Editor's Note:

The S&P 500 index has extended its gains to four weeks in a row and closed at new multi-year highs. Most of our bullish candidates are following the market higher.

We did close GILD on Friday. Both CTRX and SODA were triggered.


Current Portfolio:


CALL Play Updates

Anheuser-Busch InBev - BUD - close: 91.71 change: +1.45

Stop Loss: 88.45
Target(s): 99.00
Current Option Gain/Loss: +18.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
01/26/13: Friday saw shares of BUD gap open higher and close at new all-time highs with a +1.6% gain on the session. We are adjusting our stop loss higher to $88.45.

- Suggested Positions -

Long MAR $90 call (BUD1316c90) entry $3.05

01/25/13 new stop loss @ 88.45

chart:

Entry on January 22 at $90.25
Average Daily Volume = 894 thousand
Listed on January 19, 2012


Catamaran Corp. - CTRX - close: 53.23 change: +0.11

Stop Loss: 50.90
Target(s): 58.50
Current Option Gain/Loss: - 8.3%
Time Frame: exit PRIOR to earnings in late February
New Positions: see below

Comments:
01/26/13: CTRX was little changed on Friday but shares did climb high enough to hit our entry point to buy calls at $53.25. I would still consider new positions now. I don't see any changes from my Thursday night comments.

More conservative traders could wait for a new high above $53.60 instead. Our target is $58.50 but we do not want to hold over the late February earnings report (no date set yet). FYI: The Point & Figure chart for CTRX is bullish with a $68 target.

- Suggested Positions -

Long Feb $55 call (CTRX1316B55) entry $0.60

chart:

Entry on January 25 at $53.25
Average Daily Volume = 1.3 million
Listed on January 24, 2012


Deere & Co - DE - close: 93.47 change: +0.23

Stop Loss: 89.25
Target(s): 99.00
Current Option Gain/Loss: +63.8%
Time Frame: Exit prior to the Feb. 13th earnings report
New Positions: see below

Comments:
01/26/13: DE was up every day this week. Shares closed at new 18-month highs. The stock is arguably short-term overbought and due for a dip. Look for support near its 10-dma or in the $91-90 zone.

We do not want to hold over DE's February 13th earnings report. FYI: The Point & Figure chart for DE is bullish with a $104 target.

- Suggested Positions -

Long Feb $90 call (DE1316B90) entry $2.35

01/22/13 new stop loss @ 89.25

chart:

Entry on January 11 at $90.25
Average Daily Volume = 2.3 million
Listed on January 09, 2012


Starwood Hotels - HOT - close: 60.89 change: +0.91

Stop Loss: 58.85
Target(s): 64.50
Current Option Gain/Loss: + 2.2%
Time Frame: exit prior to earnings on Feb. 7th
New Positions: see below

Comments:
01/26/13: HOT is once again challenging resistance at the $61.00 level. The stock looks poised to breakout this time. More conservative traders may want to raise their stop. I would use a breakout past $61.00 as a new bullish entry point. Keep in mind our plan to exit prior to earnings on Feb. 7th.

- Suggested Positions -

Long Feb $60 call (HOT1316B60) entry $1.81

chart:

Entry on January 22 at $60.60
Average Daily Volume = 1.9 million
Listed on January 15, 2012


Ingersoll-Rand - IR - close: 51.47 change: +0.38

Stop Loss: 49.75
Target(s): 54.00
Current Option Gain/Loss: +14.2%
Time Frame: Exit prior to earnings on Feb. 1st!
New Positions: see below

Comments:
01/26/13: IR was up every day this week. Shares closed near its 52-week high. I am raising our stop loss to $49.75. I'm not suggesting new positions. We only have a few days left. The plan is to exit prior to earnings on Feb. 1st.

- Suggested Positions -

Long Feb $50 call (IR1316B50) entry $1.75

01/26/13 new stop loss @ 49.75
01/24/13 new stop loss @ 49.25

chart:

Entry on January 17 at $50.25
Average Daily Volume = 1.8 million
Listed on January 12, 2012


Noble Energy - NBL - close: 108.30 change: +0.70

Stop Loss: 104.65
Target(s): 114.00
Current Option Gain/Loss: + 4.3%
Time Frame: Exit prior to earnings on Feb. 7th!
New Positions: see below

Comments:
01/26/13: Since the big surge higher on Tuesday, shares of NBL have been consolidating sideways. I am raising our stop loss up to $104.65. More conservative traders may want to raise theirs closer to $106.00 instead. I am not suggesting new positions at this time.

- Suggested Positions -

Long Feb $110 call (NBL1316B110) entry $1.15

01/26/13 new stop loss @ 104.65
01/22/13 new stop loss @ 103.75
01/17/13 new stop loss @ 102.75

chart:

Entry on January 14 at $105.31
Average Daily Volume = 820 thousand
Listed on January 12, 2012


OpenTable, Inc. - OPEN - close: 53.75 change: -0.25

Stop Loss: 51.40
Target(s): 58.00
Current Option Gain/Loss: -11.4%
Time Frame: Exit prior to earnings on Feb. 7th!
New Positions: see below

Comments:
01/26/13: The upward momentum in OPEN could be in trouble. Thursday saw shares produce a bearish reversal at the $56.00 level. The weakness continued on Friday although the pullback has been pretty mild. I am not suggesting new positions. More conservative traders may want to raise their stop loss.

Earlier Comments:
OPEN could see a short squeeze. The most recent data listed short interest at 42% of the very small 19.4 million share float. FYI: The Point & Figure chart for OPEN is bullish with a $73 target.

- Suggested Positions -

Long Feb $55 call (OPEN1316B55) entry $2.54

01/19/13 new stop loss @ 51.40
01/16/13 new stop loss @ 50.90
01/12/13 new stop loss @ 49.90

chart:

Entry on January 04 at $52.23
Average Daily Volume = 361 thousand
Listed on January 03, 2012


Sherwin-Williams Company - SHW - close: 165.51 change: -0.28

Stop Loss: 161.75
Target(s): 169.00
Current Option Gain/Loss: +25.8%
Time Frame: Exit prior to earnings on Jan. 31st!
New Positions: see below

Comments:
01/26/13: Readers may want to exit early now and book a profit on SHW. The stock hit new record highs this last week but momentum has been slow. We only have a few days left. SHW is scheduled to report earnings on January 31st. If SHW does not hit our exit target at $169.00 then we will plan on closing positions on January 30th at the closing bell. Please note our new stop loss at $161.75.

Earlier Comments:
We keep our position size small to limit our risk.

- Suggested Positions - *Small Positions*

Long Feb $165 call (SHW1316B165) entry $3.10

01/26/13 new stop loss @ 161.75
Prepare to exit on Jan. 30th at the closing bell if SHW does not hit our target by then.
01/19/13 new stop loss @ 159.65

chart:

Entry on January 09 at $161.28
Average Daily Volume = 928 thousand
Listed on January 08, 2012


iShares Silver ETF - SLV - close: 30.21 change: -0.44

Stop Loss: 29.85
Target(s): 33.50
Current Option Gain/Loss: +13.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/26/13: I have been warning readers to expect a likely pullback in the SLV towards the $30.00 level. The ETF complied with a drop to $30.10 on Friday afternoon. I'm expecting the $30.00 level to be support so we're raising the stop loss to $29.85. That may be too tight for some traders who will want to keep their stop loss wider and give the SLV more room to maneuver.

Earlier Comments:
More cautious traders might want to raise their stop loss.

- Suggested Positions -

Long March $30 call (SLV1316c30) entry $0.95

01/26/13 new stop loss @ 29.85
01/22/13 new stop loss @ 28.49

chart:

Entry on December 31 at $29.07
Average Daily Volume = 11.6 million
Listed on December 29, 2012


SodaStream Intl. Ltd. - SODA - close: 53.23 change: +1.48

Stop Loss: 49.45
Target(s): 58.50
Current Option Gain/Loss: +29.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/26/13: Our new trade on SODA is off to a strong start. Shares opened at $52.00 and surged to a +2.8% gain. Our trigger to buy calls was hit at $52.15. If you missed the entry point I would wait for a little pullback. Please note I am raising our stop loss to $49.45. FYI: The Point & Figure chart for SODA is bullish with a $62 target.

- Suggested Positions -

Long Feb $52.50 call (SODA1316b52.5) entry $1.85

01/26/13 new stop loss @ 49.45

chart:

Entry on January 25 at $52.15
Average Daily Volume = 1.2 million
Listed on January 24, 2012


SPX Corp. - SPW - close: 73.79 change: +0.60

Stop Loss: 69.75
Target(s): 79.00
Current Option Gain/Loss: +11.5%
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: see below

Comments:
01/26/13: SPW is up five out of the last six trading days. More conservative traders may want to raise their stop loss here. SPW is nearing what could be round-number resistance at $75.00 so I would not be surprised to see a little pullback. Watch for short-term support near $72.00. I am not suggesting new positions at this time.

- Suggested Positions -

Long Feb $75 call (SPW1316B75) entry $1.30

chart:

Entry on January 23 at $72.42
Average Daily Volume = 832 thousand
Listed on January 22, 2012


Whole Foods Market - WFM - close: 95.65 change: +2.10

Stop Loss: 91.40
Target(s): 99.50
Current Option Gain/Loss: +52.1%
Time Frame: Exit PRIOR to earnings on Feb. 13th
New Positions: see below

Comments:
01/26/13: Whew! Friday's rally in WFM comes as a relief after the Thursday afternoon reversal lower. WFM gapped open higher on Friday and surged past potential resistance near $94.00 and its 100-dma and 150-dma. The stock even closed above potential round-number resistance at $95.00.

We do not want to hold over the Feb. 13th earnings report.
NOTE: because of a previous dividend the option strike for February is an odd one (95.50)

- Suggested Positions -

Long Feb $95.50 call (WFM1316B95.5) entry $1.90

chart:

Entry on January 24 at $94.25
Average Daily Volume = 1.5 million
Listed on January 23, 2012


PUT Play Updates


Currently we do not have any active put trades.



CLOSED BULLISH PLAYS

Gilead Sciences - GILD - close: 79.36 change: +0.96

Stop Loss: 76.45
Target(s): 84.50
Current Option Gain/Loss: + 7.2%
Time Frame: EXIT on Friday Jan. 25th at the close
New Positions: see below

Comments:
01/26/13: GILD broke out from its recent trading range and closed at new all-time highs on Friday. Yet we had decided to close positions on Friday at the closing bell to avoid holding over the stock's 2-for-1 split. GILD will begin trading post-split on Monday.

The trend is up and we will keep GILD on our radar screen for a future entry point.

- Suggested Positions -

Feb $80 call (GILD1316b80) entry $1.51 exit $1.62 (+7.2%)

01/25/13 scheduled close
01/24/13 prepare to exit at the close tomorrow, unless GILD hits our target
01/23/13 GILD not working, do not be surprised to get stopped tomorrow
01/22/13 Strategy adjustment, prepare to exit on Friday, Jan. 25th to avoid holding over the 2-for-1 stock split.
01/22/13 trade opened at trigger (78.65)

chart:

Entry on January 22 at $78.65
Average Daily Volume = 4.0 million
Listed on January 19, 2012


CLOSED BEARISH PLAYS

Lululemon Athletica - LULU - close: 69.83 change: +2.23

Stop Loss: 66.65
Target(s): 60.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
01/26/13: The stock market's strength is fueling a rebound in shares of LULU. Shares are bouncing from support. Friday saw it rally past several moving averages. It is unlikely that LULU will hit our suggested entry point to buy puts at $64.75 any time soon. We are removing the stock as a bearish candidate.

Trade did not open.

01/26/13 removed from the newsletter.

chart:

Entry on January -- at $---.--
Average Daily Volume = 3.1 million
Listed on January 22, 2012