Editor's Note:

Lowered forecasts from the IMF and a round of earnings warnings helped spark a sell-off on Tuesday.

WFM and PXP were both stopped out.

Current Portfolio:


CALL Play Updates

Commvault Sys. - CVLT - close: 55.46 change: -1.12

Stop Loss: 54.90
Target(s): 62.00
Current Option Gain/Loss: -95.9%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/09/12: CVLT came extremely close to hitting our stop loss today. Shares dipped to $54.91 at its lows. The stock spent most of its time in the $55.00-55.50 zone. The $55.00 level should be support but if the market's major indices decline again tomorrow I would expect CVLT to hit our stop loss at $54.90. I am not suggesting new positions at this time.

- Suggested Positions -

Long Oct $60 Call (CVLT1220j60) Entry $1.24

10/03/12 adjust exit target to $62.00
10/01/12 new stop loss @ 54.90
09/29/19 new stop loss @ 54.40

Entry on September 20 at $56.07
Average Daily Volume = 427 thousand
Listed on September 19, 2012


EQT Corp. - EQT - close: 60.49 change: +0.44

Stop Loss: 57.75
Target(s): 63.00
Current Option Gain/Loss: +88.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
10/09/12: EQT displayed relative strength with a +0.7% gain. The close above resistance at $60.00 is bullish. Yet EQT will not be immune to a market wide decline if the indices continue to fall.

More conservative traders may want to take profits right now. I am not suggesting new positions at this time.

- Suggested Positions -

Long Oct $60 call (EQT1220j60) Entry $0.61

10/08/12 readers may want to take profits now
10/06/12 new stop loss @ 57.75
10/04/12 new stop loss @ 57.45
09/27/12 new stop loss @ 56.45

Entry on September 24 at $ xx.xx
Average Daily Volume = 1.0 million
Listed on September 22, 2012


NetSuite Inc. - N - close: 59.89 change: -2.32

Stop Loss: 59.75
Target(s): 67.50
Current Option Gain/Loss: Oct65: -85.7% & Nov65c: -43.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
10/09/12: I could not find any news to explain the relative weakness in shares of N today. The stock broke down under short-term support near $62 and pierced the next level of support at $60.00. EQT underperformed with a -3.7% decline. The low today was $59.83. If there is any follow through lower tomorrow the stock will hit our stop loss at $59.75. I am not suggesting new positions at this time.

Our multi-week target is $67.50. FYI: The Point & Figure chart for N is bullish with an $82 target.

- Suggested Positions -

Long Oct $65 call (N1220j65) Entry $1.05

- or -

Long Nov $65 call (N1217k65) Entry $2.90

10/01/12 triggered @ 62.50

Entry on October 01 at $62.50
Average Daily Volume = 565 thousand
Listed on September 29, 2012


Noble Energy, Inc. - NBL - close: 94.37 change: +0.07

Stop Loss: 91.75
Target(s): 99.75
Current Option Gain/Loss: Oct95c: -10.3% & Nov95c: - 6.4%
Time Frame: exit prior to earnings on Oct. 25th
New Positions: see below

Comments:
10/09/12: Traders bought the dip in NBL, twice in fact, near $93.85, and the stock rebounded to close in positive territory. The relative strength is encouraging. If the market opens positive tomorrow then I would use today's move in NBL as a new bullish entry point. Keep in mind that we do not want to hold over the late October earnings report.

Trigger @ 94.25

- Suggested Positions -

Long Oct $95 call (NBL1220j95) Entry $1.45

- or -

Long Nov $95 call (NBL1217k95) Entry $3.10

Entry on October 08 at $94.25
Average Daily Volume = 1.0 million
Listed on October 2, 2012


Sears Holding Corp. - SHLD - close: 58.90 change: +0.32

Stop Loss: 54.75
Target(s): 62.50
Current Option Gain/Loss: +48.5%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
10/09/12: SHLD continues to drift higher and shares are nearing potential round-number resistance at $60.00. More conservative traders may want to take profits now.

Earlier Comments:
SHLD could see some short covering. The most recent data listed short interest at 37% of the 31.3 million share float.

NOTE: There are two October $57.50 option strikes. Make sure you pick the normal one. Pay attention to the symbol.

- Suggested Positions -

Long Oct $57.50 call (SHLD1220j57.5) Entry $1.75

10/06/12 new stop loss @ 54.75

Entry on September 28 at $56.11
Average Daily Volume = 1.7 million
Listed on September 27, 2012


PUT Play Updates

CACI Intl. - CACI - close: 49.26 change: -0.43

Stop Loss: 52.01
Target(s): 45.25
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: , see below

Comments:
10/09/12: CACI tried to rally this morning with a gap higher but shares struggled with new resistance near $50.00. The stock ended the day with a -0.8% decline. I would still consider new bearish positions at current levels. FYI: The Point & Figure chart for CACI is bearish with a $20 target.

- Suggested Positions -

Long Nov $50 PUT (CACI1211w50) Entry $2.30

Entry on October 09 at $49.64
Average Daily Volume = 373 thousand
Listed on October 8, 2012


ITT Educational Services - ESI - close: 30.84 change: -0.51

Stop Loss: 32.05
Target(s): 25.15
Current Option Gain/Loss: -25.1%
Time Frame: exit prior to earnings on Oct. 25th
New Positions: see below

Comments:
10/09/12: Right on cue ESI encountered resistance near short-term resistance. The stock gave up -1.6% today. Readers can use today's move as a new entry point for bearish positions.

Earlier Comments:
I want to reiterate my caution about using small positions. ESI already has a high amount of short interest because so many investors think this stock is going lower.

- Suggested *SMALL* Positions -

Long 2013 Jan $27.50 PUT (ESI1319m27.5) Entry $3.10

Entry on October 04 at $29.47
Average Daily Volume = 408 thousand
Listed on October 3, 2012


Juniper Networks - JNPR - close: 16.58 change: -0.03

Stop Loss: 17.75
Target(s): 14.10
Current Option Gain/Loss: + 1.3%
Time Frame: Exit prior the late October earnings report
New Positions: see below

Comments:
10/09/12: It was a relatively quiet session for JNPR with shares rebounding off its intraday lows but failing to post any gains.

Earlier Comments:
The plan was to keep our position size small to reduce our risk. FYI: The Point & Figure chart for JNPR is bearish with a $13.50 target.

- Suggested *SMALL* Positions -

buy the Nov $16 PUT (JNPR1211W16) Entry $0.72

Entry on October 04 at $16.74
Average Daily Volume = 6.6 million
Listed on October 3, 2012


Starbucks Corp. - SBUX - close: 47.35 change: -1.41

Stop Loss: 50.05
Target(s): 44.00
Current Option Gain/Loss: +28.2%
Time Frame: exit prior to the early November earnings report
New Positions: see below

Comments:
10/09/12: As we expected shares of SBUX have continued to decline. Shares accelerated lower today with a -2.8% drop and a breakdown under its 50-dma, its 300-dma and the $48.00 level. So far, so good.

Our target is $44.00. More aggressive traders could aim lower since SBUX appears to be in a new trend of lower highs and lower lows.

- Suggested Positions -

Long Nov $50 PUT (SBUX1211w50) Entry $2.73

Entry on October 08 at $48.40
Average Daily Volume = 8.1 million
Listed on October 6, 2012


Tech Data Corp. - TECD - close: 43.19 change: -0.93

Stop Loss: 45.15
Target(s): 42.00
Current Option Gain/Loss: +30.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/09/12: TECD broke down to new 2012 lows today. I am adjusting our stop loss down to $45.15. Our target is $42.00. More aggressive traders could aim lower. I am not suggesting new positions at this time.

Earlier Comments:
I would keep our position size small to limit our risk.

*Small Positions* - Suggested Positions -

Long Nov $45 PUT (TECD1211w45) Entry $1.95

10/09/12 new stop loss @ 45.15
10/03/12 new stop loss @ 45.75
10/01/12 triggered @ 44.90

Entry on October 01 at $44.90
Average Daily Volume = 333 thousand
Listed on September 29, 2012


CLOSED BULLISH PLAYS

Whole Foods Market - WFM - close: 97.99 change: -2.46

Stop Loss: 98.75
Target(s): 104.75
Current Option Gain/Loss: -12.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/09/12: WFM proved to be a dud. With a market-wide decline on Tuesday, shares of WFM reversed lower and underperformed with a -2.4% decline. Shares opened at $100.14 and quickly hit our stop loss at $98.75.

- Suggested Positions -

closed Nov $105 call (WFM1211K105) entry $2.27, exit $1.98 (-12.7%)

10/09/12 stopped out at $98.75
10/09/12 entry at $100.14

Chart:

Entry on October 09 at $100.14
Average Daily Volume = 1.3 million
Listed on October 8, 2012


CLOSED BEARISH PLAYS

Plains Exploration & Production - PXP - close: 37.00 change: +0.93

Stop Loss: 37.25
Target(s): 31.50
Current Option Gain/Loss: -31.2%
Time Frame: exit prior to earnings on Nov. 1st.
New Positions: see below

Comments:
10/09/12: PXP did not cooperate. Oil and energy stocks were some of the few exceptions to today's widespread market decline. PXP surged +2.5% and reached even higher intraday to hit our stop loss at $37.25.

*Small Positions* - Suggested Positions -

Nov $35 PUT (PXP1211w35) Entry $1.60 exit $1.10 (-00.0%)

10/09/12 stopped out at $37.25

chart:

Entry on October 08 at $35.75
Average Daily Volume = 4.3 million
Listed on October 6, 2012