Editor's Note:

The S&P 500 index has rallied to a new all-time closing high. This is the third week of gains for the large cap index.

Cautious traders might want to start taking some money off the table.
We did close the MPC trade on Friday morning.


Current Portfolio:


CALL Play Updates

Automatic Data Processing - ADP - close: 73.41 change: +1.56

Stop Loss: 69.85
Target(s): 74.00
Current Option Gain/Loss: +124.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/13/13: Great news! ADP accelerated higher toward the weekend and has now broken out past resistance at the $72.00 level. If there is any follow through higher on Monday we could see ADP hit our target at $74.00. More aggressive traders may want to aim higher. With our option up +124% in value readers might want to just take profits now.

- Suggested Positions -

Long Aug $70 call (ADP1317H70) entry $1.65

07/11/13 new stop loss @ 69.85
07/10/13 new stop loss @ 69.40
07/06/13 new stop loss @ 68.40
06/27/13 new stop loss @ 67.90

chart:

Entry on June 18 at $69.25
Average Daily Volume = 1.8 million
Listed on June 17, 2013


Ameriprise Financial - AMP - close: 86.60 change: +0.14

Stop Loss: 83.25
Target(s): 89.25
Current Option Gain/Loss: + 3.0%
Time Frame: exit PRIOR to earnings on July 24th
New Positions: see below

Comments:
07/13/13: The rally in AMP paused on Friday with shares churning sideways in a narrow range. Readers may want to wait for a dip back toward the $85.00 level before considering new bullish positions.

Earlier Comments:
If triggered our target is $89.25. However, we will plan to exit prior to the earnings report on July 24th.

- Suggested Positions -

Long Aug $85 call (AMP1317H85) entry $3.30

07/11/13 trade opened on gap open at $86.17. Trigger was $85.25.

chart:

Entry on July 11 at $86.17
Average Daily Volume = 1.25 million
Listed on July 09, 2013


Borg Warner - BWA - close: 89.30 change: +0.45

Stop Loss: 85.40
Target(s): 93.00
Current Option Gain/Loss: +14.2%
Time Frame: exit PRIOR to earnings on July 25th
New Positions: see below

Comments:
07/13/13: The rally in BWA continued on Friday but shares did see some profit taking as the stock neared the $90.00 level. Traders might want to wait for a dip back into the $88-87 zone before initiating new positions.

Earlier Comments:
It is possible that $90.00 could be round-number resistance but we're aiming for $93.00. Please note that we will plan on exiting positions prior to the earnings report on July 25th. FYI: The Point & Figure chart for BWA is bullish with a $114 target.

- Suggested Positions -

Long Aug $90 call (BWA1317H90) entry $2.10*

07/11/13 trade opened on gap higher at $88.28. Trigger was $87.75
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on July 11 at $88.28
Average Daily Volume = 860 thousand
Listed on July 10, 2013


Eastman Chemical Co. - EMN - close: 73.96 change: +0.01

Stop Loss: 73.49
Target(s): 79.75
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings on July 29th
New Positions: Yes, see below

Comments:
07/13/13: EMN's performance on Friday was a bit disappointing. Traders did buy the midday dip near its short-term trend of higher lows. Currently we are waiting on a bullish breakout from a significant consolidation. I don't see any changes from my earlier comments.

Earlier Comments:
Shares of EMN have been consolidating sideways for the last four and a half months. The rally this month has pushed shares back toward major resistance in the $74-75 zone. A breakout past $75.00 would be a new all-time high.

I am suggesting a trigger to buy calls at $75.25. If triggered our target is $79.75. However, we will plan on exiting positions prior to the earnings report on July 29th. FYI: The Point & Figure chart for EMN is bullish with a $91 target.

Trigger @ 75.25

- Suggested Positions -

Buy the Aug $75 call (EMN1317H75) current ask $2.15

chart:

Entry on July -- at $---.--
Average Daily Volume = 1.3 million
Listed on July 11, 2013


Energizer Holdings - ENR - close: 108.15 change: +3.79

Stop Loss: 102.75
Target(s): 109.50
Current Option Gain/Loss: +100.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/13/13: Friday was a big day for ENR. Friday morning saw a dip toward $104.00 and then shares surged higher the rest of the session. The stock outperformed the major indices with a +3.6% gain. Shares closed at new multi-year highs. I am adjusting our exit target down to $109.50 from 109.75. More aggressive traders might want to consider aiming higher. Please note our new stop loss at $102.75.

I am not suggesting new positions. Cautious traders may want to take profits now since our option has doubled in value (+100%)

- Suggested Positions -

Long Aug $105 call (ENR1317H105) entry $2.75*

07/13/13 new stop loss @ 102.75. Adjust exit target from $109.75 to $109.50
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on July 09 at $103.25
Average Daily Volume = 497 thousand
Listed on July 01, 2013


Flowserve Corp. - FLS - close: 55.51 change: -0.43

Stop Loss: 53.95
Target(s): 59.00
Current Option Gain/Loss: - 25.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/13/13: FLS' performance on Friday is troubling. The stock retreated while the market's major indices are in breakout mode. Traders did buy the dip near $55.20 on Friday, which was also support on Wednesday. I remain cautious here and readers may want to raise their stop loss. We are not suggesting new positions at this time.

Our multi-week target is $59.00 but we will plan on exiting prior to the earnings report.

- Suggested Positions -

Long Oct $60 call (FLS1319J60) entry $1.20*

*07/08/13 entry price on the option is an estimate since the option did not trade when our entry trigger was hit.

chart:

Entry on July 08 at $55.60
Average Daily Volume = 665 thousand
Listed on July 06, 2013


Medidata Solutions - MDSO - close: 80.87 change: +1.04

Stop Loss: 78.75
Target(s): 84.85
Current Option Gain/Loss: - 7.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/13/13: MDSO finally decided to participate in the market's rally. Shares actually spent most of Friday's session drifting sideways near the $80.00 level. Then late in the day the stock surged higher. I am cautiously bullish here. Traders might want to wait for a new high (above $81.50) before initiating positions. Unfortunately the option spread has widened significantly which is another reason investors may want to hesitate on launching positions.

Earlier Comments:
If triggered our target is $84.85 but we will plan on exiting positions prior to the next earnings report, which is expected in late July or early August. More aggressive traders may want to aim higher. The Point & Figure chart for MDSO is bullish with a $101 target.

- Suggested Positions -

Long Aug $85 call (MDSO1317H85) entry $2.60

07/11/13 Warning! The action in MDSO is not bullish.

chart:

Entry on July 11 at $81.25
Average Daily Volume = 190 thousand
Listed on July 08, 2013


Noble Energy - NBL - close: 64.30 change: -0.23

Stop Loss: 61.40
Target(s): 68.50
Current Option Gain/Loss: +18.5%
Time Frame: Exit PRIOR to earnings on July 25th
New Positions: see below

Comments:
07/13/13: This past week saw NBL rallied to new all-time highs. If you look closely the stock has actually been trading sideways in the $63.50-64.50 zone the last three and a half days. Is this merely a pause before the next leg higher or is it a topping formation in NBL? We won't know that until the stock moves again.

I am not suggesting new positions at current levels. We will raise our stop loss up to $61.40.

Earlier Comments:
If triggered our target is $68.50. However, we will plan on exiting positions prior to NBL's earnings report on July 25th. More aggressive traders may want to aim higher. This past week has generated a new triple-top breakout buy signal on the point & figure chart with a $74.00 target.

- Suggested Positions -

Long Aug $65 call (NBl1317H65) entry $1.35

07/13/13 new stop loss @ 61.40

chart:

Entry on July 09 at $63.05
Average Daily Volume = 1.9 million
Listed on July 06, 2013


Prudential Financial - PRU - close: 77.89 change: -0.12

Stop Loss: 74.75
Target(s): 79.00
Current Option Gain/Loss: +75.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/13/13: PRU surged to new multi-year highs this past week. Yet it too saw some minor profit taking on Friday. More conservative traders may want to just exit now to lock in gains. I am not suggesting new positions.

- Suggested Positions -

Long Aug $75 call (PRU1317H75) entry $2.40

07/09/13 new stop loss @ 74.75, adjust exit target to $79.00
07/02/13 new stop loss @ 72.40

chart:

Entry on July 01 at $73.65
Average Daily Volume = 3.1 million
Listed on June 29, 2013


Toyota Motor Corp. - TM - close: 129.69 change: +0.40

Stop Loss: 124.00
Target(s): 130.00
Current Option Gain/Loss: +41.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
07/13/13: TM is just a couple of inches away from our exit target at $130.00. The stock could hit our target or gap above it on Monday morning. At the same time, if the economic data out of China disappoints the market on Monday morning (Sunday for us), then shares of TM could gap lower instead.

No new positions.

- Suggested Positions -

Long Aug $130 call (TM1317H130) entry $2.80

07/11/13 new stop loss @ 124.00
07/02/13 trade opened on gap higher at $124.70, trigger was 123.65

chart:

Entry on July 02 at $124.70
Average Daily Volume = 694 thousand
Listed on July 01, 2013


PUT Play Updates


Currently we do not have any active put trades.




Longer-Term Play Updates



Chicago Bridge & Iron - CBI - close: 61.30 change: -0.05

Stop Loss: 53.75
Target(s): 74.50
Current Option Gain/Loss: +41.1%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
07/13/13: Believe it or not CBI is up three weeks in a row. Yet it feels like the stock has been sleeping through the market's current rally. Shares are just barely drifting higher. This lack of true participation in the market rally could be a warning signal. I am not suggesting new positions at this time.

*Small Positions* - Suggested Positions -

Long 2014 Jan $65 call (CBI1418A65) entry $2.55

06/29/13 CBI might be poised to dip into the $57-55 zone again.
06/24/13 triggered @ 56.75
06/22/13 adjust entry trigger to $56.75
06/15/13 entry strategy change: change the breakout trigger at $65.25 to a buy-the-dip trigger at $56.50. Adjust the stop loss to $53.75.
Adjust the option strike to the 2014 Jan. $65 call

chart:

Entry on June 24 at $56.75
Average Daily Volume = 1.8 million
Listed on June 01, 2013


CLOSED BEARISH PLAYS

Marathon Petroleum - MPC - close: 73.24 change: +1.73

Stop Loss: 72.25
Target(s): 62.00
Current Option Gain/Loss: -65.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/13/13: After Thursday's bullish breakout higher we knew it was time to exit. The plan was to exit immediately on Friday morning. Thankfully shares of MPC gapped open lower at $70.42 before bouncing and surging higher again.

- Suggested Positions -

Aug $65 PUT (MPC1317T65) entry $2.05 exit $0.71 (-65.3%)

07/12/13 closed at the opening bell
07/11/13 exit immediately on Friday morning. MPC appears to have reversed higher and is breaking through resistance.
07/06/13 MPC has been volatile the last couple of trading days. Wait for a new low under $67.60 to launch new positions

chart:

Entry on July 03 at $68.25
Average Daily Volume = 3.2 million
Listed on July 02, 2013