Editor's Note:

Shares of Precision Castparts (PCP) hit our bullish target today. Elsewhere the market's widespread rally helped trigger both AMT and VMC. I have removed TGT as a trade and we want to exit our TIF trade at the open tomorrow. Please note that I have also updated a handful of stop losses tonight.

Current Portfolio:


CALL Play Updates

American Tower Corp. - AMT - close: 76.80 change: -0.10

Stop Loss: 75.40
Target(s): 79.85 & 82.00
Current Option Gain/Loss: -15.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/18/12: AMT's performance today was a little disappointing. Shares spiked above resistance at $77.00, hit our trigger to buy calls at $77.05, and quickly reversed lower. Yet traders did buy the dip again so AMT still looks poised to rally. I would wait for a new rise above $77.00 before initiating positions.

We have two targets. Our first target to take profits is at $79.85. Our second, more aggressive target is $82.00 but AMT will have to rally past potential resistance at $80.00 first. FYI: The Point & Figure chart for AMT is bullish with a triple-top breakout buy signal and an $88 target.

- Suggested Positions -

Long 2013 Jan $77.50 call (AMT1319a77.5) entry $1.30*

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

Entry on December 18 at $77.05
Average Daily Volume = 1.7 million
Listed on December 15, 2012


Abercombie & Fitch - ANF - close: 48.99 change: +1.82

Stop Loss: 45.85
Target(s): 49.85
Current Option Gain/Loss: + 9.4%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/18/12: ANF displayed relative strength today with a +3.8% gain and a rally to new multi-month highs. Shares could hit our exit target at $49.85 tomorrow. More aggressive traders may want to aim for the $53-55 zone instead.

Please note our new stop loss at $45.85.

- Suggested Positions -

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

12/18/12 new stop loss @ 45.85

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


Celgene Corp. - CELG - close: 80.03 change: -0.41

Stop Loss: 78.45
Target(s): 84.50 & 87.50
Current Option Gain/Loss: - 38.9%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/18/12: Uh-oh! There was no follow through on yesterday's bounce in CELG. Furthermore today's decline in CELG while the rest of the market is in rally mode doesn't bode well. Readers may want to abandon ship. Yesterday's low was $78.63. I am raising our stop loss to $78.45.

Earlier Comments:
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

12/18/12 new stop loss @ 78.45
12/15/12 traders should be defensive. The action this past week looks like a failed rally or bull trap pattern.

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


Energizer Holdings - ENR - close: 80.94 change: +0.85

Stop Loss: 79.40
Target(s): 84.50
Current Option Gain/Loss: -44.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/18/12: We were starting to worry about ENR but traders bought the dip to support near $80. Today's bounce back above the 10-dma could be used as a new bullish entry point.

- Suggested Positions -

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

12/15/12 new stop loss @ 79.40

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


Flowserve Corp. - FLS - close: 144.69 change: +2.78

Stop Loss: 139.95
Target(s): 148.50
Current Option Gain/Loss: +11.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/18/12: FLS was showing some volatility this morning. The stock gapped open lower at $140.44 but quickly reversed higher and rallied to a new relative high with a +1.9% gain on the session. I am raising our stop loss to $139.95. 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

12/18/12 new stop loss @ 139.95

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


iShares Russell 2000 - IWM - close: 84.66 change: +1.14

Stop Loss: 81.95
Target(s): 86.00
Current Option Gain/Loss: +41.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/18/12: There seems to be a growing expectation that politicians in Washington might actually get a fiscal cliff deal done. That helped fuel another day of broad-based gains and the small gaps performed well. The $RUT index rallied +1.4%. The IWM delivered a +1.3% gain. I am raising our stop loss to $81.95.

- Suggested Positions -

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

12/18/12 new stop loss @ 81.95
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: 115.58 change: +1.25

Stop Loss: 111.40
Target(s): 119.00
Current Option Gain/Loss: +45.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/18/12: Technically LNKD delivered a bullish day with a breakout above short-term resistance at the $115.00 level. I am raising our stop loss to $111.40.

Earlier Comments:
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

12/18/12 new stop loss @ 111.40
12/17/12 adjust exit target to $119.00
12/15/12 new stop loss @ $109.00

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


Lululemon Athletica - LULU - close: 77.19 change: +0.83

Stop Loss: 72.95
Target(s): 79.85
Current Option Gain/Loss: +36.3%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
12/18/12: LULU continues to extend its winning ways and posted another gain. I don't see any changes from my prior comments. I would not launch new positions at current levels.

Earlier Comments:
LULU could see a short squeeze that lifts it toward $80.00. The most recent data listed short interest at 20% of the 101 million share float. FYI: The Point & Figure chart for LULU is bullish with an $88 target.

- Suggested Positions -

Long 2013 Jan $75 call (LULU1319a75) entry $3.30

12/17/12 new stop loss @ 72.95, adjust exit to $79.85

Entry on December 12 at $74.25
Average Daily Volume = 2.1 million
Listed on December 11, 2012


Netflix, Inc. - NFLX - close: 95.64 change: +0.94

Stop Loss: 89.45
Target(s): 99.75
Current Option Gain/Loss: - 0.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/18/12: NFLX saw a spike higher between 10:00 a.m. and 10:30 when shares traded near $97.50. NFLX spent the rest of the day slowly fading lower but still managed a +0.99% gain. The stock is arguably short-term overbought and the nearest support looks like $90.00. I am not suggesting new positions.

Oddly enough our option price declined in spite of the stock's gain today.

Earlier Comments:
NFLX can be a volatile stock so I do consider this a more aggressive, higher-risk trade and we will want to keep our position size small. Target is $99.75.

- Suggested Positions - *Small Positions*

Long 2013 Jan $100 call (NFLX1319a100) entry $3.88

Entry on December 14 at $92.67
Average Daily Volume = 1.1 million
Listed on December 13, 2012


Rockwell Automation - ROK - close: 84.42 change: +1.83

Stop Loss: 79.85
Target(s): 84.75
Current Option Gain/Loss: +75.0%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
12/18/12: ROK is finally starting to see some momentum higher. Shares outperformed today with a +2.2% gain. The intraday high was $84.45 and our exit target is $84.75, which could get hit tomorrow. More aggressive traders could aim higher but ROK has failed at resistance near $85.00 in the past.

- Suggested Positions -

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

12/17/12 new stop loss @ 79.85
*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


Vulcan Materials - VMC - close: 53.19 change: +0.48

Stop Loss: 50.85
Target(s): 58.50
Current Option Gain/Loss: -17.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/18/12: Our new trade on VMC has been triggered. Shares rallied +0.9% and traded above the $53.00 level. I would still consider new positions at current levels.

Our target is $58.50. The $60.00 level looks like resistance. FYI: The Point & Figure chart for VMC is bullish with a long-term $70 target.

- Suggested Positions -

Long 2013 Jan $55 call (VMC1319a55) entry $1.15

Entry on December 18 at $53.00
Average Daily Volume = 870 thousand
Listed on December 17, 2012


PUT Play Updates

Tiffany & Co - TIF - close: 59.87 change: +1.36

Stop Loss: 60.05
Target(s): 52.50
Current Option Gain/Loss: -61.7%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/18/12: Traders are turning jolly as the market continues to rise. That is putting our bearish play on TIF in jeopardy. TIF has rallied right up to round-number resistance at $60.00 and looks poised to breakout higher. I am suggesting we exit early and close positions at the open tomorrow.

- Suggested Positions -

long Jan $55 PUT (TIF1319m55) entry $1.15

12/18/12 prepare to exit tomorrow morning at the open

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


CLOSED BULLISH PLAYS

Precision Castparts - PCP - close: 188.39 change: +1.89

Stop Loss: 183.40
Target(s): 188.00
Current Option Gain/Loss: +67.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/18/12: Target achieved.

PCP continued to rally and hit new highs with a late afternoon peak at $188.56. Our exit target was $188.00.

- Suggested *Small* Positions -

DEC $185 call (PCP1222L185) Entry $1.85 exit $3.10 (+67.5%)

12/18/12 target hit
12/17/12 new stop loss @ 183.40
12/05/12 new stop loss @ 179.75

chart:

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


CLOSED BEARISH PLAYS

Target Corp. - TGT - close: 62.28 change: +1.19

Stop Loss: 61.35
Target(s): 57.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
12/18/12: The stock market's widespread gains have started to fuel some short covering and bargain hunting. TGT rallied past a couple of key resistance levels. Our trade has not opened yet so we're dropping TGT as a candidate.

Trade did not open.

12/18/12 Removing TGT as a candidate. Trade has not opened yet.

chart:

Entry on December xx at $ xx.xx
Average Daily Volume = 5.0 million
Listed on December 15, 2012