Editor's Note:

Traders remain in a dip-buying mood with the U.S. market seeing a widespread bounce on Friday. Lack of follow through on Thursday's sell-off should be good news for the bulls.

AON and EQIX hit our entry triggers on Friday.
BEAV and KSU were stopped out. We want to exit our FFIV trade immediately.


Current Portfolio:


CALL Play Updates

Aon Plc. - AON - close: 80.60 change: +1.17

Stop Loss: 78.25
Target(s): 85.00
Current Option Gain/Loss: - 5.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
11/09/13: AON quickly recovered from yesterday's pullback as traders bought the dip near its rising 10-dma. The stock broke out past resistance near $80.00 and hit our suggested entry point at $80.50.

- Suggested Positions -

Long 2014 Jan $82.50 call (AON1418a82.5) entry $1.70

chart:

Entry on November 08 at $80.50
Average Daily Volume = 2.3 million
Listed on November 06, 2013


Costco Wholesale - COST - close: 122.78 change: +0.00

Stop Loss: 119.40
Target(s): 129.00
Current Option Gain/Loss: + 63.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
11/09/13: COST spiked lower on Friday morning but shares found support near $121.00 and the stock bounced back to unchanged on the session. If you were looking for a buy-the-dip entry point the Friday's move probably works for you. I am raising or stop loss to $119.40.

- Suggested Positions -

Long 2014 Jan $125 call (COST1418a125) entry $1.30

11/09/13 new stop loss @ $119.40

chart:

Entry on November 06 at $120.50
Average Daily Volume = 1.9 million
Listed on November 02, 2013


GNC Holdings - GNC - close: 57.88 change: +0.27

Stop Loss: 57.95
Target(s): 64.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
11/09/13: Hmm... GNC didn't see a lot of movement on Friday. Shares held support at their 20-dma but the failed to bounce back above the $58.00 level. $58 was previously short-term support and now it's new short-term resistance. GNC's bounce on Friday (+0.4%) also underperformed the major indices. Fortunately we are still on the sidelines. Currently our plan is unchanged with a suggested trigger to buy calls at $60.50.

Trigger @ 60.50

- Suggested Positions -

Buy the DEC $60 call (GNC1322L60)

chart:

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


Lockheed Martin - LMT - close: 138.11 change: +1.91

Stop Loss: 134.40
Target(s): 148.50
Current Option Gain/Loss: +11.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
11/09/13: Traders pounced on LMT with its morning dip to $136.00 on Friday. The stock bounced and rallied to a new all-time closing high. More conservative traders might want to start raising their stops.

I would not be surprised to see LMT paused at the $140 level, which might be temporary round-number resistance.

- Suggested Positions -

Long 2014 Jan $140 call (LMT1418a140) entry $2.20

chart:

Entry on November 07 at $137.25
Average Daily Volume = 1.5 million
Listed on November 06, 2013


Pall Corp. - PLL - close: 81.87 change: +1.07

Stop Loss: 79.75
Target(s): 86.00
Current Option Gain/Loss: + 4.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/09/13: PLL recovered about two thirds of Thursday's decline on Friday. The stock is now back above its simple 10-dma. Yet I would be cautious here. Readers might want to adjust their stop higher.

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

11/06/13 new stop loss @ 79.75

chart:

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


Constellation Brands - STZ - close: 66.76 change: +1.11

Stop Loss: 64.75
Target(s): 68.50
Current Option Gain/Loss: +204.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
11/09/13: STZ surged off short-term technical support at its 10-dma and rallied to a new all-time high. I am not suggesting new positions. More conservative traders may want to lock in gains now or raise their stop.

NOTE: We only have five trading days left for our November options.

- Suggested Positions -

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

11/07/13 new stop loss @ 64.75
11/06/13 new stop loss @ 64.25
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

chart:

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


PUT Play Updates

Equinix, Inc. - EQIX - close: 155.94 change: -3.81

Stop Loss: 162.75
Target(s): 150.50
Current Option Gain/Loss: +11.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/09/13: The weakness in EQIX continued on Friday and shares hit our entry point at $159.00. The stock closed at a new low for the year. I do not see any changes from my Thursday night new play description.

Earlier Comments:
Please note that I am suggesting small positions to limit our risk. The most recent data listed short interest at 28% of the relatively small 39.0 million share float. That raises the risk of a short squeeze. FYI: The Point & Figure chart for EQIX is bearish with a $142 target.

*small positions* - Suggested Positions -

Long DEC $150 PUT (EQIX1322X150) entry $3.15*
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on November 08 at $159.00
Average Daily Volume = 1.1 million
Listed on November 07, 2013


F5 Networks - FFIV - close: 82.02 change: +1.63

Stop Loss: 82.75
Target(s): 76.00
Current Option Gain/Loss: -20.9%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/09/13: FFIV is not cooperating. Shares outperformed the market again with a +2.0% gain on Friday. Shares managed to close above their 10-dma and 150-dma but they settled right on what should be resistance at the $82.00 mark. It's possible FFIV could reverse here but it seems unlikely. We are throwing in the towel and suggesting traders exit immediately on Monday morning.

- Suggested Positions -

Long DEC $80 PUT (FFIV1322X80) entry $3.15

11/09/13 prepare to exit on Monday morning
11/06/13 new stop loss @ 82.75
11/04/13 new stop loss @ 83.25

chart:

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


Green Mountain Coffee Roasters - GMCR - close: 59.71 change: +1.53

Stop Loss: 61.55
Target(s): 51.50
Current Option Gain/Loss: -12.3%
Time Frame: Exit PRIOR to earnings on Nov. 20th
New Positions: see below

Comments:
11/09/13: Hmm... the stock market's widespread bounce may have sparked some short covering and bargain hunting in GMCR on Friday. Shares produced a strong bounce of +2.6% but the rebound did fail at resistance near $60.00, at least for now. It may also be noteworthy that Friday's bounce was inside Thursday's trading range (that's called an "inside day") and could suggest indecision by traders.

A failure here near $60.00 could be used as a new bearish entry point.

Earlier Comments:
I am suggesting we keep our position size small to limit our risk. The most recent data listed short interest at more than 40% of the 130 million share float. That does raise the risk of a short squeeze if the market bounces. Our target is $51.50.

*small positions* - Suggested Positions -

Long Dec $55 PUT (GMCR1322x55) entry $4.22

chart:

Entry on November -- at $---.--
Average Daily Volume = 4.7 million
Listed on November 07, 2013


Garmin Ltd. - GRMN - close: 46.25 chane: -0.10

Stop Loss: 48.55
Target(s): 43.50
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
11/09/13: GRMN did not participate in the market's widespread bounce on Friday. That's good news if you're bearish. The next challenge for the bears is pulling GRMN through potential support near $46 and its 50-dma (currently at $45.85).

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

11/06/13 new stop loss @ 48.55

chart:

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: 56.18 change: +0.30

Stop Loss: 53.90
Target(s): Sell half @ $58.00, sell the rest at $63.00
Current Option Gain/Loss: +36.1%
Time Frame: exit PRIOR to 2014 March option expiration
New Positions: see below

Comments:
11/09/13: The European markets delivered another mixed session on Friday. Yet the VGK rebounded off its Friday morning lows and posted a +0.5% gain. The correction may not be over yet. The VGK might try and test its five-month trend line of higher lows (see chart) before returning to rally mode.

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.

chart:

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


CLOSED BULLISH PLAYS

B/E Aerospace Inc. - BEAV - close: 81.75 change: +1.34

Stop Loss: 79.60
Target(s): 89.50
Current Option Gain/Loss: -62.0%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
11/09/13: BEAV recovered a good chunk of Thursday's losses and managed to outperform the major U.S. indices on Friday with a +1.6% gain. Unfortunately on Friday morning BEAV dipped below what should have been support near $80.00 and its 20-dma to hit our stop loss at $79.60.

- Suggested Positions -

DEC $85 call (BEAV1322L85) entry $1.45 exit $0.55* (-62.0%)

11/08/13 stopped out
*option exit price is an estimate since the option did not trade at the time our play was closed.

chart:

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


Kansas City Southern - KSU - close: 123.32 change: +0.83

Stop Loss: 122.00
Target(s): 134.00
Current Option Gain/Loss: -44.4%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
11/09/13: The profit taking in KSU continued for a bit this morning. Shares hit our stop loss at $122.00 before the stock bounced. I would keep an eye on KSU for a new entry point down the road. Broken resistance in the $118-119 zone should be new support.

- Suggested Positions -

DEC $125 call (KSU1322L125) entry $3.60 exit $2.00*(-44.4%)

11/08/13 stopped out
*option exit price is an estimate since the option did not trade at the time our play was closed.

chart:

Entry on November 06 at $125.25
Average Daily Volume = 813 thousand
Listed on November 04, 2013