Editor's Note:

Bah, humbug! The stock market is obviously not in the Christmas spirit with a very widespread sell off on Wednesday.

ILMN, ITC and KSU all hit our entry triggers.
IWM, NKE, NUS, and UHS hit our stop loss.

We want to exit our JOE trade tomorrow morning.


Current Portfolio:


CALL Play Updates

Allergan, Inc. - AGN - close: 95.65 change: -1.76

Stop Loss: 94.95
Target(s): 102.50
Current Option Gain/Loss: -52.5%
Time Frame: Exit prior to January option expiration
New Positions: see below

Comments:
12/11/13: AGN underperformed the market today and that's not good news. The S&P 500 lost -1.1% while AGN plunged -1.8% and closed on its low for the session. The next level of potential support is the $95.00 mark. I am not suggesting new positions at this time.

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

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


Aon Plc. - AON - close: 81.75 change: -1.32

Stop Loss: 80.75
Target(s): 85.00
Current Option Gain/Loss: -17.6%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/11/13: AON slipped -1.5% and settled on its rising 20-dma. The next level of potential support should be the $81.00 mark. I am not suggesting new positions at this time.

- 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

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


The Walt Disney Co. - DIS - close: 70.52 change: -1.05

Stop Loss: 68.95
Target(s): 77.50
Current Option Gain/Loss: -10.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
12/11/13: The recent relative strength in DIS vanished. Shares gave back -1.4% today. More importantly today's session has created a bearish engulfing candlestick reversal pattern. More conservative traders may want to raise their stop closer to the $70.00 level.

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

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


Illumina Inc. - ILMN - close: 99.26 change: -0.71

Stop Loss: 97.75
Target(s): 109.00
Current Option Gain/Loss: -26.4%
Time Frame: Exit PRIOR to 2014 January option expiration
New Positions: , see below

Comments:
12/11/13: Sometimes it might feel like the stock market is out to "get you". All of the market's major indices opened lower and were plunging lower most of the session. There is no real explanation to account for the sudden surge higher in shares of ILMN this morning. The stock should have followed the market lower this morning. Instead the stock spiked up past yesterday's high, hit $102.67, and then reversed to give back all of its gains. Our suggested trigger to buy calls was hit at $102.00. Shares settled on short-term support at their 10-dma.

I am not suggesting new positions at this time.

Earlier Comments:
Further gains could spark some short covering since the most recent data listed short interest at 26% of the 125 million-share float.

If triggered our target is $109.00. More aggressive traders may want to aim higher since the point & figure chart is bullish with a $146 target. P&F chart readers will also notice that ILMN is about to produce a new triple-top breakout buy signal.

NOTE: Biotech stocks can be volatile and the wrong headline could send shares gapping lower. Investors may want to limit their position size.

- Suggested Positions -

Long 2014 Jan $105 call (ILMN1418a105) entry $3.40

Entry on December 11 at $102.00
Average Daily Volume = 931 thousand
Listed on December 09, 2013


ITC holdings - ITC - close: 94.03 change: +0.73

Stop Loss: 90.95
Target(s): 98.50
Current Option Gain/Loss: -27.6%
Time Frame: four to six weeks.
New Positions: see below

Comments:
12/11/13: We were expecting to see strength in shares of ITC but not a big gap higher. This morning, before the opening bell, ITC was upgrade and this sparked a gap open higher at $95.19. Our suggested entry point was $93.50. Unfortunately our trade opened on the gap higher. ITC spent the rest of the day fading lower and nearly filling the gap. At this point I would take a cautious approach to new positions. You could wait for a dip near $93.00, which could be very short-term support. Or if the market bounces tomorrow then a new rally above $94.25 might work as an alternative entry point.

Did you notice how the rally failed at resistance near $96.00 this morning? I mentioned that yesterday as a possible hurdle.

Earlier Comments:
ITC can be a volatile stock. I could not find any explanation for the gap down on November 13th. Therefore I am suggesting small bullish positions to limit our risk. It's also worth noting that the $96.00 area and its simple 50-dma (also near $96) could be overhead resistance.

*small positions* - Suggested Positions -

Long 2014 Feb $95 call (ITC1422B95) entry $3.80*

12/11/13 trade opened on gap higher at $95.19, suggested trigger was $93.50
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on December 11 at $95.19
Average Daily Volume = 419 thousand
Listed on December 10, 2013


Michael Kors - KORS - close: 80.58 change: -1.23

Stop Loss: 78.49
Target(s): 89.00
Current Option Gain/Loss: -37.8%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/11/13: KORS could not escape the market's pull of gravity and shares fell -1.5%. We can look for potential support in the $79-80 zone. I would wait for the bounce before considering new positions.

- 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.

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


QUALCOMM Inc. - QCOM - close: 73.01 change: -0.37

Stop Loss: 71.75
Target(s): 79.50
Current Option Gain/Loss: Unopened
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/11/13: The market's major indices spiked lower at the open yet QCOM managed to gap open higher in response to a new analyst "buy" rating. I warned readers last night that this could happen. The rally attempt failed near short-term resistance at $74.20. QCOM then plunged back toward its recent lows near $73.00.

Earlier Comments:
Currently QCOM has been consolidating sideways and actually weathered the market's recent five-day decline pretty well. Shares are now poised to breakout past resistance at $74.00. I am suggesting a trigger to buy calls at $74.25. If triggered our target is $79.50. More aggressive traders may want to aim higher since the Point & Figure chart for QCOM is bullish with a $93 target.

FYI: Don't forget that QCOM does significant amount of business with Apple (AAPL) and if AAPL has any bad headlines it could impact QCOM shares.

Trigger @ 74.25

- Suggested Positions -

Buy the 2014 Jan $75 call (QCOM1418a75)

- or -

Buy the 2014 Feb $75 call (QCOM1422b75)

Entry on December -- at $---.--
Average Daily Volume = 11.5 million
Listed on December 07, 2013


Constellation Brands Inc. - STZ - close: 70.08 change: -0.90

Stop Loss: 69.40
Target(s): 74.75
Current Option Gain/Loss: -28.5%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/11/13: STZ tagged a new all-time high this morning only to quickly reverse and slide lower the rest of the day. Shares did manage to close just above the $70.00 mark and its 20-dma. Thus it is sitting on potential short-term support. However, today's performance has created a bearish engulfing candlestick reversal pattern. I am not suggesting new positions at this time.

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

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



United Parcel Service - UPS - close: 100.87 change: -0.86

Stop Loss: 99.75
Target(s): 108.00
Current Option Gain/Loss: -52.0%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/11/13: UPS gave up -0.8% but not surprisingly shares found some short-term support near its early December low (also near its 30-dma). More conservative traders may want to raise their stop closer to today's low (100.67). 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

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




PUT Play Updates

Intl. Business Machines - IBM - close: 175.20 change: -1.92

Stop Loss: 178.65
Target(s): 170.25
Current Option Gain/Loss: + 12.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/11/13: According to a Bloomberg article today an senior VP at IBM said the slow economy was still impacting the company's sales and remains discouraging. Meanwhile shares of IBM only lost -1.0% and settled on short-term round-number support at the $175.00 level.

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

12/09/13 new stop loss @ 178.65

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


The St. Joe Company - JOE - close: 17.71 change: +0.10

Stop Loss: n/a *use small positions*
Target(s): $11.00-13.00 range
Current Option Gain/Loss: -61.5%
Time Frame: 2 to 3 months
New Positions: see below

Comments:
12/11/13: Hmm... the stock market just produced a very widespread sell off and yet JOE did not participate. Instead shares actually bounced. The long-term trend for JOE continues to look bearish but we are throwing in the towel. Tonight we're suggesting an early exit at the opening bell. More aggressive traders may want to let it ride. The story on JOE hasn't changed.

*Small Positions* - Suggested Positions -

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

12/11/13 prepare to exit tomorrow morning

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


Kansas City Southern - KSU - close: 117.01 change: -2.02

Stop Loss: 120.50
Target(s): 114.00
Current Option Gain/Loss: + 2.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/11/13: KSU's bearish reversal from yesterday continued today and shares broke down below support near $118.00. Our trigger to buy puts was hit at $117.75.

If triggered our target is $114.00. More aggressive traders may want to aim lower for the simple 200-dma instead.

- Suggested Positions -

Long 2014 Jan $115 PUT (KSU1418m115) entry $2.40*

12/11/13 triggered @ 117.75
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on December 11 at $117.75
Average Daily Volume = 486 thousand
Listed on December 07, 2013



Longer-Term Play Updates



Vanguard FTSE Europe ETF - VGK - close: 56.41 change: -0.19

Stop Loss: 54.90
Target(s): Sell half @ $58.00, sell the rest at $63.00
Current Option Gain/Loss: +22.2%
Time Frame: exit PRIOR to 2014 March option expiration
New Positions: see below

Comments:
12/11/13: A widespread sell off across Europe and the U.S. helped push the VGK to a -0.74% loss. The up trend appears to be in jeopardy. More conservative investors may want to take profits early. I am not suggesting new positions at this time.

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.

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



CLOSED BULLISH PLAYS

Russell 2000 ETF - IWM - close: 109.60 change: -1.83

Stop Loss: 109.95
Target(s): 116.00
Current Option Gain/Loss: -52.6%
Time Frame: exit prior to January option expiration
New Positions: see below

Comments:
12/11/13: The small cap index and ETF continue to underperform their large cap rivals. The IWM plunged at the open and broke down below what should have been support near $110 and its simple 50-dma. Our stop loss was hit at $109.95.

- Suggested Positions -

2014 Jan $112 call (IWM1418a112) entry $2.62 exit $1.24 (-52.6%)

12/11/13 stopped out
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


Nike Inc. - NKE - close: 76.84 change: -2.38

Stop Loss: 78.45
Target(s): 84.75
Current Option Gain/Loss: - 34.7%
Time Frame: Exit PRIOR to earnings on Dec. 19th
New Positions: see below

Comments:
12/11/13: NKE was a significant underperformer today. Shares plunged -3.0% and sliced through multiple layers of potential support. I didn't see any company-specific news to account for today's relative weakness. Our stop loss was hit at $78.45.

- Suggested Positions -

2014 Jan $80 call (NKE1418a80) entry $2.59 exit $1.69 (-34.7%)

12/11/13 stopped out at $78.45

chart:

Entry on December 09 at $80.25
Average Daily Volume = 2.6 million
Listed on December 07, 2013


Nu Skin Enterprises - NUS - close: 125.53 change: -4.02

Stop Loss: 127.40
Target(s): 139.50
Current Option Gain/Loss: - 42.7%
Time Frame: Exit PRIOR to January expiration
New Positions: see below

Comments:
12/11/13: NUS also broke down below short-term support during today's market wide sell off. Shares hit our stop loss at $127.40 before setting just above potential round-number support at $125.00.

Earlier Comments:
More conservative traders might want to wait for NUS to trade above the recent December high at $132.67 as an alternative entry point.

- Suggested Positions -

2014 Jan $135 call (NUS1418a135) entry $4.80* exit $2.75 (-42.7%)

12/11/13 stopped out at $127.40
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on December 10 at $131.75
Average Daily Volume = 1.1 million
Listed on December 09, 2013


Universal Health Services - UHS - close: 83.12 change: +0.12

Stop Loss: 81.45
Target(s): 88.50
Current Option Gain/Loss: -64.6%
Time Frame: 4 to 5 weeks
New Positions: see below

Comments:
12/11/13: It was an ugly day for UHS with a -2.74% decline that erased the prior week and a half worth of movement. The stock broke down below support near $82.00 and hit our stop loss at $81.45. Unfortunately our loss was exacerbated by the option's wide spread but on the plus side the bid/ask spread did narrow from yesterday.

- Suggested Positions -

2014 Jan $85 call (UHS1418a85) entry $1.67* exit $0.59 (-64.6%)

12/11/13 stopped out
12/10/13 new stop loss @ 81.45
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