Editor's Note:

The U.S. market chopped sideways ahead of tomorrow's pivotal FOMC meeting.

DDD hit our trigger. ITC hit our stop loss.
We want to exit our WDC trade at the opening bell tomorrow.


Current Portfolio:


CALL Play Updates

Advance Auto Parts - AAP - close: 108.46 change: -0.81

Stop Loss: 107.95
Target(s): 117.50
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to January option expiration
New Positions: Yes, see below

Comments:
12/17/13: AAP continues to slip lower. Shares lost -0.74% today. We are still sitting on the sidelines waiting for a new move higher.

I don't see any changes from my new play description from the weekend newsletter.

FYI: AAP will begin trading ex-dividend on December 18th. The quarterly cash dividend should be six cents.

We are suggesting a trigger to buy calls at $110.65. If triggered our short-term target is $117.50. Longer-term traders may want to aim higher since the Point & Figure chart for AAP is bullish with a $140 target.

Trigger @ 110.65

- Suggested Positions -

buy the Jan $110 call (AAP1418a110)

Entry on December -- at $---.--
Average Daily Volume = 923 thousand
Listed on December 14, 2013


Allergan, Inc. - AGN - close: 99.07 change: -1.16

Stop Loss: 94.95
Target(s): 104.00
Current Option Gain/Loss: +12.5%
Time Frame: Exit prior to January option expiration
New Positions: see below

Comments:
12/17/13: After yesterday's big gains and a market-wide pullback today it's no surprise to see a little dip in AGN. Shares slipped -1.1%. I am not suggesting new positions at this time.

The Point & Figure chart for AGN is bullish with a $110 target.

- Suggested Positions -

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

12/16/13 adjust exit target to $104.00
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: 81.82 change: -0.03

Stop Loss: 80.90
Target(s): 85.00
Current Option Gain/Loss: - 5.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/17/13: AON continues to churn sideways inside its new $81.35-82.35 trading range. I am inching our stop loss up to $80.90. I am not suggesting new positions at this time.

- Suggested Positions -

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

12/17/13 new stop loss @ 80.90
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


3D Systems - DDD - close: 81.38 change: +0.09

Stop Loss: 78.90
Target(s): 89.00
Current Option Gain/Loss: -12.4%
Time Frame: exit PRIOR to January option expiration
New Positions: see below

Comments:
12/17/13: DDD saw a rally this morning and shares hit our suggested trigger at $82.05. Unfortunately the stock pared its gains by the closing bell. If you're looking for a new entry point you may want to wait for a rally past today's high (82.50) before initiating positions.

Earlier Comments:
More conservative traders may want to wait for DDD to trade above its December 11th high of $82.65 before initiating positions.

Keep in mind that DDD shares can be volatile. I am suggesting we keep our position size small to limit our risk.

*small positions* - Suggested Positions -

Long Jan $85 call (DDD1418a85) entry $3.54

Entry on December 17 at $82.05
Average Daily Volume = 5.7 million
Listed on December 14, 2013


Illumina Inc. - ILMN - close: 102.00 change: -0.60

Stop Loss: 99.45
Target(s): 109.00
Current Option Gain/Loss: -14.7%
Time Frame: Exit PRIOR to 2014 January option expiration
New Positions: see below

Comments:
12/17/13: ILMN shot lower this morning but the stock found support twice near $101.30. If this dip continues we could see ILMN testing round-number support at $100.00 soon. 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

12/16/13 new stop loss @ 99.45

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


Michael Kors - KORS - close: 82.91 change: +0.71

Stop Loss: 79.90
Target(s): 89.00
Current Option Gain/Loss: - 5.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/17/13: KORS displayed relative strength with a +0.8% gain on Tuesday. The stock looks poised to breakout past resistance near $83.00 soon. Readers may want to raise their stop loss. I am not suggesting new positions at this time.

- Suggested Positions -

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

12/14/13 new stop loss @ 79.90
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



Lockheed Martin - LMT - close: 140.85 change: +0.80

Stop Loss: 137.75
Target(s): 149.00
Current Option Gain/Loss: - 1.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
12/17/13: LMT continues to climb with a +0.5% gain on Tuesday. If you were looking for a more convincing rally past the $140 mark then you got it.

Earlier Comments:
Our multi-week target is $149.00. Keep in mind that the $144-145 area is currently overhead resistance.

I'm listing the March calls. If you want to take a more short-term approach then the 2014 January calls are much cheaper.

- Suggested Positions -

Long Mar $145 call (LMT1422C145) entry $3.35

Entry on December 16 at $140.25
Average Daily Volume = 2.0 million
Listed on December 14, 2013


Tiffany & Co - TIF - close: 90.32 change: -0.53

Stop Loss: 88.45
Target(s): 98.50
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to February option expiration
New Positions: Yes, see below

Comments:
12/17/13: TIF did not see any follow through on yesterday's rally. The stock produced a quiet day with shares drifting sideways above the $90 level. I don't see any changes from our Monday night new play description.

Earlier Comments:
Monday's intraday high was $91.10. I am suggesting a trigger to buy calls at $91.25. Our target is $98.50. The Point & Figure chart for TIF is bullish with a $102 target.

FYI: Shares of TIF will begin trading ex-dividend on December 18th. The quarterly cash dividend should be 34 cents.

Trigger @ 91.25

- Suggested Positions -

buy the FEB $95 call (TIF1422b95)

Entry on December -- at $---.--
Average Daily Volume = 1.25 million
Listed on December 16, 2013


United Parcel Service - UPS - close: 101.98 change: -0.15

Stop Loss: 100.45
Target(s): 108.00
Current Option Gain/Loss: -37.7%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
12/17/13: UPS gapped open higher this morning but gains faded. Shares spent most of the session hugging the $102 level. I am not suggesting new positions at this time.

- Suggested Positions -

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

12/12/13 new stop loss @ 100.45
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


Western Digital Corp. - WDC - close: 83.40 change: +1.74

Stop Loss: 77.70
Target(s): 84.75
Current Option Gain/Loss: +63.9%
Time Frame: Exit PRIOR to January option expiration
New Positions: see below

Comments:
12/17/13: Five cents! That's all we needed was another five cents for WDC to hit our exit target at $84.75. The stock rallied again thanks to some analyst upgrades this morning. Shares hit $84.70 before paring their gains. Tonight we're suggesting an immediate exit tomorrow morning to lock in a potential profit.

The current bid/ask on our option is $5.00/5.15.

- Suggested Positions -

Long 2014 Jan $80 call (WDC1418a80) entry $3.05

12/17/13 prepare to exit tomorrow morning at the open.
WDC missed our exit target by 5 cents. We want to go ahead and exit early.

Entry on December 16 at $80.25
Average Daily Volume = 1.9 million
Listed on December 12, 2013




PUT Play Updates

Intl. Business Machines - IBM - close: 175.76 change: -2.09

Stop Loss: 178.65
Target(s): 170.25
Current Option Gain/Loss: + 1.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/17/13: We suspected that yesterday's rise was just a one-day pop. Sure enough there was no follow through higher. IBM underperformed the market with a -1.1% decline.

- Suggested Positions -

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

12/14/13 readers may want to take profits now with IBM testing its October lows.
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


Kansas City Southern - KSU - close: 117.48 change: -1.32

Stop Loss: 119.50
Target(s): 114.00
Current Option Gain/Loss: -12.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/17/13: KSU did not see any follow through on yesterday's bounce either. Today's drop was only four cents away from completely erasing yesterday's rebound. I am not suggesting new positions.

- Suggested Positions -

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

12/16/13 new stop loss @ 119.50
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


Sears Holdings - SHLD - close: 44.45 change: +0.35

Stop Loss: 48.60
Target(s): 40.15
Current Option Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/17/13: After falling to new three-month lows yesterday shares of SHLD managed a bit of an oversold bounce today. It is worth noting that shares lost -3.5% from its intraday high today.

Earlier Comments:
Our short-term target is $40.15. Keep in mind that there are already a lot of bears in this stock. The most recent data listed short interest at 56% of the 50.7 million share float. That's plenty of fuel for a short squeeze if the stock can bounce. It's another reason to keep your position size small.

- Suggested Positions - *small positions*

Long 2014 Jan $39 PUT (SHLD1418m39) entry $1.66

12/16/13 new stop loss @ 48.60

Entry on December 12 at $46.18
Average Daily Volume = 1.5 million
Listed on December 11, 2013


CLOSED BULLISH PLAYS

ITC holdings - ITC - close: 92.58 change: -1.34

Stop Loss: 92.40
Target(s): 98.50
Current Option Gain/Loss: -46.0%
Time Frame: four to six weeks.
New Positions: see below

Comments:
12/17/13: ITC shot lower at the opening bell with a plunge toward the $92.00 level. Our stop loss was hit at $92.40.

Earlier Comments:
ITC can be a volatile stock. Therefore I am suggesting small bullish positions to limit our risk.

*small positions* - Suggested Positions -

2014 Feb $95 call (ITC1422B95) entry $3.80* exit $2.05**(-46.0%)

12/17/13 stopped out
**option exit price is an estimate since the option did not trade at the time our play was closed.
12/14/13 new stop loss @ 92.40
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.

chart:

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