Editor's Note:

The U.S. markets delivered another weak session as overnight developments in Turkey failed to have any lasting impact in stocks here.

PM hit our entry trigger.


Current Portfolio:


CALL Play Updates

Chicago Bridge & Iron - CBI - close: 76.35 change: -0.83

Stop Loss: 73.15
Target(s): 82.50
Current Option Gain/Loss: + 2.9%
Time Frame: Exit PRIOR to CBI's earnings report in February
New Positions: see below

Comments:
01/29/14: CBI gave back just over half of yesterday's gains. Shares could be poised to retest what should be short-term support near $75.00 and its simple 100-dma.

- Suggested Positions -

Buy the Mar $80 call (CBI1422C80) entry $1.70

01/28/14 new stop loss @ 73.15

Entry on January 27 at $76.17
Average Daily Volume = 1.5 million
Listed on January 25, 2014


EnerNOC, Inc. - ENOC - close: 22.65 change: -0.19

Stop Loss: 21.49
Target(s): 25.75
Current Option Gain/Loss: Unopened
Time Frame: EXIT PRIOR to earnings on February 13th
New Positions: Yes, see below

Comments:
01/29/14: ENOC spent Wednesday's session churning sideways below resistance at the $23.00 level. I do not see any changes from our Tuesday night new play description.

I am suggesting a trigger to buy calls at $23.10. If triggered our target is $25.75. However, we will plan to exit prior to ENOC's earnings report on February 13th. FYI: The Point & Figure chart for ENOC is bullish with a $28 target.

Trigger @ 23.10

- Suggested Positions -

Buy the MAR $22.50 call (ENOC1422C22.5)

Entry on January -- at $---.--
Average Daily Volume = 485 thousand
Listed on January 28, 2014


General Dynamics - GD - close: 99.01 change: -1.49

Stop Loss: 97.75
Target(s): 107.00
Current Option Gain/Loss: -28.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/29/14: Last night Boeing (BA) reported earnings that were better than expected but BA's management lowered their 2014 earnings guidance. Shares of BA collapsed with a -5% drop today. This weakness in BA could have influenced trading in GD as both companies are major defense contractors. GD lost -1.48% and looks poised to test the $98 level (and its simple 10-dma) again.

I am not suggesting new bullish positions at this time.

- Suggested Positions -

Long Mar $100 call (GD1422C100) entry $3.00*

01/28/14 triggered @ 100.50
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on January 28 at $100.50
Average Daily Volume = 2.6 million
Listed on January 27, 2014


iShares Russell 2000 ETF - IWM - close: 111.34 change: -1.63

Stop Loss: 108.85
Target(s): 118.00
Current Option Gain/Loss: Unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
01/29/14: After the central bank of Turkey raised its interest rates last night it appeared that the equity markets were poised to rally today. Yet by the time the market's opening bell sounded all of the optimism faded as gains in the emerging markets faded. The IWM fell -1.4% by the closing bell. It looks like this ETF is moving towards our buy-the-dip trigger at $110.30. Please note that I'm adjusting our stop loss on the dip trigger from 108.85 to 108.65.

Earlier Comments:
Currently we have two different entry point triggers listed. One is a buy-the-dip trigger to buy calls at $110.30 with a stop loss at $108.65 (was 108.85). We also have an alternative entry point listed to buy calls at $114.15 with a stop at $109.90.

Buy the Dip Trigger @ $110.30, stop loss 108.65

- or - Buy Trigger @ $114.15, stop loss @ 109.90.

- Suggested Positions -

Buy the Mar $115 call (IWM1422C115) current ask $1.45

01/29/14 adjust stop on buy-the-dip entry point to 108.65
01/28/14 add a secondary entry point to buy calls at $114.15
01/27/14 adjust the entry point trigger to $110.30 and move the stop loss to $108.85.

Entry on January -- at $---.--
Average Daily Volume = 31.7 million
Listed on January 25, 2014


NASDAQ-100 ETF - QQQ - close: 84.93 change: -0.92

Stop Loss: 83.90
Target(s): 92.00
Current Option Gain/Loss: -28.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
01/29/14: The stock market did not see any follow through on yesterday's intraday bounce. The QQQs gapped open lower and posted a -1.0% decline. This is the ETF's fifth decline in a row. More conservative traders might want to raise their stop loss. I am not suggesting new positions at this time.

*small positions* - Suggested Positions -

Long Mar $87 call (QQQ1422C87) entry $1.60

01/27/14 adjust stop loss to $83.90
01/27/14 triggered at $86.00

Entry on January 27 at $86.00
Average Daily Volume = 29 million
Listed on January 25, 2014




PUT Play Updates

Philip Morris Intl. - PM - close: 79.44 change: -1.37

Stop Loss: 81.55
Target(s): 75.25
Current Option Gain/Loss: +18.1%
Time Frame: Exit PRIOR to earnings on Feb 6th
New Positions: see below

Comments:
01/29/14: The relative weakness in shares of PM continued on Wednesday with a -1.7% decline and a breakdown below the $80.00 mark. The stock was weak right from the opening bell this morning (like most of the market) and hit our suggested entry point at $79.85. This is almost a new two-year low for the stock.

Don't forget that we have less than one full week for this trade to play out.

Earlier Comments:
Our short-term target is $75.25. Please note that this is a short-term trade. PM is due to report earnings on February 6th and we do not want to hold over the report.

- Suggested Positions -

Long Feb $80 PUT (PM1422N80) entry $1.43

01/29/14 triggered @ 79.85

Entry on January -- at $---.--
Average Daily Volume = 5.9 million
Listed on January 27, 2014


Restoration Hardware - RH - close: 54.96 change: -2.48

Stop Loss: 60.25
Target(s): 51.00
Current Option Gain/Loss: +3.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
01/29/14: The weakness in RH continued right on cue. Shares actually gapped open lower at $56.47 and plunged to short-term support near $55.00. Our plan was to open bearish positions this morning. If you missed it RH might provide a temporary bounce from $55.00, which we can use as a new entry point. Look for short-term resistance near its 10-dma (near 57.75.

Earlier Comments:
Please note that I do consider this a somewhat more aggressive, higher-risk trade because RH does have above average short interest (about 10% of the 34 million-share float). Our multi-week target is $51.00. More aggressive traders could aim lower. The Point & Figure chart for RH is bearish with a $43 target.

*Small Positions* - Suggested Positions -

Long MAR $55 PUT (RH1422o55) entry $3.00*

01/29/14 trade opened this morning. RH gapped down at $56.47.
*option entry price is an estimate since the option did not trade at the time our play was opened.

Entry on January 29 at $56.47
Average Daily Volume = 981 thousand
Listed on January 28, 2014