Editor's Note:

We closed a couple of winning trades tonight at the closing bell with both HOT and NBL. WFM was stopped out. We have removed PETM as a candidate. COO, MMM, and RKT were all triggered.


Current Portfolio:


CALL Play Updates

Check Point Software Tech. - CHKP - close: 51.05 change: +0.24

Stop Loss: 49.40
Target(s): 54.50
Current Option Gain/Loss: + 7.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
02/06/13: The bounce in CHKP continues. Shares are facing potential resistance at $52 and its simple 300-dma. Broken resistance at $50.00 should be short-term support. I am raising our stop loss to $49.40.

*Small Positions* - Suggested Positions -

Long Mar $50 call (CHKP1316c50) entry $1.90

02/06/13 new stop loss @ 49.40

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


The Cooper Companies - COO - close: 103.03 change: +2.17

Stop Loss: 99.90
Target(s): 107.50
Current Option Gain/Loss: -11.1%
Time Frame: Exit prior to earnings on Mar. 7th
New Positions: see below

Comments:
02/06/13: COO spiked higher in the first few minutes of trading. Then after a short pullback spent the rest of the session working its way higher. Our trigger to buy calls was hit at $102.60. The stock closed at a new all-time high.

Earlier Comments:
Please note that we do want to keep our position size small because the option spreads are a little bit wide. COO is scheduled to report earnings on March 7th. We do not want to hold over the report. FYI: The Point & Figure chart for COO is bullish with a $125 target.

*Small Positions* - Suggested Positions -

Long Mar $105 call (COO1316c105) entry $2.70

Entry on February 06 at $102.60
Average Daily Volume = 303 thousand
Listed on February 02, 2012


3M Company - MMM - close: 102.69 change: +1.20

Stop Loss: 100.70
Target(s): 106.50
Current Option Gain/Loss: + 6.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
02/06/13: Our new play on MMM has been triggered. As expected shares of MMM rallied on its press release last night detailing a higher dividend and a new stock buy back program. Shares actually opened lower but traders quickly bought the dip at short-term technical support on its simple 10-dma. The stock rallied past resistance at $102.00 and hit our trigger to buy calls at $102.25.

Earlier Comments:
I am suggesting we keep our position size small to limit our risk.

- Suggested Positions -

long Mar $100 call (MMM1316c100) entry $2.95

Entry on February 06 at $102.25
Average Daily Volume = 3.0 million
Listed on February 05, 2012


Rock-Tenn Company - RKT - close: 81.40 change: +1.29

Stop Loss: 79.45
Target(s): 84.85
Current Option Gain/Loss: - 4.9%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
02/06/13: RKT displayed some relative strength today with a +1.6% gain, a breakout past resistance near $81.00, and a new all-time high. Our trigger to buy calls was hit at $81.05.

FYI: The Point & Figure chart for RKT is bullish with a long-term $117 target.

- Suggested Positions -

Long Mar $80 call (RKT1316c80) entry $3.05

Entry on February 06 at $81.05
Average Daily Volume = 743 thousand
Listed on February 02, 2012


Starbucks Corp. - SBUX - close: 56.05 change: -0.15

Stop Loss: 54.75
Target(s): 59.85
Current Option Gain/Loss: - 16.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
02/06/13: SBUX spent the session churning sideways. The last two or three days the stock has been drifting lower. I suspect SBUX might be poised to dip back into the $55.50-55.00 zone soon. No new positions at this time.

Earlier 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: 100.79 change: +0.47

Stop Loss: 99.75
Target(s): 104.90
Current Option Gain/Loss: -47.3%
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: see below

Comments:
02/06/13: SHPG managed a bounce today but our option contracted. I am cautious here. We're not suggesting new positions at this time.

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: 75.22 change: +0.22

Stop Loss: 73.95
Target(s): 78.00
Current Option Gain/Loss: +38.4%
Time Frame: Exit prior to earnings on Feb. 14th
New Positions: see below

Comments:
02/06/13: After five days of consolidating sideways on either side of the $75.00 level it finally looks like SPW might be poised to breakout higher. I am raising our stop loss to $73.95. More conservative traders may want to put their stop closer to $74.40 instead.

- Suggested Positions -

Long Feb $75 call (SPW1316B75) entry $1.30

02/06/13 new stop loss @ 73.95
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


PUT Play Updates

SourceFire, Inc. - FIRE - close: 41.02 change: -0.17

Stop Loss: 41.55
Target(s): 35.25
Current Option Gain/Loss: Unopened
Time Frame: exit prior to earnings on Feb. 21
New Positions: Yes, see below

Comments:
02/06/13: FIRE is still slowly drifting lower. There is no change from my prior comments.

FIRE is nearing support near $40.00. A breakdown at $40.00 could spark the next leg lower. The January 30th low was $39.51. I am suggesting a trigger to open small bearish put positions at $39.40. If triggered our target is $35.25. We do not want to hold over the earnings report on Feb. 21st.

Trigger @ 39.40 *Small Positions*

- Suggested Positions -

buy the Mar $35 PUT (FIRE1316o35)

Entry on February -- at $---.--
Average Daily Volume = 890 thousand
Listed on February 05, 2012


CLOSED BULLISH PLAYS

Starwood Hotels - HOT - close: 62.60 change: +0.85

Stop Loss: 60.45
Target(s): 64.50
Current Option Gain/Loss: +68.5%
Time Frame: exit prior to earnings on Feb. 7th
New Positions: see below

Comments:
02/06/13: Our plan was to close our HOT trades at the closing bell tonight to avoid holding over the earnings report tomorrow. HOT was kind enough to outperform the market with a +1.37% gain for today's session.

- Suggested Positions -

Long Feb $60 call (HOT1316B60) entry $1.81 exit $3.05 (+68.5%)

02/06/13 planned exit at the close
02/05/13 new stop loss @ 60.45, prepare to exit tomorrow at the closing bell
01/28/13 new stop loss @ 59.75

chart:

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


Noble Energy - NBL - close: 113.57 change: +1.65

Stop Loss: 109.00
Target(s): 114.00
Current Option Gain/Loss: +230.4%
Time Frame: Exit prior to earnings on Feb. 7th!
New Positions: see below

Comments:
02/06/13: NBL continues to soar and hit new highs with a +1.4% gain today. Our plan was to exit positions today at the closing bell to avoid holding over the earnings report tomorrow.

- Suggested Positions -

Feb $110 call (NBL1316B110) entry $1.15 exit $3.80 (+230.4%)

02/06/13 scheduled exit
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

chart:

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


Whole Foods Market - WFM - close: 93.36 change: -1.14

Stop Loss: 93.75
Target(s): 99.50
Current Option Gain/Loss: -2.6%
Time Frame: Exit PRIOR to earnings on Feb. 13th
New Positions: see below

Comments:
02/06/13: WFM has looked weak since the Monday reversal lower. Shares gapped open lower this morning, skipping past potential support at $94.00 and its 100-dma and 150-dma. Our stop loss was at $93.75 but the stock opened at $93.49. I didn't see any specific company news behind today's relative weakness or the gap down.

- Suggested Positions -

Feb $95.50 call (WFM1316B95.5) entry $1.90 exit $1.85 (-2.6%)

02/06/13 stopped out on gap down at $93.49
01/30/13 new stop loss @ 93.75
01/29/13 new stop loss @ 92.25, expect a pullback soon

chart:

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


CLOSED BEARISH PLAYS

PetSmart, Inc. - PETM - close: 66.01 change: +0.57

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

Comments:
02/06/13: PETM continues to bounce. Big picture the stock looks weak. Yet short-term the stock is bouncing. The $66.00 level is still resistance and PETM could rollover right here. However, we don't know how long it might take for PETM to hit our entry trigger at $62.40.

Our trade has not opened yet so we're removing PETM as a candidate.

Trade did not open.

02/06/13 removed from the newsletter

chart:

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