Editor's Note:

The market's major indices failed to make any real progress as investors wait for the jobs report due out Friday morning.

We can expect an increase in volatility tomorrow morning based on the jobs number.

OTEX hit our stop. TIF was closed.


Current Portfolio:


CALL Play Updates

Advance Auto Parts - AAP - close: 113.55 change: +1.25

Stop Loss: 109.75
Target(s): 117.50
Current Option Gain/Loss: +12.8%
Time Frame: exit PRIOR to earnings in February
New Positions: see below

Comments:
01/09/14: AAP managed to outperform the market's major indices with a +1.1% gain today. Yet shares are still struggling with short-term resistance near the $114.00 level.

Earlier Comments:
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.

- Suggested Positions -

Long Mar $115 call (AAP1422c110) entry $3.90*

01/07/14 new stop loss @ 109.75
01/04/14 new stop loss @ 108.75
12/24/13 triggered @ 110.65
*option entry price is an estimate since the option did not trade at the time our play was opened.
12/21/13 adjust the option strike from the January $110 to the March $115 call

Entry on December 24 at $110.65
Average Daily Volume = 923 thousand
Listed on December 14, 2013


Chicago Bridge & Iron - CBI - close: 82.09 change: +1.02

Stop Loss: 79.65
Target(s): 89.50
Current Option Gain/Loss: - 3.2%
Time Frame: Exit PRIOR to CBI's earnings report in February
New Positions: see below

Comments:
01/09/14: CBI is starting to bounce from support near the $80 level. Shares displayed relative strength today with a +1.25% gain and a bullish breakout back above its simple 10-dma. Traders could use today's move as a new entry point to buy calls.

Earlier Comments:
Our target is $89.50. We want to exit prior to CBI's earnings report in February.

- Suggested Positions -

Long April $85 call (CBI1419D85) entry $3.10

12/28/13 new stop loss @ 79.65

Entry on December 19 at $80.35
Average Daily Volume = 1.5 million
Listed on December 18, 2013


Check Point Software - CHKP - close: 64.70 change: +0.13

Stop Loss: 63.35
Target(s): 69.50
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to earnings on January 28th
New Positions: Yes, see below

Comments:
01/09/14: CHKP briefly traded above resistance at the $65.00 level. Yet shares did not hit our suggested entry point at $65.25. If the market cooperates tomorrow we could see CHKP hit our entry point on Friday morning.

If triggered our target is $69.50 but we will plan to exit prior to CHKP's earnings report on January 28th.

Trigger @ 65.25

- Suggested Positions -

Buy the Feb $65 call (CHKP1422B65)

Entry on January -- at $---.--
Average Daily Volume = 821 thousand
Listed on January 04, 2014


Demandware, Inc. - DWRE - close: 68.97 change: +0.28

Stop Loss: 64.75
Target(s): 69.50
Current Option Gain/Loss: +34.6%
Time Frame: exit PRIOR to earnings in mid February
New Positions: see below

Comments:
01/09/14: Friday morning the market will be moving in reaction to the jobs number. This will either push DWRE toward $70.00 and our exit target at $69.50 or we could see DWRE reversing back toward the $65.00 level.

FYI: The Point & Figure chart for DWRE is bullish with a $77 target.

- Suggested Positions -

Long Feb $70 call (DWRE1422B70) entry $2.45*

01/08/14 new stop loss @ 64.75
01/06/14 new stop loss @ 63.45
01/06/14 triggered @ 65.25
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on January 06 at $65.25
Average Daily Volume = 275 thousand
Listed on January 02, 2014


General Dynamics - GD - close: 95.23 change: +0.51

Stop Loss: 93.85
Target(s): 99.50
Current Option Gain/Loss: -14.0%
Time Frame: exit PRIOR to earnings on January 17th
New Positions: see below

Comments:
01/09/14: GD briefly traded at a new high but failed at resistance near $96.00. I am not suggesting new positions at this time.

Earlier Comments:
Our target is $99.50. More aggressive traders may want to aim higher since the Point & Figure chart for GD is bullish with a $105 target. The plan was to keep our position size small.

*small positions* - Suggested Positions -

Long Feb $95 call (GD1422B95) entry $2.21

Entry on December 31 at $95.25
Average Daily Volume = 1.1 million
Listed on December 28, 2013


Honeywell Intl. - HON - close: 90.47 change: +0.03

Stop Loss: 89.65
Target(s): 94.75
Current Option Gain/Loss: -10.2%
Time Frame: exit PRIOR to earnings in late January
New Positions: see below

Comments:
01/09/14: HON tried to rally this morning but the surge ran out of steam near short-term resistance at $91.50. HON faded back to unchanged on the session. Tomorrow's movement will be a reaction to the jobs report out Friday morning. We'll either see HON breakdown and hit our stop loss at $89.65 or we should see a bullish breakout higher. I am not suggesting new positions at this time.

Earlier Comments:
Our short-term target is $94.75. More aggressive traders may want to aim for the $97-100 zone instead.

- Suggested Positions -

Long Mar $92.50 call (HON1422c92.5) entry $1.75*

01/08/14 new stop loss @ 89.65
12/28/13 new stop loss @ 88.40
12/24/13 triggered @ 90.30
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on December 24 at $90.30
Average Daily Volume = 2.4 million
Listed on December 23, 2013


NetSuite Inc. - N - close: 104.21 change: -0.02

Stop Loss: 99.95
Target(s): 110.00
Current Option Gain/Loss: - 6.6%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
01/09/14: The rally in shares of N took the day off with the stock drifting sideways near $104. Investors are most likely waiting for the jobs report due out tomorrow morning.

Earlier Comments:
Our target is $110.00. However, we will plan to exit prior to their earnings report in late January or early February. FYI: The Point & Figure chart for N is bullish with a $129 target.

- Suggested Positions -

Long Feb $110 call (N1422B110) entry $3.00

Entry on January 08 at $103.75
Average Daily Volume = 410 thousand
Listed on January 07, 2014


NetEase, Inc. - NTES - close: 79.77 change: +2.63

Stop Loss: 77.50
Target(s): 87.50
Current Option Gain/Loss: -28.0%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
01/09/14: Uh-oh! Warning signals should be going off for NTES bulls. The spike higher this morning didn't last very long and NTES completely reversed into a -3.19% decline. Asian markets were weak today but nothing that would explain such a big drop in NTES. Unfortunately today's session has created a bearish engulfing candlestick reversal pattern. More conservative traders may want to exit immediately or raise their stop loss closer to $79.00. I am not suggesting new positions.

- Suggested Positions -

Long Feb $85 call (NTES1422B85) entry $2.85*

01/09/14 Warning! Today's session has created a bearish reversal pattern

Entry on January 08 at $80.75
Average Daily Volume = 661 thousand
Listed on January 07, 2014



Palo Alto Networks, Inc. - PANW - close: 60.64 change: +0.59

Stop Loss: 57.65
Target(s): 64.00
Current Option Gain/Loss: +42.8%
Time Frame: exit PRIOR to February option expiration
New Positions: see below

Comments:
01/09/14: PANW continued to push higher with a +0.98% gain. I am adjusting our stop loss up to $57.65. I am not suggesting new positions at this time.

Earlier Comments:
Our short-term target is $64.00 but I will point out that the February 2013 high near $62.00 could be potential resistance.

- Suggested Positions -

Long Feb $60 call (PANW1422B60) entry $2.45*

01/09/14 new stop loss @ 57.65
01/07/14 new stop loss @ 56.75
01/06/14 triggered @ 58.25
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on January 06 at $58.25
Average Daily Volume = 1.1 million
Listed on January 04, 2014


Polaris Industries, Inc. - PII - close: 144.97 change: -0.53

Stop Loss: 142.40
Target(s): 149.00
Current Option Gain/Loss: - 8.4%
Time Frame: EXIT prior to earnings on January 28th
New Positions: see below

Comments:
01/09/14: PII spent Thursday's session fading lower and retesting its simple 10-dma. I am not suggesting new positions at this time.

Earlier Comments:
Our multi-week target is $149.00. More aggressive traders could aim higher since the Point & Figure chart for PII is bullish with a $158 target.

- Suggested Positions -

Long Mar $150 call (PII1422c150) entry $4.48
01/08/14 new stop loss @ 142.40
01/07/14 new stop loss @ 141.75
12/30/13 new stop loss @ 139.75
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on December 23 at $142.25
Average Daily Volume = 457 thousand
Listed on December 21, 2013


Salix Pharmaceuticals - SLXP - close: 91.60 change: +0.65

Stop Loss: 87.80
Target(s): 98.50
Current Option Gain/Loss: -16.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
01/09/14: The rebound in SLXP continued on Thursday but shares were unable to breakout past resistance near $92.00.

Earlier Comments:
SLXP is poised to breakout past resistance at the $90.00 level. If shares can breakout past $90 the next major milestone would be the $100 mark. If triggered our multi-week target is $98.50.

- Suggested Positions -

Long Feb $95 call (SLXP1422B95) entry $2.50*

01/07/14 new stop loss @ 87.80
01/03/14 triggered @ 90.25
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on January 03 at $90.25
Average Daily Volume = 790 thousand
Listed on December 31, 2013


United Technologies - UTX - close: 113.71 change: +0.06

Stop Loss: 111.75
Target(s): 118.50
Current Option Gain/Loss: - 4.4%
Time Frame: exit PRIOR to earnings in late January
New Positions: see below

Comments:
01/09/14: UTX keeps trying to breakout past resistance near $114.00. Looks like we'll have to wait and see if the jobs report tomorrow morning will boost stocks or drag them lower.

Today's high was $114.23. I would be tempted to buy calls on a rally past this level.

Please note our new stop loss at $111.75.

Earlier Comments:
Our target is $118.50 but we'll plan on exiting prior to UTX's earnings report in late January. More aggressive investors might want to consider aiming higher. The Point & Figure chart for UTX is bullish with a $139 target.

- Suggested Positions -

Long Feb $115 call (UTX1422B115) entry $1.80

01/09/14 new stop loss @ 111.75
12/31/13 trade opened on gap higher at $113.16. Suggested trigger was $113.05

Entry on December 31 at $113.16
Average Daily Volume = 2.8 million
Listed on December 26, 2013




PUT Play Updates

Lululemon Athletica - LULU - close: 57.35 change: -0.67

Stop Loss: 60.05
Target(s): 51.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
01/09/14: As expected LULU continues to underperform the market. Shares did trade down to new 52-week lows yet the stock missed our suggested entry point by the narrowest of margins. Today's low was $57.01. I am adjusting our suggested entry point from $57.00 to $56.90.

Earlier Comments:
LULU is poised to breakdown below its December lows. I am suggesting small bearish positions if LULU can trade at $57.00. Why small positions? That's because short interest is already at 17% of the 134.5 million share float. Any sudden bounce could spark some short covering.

If triggered our target is $51.00. More aggressive traders could aim lower since the Point & Figure chart for LULU is bearish with a $43 target.

Trigger @ 56.90

- Suggested Positions -

Buy the Feb $55 PUT (LULU1422N55)

01/09/14 LULU missed our trigger by a penny. We're adjusting the suggested entry point from 57.00 to 56.90

Entry on January -- at $---.--
Average Daily Volume = 4.6 million
Listed on January 06, 2014


Rock-Tenn Co. - RKT - close: 101.60 change: -0.21

Stop Loss: 105.25
Target(s): 96.00
Current Option Gain/Loss: - 2.7%
Time Frame: Exit PRIOR to earnings on January 28th
New Positions: see below

Comments:
01/09/14: Our new trade on RKT began this morning with shares opening at $101.96. The stock dipped to $100.37 before bouncing back, almost to unchanged. If the market bounces on the jobs report tomorrow we could see RKT testing the $103-104 area.

Earlier Comments:
There is a lot of congestion in the $100-95 area but we suspect that RKT could retreat back toward $95.00. Our target is $96.00.

- Suggested Positions -

Long FEB $100 PUT (RKT1422N100) entry $3.70

Entry on January 09 at $101.96
Average Daily Volume = 656 thousand
Listed on January 08, 2014



CLOSED BULLISH PLAYS

Open Text Corp. - OTEX - close: 90.06 change: -3.98

Stop Loss: 90.75
Target(s): 98.50
Current Option Gain/Loss: -29.3%
Time Frame: exit PRIOR to February expiration
New Positions: see below

Comments:
01/09/14: Ouch! What happened to OTEX? I can't find any news to explain the -$4.00 drop in the first two hours of trading. The stock plunged to round-number support near $90.00. Our stop was hit at $90.75. The bullish breakout from yesterday suddenly looks like a potential bull trap pattern.

- Suggested Positions -

FEB $95 call (OTEX1422b95) entry $2.90* exit $2.05 (-29.3%)

01/09/14 stopped out
01/04/14 new stop loss @ 90.75
12/30/13 new stop loss @ 89.65
12/23/13 new stop loss @ 88.90
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on December 20 at $91.05
Average Daily Volume = 325 thousand
Listed on December 19, 2013


Tiffany & Co - TIF - close: 92.01 change: +0.31

Stop Loss: 89.75
Target(s): 98.50
Current Option Gain/Loss: -38.6%
Time Frame: exit PRIOR to February option expiration
New Positions: see below

Comments:
01/09/14: Last night we decided to close our TIF trade due to worries about the retail sector. Sure enough this morning the retail industry was full of bad news. BBBY reported earnings, missed estimates, and guided lower. FDO also missed estimates and guided lower. Altogether there were eleven retailers that lowered their guidance this morning following the monthly same-store sales data release. Granted TIF has a much different clientele than BBBY and FDO but overall the retail industry could report a disappointing holiday shopping season.

Our plan was to exit TIF this morning. All this negative data helped push TIF to gap open lower at $91.20 before bouncing. The option gapped down at $1.38 (six cent spread).

- Suggested Positions -

FEB $95 call (TIF1422b95) entry $2.15 exit $1.32 (-38.6%)

01/09/14 planned exit, TIF gapped down
01/08/14 prepare to exit tomorrow at the opening bell
12/31/13 new stop loss @ 89.75
12/26/13 TIF stock seems unaffected by the negative legal news from Monday
12/23/13 TIF reacts to news that a Dutch court orders it to pay Swatch $449 million in damages.

chart:

Entry on December 18 at $91.25
Average Daily Volume = 1.25 million
Listed on December 16, 2013