Editor's Note:

A better than expected Q2 GDP estimate this morning helped overshadow worries about Syria. Keep in mind that stronger economic data would support the Federal Reserve's desire to begin tapering their QE program earlier rather than later.


Current Portfolio:


CALL Play Updates

Sturm, Ruger & Co. Inc. - RGR - close: 53.15 change: +0.40

Stop Loss: 49.95
Target(s): 57.50
Current Option Gain/Loss: - 3.2%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
08/29/13: Traders bought the dip again this morning and RGR produced a +0.75% gain. More conservative traders may want to tighten their stops closer to the $51 or $52 levels.

Earlier Comments:
If this rally continues it could spark a short squeeze. The most recent data listed short interest at 30% of the very small 18.8 million share float.

- Suggested Positions -

Long Oct $55 call (RGR1319j55) entry $1.24

08/28/13 trade opened on gap higher at $53.45. Trigger was 52.65

Entry on August 28 at $53.45
Average Daily Volume = 341 thousand
Listed on August 27, 2013


PUT Play Updates

DaVita HealthCare - DVA - close: 108.02 change: -0.00

Stop Loss: 110.51
Target(s): 105.25
Current Option Gain/Loss: + 40.9%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/29/13: DVA saw a midday rally but the bounce failed under resistance near $110.00 and the stock reversed to close unchanged on the session. This stock should also find overhead resistance at its simple 10-dma, which has fallen to $110.17. Tonight we are moving our stop loss down to $110.51.

Earlier Comments:
Our short-term target is $105.25. More aggressive traders could aim lower since the Point & Figure chart for DVA is bearish with a $96 target.

FYI: Investors should note that DVA does have a 2-for-1 split coming up on September 9th.

- Suggested Positions -

Long Sep $110 PUT (DVA1321u110) entry $2.20*

08/29/13 new stop loss @ 110.51
08/27/13 trade opens on gap down at $109.95
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on August 27 at $109.95
Average Daily Volume = 833 thousand
Listed on August 26, 2013


eBay Inc. - EBAY - close: 50.99 change: +0.56

Stop Loss: 51.75
Target(s): 46.00
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to September option expiration
New Positions: Yes, see below

Comments:
08/29/13: Bulls are not giving up on EBAY and buy-the-dip traders did buy EBAY this morning near round-number support at $50.00. The stock bounced but the rally failed near its 10-dma. Shares still closed up +1.1% and today's move is technically a bullish engulfing candlestick reversal pattern. At the moment I don't see any changes from my earlier comments.

We are suggesting a trigger to buy puts at $49.75. If triggered our target is $46.00. More aggressive traders may want to aim lower.

NOTE: We are listing the September puts, which expire in less than four weeks. You might want to play the Octobers instead.

Trigger @ 49.75

- Suggested Positions -

Buy the Sep $50 PUT (EBAY1321u50)

Entry on August -- at $---.--
Average Daily Volume = 8.2 million
Listed on August 28, 2013


iShares Russell 2000 ETF - IWM - close: 101.97 change: +1.01

Stop Loss: 105.25
Target(s): 99.00
Current Option Gain/Loss: -14.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
08/29/13: The small caps outperformed the larger cap stocks. The market chose to ignore worries over Syria and instead focus on the better than expected Q2 GDP estimate. The IWM added +1.0% but still has a short-term trend of lower highs. Readers may want to lower their stop back down toward the $104.00 level.

- Suggested Positions -

Long Sep $100 PUT (IWM1321u100) Entry $1.48

08/27/13 adjust exit target to $99.00
08/24/13 new stop loss @ 105.25
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


ManpowerGroup Inc. - MAN - close: 65.98 change: +0.58

Stop Loss: 67.05
Target(s): 61.00
Current Option Gain/Loss: -20.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/29/13: MAN bounced for a second day in a row. It does look like the bounce reversed intraday once MAN came close to filling the gap from the 27th of August.

- Suggested Positions -

Long Sep $65 PUT (MAN1321u65) entry $1.70

Entry on August 27 at $65.75
Average Daily Volume = 530 thousand
Listed on August 21, 2013


Sherwin-Williams Co. - SHW - close: 172.05 change: +2.68

Stop Loss: 170.25
Target(s): sell half at 161.00, then exit the rest at $156.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
08/29/13: SHW also rebounded for the second day in a row. Shares are now back above potential round-number resistance at $170.00 and above its 200-dma (near $170). Yet SHW still has a bearish trend of lower highs, at least for now. We remain on the sidelines waiting for a new relative low.

Earlier Comments:
SHW's long-term up trend is in serious jeopardy. The Point & Figure chart has turned bearish and is forecasting a $136 target.

The recent lows are near $166.00. We are suggesting a trigger to buy puts at $165.90. If triggered you could target a drop toward $160.00 and its 300-dma. I am suggesting we plan on exiting half of our position at $161.00. We'll plan on exiting the remain of our position at $156.00.

Trigger @ 165.90

- Suggested Positions -

Buy the Sep $160 PUT (SHW1321u160)

Entry on August -- at $---.--
Average Daily Volume = 781 thousand
Listed on August 27, 2013


Time Warner Cable - TWC - close: 107.63 change: -0.40

Stop Loss: 110.55
Target(s): 105.00
Current Option Gain/Loss: -25.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
08/29/13: TWC continues to churn sideways. The majority of the last three days have been inside the $107.50-108.50 zone. I am concerned about the lack of downward momentum. We are moving our stop loss lower to $110.55.

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

08/29/13 new stop loss @ 110.55

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: 60.70 change: -0.27

Stop Loss: 55.75
Target(s): 74.50
Current Option Gain/Loss: -17.4%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
08/29/13: It was a quiet day for CBI with shares trading inside a 52-cent range. There is no change from my earlier comments.

*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: 51.57 change: -0.15

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:
08/29/13: The VGK gapped down at the open again. Traders did buy the dip but the intraday rally failed. If this correction continues we might see the VGK retrace lower toward the $50.00 level and its simple 200-dma (also near $50.00). Coincidentally a 50% retracement of the rally from its June lows to the August highs would be near the $50.00 mark.

Currently we are waiting for a new relative high (see below) but we might re-evaluate our entry point strategy if we see the VGK test what should be support near $50.00.

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 2014 Mar $55 call (VGK1422L55)

08/24/13 adjust the option strike from 2013 Dec $55 to $2014 Mar $55.

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