Editor's Note:

The major U.S. indices posted declines on Monday as the volatility index and bond yields ticked higher.

SINA and APA were triggered. BYI was stopped out.


Current Portfolio:


CALL Play Updates

Fluor Corp. - FLR - close: 65.06 change: -1.13

Stop Loss: 64.95
Target(s): 74.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 9 weeks
New Positions: Yes, see below

Comments:
08/19/13: After ignoring most of the market's weakness last week shares of FLR were suddenly showing relative weakness today. The stock lost -1.7% to settle on the $65.00 level. If FLR continues to drop tomorrow then we'll likely remove it as a bullish candidate. Until then our play hasn't changed.

The $67.00 area is major resistance and a breakout could signal a big move higher. Tonight we're suggesting a trigger to buy calls at $67.25. If triggered our multi-week target is $74.00. FYI: The Point & Figure chart for FLR is bullish with an $82 target.

Trigger @ 67.25

- Suggested Positions -

Buy the Oct $70 call (FLR1319j70)

Entry on August -- at $---.--
Average Daily Volume = 1.7 million
Listed on August 17, 2013


Shire plc - SHPG - close: 112.53 change: -0.32

Stop Loss: 109.40
Target(s): 118.50
Current Option Gain/Loss: - 9.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/19/13: According to a SundayTimes article this past weekend SHPG has hired Lazard to defend itself against potential takeovers. This follows Bristol-Myers Squibb informal attempt to buy SHPG earlier this year.

The news didn't do much for the stock. SHPG's gap open higher near $113.60 faded by the closing bell. I am not suggesting new positions.

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

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


SINA Corp. - SINA - close: 80.60 change: +0.61

Stop Loss: 77.70
Target(s): 89.00
Current Option Gain/Loss: -16.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/19/13: Our new play on SINA has been triggered. The stock spiked lower at the open but quickly reversed near short-term support around the $78 area and its simple 10-dma. Dip buyers helped push SINA past $83 a share before the stock pared its gains. Our trigger to buy calls was hit at $81.35. If you missed the entry point consider waiting for a new rally past $81.25 before launching positions.

- Suggested Positions -

Long Sep $85 call (SINA1321i85) entry $2.75

Entry on August 19 at $81.35
Average Daily Volume = 2.9 million
Listed on August 17, 2013


PUT Play Updates

Apache Corp. - APA - close: 75.37 change: -3.62

Stop Loss: 80.55
Target(s): 71.00
Current Option Gain/Loss: +81.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/19/13: Our new play on APA is off to a strong start. Shares gapped open lower at $78.42 and then plunged to a -4.5% decline on above average volume. Our plan was to buy puts at $78.75 but the gap down triggered our play.

FYI: The Point & Figure chart for APA is bearish with a $72 target.

- Suggested Positions -

Long Oct $75 PUT (APA1319v75) entry $1.60

08/19/13 trade opened on gap down at $78.42. Trigger was $78.75

Entry on August 19 at $78.42
Average Daily Volume = 2.6 million
Listed on August 17, 2013


Boeing Company - BA - close: 104.72 change: +1.25

Stop Loss: 105.55
Target(s): 100.25
Current Option Gain/Loss: -37.7%
Time Frame: 1 to 2 weeks
New Positions: see below

Comments:
08/19/13: Shares of BA are not cooperating with us. It is possible the stock was rising on news that BA just undercut its rivals for a $7.4 billion contract to build fighter jets for South Korea. The country hasn't made a decision yet but BA's move certainly makes its bid more attractive.

Technically the bounce in BA is interesting. Today's rise above its simple 50-dma is arguably bullish. Yet the rally stalled at its three-week trend line of lower highs (resistance, see chart). If there is any follow through higher we could see BA hit our stop loss.

- Suggested Positions -

Long Sep $100 PUT (BA1321u100) entry $1.75

08/15/13 trade opened on gap down at $103.19. Trigger was $103.75

chart:

Entry on August 15 at $103.19
Average Daily Volume = 4.6 million
Listed on August 14, 2013


Digital Realty Trust - DLR - close: 51.06 change: -1.24

Stop Loss: 55.35
Target(s): 50.25
Current Option Gain/Loss: +52.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/19/13: DLR issued a press release this morning stating that, "it has completed the refinancing of its global revolving credit facility and term loan. The refinancing allowed the company to reduce pricing, extend loan maturities and increase its aggregate commitments by $450 million. The combined facilities total $3 billion, representing the 5th largest unsecured credit facilities among US REITs. The refinancing provides funds for acquisitions, development, redevelopment, debt repayment, working capital and global expansion." The news failed to slow the sell-off in the share price. DLR lost another -2.3% and hit an intraday low near $51.00. I am lowering our stop loss down to $54.25.

Earlier Comments:
If triggered our short-term target is $50.25. More aggressive traders may want to aim lower since the Point & Figure chart for DLR is bearish with a $42 target.

- Suggested Positions -

Long Sep $50 PUT (DLR1321u50) entry $1.05

08/19/13 new stop loss @ 54.25

Entry on August 14 at $53.75
Average Daily Volume = 1.8 million
Listed on August 13, 2013


iShares Russell 2000 ETF - IWM - close: 100.65 change: -1.03

Stop Loss: 104.25
Target(s): 98.50
Current Option Gain/Loss: +28.3%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/19/13: Worries over rising interest rates and the Fed's taper continued to push stocks lower on Monday. The IWM slipped another -1.0% and broke down below its rising 50-dma. Tonight we're adjusting our stop loss down to $104.25.

I am not suggesting new bearish positions at this time.

- Suggested Positions -

Long Sep $100 PUT (IWM1321u100) Entry $1.48

08/19/13 new stop loss @ 104.25
08/15/13 adjust exit target from $97.00 to $98.50
08/03/13 readers may want to consider an early exit

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


Time Warner Cable - TWC - close: 108.73 change: -1.21

Stop Loss: 111.60
Target(s): 105.00
Current Option Gain/Loss: -12.7%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/19/13: TWC continued to show relative weakness with a -1.1% decline and anew six-week closing low. The stock has producing a convincing breakdown below $110 and its 50-dma with today's drop.

Earlier Comments:
We do want to keep our position size small. There is potential support at $108.00. The next level of support is $104.00. If we are triggered at $109.50, our target is $105.00.

- Suggested Positions -

Long Sep $105 PUT (TWC1321u105) entry $2.35

Entry on August 16 at $109.50
Average Daily Volume = 2.3 million
Listed on August 15, 2013



Longer-Term Play Updates



Chicago Bridge & Iron - CBI - close: 60.21 change: -1.06

Stop Loss: 55.75
Target(s): 74.50
Current Option Gain/Loss: -21.5%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
08/19/13: After showing some relative strength late last week CBI gave back a good chunk of those gains with a -1.7% drop today.

I am not 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

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


Vanguard FTSE Europe ETF - VGK - close: 52.62 change: -0.47

Stop Loss: 51.25
Target(s): 58.50
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to 2013 December option expiration
New Positions: Yes, see below

Comments:
08/19/13: Most of the European markets closed in negative territory today. That put pressure on the VGK. I don't see any changes from my earlier comments.

Earlier Comments:
We are taking a multi-month time frame with this trade. I am suggesting we wait for the VGK to close above $53.50 and then buy calls the next morning. If we are triggered our target is $58.50 but we'll adjust it as the trade progresses.

FYI: The Point & Figure chart for VGK is bullish with a $63 target.

Trigger: Wait for a close above $53.50,
then buy calls the next morning.

- Suggested Positions -

Buy the 2013 Dec $55 call (VGK1322L55)

Entry on August -- at $---.--
Average Daily Volume = 3.0 million
Listed on August 10, 2013


CLOSED BEARISH PLAYS

Bally Technologies - BYI - close: 71.14 change: +0.63

Stop Loss: 71.65
Target(s): 65.25
Current Option Gain/Loss: -28.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/19/13: Too much volatility in shares of BYI ended up hurting us. Our plan was to wait for a breakdown under the $70.00 level and buy puts at $69.75. BYI gapped lower at $69.98, dipped to $69.66 (trigging our play) and then produced a sharp rebound climbing up and past the $72.00 level before paring its gains. BYI hit both our entry point and our stop loss (71.65) in the same session. We knew this was a more aggressive trade, which was why I suggested small positions.

*small positions* - Suggested Positions -

Sep $70 PUT (BYI1321u70) entry $1.60, exit: 1.15 (-28.1%)

08/19/13 stopped out at $71.65
08/19/13 triggered at $69.75

Annotated Chart:

Entry on August -- at $---.--
Average Daily Volume = 522 thousand
Listed on August 17, 2013