Editor's Note:

Shares of Anheuser Busch INBEV (BUD) plunged on news of a government lawsuit today. Our BUD play was stopped out on the move. XEC was also stopped out today and we closed IR.


Current Portfolio:


CALL Play Updates

Starwood Hotels - HOT - close: 61.41 change: +0.25

Stop Loss: 59.75
Target(s): 64.50
Current Option Gain/Loss: +23.7%
Time Frame: exit prior to earnings on Feb. 7th
New Positions: see below

Comments:
01/31/13: HOT is still hovering sideways above the $61.00 level for now. We only have a few days left. The plan is to exit positions prior to the company's earnings on Feb. 7th next week. I am not suggesting new positions.

- Suggested Positions -

Long Feb $60 call (HOT1316B60) entry $1.81

01/28/13 new stop loss @ 59.75

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


Noble Energy - NBL - close: 107.79 change: -0.44

Stop Loss: 106.95
Target(s): 114.00
Current Option Gain/Loss: -17.3%
Time Frame: Exit prior to earnings on Feb. 7th!
New Positions: see below

Comments:
01/31/13: NBL gapped down at the open and dipped toward $107 before paring its losses. Tomorrow could be a volatile day for the energy sector. Both XOM and CVX report earnings before the opening bell tomorrow. These results might have an influence on shares of NBL. I am not suggesting new positions at this time.

- Suggested Positions -

Long Feb $110 call (NBL1316B110) entry $1.15

01/30/13 new stop loss @ 106.95
01/29/13 new stop loss @ 105.75
01/26/13 new stop loss @ 104.65
01/22/13 new stop loss @ 103.75
01/17/13 new stop loss @ 102.75

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


Starbucks Corp. - SBUX - close: 56.00 change: +0.40

Stop Loss: 54.75
Target(s): 59.85
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
01/31/13: SBUX rallied this morning and the stock came very close to hitting out entry trigger. Yet the rally ran out of steam at $56.49.

I am suggesting a trigger to buy calls at $56.50. If triggered our target is $59.85. More aggressive traders could aim for the all-time highs in the $62 area set last year. FYI: The Point & Figure chart for SBUX is bullish with a long-term $67 target.

Trigger @ 56.50

- Suggested Positions -

buy the Mar $55 call (SBUX1316c55) current ask $2.21

Entry on January -- at $---.--
Average Daily Volume = 6.8 million
Listed on January 30, 2012


Shire Plc - SHPG - close: 100.14 change: +0.03

Stop Loss: 99.75
Target(s): 104.90
Current Option Gain/Loss: Unopened
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: Yes, see below

Comments:
01/31/13: SHPG rallied off its early morning lows but gains faded by the closing bell. If SHPG doesn't breakout to new highs soon we will likely drop it.

Earlier Comments:
This is a short-term trade. We do not want to hold positions over the Feb. 14th earnings report. For that reason I am listing the February calls, which expire after the 15th. Otherwise I would probably choose the March calls. Looking at Februarys I would play either the Feb. $100s or the Feb $105s. The spread is wider on the $105s but your capital outlay is less.

I am suggesting a trigger to open bullish positions at $101.15. If triggered our target is $104.90. FYI: The Point & Figure chart for SHPG is bullish with a long-term $137 target.

Trigger @ 101.15

- Suggested Positions -

buy the Feb $105 call (SHPG1316b105)

Entry on January -- at $---.--
Average Daily Volume = 323 thousand
Listed on January 29, 2012


SPX Corp. - SPW - close: 74.63 change: -0.37

Stop Loss: 73.75
Target(s): 78.00
Current Option Gain/Loss: +26.9%
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: see below

Comments:
01/31/13: SPW spent most of the day drifting sideways inside the $74.50-75.00 range. If the market accelerates lower I would expect SPW to hit our stop at $73.75. I am not suggesting new positions at this time.

- Suggested Positions -

Long Feb $75 call (SPW1316B75) entry $1.30

01/30/13 new stop loss @ 73.75
01/29/13 new stop loss @ 71.95, adjust exit to $78.00
readers may want to just take profits right now
01/28/13 new stop loss @ 71.40

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


Whole Foods Market - WFM - close: 96.25 change: +1.00

Stop Loss: 93.75
Target(s): 99.50
Current Option Gain/Loss: +71.0%
Time Frame: Exit PRIOR to earnings on Feb. 13th
New Positions: see below

Comments:
01/31/13: WFM displayed relative strength with a +1.0% gain on Thursday. While the bounce is encouraging I would hesitate to launch new positions.

Earlier Comments:
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

01/30/13 new stop loss @ 93.75
01/29/13 new stop loss @ 92.25, expect a pullback soon

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


PUT Play Updates

Herbalife Ltd. - HLF - close: 36.32 change: -0.77

Stop Loss: 40.55
Target(s): 31.00
Current Option Gain/Loss: +25.0%
Time Frame: Exit prior to earnings on Feb. 19th
New Positions: see below

Comments:
01/31/13: HLF saw a very brief midday spike higher but the rally attempt quickly reversed. Shares underperformed the market with a -2.0% decline.

Earlier Comments:
I want to warn you that HLF can be a volatile stock. We consider this an aggressive, higher-risk trade.

*Small Positions*- Suggested Positions -

Long Feb $37.50 PUT (HLF1316n37.5) entry $2.40

Entry on January 29 at $38.50
Average Daily Volume = 13.6 million
Listed on January 28, 2012


Monster Beverage Corp. - MNST - close: 47.90 change: -0.28

Stop Loss: 50.15
Target(s): 41.00
Current Option Gain/Loss: -20.6%
Time Frame: Exit PRIOR to the late February earnings report
New Positions: see below

Comments:
01/31/13: There was no follow through on yesterday's bounce in MNST. Yet at the same time traders did buy the dip in the stock this morning. There is no change from my prior comments. We are keeping our stop loss at $50.15 for now. More conservative traders may want to tighten their stop instead. I am not suggesting new positions at this time.

Earlier Comments:
Please note that MNST has been a very volatile stock in the past. This should be considered an aggressive, higher-risk trade.

- Suggested Positions - *Small Positions*

Long Mar $45 PUT (MNST1316o45) entry $2.90

Entry on January 28 at $46.91
Average Daily Volume = 2.0 million
Listed on January 26, 2012



CLOSED BULLISH PLAYS

Anheuser-Busch InBev - BUD - close: 88.60 change: -5.54

Stop Loss: 91.75
Target(s): 94.85
Current Option Gain/Loss: +18.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
01/31/13: BUD turned out to be a major story on Thursday. Less than an hour into the trading day shares of BUD suddenly plunged on news that the U.S. Justice Department had filed a lawsuit to block BUD's planned $20.1 billion deal to buy Grupo Modelo SAB. The government claims that the merger would reduce the amount of competition in the beer market and result in higher prices for consumers.

The stock plunged toward its 100-dma near $86.75 before bouncing to close down -5.8%. Our stop loss was hit pretty early at $91.75. I hope some of our readers took my suggestion last night to just exit early and take a profit. We had a potential gain of +70% as of last night. Our trade closed much lower.

- Suggested Positions -

Long MAR $90 call (BUD1316c90) entry $3.05 exit $3.60*(+18.0%)

01/31/13 stopped out at @91.75 on news of a lawsuit from the U.S. government.
*exit price is an estimate. BUD was moving fast. Actual exit could have been better or worse.
01/30/13 new stop loss @ 91.75, adjust target to $94.85, readers may want to just exit early now with a profit
01/29/13 new stop loss @ 89.75
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


Ingersoll-Rand - IR - close: 51.39 change: -0.23

Stop Loss: 50.75
Target(s): 54.00
Current Option Gain/Loss: +11.4%
Time Frame: Exit prior to earnings on Feb. 1st!
New Positions: see below

Comments:
01/31/13: IR continues to hover near its recent highs. Our plan was to exit today at the closing bell to avoid holding over the earnings report tomorrow.

- Suggested Positions -

Feb $50 call (IR1316B50) entry $1.75 exit $1.95 (+11.4%)

01/31/13 scheduled exit
01/30/13 new stop loss @ 50.75
01/29/13 prepare to exit on Jan. 31st at the close
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


Cimarex Energy Co. - XEC - close: 63.86 change: +0.11

Stop Loss: 62.90
Target(s): 69.50
Current Option Gain/Loss: - 36.0%
Time Frame: Exit PRIOR to earnings on Feb. 19th
New Positions: see below

Comments:
01/31/13: XEC spiked down at the open and hit our stop loss at $62.90 before reversing back into positive territory.

- Suggested Positions -

Mar $65 call (XEC1316c65) entry $2.50 exit $1.60 (-36.0%)

01/31/13 stopped out
01/30/13 new stop loss @ 62.90

chart:

Entry on January 29 at $64.55
Average Daily Volume = 708 thousand
Listed on January 26, 2012