Editor's Note:

Equities produced a nice intraday bounce but the S&P 500 failed to break the two-week trend line of lower highs.

I am suggesting we exit our WFM trade at the open tomorrow.

CRI and PTR were triggered. DRQ was stopped out.

Current Portfolio:


CALL Play Updates

Amgen Inc. - AMGN - close: 84.33 change: +0.41

Stop Loss: 82.40
Target(s): 88.50
Current Option Gain/Loss: Sep85c: -28.1% & Oct85c: - 5.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/04/12: AMGN managed a decent bounce (+0.4%) that outperformed the major indices and the biotech sector index. I don't see any changes from my weekend comments.

- Suggested Positions -

Long Sep $85 call (AMGN1222i85) Entry $1.35

- or -

Long Oct $85 call (AMGN1220j85) Entry $2.15

09/01/12 new stop loss @ 82.40
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: 35.34 change: -0.19

Stop Loss: 34.40
Target(s): 38.50
Current Option Gain/Loss: + 0.5%
Time Frame: 4-6 weeks
New Positions: see below

Comments:
09/04/12: I am growing impatient with BRCM's lack of progress. Shares almost hit our stop loss today with a dip to $34.65 before bouncing. You would think that given all the excitement over AAPL's upcoming iPhone 5 launch that BRCM would show more strength. More conservative traders may want to exit early 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

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


Celgene Corp. - CELG - close: 72.07 change: +0.03

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:
09/04/12: CELG rebounded off its morning lows but did not quite breakout past recent resistance. We're still waiting for a move to $72.75.

I am suggesting a trigger to buy calls at $72.75 with a stop loss at $70.45.

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: 73.34 change: +0.94

Stop Loss: 71.25
Target(s): 74.75 (Sept calls), $77.50 (Nov calls)
Current Option Gain/Loss: Sep75c: +12.0% & Nov75c: +22.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/04/12: CNQR is showing some relative strength with a +1.3% gain. Please note I am making some changes to our trade tonight. We will plan on exiting our September $75 calls at $74.75 but I am raising the exit target on our November calls to $77.50. We will adjust our stop loss to $71.25.

I am not suggesting new positions at this time.

- Suggested Positions -

Long Sep $75 call (CNQR1222i75) Entry $1.25

- or -

Long Nov $75 call (CNQR1217j75) Entry $3.60

09/04/12 adjust exit target for Sept. calls to $74.75
adjust exit target for Nov. calls to $77.50
+ new stop loss @ 71.25
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


Carter's Inc. - CRI - close: 56.50 change: +0.79

Stop Loss: 54.65
Target(s): 59.85
Current Option Gain/Loss: - 4.3%
Time Frame: 3 weeks
New Positions: see below

Comments:
09/04/12: CRI continues to show strength with a bullish breakout past $56.00. Our trigger to buy calls was hit at $56.25.

FYI: There are less than three weeks left on the September options. Octobers are available but the spreads are too wide.

- Suggested Positions -

Long Sep $55 call (CRI1222i55) Entry $2.30

09/04/12 triggered @ 56.25

Entry on September 04 at $56.25
Average Daily Volume = 441 thousand
Listed on September 01, 2012


Express Scripts - ESRX - close: 63.06 change: +0.44

Stop Loss: 59.75
Target(s): 67.50
Current Option Gain/Loss: Sep62.5c: +55.7% & Oct$62.5c: +39.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/04/12: ESRX just closed at a new high with today's +0.69% gain. Readers may want to start inching up their stop loss. If you were waiting for a breakout to buy calls then this is it.

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 24 at $61.31
Average Daily Volume = 5.1 million
Listed on August 23, 2012


Whole Foods Market, Inc. - WFM - close: 96.63 change: -0.12

Stop Loss: 94.75
Target(s): 104.50
Current Option Gain/Loss: Sep$100c: -48.2% & Oct$100c: -24.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/04/12: The larger trend for WFM is bullish but short-term the stock is not seeing any improvement. Shares remain inside the $96-98 trading range. We are going to close this play early tomorrow at the opening bell. I'd be inclined to keep WFM on your watch list in case we see another entry point down the road.

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

09/04/12 prepare to exit at the open tomorrow morning

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


PUT Play Updates

CH Robinson Worldwide - CHRW - close: 56.63 change: +0.02

Stop Loss: 58.05
Target(s): 51.25
Current Option Gain/Loss: -20.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/04/12: The Dow Jones Transportation average managed a decent bounce off its intraday lows but just barely made it into positive territory. CHRW had a similar move as it ricocheted between $56 and $57. Readers may want to wait for a new drop under $56.00 as an entry point to start bearish positions.

- Suggested *Small* Positions -

Long Oct $55 PUT (CHRW1220v55) entry $1.38

Entry on August 29 at $56.29
Average Daily Volume = 1.1 million
Listed on August 28, 2012


Cummins Inc. - CMI - close: 95.29 change: -1.82

Stop Loss: 100.55
Target(s): 92.50
Current Option Gain/Loss: +47.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/04/12: Good news! CMI completely erased Friday's bounce with a -1.8% plunge today. Shares are testing round-number support at $95.00 and technical support near its 50-dma. I would not open new positions at this time.

Earlier Comments:
There is potential support at $95.00 and the 50-dma but we are aiming for $92.50.

- Suggested Positions -

Long Sep $95 PUT (CMI1222u95) Entry $1.70

08/28/12 new stop loss @ 100.55
08/28/12 trade opens with CMI gapping down at $98.28

Entry on August 28 at $98.28
Average Daily Volume = 2.3 million
Listed on August 27, 2012


FB - Facebook - close: 17.73 change: -0.33

Stop Loss: 19.15
Target(s): 17.00
Time Frame: 2-4 weeks
Current Option Gain/Loss: +65.5%
New Positions: see below

Comments:
09/04/12: Shares of FB continue to fall in spite of two different brokerage firms issuing bullish comments on the stock today. There is no change from my weekend comments.

Readers may want to exit now but we are aiming for $17.00 on FB.

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 (FB1222U20) entry $1.45

09/01/12 new stop loss @ 19.15
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


PetroChina Co. Ltd. - PTR - close: 117.86 change: -2.44

Stop Loss: 121.25
Target(s): 111.00
Current Option Gain/Loss: Sep120p: - 1.3% & Oct115p: - 1.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/04/12: Thankfully we did not have to wait very long for PTR to hit our entry point. Shares gapped open lower at $119.00 and hit our trigger of $118.75 pretty early.

Earlier Comments:
I do consider this somewhat of an aggressive trade since PTR gaps open (up and down) quite often as its price adjusts to trading back home overnight in China.

- Suggested Positions -

Long Sep $120 PUT (PTR1222u120) Entry $3.65*

- or -

Long Oct $115 PUT (PTR1220v115) Entry $3.16

09/04/12 triggered @ 118.75
*entry price on the Sept. $120 put is an estimate as the option did not trade when our play was triggered.

Entry on September 04 at $118.75
Average Daily Volume = 125 thousand
Listed on September 01, 2012


Weight Watchers Intl. - WTW - close: 46.98 change: -0.79

Stop Loss: 50.10
Target(s): 42.50
Current Option Gain/Loss: Sep47.5p: - 8.1% & Oct45p: -10.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/04/12: WTW continues to underperform with a -1.6% decline on Tuesday. This is a new three-week low. Readers may want to start inching down their stop loss.

- Suggested Positions -

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

- or -

Long Oct $45.00 PUT (WTW1220V45) Entry $1.85

08/28/12 new stop loss @ 50.10

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


CLOSED BEARISH PLAYS

Dril-Quip - DRQ - close: 70.32 change: +0.28

Stop Loss: 70.75
Target(s): 64.00
Current Option Gain/Loss: -54.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/04/12: DRQ was just a little bit too volatile for us this morning. Shares tagged our stop loss at $70.75 in a choppy session.

The plan was to limit our risk by keeping our position size small.

- Suggested *Small* Positions -

Sep $70 PUT (DRQ1222u70) entry $3.30 exit $1.50* (-54.5%)

*exit price is an estimate. option did not trade when our play was closed.
09/04/12 stopped out at $70.75

chart:

Entry on August 30 at $68.40
Average Daily Volume = 425 thousand
Listed on August 29, 2012