Editor's Note:

The U.S. stock market faced its second day of broad-based selling as investor worry grows over the government shutdown and debt ceiling fight. The S&P 500 index and the NASDAQ composite delivered their worst day since August. The volatility index (VIX) soared to three-month highs. Previously bullet-proof momentum names were hammered lower.

APC, ROST, SBUX, SLB, SOHU, TSCO, WDAY, and ENR have been stopped out.

DDD, ECL, LTD, UPS, and YELP have been removed (trades did not open).

WFM was triggered.


Current Portfolio:


CALL Play Updates

Gulfport Energy - GPOR - close: 64.88 change: -1.54

Stop Loss: 63.95
Target(s): 72.50
Current Option Gain/Loss: -32.7%
Time Frame: exit PRIOR to GPOR's earnings in November
New Positions: see below

Comments:
10/08/13: Ouch! GPOR underperformed the major indices and its peers in the energy industry with a -2.3% plunge. I have been cautioning traders to look for likely support in the $64.00-65.00 zone. I would wait for a bounce before considering new positions.

- Suggested Positions -

Long NOV $70 call (GPOR1316K70) entry $2.75

Entry on October 04 at $67.10
Average Daily Volume = 1.4 million
Listed on October 03, 2013


iShares Russell 2000 ETF - IWM - close: 104.06 change: -1.71

Stop Loss: 103.40
Target(s): 110.95
Current Option Gain/Loss: -15.7%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
10/08/13: After more than a week of a government shutdown and lack of progress in Washington, suddenly stock market participants decided it was time to take some money off the table. Odds are all the talk about a potential U.S. debt default, no matter how unlikely, is being used as an excuse to sell. The IWM delivered one of its worst one-day declines in weeks with a -1.6% plunge. Shares stopped near potential support at $104 and just below it simple 50-dma. If there is any follow through lower tomorrow we could see the IWM hit our stop loss at $103.40.

- 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


Whole Foods Market - WFM - close: 59.09 change: -0.06

Stop Loss: 57.90
Target(s): 64.75
Current Option Gain/Loss: -19.6%
Time Frame: exit PRIOR to earnings in early November
New Positions: see below

Comments:
10/08/13: WFM completely ignored the stock market's weakness, at least for the first hour of trading. Shares may have received a boost from some bullish analyst comments this morning. WFM climbed up past round-number resistance at $60.00 and hit $60.60 before eventually following the market lower. Our suggested trigger to buy calls was hit at $60.25. Unfortunately, now the move today looks like a potential bull-trap pattern. I would wait for a new rally above $60.00 before initiating new positions if you don't own calls yet.

- Suggested Positions -

Long NOV $60 call (WFM1316K60) entry $2.50

Entry on October 08 at $60.25
Average Daily Volume = 2.4 million
Listed on October 05, 2013


PUT Play Updates

McDonald's Corp. - MCD - close: 93.94 change: -0.42

Stop Loss: 94.85
Target(s): 90.25
Current Option Gain/Loss: Unopened
Time Frame: 2 to 3 weeks
New Positions: Yes, see below

Comments:
10/08/13: Suddenly I am a little less enthusiastic about puts on MCD. The stock market accelerated lower today and the S&P 500 lost -1.2% yet MCD fell -0.4%. Shares only broke down below support at $94.00 in the last five minutes of trading today. The trend for MCD is still bearish but the lack of weakness is a bit surprising. Traders may want to use small positions to limit their risk.

Earlier Comments:
I am suggesting a trigger to buy puts at $93.75. If triggered our target is $90.25. Our time frame is only two, maybe three weeks as we do not want to hold over MCD's earnings report expected in late October.

NOTE: Just because the option looks cheap, I would not go overboard on your position size.

Trigger @ 93.75

- Suggested Positions -

Buy the NOV $90 PUT (MCD1316W90) current ask $0.80

Entry on October -- at $---.--
Average Daily Volume = 4.3 million
Listed on October 07, 2013



Longer-Term Play Updates



Chicago Bridge & Iron - CBI - close: 68.01 change: -1.99

Stop Loss: 64.00
Target(s): 79.00
Current Option Gain/Loss: +119.6%
Time Frame: 4 to 6 months
New Positions: see below

Comments:
10/08/13: No surprises here. I've been warning readers to expect a dip into the $66-68 zone. The pullback may not be over yet.

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: 53.72 change: -0.57

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:
10/08/13: European markets closed down, nearly across the board today. This helped push the VGK to a -1.0% decline. Investors can look for a bounce near $53.00 or its 50-dma near $53.35 as a possible entry point to buy calls.

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

Anadarko Petroleum - APC - close: 92.12 change: -1.48

Stop Loss: 92.25
Target(s): 99.50
Current Option Gain/Loss: -73.7%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
10/08/13: APC was not immune to the market's widespread sell-off. Shares gave up -1.58% and dropped to their simple 50-dma. Our stop loss was hit at $92.25.

- Suggested Positions -

Oct $95 call (APC1319j95) entry $3.05* exit $0.80 (-73.7%)

10/08/13 stopped out
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.

chart:

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


3D Systems - DDD - close: 51.94 change: -1.78

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: see below

Comments:
10/08/13: DDD underperformed the market with a -3.3% decline and a drop to a new two-week low. Our trade has not opened yet (suggested trigger was $56.35). We are removing DDD as an active candidate. We do like DDD as a potential bullish play down the road so I would keep it on your watch list.

Trade did not open.

10/08/13 removed from the play list.

chart:

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


Ecolab Inc. - ECL - close: 96.91 change: -0.36

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

Comments:
10/08/13: Profit taking in ECL really wasn't that bad today but shares did close below the bottom of its recent trading range. Our trade has not opened yet (suggested trigger was $100.25). Tonight we are removing ECL as an active candidate. I would keep an eye on ECL for a dip near technical support at its rising 50-dma (currently near $95.00). A dip there could be a new bullish entry point.

Trade did not open.

10/08/13 removed from the newsletter.

chart:

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


L Brands, Inc. - LTD - close: 58.59 change: -1.93

Stop Loss: 59.95
Target(s): 66.50
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings in mid November
New Positions: , see below

Comments:
10/08/13: Yesterday we saw retail-related names underperform the market. Today that weakness accelerated in LTD and the stock plunged -3.1% and broke down below its 50-dma.

Our trade has not opened yet (suggested trigger 62.25) and tonight we're removing LTD as an active candidate.

Trade did not open.

10/08/13 removed from the newsletter

chart:

Entry on October -- at $---.--
Average Daily Volume = 1.5 million
Listed on October 05, 2013


Ross Stores Inc. - ROST - close: 71.45 change: -0.96

Stop Loss: 69.95
Target(s): 77.50
Current Option Gain/Loss: Nov75c: -46.9% & 2014jan75c: -15.3%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
10/08/13: ROST is another retail name that suffered some profit taking. Shares gapped down at the open and then slowly drifted lower toward the $71.50 area. Our trade would actually still be open except for a tick lower near the opening bell.

Shares opened at $71.28 this morning. The very next tick was one trade for 100 shares at $69.15, below its 50-dma. Then the very next trade was $70.87. Unfortunately, we have to close this play as stopped out. Our suggested stop loss was $69.95.

I would keep ROST on your watch list for a new bullish position down the road.

- Suggested Positions -

Long Nov $75 call (ROST1316K75) entry $1.13 exit $0.60**(-46.9%)

- or -

Long 2014 Jan $75 call (ROST1418a75) entry $2.60* exit $2.20** (-15.3%)

10/08/13 stopped out, one tick at $69.15 technically closed this trade.
**option exit price is an estimate since the option did not trade at the time our play was closed.
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

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


Starbucks Corp. - SBUX - close: 75.53 change: -1.33

Stop Loss: 75.75
Target(s): 79.75
Current Option Gain/Loss:(Oct75c:+ 93.2%) & 2014Jan75c: +32.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
10/08/13: SBUX tried to rally this morning. Shares actually hit a new high just above $78.00 but quickly reversed. The stock eventually succumbed to the market's widespread decline and broke down through the bottom of its trading range. Our stop loss was hit at $75.75.

2014 January $75 call exit @ $4.30 (+32.3%).

NOTE: I would keep an eye on SBUX for a drop toward support near $74.00 and its 50-dma. It could be a new bullish buy-the-dip entry point.

- Suggested Positions -

(October call position closed 09/18/2013)
Oct $75 call (SBUX1319j75) entry $1.18 exit $2.28 (+93.2%)

- or -

2014 Jan $75 call (SBUX1418a75) entry $3.25 exit $4.30 (+32.3%)

10/08/13 stopped out
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.

chart:

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


Schlumberger - SLB - close: 87.95 change: -1.34

Stop Loss: 88.25
Target(s): 94.75
Current Option Gain/Loss: -36.1%
Time Frame: exit PRIOR to earnings on Oct. 18th
New Positions: see below

Comments:
10/08/13: The market's broad-based sell-off pushed SLB to a -1.5% decline. Shares hit our stop loss at $88.25.

- Suggested Positions -

Nov $92.50 call (SLB1316K92.5) entry $1.88 exit $1.20 (-36.1%)

10/08/13 stopped out

chart:

Entry on October 04 at $90.25
Average Daily Volume = 6.3 million
Listed on October 02, 2013


Sohu.com Inc. - SOHU - close: 78.08 change: -5.67

Stop Loss: 81.75
Target(s): 88.50
Current Option Gain/Loss: + 4.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/08/13: Momentum stocks were crushed today. Nearly all of the previously bullet-proof names were hammered for big losses as traders tried to take money off the table. SOHU plunged -6.7% and broke down below its 10-dma for the first time in weeks. Our stop loss was hit at $81.75. I've been suggesting that readers may want to exit early to lock in gains.

Earlier Comments:
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 exit $4.60 (+ 4.5%)

10/08/13 stopped out
10/05/13 new stop loss @ 81.75. More conservative traders may want to just take profits right now!
10/03/13 new stop loss @ 77.75

chart:

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


Tractor Supply Company - TSCO - close: 65.49 change: -1.30

Stop Loss: 65.75
Target(s): 74.00
Current Option Gain/Loss: -33.8%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
10/08/13: TSCO is another victim of the market's two-day sell-off. Shares broke down below what should have been support near $66.00. Our stop was hit at $65.75.

- Suggested Positions -

2014 Jan $70 call (TSCO1418a70) entry $2.72 exit $1.80*(-33.8%)

10/08/13 stopped out
*option exit price is an estimate since the option did not trade at the time our play was closed.
10/03/13 new stop loss @ 65.75
10/01/13 trade opened on gap higher at $68.04.
Trigger was $67.50

chart:

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


United Parcel Service - UPS - close: 88.93 change: -1.10

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

Comments:
10/08/13: UPS had been struggling to hold the $90.00 level. Today's market-wide plunge pushed UPS to a new two-week low. Our trade has not opened yet (suggested trigger was $92.25) and tonight we're removing it as an active candidate.

Trade did not open.

10/08/13 removed from the newsletter

chart:

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


Workday, Inc. - WDAY - close: 78.42 change: -2.85

Stop Loss: 79.75
Target(s): 89.00
Current Option Gain/Loss: -40.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
10/08/13: Ouch! WDAY's -3.5% plunge today erased almost three week's worth of gains. The stock fell to $77.04 intraday before paring its losses and closing near prior technical support at its 30-dma. Our stop loss was hit at $79.75 before lunchtime.

- Suggested Positions -

Dec $90 call (WDAY1322L90) entry $2.85 exit $1.70*(-40.3%)

10/08/13 stopped out
*option exit price is an estimate since the option did not trade at the time our play was closed.

chart:

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


Yelp, Inc. - YELP - close: 64.60 change: -5.33

Stop Loss: 69.75
Target(s): 79.50
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings in very late October
New Positions: see below

Comments:
10/08/13: Many of the high-flying momentum names saw a washout on Tuesday. YELP was one of them with a -7.6% plunge. Our trade has not opened yet (suggested trigger was $73.75) and tonight we are removing YELP as an active candidate. Nimble traders may want to keep an eye on potential support near $60.00 and its 50-dma.

Trade did not open.

10/08/13 removed from the newsletter.

chart:

Entry on October -- at $---.--
Average Daily Volume = 3.75 million
Listed on October 05, 2013


CLOSED BEARISH PLAYS

Energizer Holdings - ENR - close: 92.28 change: +0.24

Stop Loss: 93.65
Target(s): 88.00
Current Option Gain/Loss: -60.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
10/08/13: Sometimes the stock market just refuses to cooperate. Almost the entire market moved lower this morning. Yet ENR gapped open higher in reaction to some bullish analyst comments this morning. Shares gapped open at $93.86 and then immediately reversed under resistance near $94.00 and its exponential 200-dma. Since our suggested stop loss was $93.65 the opening print closed our play.

- Suggested *Small* Positions -

Oct $90 PUT (ENR1319v90) entry $1.00 exit $0.40*(-60.0%)

10/08/13 stopped out on gap higher at $93.86
*option exit price is an estimate since the option did not trade at the time our play was closed.
10/05/13 new stop loss @ 93.65

chart:

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