Editor's Note:

I'm joking. I expect that December 21st, 2012 will be like any other pre-Christmas Friday for the stock market. Low volume and exaggerated movement.

Overall Thursday was pretty mild with a widespread swell higher.

Current Portfolio:


CALL Play Updates

American Tower Corp. - AMT - close: 77.26 change: +1.13

Stop Loss: 75.40
Target(s): 79.85 & 82.00
Current Option Gain/Loss: - 3.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/20/12: Traders bought the dip in AMT this morning and the stock reversed into a +1.4% gain and a new high. This move looks like a new bullish entry point to buy calls. More conservative traders could up their stops toward today's low (75.92).

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: 48.55 change: +0.72

Stop Loss: 45.85
Target(s): 49.85
Current Option Gain/Loss: + 3.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/20/12: There was no follow through on yesterday's pullback in shares of ANF. Yet if you look closely both yesterday and now again today the stock has created an "inside day" which only tells us that traders are indecisive. The larger, prevailing trend is up. We should see ANF resume the climb higher.

- 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: 80.02 change: +0.32

Stop Loss: 78.45
Target(s): 84.50 & 87.50
Current Option Gain/Loss: - 43.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/20/12: Unfortunately CELG is going nowhere fast. The stock has been consolidating sideways on either side of the $80.00 level the last few days. I find this action troubling and readers may want to abandon ship and just exit early. I am not suggesting new positions at this time.

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: 81.11 change: +0.70

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:
12/20/12: ENR displayed some relative strength today with a +0.8% gain. Yet the stock seems to be struggling with short-term resistance at its simple 10-dma. Readers may want to raise their stop loss.

- 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: 146.29 change: +1.34

Stop Loss: 141.85
Target(s): 148.50
Current Option Gain/Loss: +18.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/20/12: FLS also showed some relative strength today with a +0.9% gain. This is also a new closing high for the stock. We are raising our stop loss to $141.85. 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

12/20/12 new stop loss @ 141.85
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


Green Mountain Coffee Roasters - GMCR - close: 42.59 change: +0.76

Stop Loss: 39.20
Target(s): 47.50
Current Option Gain/Loss: +20.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/20/12: GMCR is still pushing higher and has just about made it past the early December high. I would not open positions at current levels.

Earlier Comments:
GMCR could see a short squeeze. The most recent data listed short interest at 43% of GMCR's 120 million share float. The $45.00 could be round-number resistance but we will target a move to $47.50. GMCR can be a very volatile stock. I do consider this a more aggressive, higher-risk trade. Let's keep our position size small to limit our risk.

(small positions) - Suggested Positions -

Long 2013 Jan $45 call (GMCR1319a45) entry $1.18

Entry on December 19 at $41.35
Average Daily Volume = 8.3 million
Listed on December 18, 2012


iShares Russell 2000 - IWM - close: 84.54 change: +0.42

Stop Loss: 81.95
Target(s): 86.00
Current Option Gain/Loss: +81.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/20/12: The IWM continues to extend its gains. This ETF is up four days in a row. Readers may want to start inching up their stop loss. I am not suggesting new positions at this time. Or readers could start taking profits now with our call option up +81%.

- 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: 115.66 change: +0.88

Stop Loss: 111.40
Target(s): 119.00
Current Option Gain/Loss: +48.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/20/12: Traders bought the dip in LNKD this morning and the stock erased yesterday's pullback. I am not suggesting new positions at current levels.

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: 77.15 change: +0.96

Stop Loss: 73.75
Target(s): 79.85
Current Option Gain/Loss: +34.8%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
12/20/12: LULU initially turned lower but the stock managed a midday rebound and came close to reversing yesterday's pullback. The +1.2% gain today outperformed the major indices. I am raising our stop loss up to $73.75.

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

12/20/12 new stop loss @ 73.75
12/17/12 new stop loss @ 72.95, adjust exit to $79.85
61

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


Monsanto Co. - MON - close: 92.54 change: +0.86

Stop Loss: 89.95
Target(s): 99.50
Current Option Gain/Loss: Unopened
Time Frame: exit prior to Jan 8th.
New Positions: Yes, see below

Comments:
12/20/12: MON delivered a similar pattern with an early morning dip that reversed higher. Shares added +0.9% but did not breakout past the $93.00 level. The Nov. 29th high was $93.00. I suspect that if MON can breakout we could see it run to round-number resistance at the $100.00 mark.

I am suggesting we use small positions and buy calls when MON hits $93.05. If triggered our target is $99.50.

NOTE: This is a short-term trade. We do not want to hold over the January 8th earnings report.

Trigger @ $93.05 *Small Positions*

- Suggested Positions -

buy the 2013 Jan $95 call (MON1319a95) current ask $1.18

Entry on December xx at $ xx.xx
Average Daily Volume = 2.2 million
Listed on December 19, 2012


Netflix, Inc. - NFLX - close: 93.50 change: -0.48

Stop Loss: 89.45
Target(s): 99.75
Current Option Gain/Loss: -24.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/20/12: Last night I warned readers that NFLX has created a bearish reversal candlestick yesterday. Today's decline is technically confirmation but I am still expecting NFLX to find support near $90.00. I am not suggesting new positions at this time.

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


Vulcan Materials - VMC - close: 53.25 change: +0.15

Stop Loss: 50.85
Target(s): 58.50
Current Option Gain/Loss: -26.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/20/12: VMC spent much of Thursday's session consolidating sideways. I would still consider new positions now. However, readers may want to wait for a new rally past $53.50 before initiating new positions.

Earlier Comments:
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


Watson Pharma. - WPI - close: 90.20 change: +1.30

Stop Loss: 88.20
Target(s): 94.85
Current Option Gain/Loss: -12.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/20/12: Good news! There was no follow through on yesterday's bearish reversal pattern. Instead WPI turned higher and erased yesterday's decline. Today's close above $90.00 looks like a new bullish entry point. However, you may want to wait for a new rise past $90.50 before initiating positions.

- Suggested Positions -

Long 2013 Jan $90 call (WPI1319a90) entry $2.00*
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on December 19 at $90.50
Average Daily Volume = 730 thousand
Listed on December 18, 2012


PUT Play Updates

Currently we do not have any active put trades.