Editor's Note:

The Friday morning rally on the better than expected jobs report didn't last very long and stocks ended the day in negative territory.

EVEP and WYNN were triggered.

IWM was stopped out. MDVN was closed as planned.

Current Portfolio:


CALL Play Updates

Deere & Co - DE - close: 85.60 change: -1.27

Stop Loss: 84.75
Target(s): 89.90
Current Option Gain/Loss: -29.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/03/12: The Friday morning rally in DE didn't last very long. Traders immediately sold into strength and DE gave back most of Thursday's gains. Odds look pretty good we'll see DE retest support near the $85.00-84.85 zone. If there is any further weakness then DE will hit our new stop loss at $84.75.

I am not suggesting new positions at this time.

- 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

chart:

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


EV Energy Partners - EVEP - close: 65.38 change: -0.51

Stop Loss: 63.95
Target(s): 69.85
Current Option Gain/Loss: - 33.3%
Time Frame: exit prior to the Nov. 8th earnings report
New Positions: see below

Comments:
11/03/12: Warning! I am urging caution here. The stock market's widespread rally on Friday morning was enough to push EVEP to a new relative high and above resistance near $65.00. Yet the stock reversed lower as the market gave back its gains. Unfortunately, our bullish trigger to buy calls had already been hit at $66.25. I am not suggesting new positions at this time.

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

- Suggested Positions -

Long NOV $65 call (EVEP1217k65) entry $2.85

chart:

Entry on November 02 at $66.25
Average Daily Volume = 111 thousand
Listed on October 27, 2012


Green Mountain Coffee Roasters - GMCR - close: 25.67 change: -0.67

Stop Loss: 23.90
Target(s): 29.50
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/03/12: After big gains on Thursday it was not surprising to see some profit taking on Friday. It looks like the simple 150-dma remains technical resistance. I would look for a dip back into the $25.50-25.50 zone and wait for a bounce there before considering new bullish positions. More conservative traders might want to consider raising their stops closer to $25.00.

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

chart:

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


Harley-Davidson - HOG - close: 47.29 change: -0.32

Stop Loss: 45.40
Target(s): 52.25
Current Option Gain/Loss: -13.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/03/12: HOG tagged a new four-month high on Friday morning before reversing back into negative territory. I would not be surprised to see shares dip back into the $47.00-46.00 zone. Wait for a bounce there before considering new bullish positions.

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

chart:

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


Stericycle, Inc. - SRCL - close: 94.77 change: -0.99

Stop Loss: 93.60
Target(s): 99.75 or $104.00
Current Option Gain/Loss: - 26.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/03/12: There was no follow through for SRCL on Thursday's bullish breakout. Shares failed at the $96.00 level and gave back nearly all of Thursday's gains. Furthermore Friday's session has produced a bearish engulfing candlestick reversal pattern.

More conservative traders may want to raise their stop loss. I am not suggesting new positions at this time. We'll reconsider if SRCL can bounce near the $94.00 area.

Earlier Comments:
Please note that I am setting two exit targets. Our conservative exit target is $99.85 since the $100.00 level could be round-number, psychological resistance. Our more aggressive, longer-term target is $104.00.

- Suggested Positions -

Long DEC $100 call (SRCL1222L100) Entry $0.75

chart:

Entry on November 2 at $95.98
Average Daily Volume = 509 thousand
Listed on November 1, 2012


Sempra Energy - SRE - close: 69.13 change: +0.14

Stop Loss: 68.40
Target(s): 72.00
Current Option Gain/Loss: +14.2%
Time Frame: Exit prior to the Nov. 6th earnings report
New Positions: see below

Comments:
11/03/12: SRE displayed some relative strength by posting a small gain on Friday. Shares remain under round-number resistance at $70.00. The stock's trend is up but we're out of time. SRE is scheduled to report earnings on Tuesday. We will plan to exit positions on Monday at the closing bell. I am raising our stop loss to $68.40, which is just under the simple 10-dma.

- Suggested Positions -

Long DEC $70 call (SRE1222L70) Entry $0.70

11/03/12 new stop loss @ 68.40, prepare to exit on Monday at the closing bell

chart:

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


Wynn Resorts - WYNN - close: 120.80 change: -2.10

Stop Loss: 117.75
Target(s): 129.75
Current Option Gain/Loss: -11.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/03/12: We were expecting WYNN to see a little pullback after its Wednesday-Thursday rally. Sure enough WYNN did retrace its steps on Friday with a -1.7% decline. Unfortunately Friday's performance has also created a new bearish engulfing candlestick (one-day) reversal pattern. Now typically these patterns need to see confirmation but it's still a warning signal.

Our buy-the-dip trigger was hit at $121.25. At this point I would wait for a new bounce, possibly near $120 or more likely the rising 10-dma near $118 before considering new positions.

Earlier Comments:
WYNN can be a volatile stock so I am suggesting we keep our position size small to limit our risk.

- Suggested *Small* Positions -

Long DEC $125 call (WYNN1222L125) entry $3.00

chart:

Entry on November 02 at $121.25
Average Daily Volume = 1.8 million
Listed on November 1, 2012


PUT Play Updates

The Mosaic Co. - MOS - close: 52.19 change: -0.94

Stop Loss: 54.25
Target(s): 48.00
Current Option Gain/Loss: +13.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/03/12: The Friday morning rally attempt in MOS didn't last very long. Shares failed under the $54.00 level. The stock reversed into a -1.7% decline and set a new multi-month closing low. MOS looks poised to breakdown further but 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

chart:

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


Schlumberger Ltd. - SLB - close: 68.77 change: -1.38

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:
11/03/12: So far so good with SLB. The bounce attempt failed at resistance on Friday morning and shares fell to a -1.9% decline. This is a new three-month closing low. Friday's drop looks like a new bearish entry point.

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

chart:

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


CLOSED BULLISH PLAYS

iShares Russell 2000 - IWM - close: 81.19 change: -1.30

Stop Loss: 81.45
Target(s): 86.00
Current Option Gain/Loss: -25.9%
Time Frame: several weeks
New Positions: see below

Comments:
11/03/12: We had a relatively tight stop loss on our IWM trade. Friday's bearish reversal lower was too much and shares hit our stop loss at $81.45. Technically Friday's move looks like a bearish engulfing candlestick reversal pattern and a failed rally under the 50-dma and its six-week trend of lower highs. A close under what should be support at $80.00 would be a very bearish signal for the markets.

- Suggested Positions -

2013 Jan $85 call (IWM1319a85) entry $1.35 exit $1.00 (-25.9%)

11/02/12 stopped out at $81.45
11/01/12 triggered @ 82.25

chart:

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


Medivation, Inc. - MDVN - close: 47.50 change: -3.65

Stop Loss: 49.95
Target(s): 57.00
Current Option Gain/Loss: -72.5%
Time Frame: exit prior to the Nov. 8th earnings report (unconfirmed date)
New Positions: see below

Comments:
11/03/12: It looks like we were correct to worry about MDVN. Shares had been acting weak the last couple of days. The failed rally on Thursday was a signal to exit. Our plan was to abandon ship immediately on Friday morning. The market's rally on Friday morning helped MDVN gap open higher at $51.84 but shares quickly reversed lower and plunged to a -7.1% drop. The long-term up trend has been broken.

- Suggested Positions -

Nov $55 CALL (MDVN1217K55) Entry $2.00 exit $0.55 (-72.5%)

11/02/12 planned exit at the open on Friday morning
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

chart:

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