Editor's Note:

The stock market accelerated lower on bearish comments from the U.S. treasury regarding the impact of a debt default (referencing the debt ceiling debate). The Treasury said the situation could worsen and be as bad or worse than the 2008 financial crisis.

Equities did manage to pare their losses by the closing bell.

BA has been removed. SFUN was stopped out. SOHU was triggered.


Current Portfolio:


CALL Play Updates

Actavis, Inc. - ACT - close: 144.49 change: -1.89

Stop Loss: 139.40
Target(s): 148.50
Current Option Gain/Loss: + 53.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/03/13: ACT erased yesterday's gains with a -1.89% pullback today. The stock closed on its lows for the session and that doesn't bode well for tomorrow morning. More conservative traders may want to take profits now. If this weakness continues ACT could test support near $142.00. The next level of support would be $140.

- Suggested Positions -

Long Oct $145 call (ACT1319j145) entry $1.50*

09/30/13 new stop loss @ 139.40
09/28/13 new stop loss @ 137.75
09/25/13 new stop loss @ 135.75
09/21/13 Shares of ACT were volatile right at the closing bell on Friday (09/20/13). Expected more volatility on Monday morning
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on September 19 at $139.50
Average Daily Volume = 985 thousand
Listed on September 18, 2013


Anadarko Petroleum - APC - close: 92.98 change: -1.70

Stop Loss: 92.25
Target(s): 99.50
Current Option Gain/Loss: -59.6%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
10/03/13: APC reversed yesterday's gains with a -1.79% decline. The stock is once again testing support in the $92.50-93.00 zone. If the market continues to sink tomorrow we could see APC hit our stop loss at $92.25. Today's reversal seems to reaffirm the short-term, three-week trend of lower highs. I am not suggesting new positions.

- Suggested Positions -

Long Oct $95 call (APC1319j95) entry $3.05*

09/21/13 new stop loss @ 92.25
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on September 11 at $94.25
Average Daily Volume = 2.55 million
Listed on September 09, 2013


3D Systems - DDD - close: 53.93 change: -1.29

Stop Loss: 52.48
Target(s): 59.75 & 64.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks and two-to-three months
New Positions: Yes, see below

Comments:
10/03/13: DDD dipped towards Monday's low and its 30-dma before paring its losses today. Shares ended the session down -2.3%. If DDD doesn't improve soon we will likely remove it as a candidate. I don't see any changes from my earlier comments.

Earlier Comments:
DDD could see a short squeeze. The most recent data listed short interest at 33% of the 94.5 million share float. Tuesday's high was $56.23. We are suggesting a trigger to buy calls at $56.35. If triggered our short-term target is $59.75. Our longer-term target is $64.00. The Point & Figure chart for DDD is bullish with a $71 target.

Trigger @ 56.35

- Suggested Positions -

Buy the NOV $60 call (DDD1316k60)

- or -

Buy the 2014 Jan $60 call (DDD1418a60)

Entry on September -- at $---.--
Average Daily Volume = 4.1 million
Listed on September 24, 2013


Ecolab Inc. - ECL - close: 97.76 change: -1.75

Stop Loss: 97.75
Target(s): 105.00
Current Option Gain/Loss: Unopened
Time Frame: exit prior to earnings in late October
New Positions: Yes, see below

Comments:
10/03/13: ECL also underperformed the market's major indices. The stock fell -1.75% and is flirting with a breakdown from its recent two-week trading range. If ECL does not improve soon we will likely remove it as a bullish candidate.

We are suggesting a trigger to buy calls at $100.25. If triggered we'll use a stop loss at $97.75. Our target is $105.00. We will plan to exit prior to ECL's next earnings report due sometime in very late October.

Trigger @ 100.25

- Suggested Positions -

buy the NOV $100 call (ECL1316k100)

Entry on October -- at $---.--
Average Daily Volume = 877 thousand
Listed on October 01, 2013


iShares Russell 2000 ETF - IWM - close: 106.31 change: -1.10

Stop Loss: 103.40
Target(s): 110.95
Current Option Gain/Loss: + 6.1%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
10/03/13: The small cap IWM gave up more than -1.0% on Thursday. Shares did bounce twice near $105.60 midday. I am not suggesting new positions at this time. More conservative investors may want to consider raising their stop loss toward the $105 area.

Earlier Comments:
I'm suggesting the 2014 January $110 calls but you may want to use another month or strike that better suits your trading style.

- Suggested Positions -

Long 2014 Jan $110 call (IWM1418a110) entry $2.10

10/01/13 setting the bullish exit target at $110.95
09/30/13 buy-the-dip trigger hit at $105.25.

Entry on September 30 at $105.25
Average Daily Volume = 34.6 million
Listed on September 28, 2013


Ross Stores Inc. - ROST - close: 73.16 change: -0.85

Stop Loss: 69.95
Target(s): 77.50
Current Option Gain/Loss: Nov75c: - 2.6% & 2014jan75c: - 1.9%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
10/03/13: After a five-day rally ROST finally hit some profit taking as traders start to worry over the government shutdown. ROST held short-term support in the $72.50-73.00 zone. If this pullback continues the next likely support levels are $72.00 and $70.00.

There was an interesting note from the National Retail Federation today. The NRF released their 2013 holiday shopping forecast and expect overall retail sales in November and December to show +3.9% growth in 2013. That's above 2012's 3.5% growth rate and above the 10-year average of +3.3% growth. However, they also warned that the situation in Washington D. C. could impact consumer confidence if the lack of political cooperation persists. The government shutdown and concerns over the debt ceiling could hamper consumers' appetite to spend money.

Earlier Comments:
FYI: The Point & Figure chart for ROST is bullish with an $89 target.

NOTE: I'm listing our trade with an initial stop loss at $69.95 but more conservative traders may want to use a stop closer to $71.00 instead.

- Suggested Positions -

Long Nov $75 call (ROST1316K75) entry $1.13

- or -

Long 2014 Jan $75 call (ROST1418a75) entry $2.60*

*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on October 01 at $73.05
Average Daily Volume = 1.28 million
Listed on September 28, 2013


Starbucks Corp. - SBUX - close: 76.87 change: -0.32

Stop Loss: 75.75
Target(s): 79.75
Current Option Gain/Loss:(Oct75c:+ 93.2%) & 2014Jan75c: +52.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
10/03/13: Thursday's session for SBUX looks a lot like yesterday. Shares remain inside their $76.00-77.50 trading range.

Traders looking for a new entry point could use a breakout past $77.50 as a possible entry point (you'll need to adjust your stop and target).

- Suggested Positions -

Oct $75 call (SBUX1319j75) entry $1.18 exit $2.28 (+93.2%)

- or -

Long 2014 Jan $75 call (SBUX1418a75) entry $3.25

10/02/13 adjust final target to $79.75
09/28/13 new stop loss @ 75.75, consider taking profits early!
09/19/13 new stop loss @ 73.90
09/18/13 new stop loss @ 73.40, adjust exit to $79.00
this morning we closed the Oct. $75 calls at the open.
09/17/13 prepare to exit the October $75 calls at the open tomorrow
09/17/13 new stop loss @ 72.40
09/14/13 new stop loss @ 71.75
09/11/13 SBUX at new highs. Cautious traders may want to lock in some gains.

Entry on September 05 at $72.35
Average Daily Volume = 3.0 million
Listed on September 04, 2013


Schlumberger - SLB - close: 89.44 change: -0.41

Stop Loss: 88.25
Target(s): 94.75
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings on Oct. 18th
New Positions: Yes, see below

Comments:
10/03/13: SLB actually held up relatively well today. Profit taking was mild with a -0.4% pullback. There is no change from my prior comments.

Please note that we only have about two weeks. We do not want to hold positions over SLB's earnings announcement on October 18th. I am suggesting a trigger to buy calls at $90.25. If triggered our target is $94.75.

FYI: The Point & Figure chart for SLB is bullish with a $113 target.

Trigger @ 90.25

- Suggested Positions -

Buy the Nov $92.50 call (SLB1316K92.5) current ask $1.66

Entry on October -- at $---.--
Average Daily Volume = 6.3 million
Listed on October 02, 2013


Sohu.com Inc. - SOHU - close: 82.58 change: +2.30

Stop Loss: 76.75
Target(s): 88.50
Current Option Gain/Loss: +18.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/03/13: Our new trade on SOHU has been opened. The stock hit our suggested entry point to buy calls at $80.75 within the first ten minutes of trading this morning. Shares faded from the $81 level and eventually bounced twice from the $78.75 area. The afternoon rebound lifted SOHU to a new 52-week high. Shares outperformed the market with a +2.8% gain.

Please note that I am raising our stop loss to $77.75.

NOTE: I do consider this a more aggressive, higher-risk trade because SOHU can be a volatile stock. I am suggesting small positions to limit risk.

*small positions* - Suggested Positions -

Long Nov $85 call (SOHU1316K85) entry $4.40

Entry on October 03 at $80.75
Average Daily Volume = 2.0 million
Listed on October 02, 2013


Tractor Supply Company - TSCO - close: 68.20 change: -0.53

Stop Loss: 65.75
Target(s): 74.00
Current Option Gain/Loss: + 0.1%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
10/03/13: TSCO hit a new high this morning before following the market lower. I am not suggesting new positions at this time. We are raising our stop loss to $65.75.

Earlier Comments:
It is possible that the $70.00 level could be round-number resistance but we're aiming for $74.00 between now and yearend. FYI: The Point & Figure chart for TSCO is bullish with an $87 target.

- Suggested Positions -

Long 2014 Jan $70 call (TSCO1418a70) entry $2.72

10/03/13 new stop loss @ 65.75
10/01/13 trade opened on gap higher at $68.04.
Trigger was $67.50

Entry on October 01 at $68.04
Average Daily Volume = 440 thousand
Listed on September 30, 2013


United Parcel Service - UPS - close: 90.10 change: -1.18

Stop Loss: 89.95
Target(s): 99.00
Current Option Gain/Loss: Unopened
Time Frame: exit prior to earnings on Oct. 25th
New Positions: Yes, see below

Comments:
10/03/13: Uh-oh! UPS appears to be breaking down from its recent sideways consolidation. Shares underperformed their peers in the transports with a -1.29% decline today. UPS settled on round-number support near $90.00. If the stock does not recover tomorrow then we will likely remove UPS as a bullish candidate.

Earlier Comments:
We are suggesting a trigger to buy calls at $92.25. If triggered our target is $99.00 but we will plan to exit prior to the earnings announcement on October 25th.

Trigger @ 92.25

- Suggested Positions -

buy the 2014 Jan $95 call (UPS1418a95)

Entry on October -- at $---.--
Average Daily Volume = 2.6 million
Listed on October 01, 2013


Workday, Inc. - WDAY - close: 82.40 change: -0.23

Stop Loss: 79.75
Target(s): 89.00
Current Option Gain/Loss: -19.2%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
10/03/13: It was a bumpy session for WDAY. Early gains faded and shares traded below short-term support at their 10-dma before recovering. I am cautious here given the market's continued weakness.

Earlier Comments:
The stock could see a short squeeze. The most recent data listed short interest at 18% of the 65.2 million share float.

- Suggested Positions -

Long Dec $90 call (WDAY1322L90) entry $2.85

Entry on September 27 at $82.75
Average Daily Volume = 1.2 million
Listed on September 26, 2013


PUT Play Updates

Energizer Holdings - ENR - close: 92.39 change: +0.05

Stop Loss: 94.65
Target(s): 88.00
Current Option Gain/Loss: -40.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/03/13: Today's performance in ENR is somewhat concerning. We do not want to see our bearish candidates showing relative strength on a down day for the market. ENR bounced up to short-term technical resistance at its 10-dma before paring its gains.

- Suggested *Small* Positions -

Long Oct $90 PUT (ENR1319v90) entry $1.00

Entry on September 26 at $92.36
Average Daily Volume = 424 thousand
Listed on September 25, 2013


The Fresh Market, Inc. - TFM - close: 48.00 change: +0.21

Stop Loss: 48.75
Target(s): 42.00
Current Option Gain/Loss: -66.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/03/13: I am growing more concerned with our TFM put play. Shares displayed relative strength with a +0.4% gain on a down day for the market. Plus today's move is a bullish breakout above short-term technical resistance at both its simple 10-dma and simple 200-dma. More conservative traders may want to abandon ship immediately. I am not suggesting new positions and if TFM doesn't decline tomorrow we are likely to drop it.

Earlier Comments:
Our target is $42.00. I am suggesting we keep our position size small because TFM can be a little bit volatile. Plus the most recent data listed short interest at 13% of its small 40.1 million share float. FYI: The Point & Figure chart for TFM is bearish with a $39 target.

- Suggested *small* Positions -

Long Oct $45 PUT (TFM1319v45) entry $0.45

10/02/13 new stop loss @ 48.75

Entry on September 25 at $47.50
Average Daily Volume = 591 thousand
Listed on September 16, 2013



Longer-Term Play Updates



Chicago Bridge & Iron - CBI - close: 69.69 change: -1.09

Stop Loss: 64.00
Target(s): 79.00
Current Option Gain/Loss: +154.9%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
10/03/13: CBI hit some profit taking (-1.5%) after its recent surge to new highs.

I am not suggesting new positions at this time.

*Small Positions* - Suggested Positions -

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

10/01/13 new stop loss @ 64.00, adjust target to $79.00
09/21/13 new stop loss @ 59.75
09/11/13 new stop loss @ 57.65
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: 54.58 change: -0.29

Stop Loss: 50.95
Target(s): 58.50
Current Option Gain/Loss: +13.8%
Time Frame: exit PRIOR to 2014 March option expiration
New Positions: see below

Comments:
10/03/13: The VGK is still struggling with short-term technical resistance at its 10-dma. If the stock market really starts to accelerate lower we could see VGK dip toward what should be support in the $53.00-53.50 zone. Although VGK is a European stock ETF so it should be somewhat insulated from the U.S. government shutdown.

I am not suggesting new positions at this time.

Earlier Comments:
We are taking a multi-month time frame with this trade. 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.

- Suggested Positions -

Long 2014 Mar $55 call (VGK1422L55) entry $1.80*

09/11/13 trade opens. VGK @ 53.60
*option entry @ 1.80 is an estimate. Ask closed at $1.75 yesterday
09/10/13 entry trigger met. open positions tomorrow.
09/10/13 new stop loss @ 50.95
08/24/13 adjust the option strike from 2013 Dec $55 to $2014 Mar $55.

Entry on September 11 at $---.--
Average Daily Volume = 3.0 million
Listed on August 10, 2013


CLOSED BULLISH PLAYS

Boeing Co. - BA - close: 115.24 change: -2.60

Stop Loss: 117.75
Target(s): 127.50
Current Option Gain/Loss: Unopened
Time Frame: Exit prior to Oct. 23 earnings announcement
New Positions: see below

Comments:
10/03/13: Worries over how the U.S. government shutdown might impact BA's aerospace and defense business sparked some selling today. The stock underperformed the market with a -2.2% decline. The breakdown under short-term support at $116.00 is short-term bearish. The next level of significant support is probably the $110 area.

Tonight we are removing BA as a candidate. Our suggested entry point is more than $5.00 away. However, I am suggesting that readers keep BA on your watch list. A dip into the $111-110 zone could prove to be a bullish entry point.

Trade did not open.

10/03/13 removed from the newsletter.
suggested trigger was $120.50

chart:

Entry on September -- at $---.--
Average Daily Volume = 4.5 million
Listed on September 26, 2013


SouFun Holdings - SFUN - close: 47.42 change: -4.30

Stop Loss: 47.90
Target(s): 57.50
Current Option Gain/Loss: -62.8%
Time Frame: exit prior to October expiration
New Positions: see below

Comments:
10/03/13: Ouch! Something happened to SFUN today but I can't find any news on it. Shares initially broke out higher this morning but the rally reversed at resistance near its early September highs (near $54). Once the rally failed SFUN shares accelerated lower to a -8.3% decline. The stock hit our suggested stop loss at $47.90.

Earlier Comments:
This is an aggressive, higher-risk trade. I am suggesting we use small positions to help limit our risk. The recent high near $53.50 could be resistance but we're aiming for $57.50. The Point & Figure chart for SFUN is bullish with a $63 target.

*small positions* - Suggested Positions -

Oct $55 call (SFUN1319j55) entry $1.75* exit $0.65 (-62.8%)

10/03/13 stopped out
09/24/13 trade opened on gap higher at $51.14. Trigger was 51.10
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on September 24 at $51.14
Average Daily Volume = 1.2 million
Listed on September 23, 2013