Editor's Note:

The S&P 500 index almost made it nine winning weeks in a row but the index missed that feat by less than one point.

Stocks recovered a lot of lost ground thanks to a big bounce on Friday morning.

AGN, IWM, and UHS all hit our entry triggers.

FLT was stopped out. CTRP was closed. SBUX has been removed.

We want to exit our ENDP trade on Monday morning.


Current Portfolio:


CALL Play Updates

Allergan, Inc. - AGN - close: 98.20 change: +1.70

Stop Loss: 94.95
Target(s): 102.50
Current Option Gain/Loss: - 7.5%
Time Frame: Exit prior to January option expiration
New Positions: see below

Comments:
12/07/13: Our new play on AGN has been opened. The combination of a bullish market open and new bullish analyst comments on AGN produced a gap higher in this stock. Our plan was to buy calls at $97.00 but AGN opened at $98.02. There is a chance that AGN could fill the gap and that would mean a dip back toward the $96.50-96.75 area. Nimble traders might want to consider waiting for a dip to launch new positions.

Our multi-week target is $102.50. More aggressive traders could aim higher. The Point & Figure chart for AGN is bullish with a $110 target.

- Suggested Positions -

Long 2014 Jan $100 call (AGN1418a100) entry $2.00

12/06/13 triggered on gap higher at $98.02, suggested trigger was $97.00

chart:

Entry on December 06 at $98.02
Average Daily Volume = 1.9 million
Listed on December 05, 2013


Aon Plc. - AON - close: 82.75 change: +1.29

Stop Loss: 80.75
Target(s): 85.00
Current Option Gain/Loss: +11.7%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/07/13: The market's big rally on Friday helped AON gap open higher and surge to a new all-time high. I am raising our stop loss to $80.75.

- Suggested Positions -

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

12/07/13 new stop loss @ 80.75
11/23/13 new stop loss @ 79.85
11/18/13 new stop loss @ 79.45
11/13/13 new stop loss @ 78.75

chart:

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


The Walt Disney Co. - DIS - close: 71.46 change: +1.23

Stop Loss: 68.95
Target(s): 77.50
Current Option Gain/Loss: +29.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
12/07/13: DIS shares began bouncing on Wednesday. The stock continued to outperform on Friday with a +1.75% gain and a new all-time closing high. Tonight we are moving our stop loss to $68.95.

Our multi-week target is $77.50. More aggressive investors could aim higher. The Point & Figure chart for DIS is bullish with an $83 target.

- Suggested Positions -

Long 2014 Jan $70 call (DIS1418a70) entry $1.66

12/07/13 new stop loss @ 68.95
11/30/13 new stop loss @ 68.45
11/26/13 new stop loss @ 67.95

chart:

Entry on November 22 at $70.25
Average Daily Volume = 6.6 million
Listed on November 14, 2013


Endo Health Solutions - ENDP - close: 65.94 change: -0.01

Stop Loss: 64.75
Target(s): 74.00
Current Option Gain/Loss: -39.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/07/13: Uh-oh! ENDP failed to participate in the market's rally on Friday. Shares did gap open higher on Friday morning but the gains faded and shares closed virtually unchanged on the day.

This could be a warning signal. Tonight we are suggesting an immediate exit on Monday morning.

- Suggested Positions -

Long 2014 Jan $70 call (ENDP1418a70) entry $2.40

12/07/13 prepare to exit on Monday morning, Dec. 9th
12/05/13 new stop loss @ 64.75

chart:

Entry on November 27 at $67.35
Average Daily Volume = 4.6 million
Listed on November 26, 2013


Russell 2000 ETF - IWM - close: 112.48 change: +0.87

Stop Loss: 109.95
Target(s): 116.00
Current Option Gain/Loss: - 7.2%
Time Frame: exit prior to January option expiration
New Positions: see below

Comments:
12/07/13: Our IWM trade has opened. The plan was to buy calls at $112.55 but the market's bullish reaction to the jobs data on Friday morning produced a gap open higher. The IWM opened at $112.62. I would still consider new positions now.

- Suggested Positions -

Long 2014 Jan $112 call (IWM1418a112) entry $2.62

12/06/13 trade opened on gap higher at $112.62, suggested trigger was $112.55

chart:

Entry on December 06 at $112.62
Average Daily Volume = 40.6 million
Listed on December 04, 2013


Michael Kors - KORS - close: 79.68 change: -1.08

Stop Loss: 78.49
Target(s): 89.00
Current Option Gain/Loss: -43.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/07/13: Investors can't seem to make up their mind about retail-related stocks. On Friday morning KORS underperformed the market with a sharp drop to a new two-week low before paring its losses. More conservative traders will want to seriously consider an immediate exit right now, especially considering KORS' relative weakness during the market rally on Friday. I am not suggesting new positions. Tonight we're moving our stop loss to $78.49.

- Suggested Positions -

Long 2014 Jan $85 call (KORS1418a85) entry $1.85

12/07/13 new stop loss @ 78.49, readers may want to consider an early exit right here
11/22/13 trigger hit at $81.05
11/21/13 adjust entry strategy. Instead of buying a dip at $76.50, move the entry trigger to $81.05. Adjust the stop loss to $77.75. Adjust the option strike to 2014 Jan. $85 call.

chart:

Entry on November 22 at $81.05
Average Daily Volume = 7.2 million
Listed on November 20, 2013


Constellation Brands Inc. - STZ - close: 70.65 change: +0.57

Stop Loss: 69.40
Target(s): 74.75
Current Option Gain/Loss: -11.4%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/07/13: STZ poured a +0.8% gain on Friday. The fact that shares did not confirm Thursday's bearish reversal pattern is a good sign. However, Friday's move is an "inside day" (inside the prior day's range) and that can mean indecision. I am not suggesting new positions at this time. STZ could still disappoint us and move lower from here.

Earlier Comments:
Our plan was to limit our risk by using small positions.

*small positions* - Suggested Positions -

Long 2014 Jan $72.50 call (STZ1418a72.5) entry $1.75

12/03/13 new stop loss at $69.40

chart:

Entry on November 25 at $70.55
Average Daily Volume = 1.3 million
Listed on November 23, 2013



Universal Health Services - UHS - close: 82.91 change: +0.70

Stop Loss: 80.75
Target(s): 88.50
Current Option Gain/Loss: -19.1%
Time Frame: 4 to 5 weeks
New Positions: see below

Comments:
12/07/13: The stock market's strength on Friday morning helped UHS spike to a new high. Shares opened at $83.03 and hit $83.83 before paring its gains. Our suggested entry point was hit at $83.60. At the moment I would wait for a new rise above $83.35 before initiating new positions. More conservative traders might want to consider a stop loss closer to the $81.50-82.00 area.

- Suggested Positions -

Long 2014 Jan $85 call (UHS1418a85) entry $1.67*

12/06/13 triggered at $83.60
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on December 06 at $83.60
Average Daily Volume = 912 thousand
Listed on December 03, 2013


United Parcel Service - UPS - close: 102.43 change: +0.80

Stop Loss: 99.75
Target(s): 108.00
Current Option Gain/Loss: -10.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/07/13: UPS also gapped open higher. The Friday morning rally struggled with UPS' recent highs near $103.00. Thanks to Friday's gain UPS has extended its rally to eight weeks in a row. I am not suggesting new positions at this time.

- Suggested Positions -

Long 2014 Jan $105 call (UPS1418a105) entry $0.98

11/23/13 new stop loss @ 99.75
11/20/13 new stop loss @ 98.95

chart:

Entry on November 14 at $101.25
Average Daily Volume = 3.8 million
Listed on November 13, 2013


Western Digital Corp. - WDC - close: 78.91 change: +2.13

Stop Loss: 75.75
Target(s): 79.75
Current Option Gain/Loss: +70.5%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/07/13: WDC displayed relative strength again with Friday's +2.77% surge to new highs. More conservative traders may want to just take profits now. I am raising our stop loss to $75.75.

Our target is $79.75 but more aggressive traders may want to aim higher. The Point & Figure chart for WDC is bullish with a $91 target.

- Suggested Positions -

Long 2014 Jan $80 call (WDC1418a80) entry $1.46

12/07/13 new stop loss @ 75.75
12/04/13 new stop loss @ 74.75
11/27/13 new stop loss @ 73.40

chart:

Entry on November 22 at $75.25
Average Daily Volume = 2.4 million
Listed on November 21, 2013


PUT Play Updates

SPDR Gold ETF - GLD - close: 118.30 change: -1.66

Stop Loss: 121.25
Target(s): 115.50
Current Option Gain/Loss: - 9.4%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/07/13: Gold and the GLD managed a small bounce on Friday. Yet the overall trend remains bearish.

I am not suggesting new positions at this time.

Earlier Comments:
Traders may want to limit their position size to limit risk.

Our target is $115.50. More aggressive traders may want to aim lower since the Point & Figure chart for GLD is bearish with a $110 target.

- Suggested Positions -

Long 2014 Jan $115 PUT (GLD1418m115) entry $1.80

12/05/13 new stop loss @ 121.25
11/30/13 new stop loss @ 122.55

chart:

Entry on November 20 at $121.00
Average Daily Volume = 7.0 million
Listed on November 12, 2013


Intl. Business Machines - IBM - close: 177.67 change: +1.59

Stop Loss: 181.25
Target(s): 170.25
Current Option Gain/Loss: - 9.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/07/13: Shares of IBM were downgraded again on Friday morning. Yet that didn't stop the stock from following the market higher. Shares did stall near short-term resistance at its 10-dma and the $178.00 level. I would wait for this bounce to reverse before initiating new positions.

Earlier Comments:
Our target is $170.25, a new lower low. However, more conservative traders may want to exit near the October lows near $172.50 since they could be potential support.

- Suggested Positions -

Long 2014 Jan $175 PUT (IBM1418m175) entry $3.15

chart:

Entry on December 03 at $176.90
Average Daily Volume = 5.1 million
Listed on December 02, 2013


The St. Joe Company - JOE - close: 17.60 change: -0.05

Stop Loss: n/a *use small positions*
Target(s): $11.00-13.00 range
Current Option Gain/Loss: -51.9%
Time Frame: 2 to 3 months
New Positions: see below

Comments:
12/07/13: Shares of JOE continued to show relative weakness on Friday. That's very encouraging if you're bearish. I would be tempted to launch new positions here.

Remember, this is a lottery ticket style of trade.

I don't see any changes from JOE's new play description.

Earlier Comments:
I do consider this an aggressive, higher-risk trade. Not everyone agrees with Einhorn. There are some big names in the stock on the bullish side. Plus, there are so many bears that any good news can produce these massive spikes higher. The most recent data listed short interest at 35% of the 92.1 million share float.

I am going to label this one a lottery ticket trade. We'll buy a cheap, out of the money option. If JOE continues to sink like we expect it to then great! We expect to more than double our money. If not, then we did not have that much invested. We definitely want to limit our position size to reduce our risk. I am not listing a stop loss because shares of JOE can be so volatile.

Our long-term target is $11.00 although we'll seriously consider exiting near the 2011 lows around $13.00.

*Small Positions* - Suggested Positions -

Long 2014 March $15 PUT (JOE1422o15) entry $0.52

chart:

Entry on November 25 at $17.50
Average Daily Volume = 627 thousand
Listed on November 23, 2013



Longer-Term Play Updates



Vanguard FTSE Europe ETF - VGK - close: 56.54 change: +0.75

Stop Loss: 54.90
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:
12/07/13: A widespread bounce both in Europe and the U.S. helped the VGK produce a +1.3% gain. The stock is back above what could have been short-term resistance at $56.00 and its 50-dma. Yet the broken trend line of higher lows could now prove to be new technical resistance (see chart).

Earlier Comments:
Don't forget that we have two exit targets for this trade!

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*

11/30/13 new stop loss @ 54.90
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

FleetCor Technologies - FLT - close: 118.73 change: -3.46

Stop Loss: 119.70
Target(s): 128.50
Current Option Gain/Loss: - 54.5%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/07/13: Ouch! FLT was a serious underperformer on Friday. Strangely I do not see any company-specific news to account for Friday's weakness. FLT gapped down while most of the market gapped higher. Our stop loss was at $119.70 but FLT gapped open at $119.30 and closed with a -2.8% decline. Our call option opened at $2.00 and the bid/ask spread on the volatility.

- Suggested Positions -

2014 Jan $125 call (FLT1418a125) entry $3.30* exit $1.50 (-54.5%)

12/06/13 stopped out on gap down at $119.30
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on November 29 at $122.50
Average Daily Volume = 936 thousand
Listed on November 27, 2013


Starbucks Corp. - SBUX - close: 79.94 change: +0.22

Stop Loss: 78.75
Target(s): 87.50
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/07/13: SBUX underperformed the market on Friday. Shares gapped open higher like so many other stocks did. Yet SBUX's rally reversed at short-term resistance near its 10-dma.

Our trade has not opened yet. Given Friday's relative weakness we are removing SBUX as an active candidate.

Trade did not open.

12/07/13 removed from the newsletter. Trade did not open. suggested trigger to buy calls was $81.00
12/04/13 adjust entry trigger from $82.75 to $81.00
adjust the stop loss from $79.75 to $78.75
adjust the option strike to the 2014 Jan. $82.50 call

chart:

Entry on November -- at $---.--
Average Daily Volume = 4.5 million
Listed on November 30, 2013


CLOSED BEARISH PLAYS

Ctrip.com Intl. - CTRP - close: 47.39 change: -0.13

Stop Loss: 49.25
Target(s): 42.00
Current Option Gain/Loss: -19.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/07/13: On Thursday night we decided to drop CTRP since shares were not moving and given the market's decline, CTRP was actually showing too much relative strength. CTRP continued to show a lack of movement on Friday.

Our plan was to exit positions on Friday morning. CTRP opened at $47.57, an 18-cent gap higher from Thursday's close. The option opened at $1.90 (20-cent spread).

- Suggested Positions -

2014 Jan $45 PUT (CTRP1418m45) entry $2.10 exit $1.70 (-19.0%)

12/06/13 planned exit at the open
12/05/13 prepare to exit tomorrow morning at the open
12/02/13 triggered @ 47.25

chart:

Entry on December 02 at $47.25
Average Daily Volume = 3.7 million
Listed on November 30, 2013