Editor's Note:

The stock market meandered sideways. Market participants are likely waiting for Bernanke's speech this Friday.

Our JOY trade was close as planned. UTX was triggered.

Current Portfolio:


CALL Play Updates

Amgen Inc. - AMGN - close: 84.43 change: -0.16

Stop Loss: 81.95
Target(s): 88.50
Current Option Gain/Loss: Sep85c: - 9.6% & Oct85c: + 4.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/27/12 update: AMGN tagged another multi-year high before paring its gains. We are raising our stop loss up to $81.95.

- Suggested Positions -

Long Sep $85 call (AMGN1222i85) Entry $1.35

- or -

Long Oct $85 call (AMGN1220j85) Entry $2.15

08/27/12 new stop loss @ 81.95
08/15/12 triggered at $83.75

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


BRCM - Broadcom - close: 35.42 change: +0.07

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

Comments:
08/27/12 update: Shares of BRCM were downgraded to a "neutral" today but the news had little affect on the stock price. Shares continue to consolidate sideways above short-term support at $35.00.

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

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


Celgene Corp. - CELG - close: 71.69 change: -0.35

Stop Loss: 70.45
Target(s): 77.50
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Comments:
08/27/12 update: There was no follow through on Friday's bounce in CELG. We are waiting for further strength.

Friday's high was $72.53. I am suggesting a trigger to buy calls at $72.75 with a stop loss at $70.45. Our target is $77.50. FYI: The Point & Figure chart for CELG is bullish with a $81 target.

Trigger @ 72.75

- Suggested Positions -

buy the Sep $75 call (CELG1221i75)

- or -

buy the Oct $75 call (CELG1220j75)

Entry on August xx at $ xx.xx
Average Daily Volume = 2.9 million
Listed on August 25, 2012


Concur Technologies - CNQR - close: 72.67 change: +0.47

Stop Loss: 69.75
Target(s): 74.75
Current Option Gain/Loss: Sep75c: +12.0% & Nov75c: +11.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/27/12 update: CNQR displayed a little relative strength today with a +0.6% gain. Yet shares are essentially stuck churning sideways along the $72 area. There is still a good chance this stock dips toward what should be support near $70.00 if the market continues to decline.

- 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

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


Dresser-Rand Group - DRC - close: 51.39 change: -0.27

Stop Loss: 49.45
Target(s): 54.75
Current Option Gain/Loss: -12.0%
Time Frame: exit prior to Sept. option expiration
New Positions: see below

Comments:
08/27/12 update: DRC is currently churning sideways under short-term resistance at $52.00. 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

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


Express Scripts - ESRX - close: 61.90 change: +0.14

Stop Loss: 59.75
Target(s): 67.50
Current Option Gain/Loss: Sep62.5c: + 8.4% & Oct$62.5c: + 8.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/27/12 update: ESRX is still drifting higher and managed a minor gain today (+0.2%). Readers might want to consider looking for a dip near $61.00 as their bullish entry point but I would still consider new positions now.

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

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


Netflix, Inc. - NFLX - close: 62.39 change: -0.77

Stop Loss: 61.25
Target(s): 69.50
Current Option Gain/Loss: -44.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/27/12 update: NFLX spent Monday churning between $62 and $64. More conservative trades may want to exit early. The recent action in this stock is worrisome. Alternatively consider raising your stop loss closer to $62 instead.

I am not suggesting new positions.

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

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


Qualcomm - QCOM - close: 62.37 change: -0.06

Stop Loss: 60.95
Target(s): 64.25
Current Option Gain/Loss: +13.5%
Time Frame: 4-6 weeks
New Positions: see below

Comments:
08/27/12 update: Monday was another quiet session for QCOM. Shares are drifting sideways. I remain cautious here.

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

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


Snap On Inc. - SNA - close: 69.57 change: -0.39

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:
08/27/12 update: There is nothing new to report on for SNA. The stock is trading inside a $69.00-70.70 range and has been stuck there for a few days. 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)

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


United Technologies - UTX - close: 80.56 change: +0.48

Stop Loss: 78.85
Target(s): 84.00
Current Option Gain/Loss: Sep80c: +15.7% & Oct82.50c: + 9.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/27/12 update: Our new trade on UTX has been triggered. The stock opened at $80.30, which just happens to be our entry trigger. There was a quick dip back to $79.82 and then UTX rebounded higher. I would still consider new positions now or you could try and buy another dip near $80.00.

- Suggested Positions -

Long Sep $80 call (UTX1222i80) Entry $1.52

- or -

Long Oct $82.50 call (UTX1220j82.5) Entry $1.33

08/27/12 triggered @ 80.30

Entry on August 27 at $80.30
Average Daily Volume = 3.7 million
Listed on August 25, 2012


Whole Foods Market, Inc. - WFM - close: 96.82 change: -0.21

Stop Loss: 94.75
Target(s): 104.50
Current Option Gain/Loss: Sep$100c: -35.8% & Oct$100c: -14.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/27/12 update: WFM is hovering under the $98.00 level. I don't see any changes from my prior comments. 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

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


Westlake Chemical - WLK - close: 68.95 change: -0.55

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:
08/27/12 update: WLK gapped down at the open thanks to shares receiving a downgrade to a "sell" before the opening bell. The stock rebounded and WLK still looks poised to breakout past resistance at $70.00. I didn't see any details on the downgrade but I would presume it was based on their valuation concerns.

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)

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


WellPoint Inc. - WLP - close: 58.16 change: +0.50

Stop Loss: 55.85
Target(s): 59.75
Current Option Gain/Loss: + 4.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/27/12 update: WLP displayed some relative strength today with a +0.8% gain. I don't see any changes from my weekend comments. 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

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


PUT Play Updates

FB - Facebook - close: 19.15 change: -0.26

Stop Loss: 20.35
Target(s): 17.00
Time Frame: 2-4 weeks
Current Option Gain/Loss: - 0.0%
New Positions: see below

Comments:
08/27/12 update: FB underperformed the market today with a -1.3% decline. After consolidating sideways the last few days shares look rested and ready for the next leg down. Technically today's drop is a bearish breakdown from the short-term pennant formation.

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

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


Weight Watchers Intl. - WTW - close: 47.84 change: -0.21

Stop Loss: 50.55
Target(s): 42.50
Current Option Gain/Loss: Sep47.5p: - 5.4% & Oct45p: - 8.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/27/12 update: The bounce attempt in WTW failed this morning and shares look weak. I would still consider new positions now at current levels.

- Suggested Positions -

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

- or -

Long Oct $45.00 PUT (WTW1220V45) Entry $1.85

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


CLOSED BULLISH PLAYS

Joy Global, Inc. - JOY - close: 54.37 change: -1.22

Stop Loss: 55.25
Target(s): 59.75
Current Option Gain/Loss: Sep $57.5c: -20.3% Oct60c: -32.0%
Time Frame: exit prior to the Aug. 29th earnings report
New Positions: see below

Comments:
08/27/12 update: Shares of JOY were not cooperating so over the weekend we decided it would be best to exit at the open on Monday morning. JOY gapped open higher at $55.85 and then dropped to a -2.1% decline.

- Suggested Positions -

Sep $57.50 call (JOY1222i57.5) Entry $2.70 exit $2.15 (-20.3%)

- or -

Oct $60.00 call (JOY1220j60) Entry $2.50 exit $1.70 (-32%)

08/27/12 closed on Monday morning as planned
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