Editor's Note:

Traders were in a bullish mood the first day of November. Widespread gains produced a number of breakouts.

Our GMCR, HOG, and IWM trades were all triggered. CRS hit our stop.

Current Portfolio:


CALL Play Updates

Deere & Co - DE - close: 86.87 change: +1.43

Stop Loss: 84.75
Target(s): 89.90
Current Option Gain/Loss: +27.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/01/12: The widespread market gains helped push DE to a +1.6% gain. Shares bounced off support near $85.00 this morning and advanced toward its mid October high.

Today's low was $84.86. I am raising our stop to $84.75.

- Suggested Positions -

Long NOV $87.50 call (DE1217k87.5) entry $0.88

11/01/12 new stop loss @ 84.75
10/26/12 triggered @ 85.55
10/25/12 adjust the entry trigger to $85.55, stop to $84.25

Entry on October 26 at $85.55
Average Daily Volume = 3.3 million
Listed on October 22, 2012


EV Energy Partners - EVEP - close: 65.89 change: +0.65

Stop Loss: 63.95
Target(s): 69.85
Current Option Gain/Loss: Unopened
Time Frame: exit prior to the Nov. 8th earnings report
New Positions: Yes, see below

Comments:
11/01/12: EVEP spent another day churning sideways but shares did close near their highs for the session. The stock is definitely flirting with a breakout past resistance at $66.00. The high today was $66.10. There is no change from my prior comments. Just remember this is going to be a short-term trade.

The October 11th high was $66.08. I am suggesting a trigger to buy calls at $66.25. If triggered our short-term target is $69.85. FYI: The Point & Figure chart for EVEP is bullish with an $83 target.

We want to exit prior to the Nov. 8th earnings report.

Trigger @ 66.25

- Suggested Positions -

buy the NOV $65 call (EVEP1217k65)

Entry on October xx at $ xx.xx
Average Daily Volume = 111 thousand
Listed on October 27, 2012


Green Mountain Coffee Roasters - GMCR - close: 26.34 change: +2.16

Stop Loss: 23.90
Target(s): 29.50
Current Option Gain/Loss: + 47.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/01/12: It was a very bullish day for GMCR with shares surging +8.9%. The stock traded even higher intraday, hitting $27.60. As expected GMCR saw part of a short squeeze once it pushed past resistance.

Our trigger to buy calls was hit at $25.50. The rally stalled at its 150-dma. I am not suggesting new positions at this time.

Earlier Comments:
GMCR could see a short squeeze. The most recent data listed short interest at 37% of the 127 million-share float. There is short-term technical resistance at the 50-dma.

*Small Positions* - Suggested Positions -

Long NOV $27 call (GMCR1217k27) entry $0.85

11/01/12 triggered @ 25.50

Entry on October xx at $ xx.xx
Average Daily Volume = 6.0 million
Listed on October 24, 2012


Harley-Davidson - HOG - close: 47.61 change: +0.85

Stop Loss: 45.40
Target(s): 52.25
Current Option Gain/Loss: + 1.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/01/12: HOG continued to climb as expected. Shares hit our trigger to buy calls at $47.50. The stock managed to outperform the S&P 500 with a +1.8% gain today.

Earlier Comments:
The $50.00 level could be round-number resistance and conservative traders may want to exit near $50.00. I am setting our exit target at $52.25 instead.

- Suggested Positions -

Long DEC $50 call (HOG1222L50) entry $0.82

11/01/12 triggered at $47.50

Entry on November 01 at $47.50
Average Daily Volume = 2.5 million
Listed on October 31, 2012


iShares Russell 2000 - IWM - close: 82.49 change: +0.86

Stop Loss: 81.45
Target(s): 86.00
Current Option Gain/Loss: + 5.1%
Time Frame: several weeks
New Positions: see below

Comments:
11/01/12: So far so good. The sideways consolidation in the small cap index over the last week and a half looks like a short-term bottom. Today's breakout past resistance near $82.00 on the IWM is a new bullish entry point. The IWM hit our trigger to buy calls at $82.25.

Earlier Comments:
The Russell 2000 index and its IWM ETF are testing a trend line of support as well as technical support at its 100-dma (and near its 200-dma). Our multi-week target is $86.00.

- Suggested Positions -

Long 2013 Jan $85 call (IWM1319a85) entry $1.35

11/01/12 triggered @ 82.25

Entry on November 01 at $82.25
Average Daily Volume = 35 million
Listed on October 27, 2012


Medivation, Inc. - MDVN - close: 51.15 change: +0.03

Stop Loss: 49.95
Target(s): 57.00
Current Option Gain/Loss: -70.0%
Time Frame: exit prior to the Nov. 8th earnings report (unconfirmed date)
New Positions: see below

Comments:
11/01/12: Today's trading in MDVN looks like a warning signal. I've been worried about this stock's recent performance. Today is the final nail in the coffin. The market produced a very widespread rally and yet MDVN failed to participate. shares actually rallied this morning only to reverse at technical resistance.

We want to exit immediately tomorrow morning. The current bid on our option is 60 cents.

- Suggested Positions -

Long Nov $55 CALL (MDVN1217K55) Entry $2.00

11/01/12 prepare to exit immediately tomorrow morning
10/20/12 Friday's bounce looks like a new entry point.
10/17/12 MDVN is not cooperating and closed under the 50-dma, readers may want to exit immediately.
10/15/12 triggered @ 52.50

Entry on October 15 at $52.50
Average Daily Volume = 780 thousand
Listed on October 12, 2012


Sempra Energy - SRE - close: 68.99 change: -0.76

Stop Loss: 66.95
Target(s): 72.00
Current Option Gain/Loss: - 7.1%
Time Frame: Exit prior to the Nov. 6th earnings report
New Positions: see below

Comments:
11/01/12: I cautioned readers to expect a pullback in SRE. Sure enough the stock dipped toward short-term technical support at its rising 10-dma. More conservative traders may want to raise their stops closer to the $68 level.

- Suggested Positions -

Long DEC $70 call (SRE1222L70) Entry $0.70

Entry on October 26 at $68.65
Average Daily Volume = 939 thousand
Listed on October 25, 2012


PUT Play Updates

The Mosaic Co. - MOS - close: 53.13 change: +0.79

Stop Loss: 54.25
Target(s): 48.00
Current Option Gain/Loss: -16.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/01/12: MOS was not immune to the market's broad-based rally today. Shares added +1.5% but the general trend is still down. I am not suggesting new positions at this time.

- Suggested Positions -

Long NOV $55 PUT (MOS1217w55) entry $2.60

10/27/12 new stop loss @ 54.25
10/23/12 triggered @ 53.45

Entry on October 23 at $53.45
Average Daily Volume = 3.9 million
Listed on October 20, 2012


Schlumberger Ltd. - SLB - close: 70.15 change: +0.62

Stop Loss: 71.05
Target(s): 65.25
Current Option Gain/Loss: -21.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/01/12: I have to warn you that today's trading in SLB might be considered a potential short-term bullish reversal pattern. Shares hit new relative lows at $68.60 and then rebounded. The close back above $70.00 and its 150-dma is technically bullish. Overall the larger trend is still very bearish and more aggressive traders may want to adjust their stops so it is above the 200-dma or above the $72.00 level.

We are keeping our stop at $71.05 for now. I am not suggesting new positions.

Earlier Comments:
SLB appears to have formed a bearish head-and-shoulders pattern, which would forecast a drop toward the $62 area. FYI: The Point & Figure chart for SLB is bearish with a $64 target.

- Suggested Positions -

Long NOV $70 PUT (SLB1217w70) entry $1.70

11/01/12 warning, today could be a bullish reversal
10/31/12 triggered @ 69.65

Entry on October 31 at $69.65
Average Daily Volume = 5.3 million
Listed on October 25, 2012


CLOSED BEARISH PLAYS

Carpenter Technology - CRS - close: 50.82 change: +2.21

Stop Loss: 50.55
Target(s): 44.25
Current Option Gain/Loss: -36.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/01/12: It was not a good day for the bears or bearish trades. The market's widespread rally sparked plenty of short covering. CRS opened at $48.85 and then surged to a +4.5% gain. Shares pushed past likely resistance at the 100-dma, the 150-dma, the $50.00 mark, the exponential 200-dma and the simple 200-dma. In this process CRS hit our stop loss at $50.55, closing our new trade.

The plan was to keep our position size small to limit our exposure.

- Suggested *SMALL* Positions -

DEC $45 PUT (CRS1222x45) entry $1.10, exit $0.70 (-36.3%)

11/01/12 stopped out at $50.55
11/01/12 trade opened at $48.85

Annotated Chart:

Entry on November 01 at $48.85
Average Daily Volume = 415 thousand
Listed on October 31, 2012