Editor's Note:

Stocks rebounded on Friday but it was not enough. The S&P 500 ended a multi-week winning streak.

We want to exit our JOY trade early on Monday.

PVH was closed as planned. UA was removed.

Current Portfolio:


CALL Play Updates

Amgen Inc. - AMGN - close: 84.59 change: +0.93

Stop Loss: 81.45
Target(s): 88.50
Current Option Gain/Loss: Sep85c: - 0.7% & Oct85c: + 9.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/25/12 update: AMGN is looking strong with a +1.1% gain on Friday and a close above resistance at $84.00. This could be the bullish entry point you've been waiting for.

- Suggested Positions -

Long Sep $85 call (AMGN1222i85) Entry $1.35

- or -

Long Oct $85 call (AMGN1220j85) Entry $2.15

08/15/12 triggered at $83.75

chart:

Entry on August 15 at $83.75
Average Daily Volume = 4.8 million
Listed on August 14, 2012


BRCM - Broadcom - close: 35.35 change: +0.14

Stop Loss: 34.40
Target(s): 38.50
Current Option Gain/Loss: + 7.2%
Time Frame: 4-6 weeks
New Positions: see below

Comments:
08/25/12 update: Traders bought the dip near $35.00 for the third day in a row. Readers might want to inch their stop loss higher. The bullish trend of higher lows and higher highs is still in place for now. I am not suggesting new positions at this time.

- Suggested Positions -

Position: Nov $36.00 Call (BRCM1217K36) entry $1.80

08/18/12 new stop loss @ 34.40
08/08/12 new stop loss @ 33.25
no follow through, turning cautious
08/07/12 triggered @ $34.75
08/06/12 adjust stop loss to $32.45

chart:

Entry on August 07 at $34.75
Average Daily Volume = 10 million
Earnings Oct-23rd
Listed on Aug 4, 2012


Concur Technologies - CNQR - close: 72.20 change: -0.46

Stop Loss: 69.75
Target(s): 74.75
Current Option Gain/Loss: Sep75c: + 0.0% & Nov75c: + 2.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/25/12 update: CNQR spent almost the entire week churning sideways between $71.50 and $73.00. Odds are growing that we'll see this stock dip toward what should be new support near $70.00.

- Suggested Positions -

Long Sep $75 call (CNQR1222i75) Entry $1.25

- or -

Long Nov $75 call (CNQR1217j75) Entry $3.60

08/21/12 new stop loss @ 69.75
08/16/12 new stop loss @ 68.75
08/15/12 triggered at $70.25

chart:

Entry on August 15 at $70.25
Average Daily Volume = 577 thousand
Listed on August 13, 2012


Dresser-Rand Group - DRC - close: 51.66 change: +0.06

Stop Loss: 49.45
Target(s): 54.75
Current Option Gain/Loss: - 6.0%
Time Frame: exit prior to Sept. option expiration
New Positions: see below

Comments:
08/25/12 update: DRC is still consolidating sideways in what almost looks like a mild bull-flag pattern. I don't see any changes from my prior comments. If you're worried about the broader market then consider waiting for DRC to dip in the $50.50 area as your entry point. FYI: The Point & Figure chart for DRC is bullish with a $58 target.

- Suggested Positions -

Long Sep $50 call (DRC1222i50) Entry $2.50

chart:

Entry on August 21 at $51.14
Average Daily Volume = 489 thousand
Listed on August 20, 2012


Express Scripts - ESRX - close: 61.76 change: +0.18

Stop Loss: 59.75
Target(s): 67.50
Current Option Gain/Loss: Sep62.5c: + 8.4% & Oct$62.5c: + 6.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/25/12 update: ESRX provided nimble traders a morning dip toward its 10-dma before the stock rebounded. I don't see any changes from my Thursday night comments and would still consider new positions now at current levels.

FYI: The Point & Figure chart for ESRX is bullish with a $76 target.

- Suggested Positions -

Long Sep $62.50 call (ESRX1222i62.5) Entry $0.95

- or -

Long Oct $62.50 call (ESRX1220j62.5) Entry $1.67

chart:

Entry on August xx at $ xx.xx
Average Daily Volume = 5.1 million
Listed on August 23, 2012


Joy Global, Inc. - JOY - close: 55.59 change: -1.25

Stop Loss: 55.25
Target(s): 59.75
Current Option Gain/Loss: Sep $57.5c: -24.4% Oct60c: -22.0%
Time Frame: exit prior to the Aug. 29th earnings report
New Positions: see below

Comments:
08/25/12 update: We are worried about JOY and suggesting an early exit. The stock seems to have peaked back on Tuesday. We're concerned shares could see a deeper correction. I am suggesting readers exit positions on Monday morning at the opening bell. More aggressive traders may want to widen their stops and hang on since there is still a chance that JOY will dip to and bounce in the $55-53.50 area. The simple 50-dma is at $53.66, which could offer some support.

Exit on Monday morning.

- Suggested Positions -

Long Sep $57.50 call (JOY1222i57.5) Entry $2.70

- or -

Long Oct $60.00 call (JOY1220j60) Entry $2.50

08/25/12 prepare to exit on Monday morning.
08/21/12 new stop loss @ 55.25

chart:

Entry on August 17 at $56.27
Average Daily Volume = 2.1 million
Listed on August 16, 2012


Netflix, Inc. - NFLX - close: 63.16 change: -0.89

Stop Loss: 61.25
Target(s): 69.50
Current Option Gain/Loss: -31.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/25/12 update: Heads up! Readers may want to consider an early exit from our NFLX trade. The stock was down on Friday following news that Amazon.com (AMZN) had just inked a deal with NBC Universal to a significant amount of content to AMZN's digital streaming video service. In summary, AMZN is getting to be tougher competition for the likes of NFLX. To make matters worse NFLX looks technically weak here. Thursday's decline produced a short-term bearish reversal pattern and Friday's decline might be considered confirmation of the reversal.

I am not suggesting new positions. Readers may want to hit the eject button.

Earlier Comments:
I do consider this an aggressive trade. NFLX can be volatile.

- Suggested (SMALL) Positions -

Long Sep $67.50 call (NFLX1222i67.5) Entry $2.23

08/25/12 NFLX not working for us. Readers may want to exit early
08/21/12 new stop loss @ 61.25

chart:

Entry on August 16 at $63.46
Average Daily Volume = 5.8 million
Listed on August 15, 2012


Qualcomm - QCOM - close: 62.43 change: +0.39

Stop Loss: 60.95
Target(s): 64.25
Current Option Gain/Loss: +17.6%
Time Frame: 4-6 weeks
New Positions: see below

Comments:
08/25/12 update: QCOM has been churning sideways the last few days following Tuesday's bearish decline. Prior support at the 10-dma has become new short-term resistance. I am still concerned that QCOM could see a deeper correction after a multi-week rally.

I am not suggesting new positions at this time.

- Suggested Positions -

Position: Oct $62.50 Call (QCOM1222J62.5) entry $1.70

08/18/12 adjust exit target to $64.25
08/16/12 new stop loss @ 60.95
08/07/12 triggered @ 60.51

chart:

Entry on August 07 at $60.51
Average Daily Volume = 1.5 million
Listed on Aug 4, 2012


Snap On Inc. - SNA - close: 69.96 change: +0.19

Stop Loss: 69.65
Target(s): 74.90
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/25/12 update: SNA has spent an entire week now consolidating sideways under resistance near the $71 level. The larger trend remains bullish. We are waiting for shares to hit our trigger at $71.00. Our target is $74.90. More aggressive traders could aim higher.

Trigger @ $71.00

- Suggested Positions -

buy the Sep $70 call (SNA1222i70)

chart:

Entry on August xx at $ xx.xx
Average Daily Volume = 390 thousand
Listed on August 21, 2012


Whole Foods Market, Inc. - WFM - close: 97.03 change: +1.95

Stop Loss: 94.75
Target(s): 104.50
Current Option Gain/Loss: Sep$100c: -24.8% & Oct$100c: - 7.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/25/12 update: Good news! There was no follow through on Thursday's ugly reversal lower. WFM gapped open higher (a little bit) on Friday and completely erased Thursday's decline. However, shares have not conquered the $98 level yet. At this point I would wait for a rally past $98.25 before launching new positions.

Earlier Comments:
Keep position size small to limit risk.

- Suggested *SMALL* Positions -

Long Sep $100 call (WFM1222i100) Entry $1.45

- or -

Long Oct $100 call (WFM1220j100) Entry $2.50

chart:

Entry on August 23 at $98.00
Average Daily Volume = 1.7 million
Listed on August 22, 2012


Westlake Chemical - WLK - close: 69.50 change: +0.37

Stop Loss: 68.40
Target(s): 74.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/25/12 update: The sideways consolidation in shares of WLK seems to be narrowing. That would suggest the stock should breakout one way or the other soon. I am suggesting we use a trigger to buy calls at $70.25. Our initial target is $74.75.

Trigger @ 70.25

- Suggested Positions -

buy the Sep $70 call (WLK1222i70)

chart:

Entry on August xx at $ xx.xx
Average Daily Volume = 507 thousand
Listed on August 22, 2012


WellPoint Inc. - WLP - close: 57.66 change: -0.07

Stop Loss: 55.85
Target(s): 59.75
Current Option Gain/Loss: -16.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/25/12 update: The lack of follow through on Wednesday's bullish breakout higher in WLP is still a concern. Yet at the moment WLP still has a bullish trend of higher lows. Readers may want to inch up their stops.

I am not suggesting new positions at this time.

- Suggested Positions -

Long Sep $57.50 call (WLP1222I57.5) Entry $1.60

08/16/12 new stop loss @ 55.85
08/08/12 triggered @ 56.50

chart:

Entry on August 08 at $56.50
Average Daily Volume = 4.4 million
Listed on August 7, 2012


PUT Play Updates

FB - Facebook - close: 19.41 change: -0.03

Stop Loss: 20.35
Target(s): 17.00
Time Frame: 2-4 weeks
Current Option Gain/Loss: - 3.4%
New Positions: see below

Comments:
08/25/12 update: Things have been quite for FB the last few days. There was no follow through on the breakdown below $20 and no follow through on Monday's oversold bounce. The stock has been stuck in a narrow sideways range the last four days. The $20.00 level "should" be overhead resistance but I am not suggesting new positions at this time.

You'll notice on the chart tonight that the sideways consolidation is narrowing and that would suggest a breakout one way or the other very soon.

FYI: The next big lock up expiration date is in November!

Earlier Comments:
Facebook has turned into the stock everyone loves to hate. Facebook has 674 million shares outstanding as of Friday. On August 15th another 268 million shares will see their lockup expire and become available for trading. That is 40% additional shares. If you were an investor or employee and you watched your shares decline from $35 to $20 ahead of your lockup expiration you are probably just waiting for an opportunity to sell. Another factor is that taxes are due on the awarded shares regardless of whether they are sold. That means employees have a big tax bill and they have not been able to sell those shares to pay the taxes. That is an additional incentive to pull the trigger on at least part of their position on August 15th.

Facebook has hundreds of detractors and they seem to be racing each other trying to put a lower price target on the stock. Mark Hulbert was on CNBC on Friday with a $13.80 price target based on a bunch of different metrics.

Facebook also has the various lawsuits over the IPO including the valuation and the various claims made about users and revenue in the days leading up to the IPO. There are plenty of clouds and no real catalysts to pump up the stock.

Facebook said expenses grew by 60% in Q2 and they would grow faster in Q3/Q4. That means earnings will decline.

I am recommending a September option with plans to exit (some time) after the August 15th share lock up expiration.

Suggested Positions

current position: Sept $20 PUT (FB1220U20) entry $1.45

08/18/12 new stop loss @ 20.35, readers may want to take profits now
08/07/12 triggered @ 20.95
08/06/12 adjust entry trigger to $20.95

chart:

Entry on August 07 at $20.95
Average Daily Volume = 80.0 million
Listed on August 5, 2012


Weight Watchers Intl. - WTW - close: 48.05 change: -0.28

Stop Loss: 50.55
Target(s): 42.50
Current Option Gain/Loss: Sep47.5p: - 8.1% & Oct45p: -13.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/25/12 update: So far so good. WTW underperformed the market on Friday with a -0.5% decline. Our trade opened on the gap down at $48.21. I don't see any changes from my Thursday night comments. The stock looks poised to resume the longer-term downtrend.

- Suggested Positions -

Long Sep $47.50 PUT (WTW1222u47.5) Entry $1.85

- or -

Long Oct $45.00 PUT (WTW1220V45) Entry $1.85

chart:

Entry on August 24 at $48.21
Average Daily Volume = 929 thousand
Listed on August 23, 2012


CLOSED BULLISH PLAYS

PVH Corp. - PVH - close: 87.94 change: +0.87

Stop Loss: 85.75
Target(s): 91.50
Current Option Gain/Loss: +16.2%
Time Frame: exit prior to the Aug 27th earnings report
New Positions: see below

Comments:
08/25/12 update: PVH conveniently cooperated with our exit plans. We wanted to exit on Friday at the closing bell to avoid holding over earnings on Monday. Shares rallied +0.99% on Friday.

- Suggested Positions -

Sep $87.50 call (PVH1222i87.5) Entry $3.27 exit $3.80 (+16.2%)

08/24/12 closed on Friday
08/22/12 new stop loss @ 85.75, prepare to exit on Friday (08/24) at the closing bell
08/18/12 more conservative traders may want to take profits early
08/16/12 new stop loss @ 84.75
08/14/12 triggered on gap open at $85.62 (trigger was 85.25)

chart:

Entry on August 14 at $85.62
Average Daily Volume = 845 thousand
Listed on August 13, 2012


Under Armour, Inc. - UA - close: 55.87 change: -1.32

Stop Loss: 55.70
Target(s): 64.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
08/25/12 update: UA has spent two weeks consolidating in the $56-58 range. Now it looks like shares might be poised for a deeper pullback. Our trigger to open bullish positions at $58.55 has not been hit. We're removing UA as a candidate.

Trade did not open.

08/25/12 removed UA as a candidate.

chart:

Entry on August xx at $ xx.xx
Average Daily Volume = 2.1 million
Listed on August 18, 2012