Editor's Note:

The U.S. stock market stumbled lower this morning thanks to widespread weakness in Europe. The European markets were down in reaction to a downgrade for the EU's 2014 GDP growth forecast.

The weakness was widespread but most of the market managed a bounce off their Tuesday morning lows.

BEAV was triggered. We want to exit our DIS trade tomorrow.
DOV has been removed. HON and PKG were stopped out.


Current Portfolio:


CALL Play Updates

B/E Aerospace Inc. - BEAV - close: 82.65 change: +0.31

Stop Loss: 79.60
Target(s): 89.50
Current Option Gain/Loss: -10.3%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
11/05/13: BEAV rebounded off its morning lows to hit new highs. Shares also hit our suggested entry point to buy calls at $82.75.

Earlier Comments:
Our target is $89.50. FYI: The Point & Figure chart for BEAV is bullish with a $90 target.

- Suggested Positions -

Long DEC $85 call (BEAV1322L85) entry $1.45

Entry on November 05 at $82.75
Average Daily Volume = 894 thousand
Listed on November 02, 2013


Costco Wholesale - COST - close: 120.13 change: -0.21

Stop Loss: 118.40
Target(s): 129.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Comments:
11/05/13: The stock market's weakness this morning seemed to short-circuit the rally in COST. Shares did manage to bounce off their lows today but COST did not hit our trigger. There is no change from our weekend new play description on COST.

Earlier Comments:
I am suggesting a trigger to buy calls at $120.50. If triggered our target is $129.00.

Trigger @ 120.50

- Suggested Positions -

Buy the 2014 Jan $125 call (COST1418a125) current ask $1.15

Entry on November -- at $---.--
Average Daily Volume = 1.9 million
Listed on November 02, 2013


The Walt Disney Company - DIS - close: 68.85 change: +0.04

Stop Loss: 67.45
Target(s): 74.00
Current Option Gain/Loss: + 12.1%
Time Frame: exit PRIOR to earnings on November 7th.
New Positions: see below

Comments:
11/05/13: Unfortunately shares of DIS have been churning sideways as investors wait to see the company's earnings report. DIS is scheduled to report earnings on November 7th, after the closing bell. I am suggesting we exit positions on Wednesday, November 6th at the closing bell to avoid holding over the announcement.

- Suggested Positions -

Long NOV $70 call (DIS1316K70) entry $0.66

11/05/13 prepare to exit tomorrow at the close
11/02/13 time is almost up. Prepare to exit on Nov. 6th at the close
new stop loss @ 67.45

Entry on October 22 at $68.10
Average Daily Volume = 7.1 million
Listed on October 21, 2013


Starwood Hotels & Resorts - HOT - close: 74.68 change: -0.17

Stop Loss: 73.40
Target(s): 79.75
Current Option Gain/Loss: Unopened
Time Frame: 3 to 5 weeks
New Positions: Yes, see below

Comments:
11/05/13: HOT was little changed today after shares recovered from their morning lows. We are waiting for a breakout.

Earlier Comments:
The last few days have seen HOT consolidating sideways below resistance near $75.00. HOT's all-time high is closer to $75.50. I am suggesting a trigger to buy calls at $75.25. More conservative traders may want to wait for a rally past $75.50 instead. If we are triggered at $75.25 our target is $79.75. More aggressive traders could aim higher. The Point & Figure chart for HOT is bullish with a $96 target.

Trigger @ 75.25

- Suggested Positions -

Buy the DEC $75 call (HOT1322L75) current ask $1.91

Entry on November -- at $---.--
Average Daily Volume = 1.8 million
Listed on November 04, 2013


Helmerich & Payne, Inc. - HP - close: 77.78 change: -0.07

Stop Loss: 75.75
Target(s): 79.50
Current Option Gain/Loss: +34.1%
Time Frame: 4 to 5 weeks
New Positions: see below

Comments:
11/05/13: HP also rebounded from its morning spiked lower. Shares continue to churn sideways below short-term resistance near $78.00. I am not suggesting new positions.

We do not want to hold over the mid-November earnings report. FYI: The Point & Figure chart for HP is bullish with an $82 target.

- Suggested Positions -

Long NOV $75 call (HP1316K75) entry $2.31

10/29/13 new stop loss @ 75.75
10/24/13 new stop loss @ 74.25
10/22/13 new stop loss @ 73.75

Entry on October 14 at $74.50
Average Daily Volume = 1.1 million
Listed on October 12, 2013


iShares Russell 2000 ETF - IWM - close: 109.59 change: -0.38

Stop Loss: 107.75
Target(s): 114.00
Current Option Gain/Loss: + 6.7%
Time Frame: 8 to 12 weeks
New Positions: see below

Comments:
11/05/13: Hmm... the IWM did not see any follow through on yesterday's bounce. The ETF gapped down like most of the market this morning. Shares pared their losses but struggled with resistance near $110.00.

- Suggested Positions -

Long 2014 Jan $110 call (IWM1418a110) entry 2.80

10/29/13 new stop loss @ 107.75
10/23/13 new stop loss @ 105.95

Entry on October 16 at $108.55
Average Daily Volume = 41 million
Listed on October 14, 2013


Kansas City Southern - KSU - close: 124.60 change: +0.54

Stop Loss: 122.00
Target(s): 134.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 5 weeks
New Positions: Yes, see below

Comments:
11/05/13: KSU displayed some relative strength today with a +0.4% gain. The stock also hit a new all-time high on an intraday basis. Yet the rally stalled at the $125.00 mark. Oddly enough the ask on the December $125 call didn't move.

Earlier Comments:
I am suggesting a trigger to buy calls at $125.25. More aggressive traders may want to jump in just over KSU's high at $124.55 instead. If we are triggered at $125.25 our target is $134.00. More aggressive investors could aim higher. The Point & Figure chart for KSU is bullish with a $152 target.

Trigger @ 125.25

- Suggested Positions -

Buy the DEC $125 call (KSU1322L125) current ask $3.10

Entry on November -- at $---.--
Average Daily Volume = 813 thousand
Listed on November 04, 2013


Pall Corp. - PLL - close: 81.88 change: -0.08

Stop Loss: 77.90
Target(s): 86.00
Current Option Gain/Loss: +13.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/05/13: PLL managed to pare its morning losses and almost made it back into positive territory. More conservative traders may want to start raising their stop loss. I am not suggesting new positions at this time.

Earlier Comments:
Our target is $86.00. However, we will plan to exit prior to PLL's earnings report in late November (not date set yet). FYI: The Point & Figure chart for PLL is bullish with a long-term $113 target.

- Suggested Positions -

Long DEC $85 call (PLL1321L85) entry $1.10

Entry on October 28 at $80.50
Average Daily Volume = 551 thousand
Listed on October 23, 2013


SanDisk Corp. - SNDK - close: 68.98 change: +0.01

Stop Loss: 67.90
Target(s): 74.75
Current Option Gain/Loss: -21.8%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
11/05/13: I am suggesting caution here. SNDK did not see much of a bounce off its morning lows. I am concerned that if the broader market continues to see weakness tomorrow we could see SNDK underperform. I am not suggesting new positions at this time.

Earlier Comments:
Our target is $74.75 but we may want to aim higher. The Point & Figure chart for SNDK is bullish with an $82 target.

- Suggested Positions -

Long 2014 Jan $72.50 call (SNDK1418a72.5) entry $2.75

Entry on October 29 at $70.60
Average Daily Volume = 5.0 million
Listed on October 28, 2013


Constellation Brands - STZ - close: 66.07 change: +0.29

Stop Loss: 63.85
Target(s): 68.50
Current Option Gain/Loss: +117.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
11/05/13: STZ is still showing strength and shares hit another new high. I am raising our stop loss up to $63.85.

- Suggested Positions -

Long NOV $62.50 call (STZ1316k62.5) entry $1.38

11/05/13 new stop loss @ 63.85
10/30/13 new stop loss @ 63.40
10/29/13 new stop loss @ 63.25
10/28/13 adjust exit target to $68.50
10/22/13 new stop loss @ 61.90, readers may want to take profits now. Our option is up +84%.
10/16/13 new stop loss @ 59.75
10/11/13 trade opened on gap higher at $61.25,
trigger was $61.10

Entry on October 11 at $61.25
Average Daily Volume = 1.9 million
Listed on October 10, 2013


PUT Play Updates

F5 Networks - FFIV - close: 79.74 change: +0.19

Stop Loss: 83.25
Target(s): 76.00
Current Option Gain/Loss: +23.8%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/05/13: FFIV garnered some bullish analyst comments today. That may account for the stock's bounce. Yet there wasn't much follow through and FFIV spent most of the session drifting sideways. I am not suggesting new positions.

- Suggested Positions -

Long DEC $80 PUT (FFIV1322X80) entry $3.15

11/04/13 new stop loss @ 83.25

Entry on October 31 at $82.00
Average Daily Volume = 2.2 million
Listed on October 30, 2013


Garmin Ltd. - GRMN - close: 47.99 chane: +0.08

Stop Loss: 49.25
Target(s): 43.50
Current Option Gain/Loss: -37.9%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/05/13: GRMN spent Tuesday's session churning below resistance near $48.00 and its 10-dma and 20-dma. More conservative traders may want to lower their stop loss.

Earlier Comments:
I do consider this an aggressive trade. GRMN has obviously been volatile the last couple of days. Plus the most recent data listed short interest at 13% of the 121 million share float.

Our target is $43.50. At this point GRMN should be nearing significant support in the $43.00 area and we might switch directions and buy calls.

*Small Positions!* - Suggested Positions -

Long DEC $45 PUT (GRMN1322X45) entry $1.08

Entry on November 01 at $46.82
Average Daily Volume = 1.2 million
Listed on October 31, 2013



Longer-Term Play Updates



Vanguard FTSE Europe ETF - VGK - close: 56.24 change: -0.52

Stop Loss: 53.90
Target(s): Sell half @ $58.00, sell the rest at $63.00
Current Option Gain/Loss: +61.1%
Time Frame: exit PRIOR to 2014 March option expiration
New Positions: see below

Comments:
11/05/13: Most of the European markets were weak on Tuesday as investors reacted to news that the EU commission had downgraded their 2014 GDP growth forecast from +1.2% to +1.1%. The VGK reacted with a gap down and a -0.9% decline.

If the $56 level fails the VGK could also see support near $55 and its 50-dma.

Earlier Comments:
Don't forget that we have two exit targets for this trade! More conservative traders could lock in gains now with our option up +94%.

We are taking a multi-month time frame with this trade. FYI: The Point & Figure chart for VGK is bullish with a $63 target.

- Suggested Positions -

Long 2014 Mar $55 call (VGK1422C55) entry $1.80*

10/22/13 Strategy Update: Plan to exit half @ $58.00 and exit the rest at $63.00. New stop loss @ 53.90
10/19/13 new stop loss @ 52.75
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

Dover Corp. - DOV - close: 91.33 change: -0.21

Stop Loss: 89.95
Target(s): 99.50
Current Option Gain/Loss: Unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Comments:
11/05/13: DOV rebounded from its morning lows but shares failed to build on its bounce. Our trade has not opened yet. Our suggested trigger was $93.00. Tonight we're removing DOV as an active candidate. We can revisit the stock if shares turn higher. Until DOV sees a new high there is a risk the stock is building a bearish double top pattern.

Trade did not open.

11/05/13 removed from the newsletter. suggested trigger was 93.00

chart:

Entry on October -- at $---.--
Average Daily Volume = 1.0 million
Listed on October 29, 2013


Honeywell Intl. - HON - close: 86.34 change: +0.03

Stop Loss: 85.75
Target(s): 98.50
Current Option Gain/Loss: -50.3%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
11/05/13: The stock market's widespread spike lower this morning was enough to push HON below our stop loss. Our trade closed at $85.75. I would keep HON on your watch list for a dip near technical support at its 100-dma or a breakout past $88.00.

- Suggested Positions -

2014 Jan $90 call (HON1418a90) entry $1.45 exit $0.72 (-50.3%)

11/05/13 stopped out
11/02/13 new stop loss @ 85.75
10/30/13 Caution. HON hit our trigger but the stock produced a potential bearish reversal pattern today.

chart:

Entry on October 30 at $87.65
Average Daily Volume = 2.9 million
Listed on October 23, 2013


Packaging Corp. of America - PKG - close: 60.61 change: -3.66

Stop Loss: 61.25
Target(s): 67.50
Current Option Gain/Loss: - 43.3%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
11/05/13: Ouch! What happened to PKG today? The stock was showing so much strength yesterday. Then today the stock revered and erased almost two weeks of gains with a -5.69% plunge. I couldn't find any company specific news that might account for today's relative weakness. It looks like this may have been a reaction to earnings news from rival Rock-Tenn Company (RKT). RKT's earnings out last night didn't seem that bad but shares of RKT were down -7.9% today. Another rival, IP, was down -3.9% today. It looks like the whole industry was in sell-off mode.

PKG hit our stop loss at $61.25.

- Suggested Positions -

2014 Jan $65 call (PKG1418a65) entry $1.50 exit $0.85*(-43.3%)

11/05/13 stopped out
11/04/13 new stop loss @ 61.25

chart:

Entry on October 28 at $62.50
Average Daily Volume = 1.0 million
Listed on October 23, 2013