Editor's Note:

The stock market rallied thanks to a sudden rash of improving economic reports from China, Europe and the U.S. The major indices have rallied to new highs.

Shares of Polaris Industries, Inc. (PII) hit our bullish target today.
We closed HAIN this morning. We want to exit ACN tomorrow morning.
DRI has been removed. ILMN has been triggered.


Current Portfolio:


CALL Play Updates

Johnson & Johnson - JNJ - close: 93.77 change: +0.27

Stop Loss: 92.35
Target(s): 98.00
Current Option Gain/Loss: Aug.call +27.7% & Sept.call: +21.9%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/01/13: JNJ is still inching higher and managed to set a new closing high today. On an intraday basis the stock seemed to struggle with yesterday's intraday high near $94.40.

The 10-dma has risen to $92.83. We will raise our stop loss to $92.35.

- Suggested Positions -

Long Aug $92.50 call (JNJ1317H92.5) entry $1.37

- or -

Long Sep $95 call (JNJ1321i95) entry $0.82

08/01/13 new stop loss @ 92.35
07/31/13 new stop loss @ 91.90

Entry on July 29 at $93.05
Average Daily Volume = 9.0 million
Listed on July 27, 2013


Xilinx Inc. - XLNX - close: 47.15 change: +0.46

Stop Loss: 44.99
Target(s): 49.85
Current Option Gain/Loss: +19.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/01/13: XLNX posted another gain and set another multi-year high. Yet it's worth noting that XLNX underperformed its peers in the semiconductor sector.

Earlier Comments:
I would keep our position size small since bears could argue that XLNX is overbought with a significant five-week rally already underway.

*small positions* - Suggested Positions -

Long Aug $46 call (XLNX1317H46) entry $1.06

Entry on July 31 at $46.65
Average Daily Volume = 3.5 million
Listed on July 25, 2013


PUT Play Updates

Accenture Plc - ACN - close: 73.81 change: +0.07

Stop Loss: 75.21
Target(s): 70.25
Current Option Gain/Loss: -58.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/01/13: ACN spiked higher at the open and managed to breakout back above its simple 200-dma. It is worth noting that ACN seemed to be struggling with round-number resistance at the $75.00 level today. However, given today's bullish move higher we are suggesting an immediate exit at the opening bell tomorrow morning.

- Suggested Positions -

Long Aug $72.50 PUT (ACN1317T72.5) entry $0.85

08/01/13 prepare to exit tomorrow morning

Entry on July 24 at $73.80
Average Daily Volume = 4.9 million
Listed on July 23, 2013


Illumina Inc. - ILMN - close: 79.45 change: -0.37

Stop Loss: 81.55
Target(s): 75.25
Current Option Gain/Loss: - 7.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/01/13: Our new trade on ILMN has been triggered. The stock initially spiked higher this morning but ILMN failed at resistance near $82.00 again. By the closing bell shares had reversed and fallen to a new one-week low. Our trigger to buy puts as hit at $79.50.

NOTE: Once ILMN fills the gap we can re-evaluate it for a potential bullish entry point.

*small positions* - Suggested Positions -

Long Sep $75 PUT (ILMN1321u75) entry $2.00

Entry on August 01 at $79.50
Average Daily Volume = 1.2 million
Listed on July 31, 2013


iShares Russell 2000 ETF - IWM - close: 105.07 change: +1.42

Stop Loss: 106.05
Target(s): 97.00
Current Option Gain/Loss: -29.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/01/13: A parade of bullish economic data today helped fuel widespread market gains and the IWM has broken out (barely) past resistance near $105.00. Stocks look poised to surge higher but it all comes down to the nonfarm payrolls (jobs) report tomorrow morning. If the market can interpret the jobs data as bullish then stocks will rally and we could see the IWM hit our stop loss at $106.05.

- Suggested Positions -

Long Sep $100 PUT (IWM1321u100) Entry $1.48

Entry on July 30 at $103.69
Average Daily Volume = 31 million
Listed on July 29, 2013


SPDR S&P 500 ETF - SPY - close: 170.66 change: +1.95

Stop Loss: 172.75
Target(s): 165.25
Current Option Gain/Loss: -34.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/01/13: The large cap ETF also rallied today. Better than expected economic news out of China, Europe and even the U.S. helped fuel market gains. The SPY managed to breakout past key resistance at the $170 level. This looks like a new bullish entry point for stocks. However, it could all change tomorrow. The nonfarm payrolls (jobs) report will come out Friday morning before the bell. If the number is bullish we will see stocks surge and the SPY will likely hit our stop loss at $172.75.

NOTE: There are a lot of different option symbols for the SPY. Make sure you get the right one. We're choosing the regular August $170 put that expires on the 17th.

- Suggested Positions -

Long Aug $170 PUT (SPY1317T170) entry $1.98

07/24/13 trade opened with the SPY gapping higher at $169.79
07/23/13 adjust entry strategy. Do not wait for a trigger. Buy puts at the opening bell tomorrow.

Entry on July 24 at $169.79
Average Daily Volume = 123 million
Listed on July 22, 2013



Longer-Term Play Updates



Chicago Bridge & Iron - CBI - close: 60.01 change: +0.43

Stop Loss: 55.75
Target(s): 74.50
Current Option Gain/Loss: - 3.9%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
08/01/13: I am urging caution here. CBI managed a gain today but the actual trading activity looks bearish. The stock has failed near $61 (and near its 50-dma) for the second day in a row. We might make some changes to our trade in the weekend newsletter.

*Small Positions* - Suggested Positions -

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

07/20/13 new stop loss @ 55.75
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

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


CLOSED BULLISH PLAYS

The Hain Celestial Group, Inc. - HAIN - close: 73.35 change: +0.39

Stop Loss: 71.95
Target(s): 79.50
Current Option Gain/Loss: -63.3%
Time Frame: exit PRIOR to August expiration
New Positions: see below

Comments:
08/01/13: HAIN was not performing midweek so we decided last night to close the trade Thursday morning at the open. Shares gapped open higher at $73.42. Unfortunately the option opened slightly lower.

- Suggested Positions -

Aug $75 call (HAIN1317H75) entry $1.50 exit $0.55 (-63.3%)

08/01/13 closed this morning
07/31/13 prepare to exit tomorrow morning.

chart:

Entry on July 25 at $74.40
Average Daily Volume = 420 thousand
Listed on July 22, 2013


Polaris Industries - PII - close: 115.12 change: +2.98

Stop Loss: 108.49
Target(s): 114.85
Current Option Gain/Loss: +69.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/01/13: Target achieved.

A bullish market environment helped PII surge to another new high. The stock hit our exit target at $114.85.

*small positions* - Suggested Positions -

Long Sep $115 call (PII1321i115) entry $2.10 exit $3.55 (+69.0%)

08/01/13 target hit

chart:

Entry on July 31 at $111.05
Average Daily Volume = 765 thousand
Listed on July 30, 2013


CLOSED BEARISH PLAYS

Darden Restaurant - DRI - close: 49.56 change: +0.51

Stop Loss: 49.35
Target(s): 44.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/01/13: DRI rallied up to round-number resistance at $50.00 and failed. It is certainly possible that shares reverse lower from here. Yet we are dropping DRI as a candidate. Our trade has not opened yet and given the market's bullish breakout to new high we are giving up on DRI considering its recent bounce.

Trade did not open.

08/01/13 removed from the newsletter
07/31/13 adjust the option strike from Aug $50 to Sep $50

chart:

Entry on July -- at $---.--
Average Daily Volume = 1.3 million
Listed on July 24, 2013