Editor's Note:

It might be time to take profits in our Trimble Navigation (TRMB) trade. We want to exit tomorrow morning. We also want to close our TDC trade tomorrow morning. Elsewhere HD was stopped out and IWM was triggered.

Current Portfolio:


CALL Play Updates

Abercombie & Fitch - ANF - close: 47.25 change: -0.06

Stop Loss: 44.49
Target(s): 49.85
Current Option Gain/Loss: -17.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/11/12: ANF spent Tuesday churning sideways following Monday's breakout to new highs. There is no change from my prior comments. Readers can choose to buy calls now or look for a dip near $46.50.

Our short-term target is $49.85 since the $50.00 mark could be resistance. More aggressive traders may want to aim for the $53-55 zone instead.

- Suggested Positions -

Long 2013 Jan $50 call (ANF1319a50) entry $1.58

Entry on December 10 at $47.48
Average Daily Volume = 5.4 million
Listed on December 08, 2012


Celgene Corp. - CELG - close: 82.08 change: +1.58

Stop Loss: 77.95
Target(s): 84.50 & 87.50
Current Option Gain/Loss: + 14.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: Our new trade on CELG is off to a strong start. Shares opened at $81.46 and rallied to a +1.9% gain and a new high. Nimble traders may want to try and buy calls on a dip near $81.00. Please note that I am setting two targets. We'll take money off the table at $84.50 and our final target will be $87.50.

- Suggested Positions -

Long 2013 Jan $82.50 call (CELG1319a82.5) entry $2.03

Entry on December 11 at $81.46
Average Daily Volume = 3.0 million
Listed on December 10, 2012


Dover Corp - DOV - close: 63.89 change: +0.10

Stop Loss: 62.75
Target(s): 67.50
Current Option Gain/Loss: +11.9%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: Shares of DOV were upgraded this morning. That helped push the stock through resistance near $64 and hit new multi-month highs. Unfortunately the rally reversed at the $65.00 level. I am raising our stop loss to $62.75. I am not suggesting new positions at this time.

- Suggested Positions -

Long 2013 Mar $65 call (DOV1316c65) entry $2.10

12/11/12 new stop loss @ 62.75
11/28/12 new stop loss @ 61.75
11/19/12 triggered @ 62.30

Entry on November 19 at $62.30
Average Daily Volume = 1.7 million
Listed on November 17, 2012


Energizer Holdings - ENR - close: 82.74 change: +1.29

Stop Loss: 78.40
Target(s): 84.50
Current Option Gain/Loss: +50.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: ENR continues to show relative strength. The stock shot higher this morning and then spent the rest of the day consolidating sideways along the $82 level. We are aiming for $84.50. More aggressive traders may want to aim higher.

- Suggested Positions -

Long 2013 Jan $85 call (ENR1319a85) entry $0.90

Entry on December 07 at $80.76
Average Daily Volume = 784 thousand
Listed on December 06, 2012


Flowserve Corp. - FLS - close: 142.92 change: +0.02

Stop Loss: 138.90
Target(s): 148.50
Current Option Gain/Loss: + 1.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: Trading in FLS over the last two weeks almost all looks the same. There is a morning rally higher each day and then FLS slowly trims its gains. This pattern continued today. I am not suggesting new positions at current levels. FYI: The Point & Figure chart for FLS is bullish with a $153 target.

- Suggested Positions -

Long 2013 Jan $145 call (FLS1319a145) Entry $2.70

Entry on December 05 at $141.50
Average Daily Volume = 518 thousand
Listed on December 04, 2012


Ingredion Inc. - INGR - close: 64.70 change: -0.49

Stop Loss: 64.40
Target(s): 69.00
Current Option Gain/Loss: -35.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: INGR is not really cooperating. The stock was at new highs just a few days ago but since then INGR has seen profit taking. The stock underperformed again today and looks poised to hit our stop loss at $64.40 soon. Readers may want to abandon ship now.

- Suggested Positions -

Long 2013 Jan $65 call (INGR1319a65) entry $2.00

12/10/12 new stop loss @ 64.40
12/08/12 new stop loss @ 63.90

Entry on December 04 at $65.25
Average Daily Volume = 504 thousand
Listed on December 03, 2012


iShares Russell 2000 - IWM - close: 83.41 change: +0.87

Stop Loss: 81.20
Target(s): 86.00
Current Option Gain/Loss: + 8.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/11/12: We were expecting a bullish breakout in the IWM but I was not expecting a gap open higher. Our trigger to buy calls was at $82.85 yet IWM gapped open at $83.11. This ETF settled with a +1.0% gain. There is always a chance the ETF tries to fill the gap so patient traders may want to wait for a dip near $82.75-82.50 as an alternative entry point.

- Suggested Positions -

buy the 2013 Jan $84 call (IWM1319a84) current ask $1.17

12/11/12 triggered on the gap open higher at $83.11 (trigger was 82.85)

Entry on December 11 at $83.11
Average Daily Volume = 38 million
Listed on December 10, 2012


Linkedin Corp. - LNKD - close: 113.45 change: +1.71

Stop Loss: 107.45
Target(s): 117.50
Current Option Gain/Loss: +32.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: LNKD has extended its gains to five days in a row. Shares added another +1.5% today. Readers may want to start raising their stop losses.

If triggered our target is $117.50. More conservative traders may want to exit in the $114-115 zone instead since $115 might be resistance. LNKD can be volatile so I would use small positions to limit our risk.

*Small Positions* - Suggested Positions -

Long Jan $115 call (LNKD1319a115) Entry $3.10

Entry on December 10 at $110.25
Average Daily Volume = 1.8 million
Listed on December 08, 2012


O'Reilly Automotive - ORLY - close: 91.89 change: +1.65

Stop Loss: 89.95
Target(s): 95.75
Current Option Gain/Loss: -71.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/11/12: ORLY was on the verge of breaking support and hitting our stop loss. Fortunately the stock reversed higher on Tuesday and shares settled with a +1.8% gain. It's worth noting that ORLY is still struggling with short-term resistance at the 10-dma. I am not suggesting new positions at this time.

- Suggested Positions -

Long DEC $95 call (ORLY1222L95) entry $1.90

Entry on November 20 at $92.05
Average Daily Volume = 1.8 million
Listed on November 19, 2012


Precision Castparts - PCP - close: 184.65 change: -0.01

Stop Loss: 179.75
Target(s): 188.00
Current Option Gain/Loss: +10.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/11/12: The trading in PCP was disappointing today. Shares broke out past resistance near $185 and hit $186.22 only to reverse and give it all back. Readers may want to raise their stop loss. I am not suggesting new positions at this time.

- Suggested *Small* Positions -

Long DEC $185 call (PCP1222L185) Entry $1.85

12/05/12 new stop loss @ 179.75

Entry on November 29 at $182.04
Average Daily Volume = 762 thousand
Listed on November 28, 2012


Rockwell Automation - ROK - close: 81.29 change: +0.86

Stop Loss: 78.90
Target(s): 84.75
Current Option Gain/Loss: -15.0%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
12/11/12: ROK reaffirmed its bullish up trend with a breakout to new multi-month highs today. Readers can use today's rally as a new bullish entry point.

- Suggested Positions -

Long 2013 Jan $85 call (ROK1319a85) entry $1.00*

*option entry price is an estimate since the option did not trade at the time our play was closed.

Entry on December 10 at $80.60
Average Daily Volume = 1.0 million
Listed on December 05, 2012


Trimble Navigation - TRMB - close: 59.54 change: +0.44

Stop Loss: 55.90
Target(s): 59.75
Current Option Gain/Loss: +111.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: TRMB is so close to our exit target. Shares hit $59.63 today. We've been aiming for $59.75. The option really didn't move though and still has a bid at $2.75 (+111%). I am suggesting we go ahead and exit now at the open tomorrow to lock in gains.

- Suggested Positions -

Long 2013 Jan $57.50 call (TRMB1319a57.5) entry $1.30

12/11/12 prepare to exit at the open tomorrow
12/10/12 new stop loss @ 55.90

Entry on November 06 at $56.15
Average Daily Volume = 708 thousand
Listed on November 28, 2012


PUT Play Updates

InterOil Corp. - IOC - close: 53.77 change: +1.56

Stop Loss: 55.15
Target(s): 50.50
Current Option Gain/Loss: + 5.9%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
12/11/12: Hmm.. the oversold bounce in IOC is starting to look stronger. Readers will want to seriously consider an early exit out of this trade. I am not suggesting new positions.

I want to remind readers that this is a more aggressive, higher risk trade. IOC is volatile and has a high amount of short interest.

*Small positions* - Suggested Positions -

Long DEC $55 PUT (IOC1222x55) entry $2.70

12/08/12 new stop loss @ 55.15
12/06/12 new stop loss @ 56.05
12/04/12 new stop loss @ 57.55
11/28/12 new stop loss @ 60.15

Entry on November 21 at $58.50
Average Daily Volume = 790 thousand
Listed on November 20, 2012


Range Resources - RRC - close: 64.71 change: +0.97

Stop Loss: 65.30
Target(s): 56.50
Current Option Gain/Loss: -33.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: Uh-oh! There was no follow through on yesterday's decline. RRC completely reversed yesterday's losses and is once again testing resistance at $65.00. This is troubling. Readers may want to exit early now. I am lowering our stop loss down to $65.30.

Earlier Comments:
I do consider this an aggressive, higher-risk trade. RRC can be volatile and there has been takeover chatter in the past. We want to keep our position size small to limit our risk.

- Suggested *Small* Positions -

buy the 2013 Jan $60 PUT (RRC1319m60) entry $1.20*

12/11/12 new stop loss @ 65.30
*option entry price is an estimate since the option did not trade at the time our play was closed. The first trade on Dec. 5th was at $1.00.

Entry on December 05 at $63.72
Average Daily Volume = 1.5 million
Listed on December 04, 2012


Teradata Corp. - TDC - close: 60.94 change: +2.31

Stop Loss: 62.10
Target(s): 55.15
Current Option Gain/Loss: -36.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/11/12: I could not find any specific news to account for the relative strength in TDC this morning. Something sparked a rally. The stock doesn't have a lot of short interest but that could have been short covering today. The breakout back above $60.00 is technically bullish. I am suggesting we hit the eject button and close this trade early since TDC is not working for us. We'll exit positions at the open tomorrow morning.

- Suggested Positions -

Long 2013 Jan $55 PUT (TDC1319m55) entry $0.86

12/11/12 prepare to exit at the open tomorrow

Entry on December 03 at $60.00
Average Daily Volume = 2.2 million
Listed on December 01, 2012


Tiffany & Co - TIF - close: 57.85 change: +0.37

Stop Loss: 60.05
Target(s): 52.50
Current Option Gain/Loss: - 9.5%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/11/12: The market's widespread gains helped TIF bounce but shares failed to rally past new resistance at the $58.00 level. I would still consider new positions now.

Our target is $52.50. Although I want to caution you that the $55.00 level is potential support. The Point & Figure chart for TIF is bearish with a $51 target.

- Suggested Positions -

long Jan $55 PUT (TIF1319m55) entry $1.15

Entry on December 10 at $57.75
Average Daily Volume = 2.3 million
Listed on December 08, 2012


CLOSED BULLISH PLAYS

Home Depot - HD - close: 62.89 change: -0.15

Stop Loss: 62.90
Target(s): 69.50
Current Option Gain/Loss: -62.5%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/11/12: The malaise in shares of HD continues and the stock underperformed again on Tuesday. Shares broke down below the $63 level and hit our stop loss at $62.90.

- Suggested Positions -

2013 Jan $65 call (HD1319a65) entry $1.95 exit $0.783 (-62.5%)

12/11/12 stopped out at $62.90

chart:

Entry on December 03 at $65.35
Average Daily Volume = 8.5 million
Listed on December 01, 2012