Editor's Note:

There was no follow through on yesterday's market decline and stocks rebounded.

We closed our MNST trade this morning. I am suggesting we exit both HOT and NBL tomorrow. See the individual play update for details.


Current Portfolio:


CALL Play Updates

Check Point Software Tech. - CHKP - close: 50.81 change: +0.58

Stop Loss: 48.25
Target(s): 54.50
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
02/05/13: The stock market's widespread bounce on Tuesday produced a +1.1% gain in shares of CHKP. The stock is bouncing from round-number support near $50.00.

*Small Positions* - Suggested Positions -

Long Mar $50 call (CHKP1316c50) entry $1.90

Entry on February 01 at $50.25
Average Daily Volume = 2.7 million
Listed on January 31, 2012


The Cooper Companies - COO - close: 100.86 change: +0.21

Stop Loss: 99.90
Target(s): 107.50
Current Option Gain/Loss: Unopened
Time Frame: Exit prior to earnings on Mar. 7th
New Positions: Yes, see below

Comments:
02/05/13: COO's performance was a bit disappointing today. The stock posted a gain but it underperformed the broader market and remains stuck in the middle of its $100-102.50 trading range. I am suggesting we stick to the plan and wait for a new relative high.
FYI: COO is scheduled to report earnings on March 7th.

Earlier Comments:
The highs last week were near $102.50. I am suggesting a trigger to open new bullish positions at $102.60. If triggered our target is $107.50. Please note that we do want to keep our position size small because the option spreads are a little bit wide. FYI: The Point & Figure chart for COO is bullish with a $125 target.

Trigger @ 102.60 *Small Positions*

- Suggested Positions -

buy the Mar $105 call (COO1316c105)

Entry on February -- at $---.--
Average Daily Volume = 303 thousand
Listed on February 02, 2012


Starwood Hotels - HOT - close: 61.75 change: +0.93

Stop Loss: 60.45
Target(s): 64.50
Current Option Gain/Loss: +29.2%
Time Frame: exit prior to earnings on Feb. 7th
New Positions: see below

Comments:
02/05/13: HOT outperformed the market with a +1.5% gain but didn't quite erase yesterday's losses. Tomorrow is our last day for this trade. We are planning to exit tomorrow (Wed. Feb. 6th) at the closing bell to avoid holding over earnings on the 7th. I am raising our stop loss to $60.45.

- Suggested Positions -

Long Feb $60 call (HOT1316B60) entry $1.81

02/05/13 new stop loss @ 60.45, prepare to exit tomorrow at the closing bell
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: 108.77 change: -0.42

Stop Loss: 109.00
Target(s): 114.00
Current Option Gain/Loss: +143.4%
Time Frame: Exit prior to earnings on Feb. 7th!
New Positions: see below

Comments:
02/05/13: NBL came alive today with a +2.89% gain and a new high. The breakout past resistance at $110 is a bullish one. Unfortunately we are out of time. NBL is scheduled to report earnings on Feb. 7th. That means we need to plan on exiting positions tomorrow (Feb.6th) at the closing bell if NBL does not hit our exit target at $114.00 first.

I am raising our stop loss to $109.00.
Remember, plan on exiting at the close tomorrow.

- Suggested Positions -

Long Feb $110 call (NBL1316B110) entry $1.15

02/05/13 new stop loss @ 109.00, prepare to exit tomorrow at the closing bell
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


Rock-Tenn Company - RKT - close: 80.11 change: +0.18

Stop Loss: 79.45
Target(s): 84.85
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
02/05/13: RKT tried to rally this morning but didn't make it very far before turning lower. Shares did manage to bounce off its rising 10-dma near $79.50. We are still waiting for a new relative high.

I am suggesting a trigger to buy calls at $81.05. If triggered our target is $84.85. More aggressive traders could aim higher. FYI: The Point & Figure chart for RKT is bullish with a long-term $117 target.

Trigger @ 81.05

- Suggested Positions -

buy the Mar $80 call (RKT1316c80)

Entry on February -- at $---.--
Average Daily Volume = 743 thousand
Listed on February 02, 2012


Starbucks Corp. - SBUX - close: 56.20 change: +0.32

Stop Loss: 54.75
Target(s): 59.85
Current Option Gain/Loss: - 11.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
02/05/13: SBUX spent Tuesday's session churning sideways. I don't see any changes from my prior comments.

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.

- Suggested Positions -

Long Mar $55 call (SBUX1316c55) entry $2.51

Entry on February 01 at $56.57
Average Daily Volume = 6.8 million
Listed on January 30, 2012


Shire Plc - SHPG - close: 100.32 change: -1.08

Stop Loss: 99.75
Target(s): 104.90
Current Option Gain/Loss: -42.1%
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: see below

Comments:
02/05/13: Uh-oh! SHPG displayed relative weakness. Almost the whole market was in bounce mode today, including the drug sector and biotech sector. Yet SHPG gave up -1.0% and briefly dipped below round-number support at $100.00. The intraday low was $99.91. If there is any follow through lower tomorrow we will likely see SHPG hit our stop loss. I am not suggesting new positions.

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. FYI: The Point & Figure chart for SHPG is bullish with a long-term $137 target.

- Suggested Positions -

Long Feb $105 call (SHPG1316b105) entry $0.95*

*02/01/13 entry point on the option is an estimate. there was not a lot of volume during today's session.

Entry on February 01 at $101.15
Average Daily Volume = 323 thousand
Listed on January 29, 2012


SPX Corp. - SPW - close: 75.00 change: +0.39

Stop Loss: 73.75
Target(s): 78.00
Current Option Gain/Loss: +34.6%
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: see below

Comments:
02/05/13: SPW failed to keep pace with the market's rally on Tuesday. The S&P 500 added +1.0% but SPW only added +0.5%. Shares can't seem to escape the gravitational pull of the $75.00 level. Readers may want to just exit early now to free up capital and book a small gain. 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: 94.50 change: +0.22

Stop Loss: 93.75
Target(s): 99.50
Current Option Gain/Loss: +23.6%
Time Frame: Exit PRIOR to earnings on Feb. 13th
New Positions: see below

Comments:
02/05/13: Shares of WFM also failed to keep pace with the market's rally today. Readers may want to just exit early now to free up capital and record a small gain. I am not suggesting 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

PetSmart, Inc. - PETM - close: 65.44 change: +1.86

Stop Loss: 65.25
Target(s): 56.00
Current Option Gain/Loss: Unopened
Time Frame: Exit Prior to earnings in late February
New Positions: Yes, see below

Comments:
02/05/13: The stock market's widespread bounce today sparked a decent sized rebound in shares of PETM. The stock soared +2.9% to close right at technical resistance at its exponential 200-dma. A failure here or at the $66.00 level could be used as an aggressive, high risk entry point for puts. I am suggesting readers be patient and wait for a new relative low per our plan below.

Earlier Comments:
I am concerned that the late January low could be support. Therefore I am suggesting a trigger to buy puts at $62.40. If triggered we'll use a stop loss at $65.25. Our target is $56.00. Do not be surprised to see a temporary bounce from the $60.00 level.

Trigger @ 62.40

- Suggested Positions -

buy the Mar $60 PUT (PETM1316o60)

Entry on February -- at $---.--
Average Daily Volume = 1.5 million
Listed on February 04, 2012


CLOSED BEARISH PLAYS

Monster Beverage Corp. - MNST - close: 48.33 change: +0.73

Stop Loss: 50.15
Target(s): 41.00
Current Option Gain/Loss: -29.3%
Time Frame: Exit PRIOR to the late February earnings report
New Positions: see below

Comments:
02/05/13: MNST has not been cooperating so we decided yesterday to exit positions at the open this morning. The stock opened at $48.05.

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 exit $2.05 (-29.3%)

02/05/13 planned exit
02/04/13 prepare to exit at the open tomorrow morning

chart:

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