More conservative traders may want to use a stop loss closer to the $50.00 level instead. FYI: The Point & Figure chart for HOT is bullish with a $64 target.

Don't forget that we plan to exit prior to the Feb. 2nd earnings.

- Suggested Positions -

Long Feb $52.50 call (HOT1218B52.5) entry: 1.67

01/13/12 Triggered on a dip at $51.00
01/10/12 initial entry point did not work. New strategy: buy a dip at $51.00.

Entry on January 13 at $51.00
Earnings Date 02/02/12 (confirmed)
Average Daily Volume = 2.4 million
Listed on January 09, 2012


Humana Inc. - HUM - close: 95.50 change: +0.79

Stop Loss: 92.95
Target(s): 99.75
Current Option Gain/Loss: -15.3%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
01/17 update: Our new HUM play is open. The stock gapped higher at $95.75 and almost made it to $96.50 before trimming its gains. Our plan was to use a trigger at $95.25 so the opening pop launched our trade.

Our target is $99.75 since the $100 level might be round-number, psychological resistance. We do not want to hold over the early February earnings report. FYI: The Point & Figure chart for HUM is bullish with a $109 target.

- Suggested Positions -

Long Feb $100 call (HUM1218B100) entry $1.30

01/17/12 HUM gapped open higher at $95.75, above our trigger at $95.25

Entry on January 17 at $95.75
Earnings Date 02/06/12 (confirmed)
Average Daily Volume = 1.2 million
Listed on January 14, 2012


iShares Transportation - IYT - close: 92.06 change: -0.18

Stop Loss: 89.45
Target(s): 94.75 or 98.50
Current Option Gain/Loss: Jan$95c: - 100% & Feb$95c: -24.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
01/17 update: The early morning spike higher in the IYT failed to hit new relative highs and the ETF spent the rest of the day consolidating sideways. We only have three days left on January options.

- Suggested Positions -

Long Jan $95 call (IYT1221A95) entry $0.20
target 94.75

- or -

Long Feb $95 call (IYT1218B95) entry $1.45
target 98.50

01/12/12 new stop loss @ 89.45
01/07/12 new stop loss @ 88.75
01/03/12 IYT gapped open higher at $91.20, above our trigger at $90.75

Entry on January 03 at $91.20
Earnings Date --/--/--
Average Daily Volume = 582 thousand
Listed on December 22, 2011


Laboratory Corp. - LH - close: 88.54 change: +1.60

Stop Loss: 85.95
Target(s): 94.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
01/17 update: LH displayed relative strength on Tuesday with a +1.8% gain. Yet shares are still trading under technical resistance at the simple 200-dma. The high today was $88.66.

I am suggesting a trigger to buy calls at $89.00. We'll aim for the $94.75 mark. More aggressive traders could aim for the $97-100 zone instead. FYI: The Point & Figure chart for LH is bullish with a $105 target.

NOTE: We do not want to hold over the earnings report around Feb. 9th (still an unconfirmed date).

Trigger @ 89.00

- Suggested Positions -

buy the Feb $90 call (LH1218B90)

Entry on January xx at $ xx.xx
Earnings Date 02/09/12 (unconfirmed)
Average Daily Volume = 564 thousand
Listed on January 10, 2012


Mohawk Industries - MHK - close: 64.29 change: +1.77

Stop Loss: 59.90
Target(s): 67.50
Current Option Gain/Loss: -24.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/17 update: Our new play on MHK is open. The stock gapped higher with the market and shares rallied to 466.07 before paring its gains. There is a chance that MHK will fill the gap so readers may want to wait for a dip back toward the $62.50 area before entering new positions.

Our target is $67.50 but we do not want to hold over the February earnings report.

Investors will be interested to note that the most recent data listed short interest at 5% of the 57 million share float. That's not excessive but it's a bit high and could boost any new gains as bears cover their shorts. FYI: The Point & Figure chart for MHK is bullish with a $90 target.

- Suggested Positions -

Long Feb $65 call (MHK1218B65) Entry $2.48

01/17/12 MHK gapped open higher at $63.99

Entry on January 17 at $63.99
Earnings Date 02/21/12 (unconfirmed)
Average Daily Volume = 621 thousand
Listed on January 14, 2012


Omnicom Group - OMC - close: 46.59 change: +0.13

Stop Loss: 44.25
Target(s): 49.00
Current Option Gain/Loss: +25.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/17 update: The stock market's opening pop this morning pushed OMC to $47.15 intraday. Unfortunately OMC spent the rest of the session consolidating lower. I am not suggesting new positions at this time. Look for support in the $46.00-45.00 zone. More conservative traders might want to inch up their stop loss.

Our target is $49.00. We do not want to hold over the mid February earnings report. FYI: The Point & Figure chart for OMC is bullish with a $64 target.

- Suggested Positions -

Long Feb $45 call (OMC1218B45) entry $1.80

Entry on January 12 at $45.75
Earnings Date 02/14/12 (unconfirmed)
Average Daily Volume = 1.6 million
Listed on January 11, 2012


Teva Pharmaceuticals - TEVA - close: 44.87 change: +0.32

Stop Loss: 43.75
Target(s): 49.50
Current Option Gain/Loss: -14.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/17 update: I am urging caution on our TEVA trade. The plan was to buy calls on a breakout with a trigger at $45.25. Shares did hit our trigger today but the rally reversed and shares closed back under the $45.00 level. I find this action a warning signal. We may have just witnessed a bull trap pattern. I would wait for a new rally past $45.50 before considering new bullish positions now.

Our target is $49.50 but we'll plan to exit prior to the earnings report in early February. FYI: The Point & Figure chart for TEVA is bullish with a $57 target.

(Small Positions)- Suggested Positions -

Long Feb $45 call (TEVA1218B45) entry $1.50

01/17/12 Be careful. TEVA hit our trigger and reversed to close back under $45.00

Entry on January 17 at $45.25
Earnings Date 02/08/12 (unconfirmed)
Average Daily Volume = 5.9 million
Listed on January 14, 2012


TJX Companies - TJX - close: 65.98 change: +0.83

Stop Loss: 64.75
Target(s): 68.00
Current Option Gain/Loss: Jan$65c: +20.0% & Feb$65c: +22.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
01/17 update: TJX displayed relative strength with a +1.2% gain. Our January call position has turned positive (+20%) and readers will want to seriously consider an early exit now with only three trading days left before January options expire.

I am suggesting we exit our January $65 calls at the closing bell tomorrow (assuming TJX doesn't hit our stop loss). Speaking of stops I am raising our stop loss to $64.75.

Earlier Comments:
On January 5th, management announced a 2-for-1 stock split payable on February 2nd, 2012.

- Suggested Positions -

Long 2012Jan $65 call (TJX1221A65) Entry $1.00

- or -

Long Feb $65 call (TJX1218B65) Entry $1.75

01/17/12 prepare to exit January calls at close tomorrow
01/17/12 new stop loss @ 64.75
01/12/12 new stop loss @ 63.75
01/07/12 readers may want to take profits now (Jan$65call +90%, Feb$65call +57%)
01/05/12 new stop loss @ 63.25, TJX announced strong same-store sales and a 2:1 split.
12/31/11 new stop loss @ 62.75

Entry on December 22 at $64.10
Earnings Date 02/23/12 (unconfirmed)
Average Daily Volume = 2.7 million
Listed on December 21, 2011


PUT Play Updates

Accenture Plc, - ACN - close: 53.49 change: +0.24

Stop Loss: 54.15
Target(s): 48.50
Current Option Gain/Loss: -77.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/17 update: The stock market's widespread rally this morning gave ACN a boost but shares failed to breakthrough resistance near $54.00. Readers may want to exit early. I am not suggesting new positions at this time.

NOTE: We only have three trading days left before January options expire.

(small positions) - Suggested Positions -

Long 2012Jan $52.50 PUT (ACN1221M52.5) Entry $1.35

01/14/12 resistance at $54.00 is holding so far but readers may want to consider an early exit anyway.

Entry on January 06 at $51.91
Earnings Date 03/26/12 (unconfirmed)
Average Daily Volume = 4.6 million
Listed on January 05, 2012


Cash America Intl. - CSH - close: 44.10 change: -0.47

Stop Loss: 46.10
Target(s): 40.50
Current Option Gain/Loss: Jan $45 put: - 9.5% & Feb$45put: - 6.2%
Time Frame: up to the earnings report.
New Positions: see below

Comments:
01/17 update: Tomorrow could be interesting for CSH. The stock was an underperformer today with shares down -1.0% and hitting new relative lows. After the closing bell tonight the company updated its earnings guidance. CSH expects FY2011 earnings to come in at $4.25 a share, which is a +16% jump from 2010 but it's also less than Wall Street was anticipating. This earnings warning could spark some selling pressure tomorrow. It's probably too late to initiate new positions now. We will lower our stop loss down to $46.10.

NOTE: I am suggesting we exit our January $45 puts at the closing bell tomorrow.

Earlier Comments:
Our target is $40.50. FYI: The Point & Figure chart for CSH is bearish with a $33 target.

- Suggested Positions -

Long Jan $45 PUT (CSH1221M45) Entry $1.05

- or -

Long Feb $45PUT (CSH1218N45) Entry $2.40

01/17/12 prepare to exit Jan. $45 puts at the close tomorrow.
01/17/12 new stop loss @ 46.10
01/17/12 CSH issued lowered guidance after the closing bell.

Entry on January 11 at $44.75
Earnings Date 01/26/12 (confirmed)
Average Daily Volume = 292 thousand
Listed on January 05, 2012


CLOSED BULLISH PLAYS

Whole Foods Market, Inc. - WFM - close: 76.73 change: +3.04

Stop Loss: 71.45
Target(s): 74.25
Current Option Gain/Loss: +126.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/17 update: Target achieved. WFM outperformed the markets today. Shares opened at $74.06 and surged to new highs, hitting $77.33 intraday. The stock settled with a +4% gain. Our target was hit at $74.25. The bid on our call option was $4.30 (+126.3%).

Broken resistance near $74.00 should offer new support. Nimble traders might want to consider buying calls again on a bounce off the $74.00 area.

- Suggested Positions -

2012Jan $70 call (WFM1221A70) entry $1.90, exit $4.30 (+126.3%)

01/17/12 target hit at $74.25
01/14/12 new stop loss @ 71.45, adjusted exit target to $74.25. Cautious traders may want to exit immediately with only four days left on January options. Current bid is at $3.70 (+94.7%)
01/12/12 new stop loss @ 69.75
01/10/12 WFM begins trading ex-dividend tomorrow morning
01/07/12 new stop loss @ 69.25
01/05/12 new stop loss @ 68.75
01/03/12 WFM gapped open higher at $70.55, above our trigger (70.25)

chart:

Entry on January 03 at $70.55
Earnings Date 02/08/12 (unconfirmed)
Average Daily Volume = 1.3 million
Listed on December 28, 2011