Editor's Note:

The major U.S. indices all posted a weekly loss during the first full week of August. Yet profit taking has been pretty anemic.


Current Portfolio:


CALL Play Updates

CR Bard Inc. - BCR - close: 117.37 change: +0.57

Stop Loss: 114.65
Target(s): 119.75
Current Option Gain/Loss: + 5.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/10/13: BCR continued to rally on Friday with a +0.48% gain. The stock has managed to ignore the market's recent weakness and extend its gains to five up weeks in a row. We are raising the stop loss to $114.65.

- Suggested Positions -

Long Sep $120 call (BCR1321i120) entry $0.90

08/10/13 new stop loss @ 114.65

chart:

Entry on August 06 at $116.25
Average Daily Volume = 475 thousand
Listed on August 05, 2013


eBay Inc. - EBAY - close: 53.33 change: -0.24

Stop Loss: 52.75
Target(s): 57.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/10/13: Friday was a relatively quiet day for shares of EBAY. The stock churned sideways between overhead resistance near its 100-dma and support at its 200-dma. We are waiting on a breakout past the $54.00 level.

We are suggesting a trigger to buy calls at $54.15. If triggered our target is $57.00.

Trigger @ 54.15

- Suggested Positions -

Buy the Sep $55 call (EBAY1321i55) current ask $0.97

chart:

Entry on August -- at $---.--
Average Daily Volume = 12.0 million
Listed on August 08, 2013


Lockheed Martin Corp. - LMT - close: 124.02 change: -0.62

Stop Loss: 123.45
Target(s): 129.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/10/13: LMT has spent nearly all of the last five trading days consolidating sideways inside the $123.50-125.00 zone. The stock managed to eke out another weekly gain in spite of Friday's decline. The stock is now up seven weeks in a row.

Currently we are waiting on a breakout past resistance at $125.00. We are suggesting small bullish positions if LMT can trade at $125.25. If triggered our target is $129.75.

On Thursday I discussed some of the bearish concerns with LMT and the defense stocks hitting overbought conditions. You can read those comments here (scroll down to LMT's update).

Trigger @ 125.25 *small positions*

- Suggested Positions -

buy the Sep $125 call (LMT1321i125)

chart:

Entry on August -- at $---.--
Average Daily Volume = 1.6 million
Listed on August 07, 2013


Polaris Industries - PII - close: 113.41 change: -0.08

Stop Loss: 113.40
Target(s): 119.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/10/13: PII's decline for the week ended a six-week rally. Yet profit taking was pretty minor. The stock is currently hovering near short-term technical support at its 10-dma. We are currently on the sidelines waiting for a breakout to new highs. I am suggesting a trigger to buy calls at $116.25. If triggered our target is $119.75.

Trigger @ 116.25

- Suggested Positions -

Buy the Sep $120 call (PII1321i120)

chart:

Entry on August -- at $---.--
Average Daily Volume = 829 thousand
Listed on August 06, 2013


Shire plc - SHPG - close: 111.24 change: +0.21

Stop Loss: 109.40
Target(s): 118.50
Current Option Gain/Loss: -28.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/10/13: SHPG recently tested the $110 level and its 10-dma as short-term support. The stock has been trying to rebound from the $110 area but it seems to be having trouble generating any momentum but that could be a factor of the lackluster market action this past week.

We are raising our stop loss up to $109.40.

Earlier Comments:
The plan was to keep our position size small to limit risk.

*small positions* - Suggested Positions -

Long Sep $115 call (SHPG1321i115) entry $2.60

08/10/13 new stop loss @ 109.40

chart:

Entry on August 02 at $111.50
Average Daily Volume = 347 thousand
Listed on August 01, 2013


Under Armour, Inc. - UA - close: 72.69 change: +0.71

Stop Loss: 69.25
Target(s): 74.75
Current Option Gain/Loss: +40.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/10/13: The rally in UA continued on Friday with a +0.98% gain. Shares have surged to a new round of all-time highs this past week. If you're looking for a new entry point I would suggest waiting for a dip into the $71-70 area. Tonight we are raising the stop loss to $69.25.

- Suggested Positions -

Long Sep $72.50 call (UA1321i72.5) entry $1.85

08/10/13 new stop loss @ 69.25

chart:

Entry on August 08 at $70.50
Average Daily Volume = 1.3 million
Listed on August 06, 2013


United Technologies - UTX - close: 105.62 change: -0.64

Stop Loss: 104.45
Target(s): 109.75
Current Option Gain/Loss: - 2.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/10/13: Uh-oh! UTX underperformed its large-cap peers on Friday with a -0.6% decline. The lack of follow through on the mid-week bounce is a concern. We are turning more cautious and raising the stop loss to $104.45. I am not suggesting new positions at this time.

FYI: UTX will begin trading ex-dividend on August 14th. The quarterly dividend should be 53.5 cents.

*small positions* - Suggested Positions -

Long Sep $105 call (UTX1321i105) entry $2.40

08/10/13 new stop loss @ 104.45

chart:

Entry on August 07 at $105.55
Average Daily Volume = 3.2 million
Listed on August 03, 2013


PUT Play Updates

Illumina Inc. - ILMN - close: 78.71 change: +0.42

Stop Loss: 80.25
Target(s): 75.25
Current Option Gain/Loss: -12.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/10/13: ILMN is still not cooperating. The stock managed a gain on Friday (+0.5%) when most of the market posted losses. That's not a good trend for a bearish put play. It does look like the rebound attempt failed at the 10-dma but I would remain cautious here. I am not suggesting new positions at this time.

*small positions* - Suggested Positions -

Long Sep $75 PUT (ILMN1321u75) entry $2.00

08/06/13 new stop loss @ 80.25

chart:

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


iShares Russell 2000 ETF - IWM - close: 104.04 change: -0.11

Stop Loss: 106.05
Target(s): 97.00
Current Option Gain/Loss: -26.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/10/13: The stock market's upward momentum appears to have stalled. Yet there has been no follow through on any attempts to correct lower. The IWM is just churning sideways. I am not suggesting new bearish positions at this time.

- Suggested Positions -

Long Sep $100 PUT (IWM1321u100) Entry $1.48

08/03/13 readers may want to consider an early exit

chart:

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



Longer-Term Play Updates



Chicago Bridge & Iron - CBI - close: 59.86 change: +0.20

Stop Loss: 55.75
Target(s): 74.50
Current Option Gain/Loss: -17.6%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
08/10/13: CBI is essentially unchanged for the week thanks to the rebound off of Wednesday's low. The stock does have a three-week trend of lower highs. I remain cautious here and we're suggesting new positions at this time.

*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

chart:

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