Editor's Note:

The market's major indices added to gains and rallied to new multi-year highs.

Friday was not a good day for our bearish trades. Three of them, CLH, DECK, and HUM, were all stopped out. I am suggesting early exits on ATHN and CRI this Monday.

Don't forget that September options expire in just a few days (after Friday).

Current Portfolio:


CALL Play Updates

Alexion Pharma. - ALXN - close: 110.47 change: +0.01

Stop Loss: 107.75
Target(s): 118.50
Current Option Gain/Loss: -15.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/15/12: ALXN's performance on Friday was disappointing. Shares hit a new high above $111 and then pared its gains to close virtually unchanged on the session. I am raising our stop loss to $107.75. Readers may want to wait for a bounce current levels as an entry point.

Our multi-week target is $118.50. FYI: The Point & Figure chart for ALXN is bullish with a $124 target.

- Suggested Positions -

Long Oct $115 call (ALXN1220j115) Entry $2.83

09/15/12 new stop loss @ 107.75

chart:

Entry on September 10 at $110.72
Average Daily Volume = 905 thousand
Listed on September 08, 2012


AthenaHealth, Inc. - ATHN - close: 90.47 change: -2.03

Stop Loss: 89.75
Target(s): 97.00
Current Option Gain/Loss: -31.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/15/12: ATHN is not working. Shares pulled back sharply from their highs on Thursday and then underperformed the market on Friday. There was no significant news to account for this relative weakness. The stock dipped toward short-term support near $90.00 on Friday. More aggressive traders may want to let it ride since the $90 level could hold. I am suggesting we go ahead and exit early on Monday due to ATHN's weakness.

Earlier Comments:
Keep in mind that ATHN could see more short covering. The most recent data listed short interest at 32% of the relatively small 35 million share float. The option spreads are a little bit wider than I'd like so let's keep our position size small to limit our risk.

- Suggested *Small* Positions -

Long Oct $95 call (ATHN1220j95) Entry $3.20

09/15/12 prepare to exit on Monday morning
09/13/12 new stop loss @ 89.75

chart:

Entry on September 07 at $91.50
Average Daily Volume = 345 thousand
Listed on September 06, 2012


Concur Technologies - CNQR - close: 75.63 change: +0.40

Stop Loss: 73.40
Target(s): 74.75 (Sept calls), $77.50 (Nov calls)
Current Option Gain/Loss:(Sep75c: +40.0%) & Nov75c: +33.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/15/12: CNQR continues to drift higher. Shares set a new closing high on Friday. I am raising our stop loss to $73.40.

I am not suggesting new positions at this time.

Earlier Comments:
Our plan was to exit the September $75 calls when CNQR hits $74.75. That target was hit on Thursday, Sept. 6th. Our target to exit the November calls is at $77.50.

- Suggested Positions -

(target hit for Sept calls @ 74.75 on CNQR)
Sep $75 call (CNQR1222i75) Entry $1.25 exit $1.75 (+40.0%)

- or -

Long Nov $75 call (CNQR1217j75) Entry $3.60

09/15/12 new stop loss @ 73.40
09/12/12 new stop loss @ 72.45
09/06/12 target hit for the Sept. calls @ 74.75
09/06/12 new stop loss @ 71.70
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

chart:

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


Carter's Inc. - CRI - close: 56.59 change: -0.25

Stop Loss: 55.75
Target(s): 59.85
Current Option Gain/Loss: -26.0%
Time Frame: 3 weeks
New Positions: see below

Comments:
09/15/12: We are worried that the upward momentum in CRI has stalled. I am suggesting an early exit on Monday morning at the open. We can keep CRI on our watch list for a new entry point down the road.

- Suggested Positions -

Long Sep $55 call (CRI1222i55) Entry $2.30

09/15/12 prepare to exit on Monday morning
09/13/12 new stop loss @ 55.75
09/11/12 new stop loss @ 54.90
09/04/12 triggered @ 56.25

chart:

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


Vertex Pharma. - VRTX - close: 58.08 change: +1.87

Stop Loss: 54.75
Target(s): 59.90
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/15/12: VRTX outperformed the markets on Friday with a +3.3% gain. Shares are testing short-term resistance at the $58.00 level. Please note that I am adjusting our exit target to $59.90. More aggressive traders could aim higher.

Earlier Comments:
I am suggesting small bullish positions if VRTX can trade at $55.75. This is a higher-risk trade. You can see from the chart that VRTX has been very volatile over the last few months. We want to limit our position size to reduce our risk.

- Suggested Positions -

Long Oct $57.50 call (VRTX1220j57.5) Entry $3.80

09/15/12 adjust exit target to $59.90
09/13/12 new stop loss @ 54.75
09/06/12 new stop loss @ 54.25
09/06/12 triggered @ 55.75

chart:

Entry on September 06 at $55.75
Average Daily Volume = 1.4 million
Listed on September 05, 2012


PUT Play Updates

Lorillard Inc. - LO - close: 115.22 change: -1.34

Stop Loss: 120.25
Target(s): 110.50
Current Option Gain/Loss: +15.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/15/12: LO continues to sink. Traders sold into strength on Friday morning and the stock fell to a new multi-month low with Friday's -1.1% decline. I am not suggesting new positions at this time.

Earlier Comments:
We want to keep our position size small to start.

(small positions) - Suggested Positions -

Long Oct $115 PUT (LO1220v115) Entry $2.65

09/12/12 new stop loss @ 120.25
09/12/12 triggered @ 118.50

chart:

Entry on September 12 at $118.50
Average Daily Volume = 963 thousand
Listed on September 11, 2012


Transocean Ltd. - RIG - close: 46.58 change: -0.02

Stop Loss: 46.80
Target(s): 42.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Comments:
09/15/12: Positive analyst comments on RIG failed to have much impact on Friday. The opening bounce faded and shares traded under $46 and its 100-dma again before bouncing back toward unchanged. Our trigger has not been hit yet.

RIG still looks weak. I am suggesting a trigger to buy puts at $45.40. Our multi-week target is $42.00.

Trigger @ 45.40

- Suggested Positions -

buy the Nov $45 PUT (RIG1217w45)

chart:

Entry on September xx at $ xx.xx
Average Daily Volume = 3.1 million
Listed on September 13, 2012


CLOSED BEARISH PLAYS

Clean Harbors - CLH - close: 54.51 change: +1.61

Stop Loss: 54.25
Target(s): 50.10
Current Option Gain/Loss: -36.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/15/12: Shares of CLH rallied for now reason on Friday. Granted the wider market was advancing but after three weeks of declines CLH suddenly shot higher and broke through resistance at its 10-dma and the $54.00 level. Our stop loss was hit at $54.25.

- Suggested Positions -

Oct $55 PUT (CLH1220v55) entry $3.40 exit $2.15 (-36.7%)

09/14/12 stopped out at $54.25
09/12/12 new stop loss @ 54.25

chart:

Entry on September 06 at $53.55
Average Daily Volume = 620 thousand
Listed on September 05, 2012


Deckers Outdoor - DECK - close: 48.92 change: +3.31

Stop Loss: 46.30
Target(s): 40.25
Current Option Gain/Loss: -47.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
09/15/12: I warned readers that DECK was an aggressive, higher-risk trade. I also cautioned about the bullish reversal pattern on Thursday. Looks like there were a number of bears that saw this pattern and all decided that want to get out at the same time. DECK saw a little bit of a short squeeze with a +7.2% gain on Friday.

Our stop loss was hit at $46.30.

- Suggested Positions -

Oct $42.50 PUT (DECK1220v42.5) Entry $2.00* exit $1.05 (-47.5%)

09/14/12 stopped out at $46.30
09/13/12 triggered @ 44.75
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on September 13 at $44.75
Average Daily Volume = 4.5 million
Listed on September 11, 2012


Humana Inc. - HUM - close: 71.12 change: +1.71

Stop Loss: 70.25
Target(s): 63.50
Current Option Gain/Loss: -40.9%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
09/15/12: HUM also outperformed the market on Friday with what looks like short covering to fuel the +2.4% gain. The rally past the $70.00 level quickly hit our stop loss at $70.25.

- Suggested Positions -

Oct $65 PUT (HUM1220v65) Entry $1.10 exit $0.45 (-59.0%)

09/14/12 stopped out at $70.25
09/13/12 triggered @ 68.50

chart:

Entry on September 13 at $68.50
Average Daily Volume = 1.8 million
Listed on September 12, 2012