Editor's Note:

The market's sell-off continues with new relative lows for April.

V was stopped out. AAP and LMT hit our entry triggers.


Current Portfolio:


CALL Play Updates

Caterpillar Inc. - CAT - close: 101.45 change: -0.81

Stop Loss: 99.75
Target(s): 109.00
Current Option Gain/Loss: -17.1%
Time Frame: exit PRIOR to earnings on April 24th
New Positions: see below

Comments:
04/12/14: CAT is holding up reasonably well. Shares lost -0.8% on Friday versus a -0.9% drop in the S&P 500. CAT did close under its simple 10-dma, which is short-term bearish. If the market sell-off continues we should expect CAT to test support near $100.00. I am not suggesting new positions at this time.

Earlier Comments:
Our exit target is $109.00. However, we do not have much time for CAT to perform. The company is scheduled to report earnings on April 24th and we do not want to hold over the announcement.

- Suggested Positions -

Long MAY $105 call (CAT1417E105) entry $1.52

04/08/14 triggered @ 102.35

chart:

Entry on April 08 at $102.35
Average Daily Volume = 5.9 million
Listed on April 07, 2014


QUALCOMM Inc. - QCOM - close: 78.01 change: -0.06

Stop Loss: 77.40
Target(s): to be determined
Current Option Gain/Loss: - 24.5%
Time Frame: Exit PRIOR to earnings on April 23rd
New Positions: see below

Comments:
04/12/14: QCOM garnered new bullish analyst comments on Friday morning. This may have helped shares resist the market's decline on Friday. Traders bought the dip near last week's lows around $77.50. If there is any follow through lower tomorrow we could see QCOM hit our stop at $77.40.

I am not suggesting new positions at this time.

Earlier Comments:
Prepare to exit prior to QCOM's earnings report on April 23rd.

- Suggested Positions -

Long MAY $80 call (QCOM1417E80) entry $1.87

04/09/14 opened on Wednesday morning.

chart:

Entry on April 09 at $79.26
Average Daily Volume = 2.0 million
Listed on April 08, 2014




PUT Play Updates

Advance Auto Parts - AAP - close: 116.25 change: -2.36

Stop Loss: 120.25
Target(s): 110.50
Current Option Gain/Loss: + 25.0%
Time Frame: exit PRIOR to earnings on May 15th
New Positions: see below

Comments:
04/12/14: AAP followed Thursday's bearish reversal with a -1.98% drop on Friday. The plan was to buy puts at $117.25. Shares gapped down at $117.29 and quickly hit our entry point. The close below its 100-dma helped confirm the new bearish trend.

- Suggested Positions -

Long May $115 PUT (AAP1417Q115) entry $3.20

04/11/12 triggered @ 117.25

chart:

Entry on April 11 at $117.25
Average Daily Volume = 752 thousand
Listed on April 10, 2014


Lockheed Martin Corp. - LMT - close: 153.82 change: -1.61

Stop Loss: 158.25
Target(s): 146.00
Current Option Gain/Loss: + 6.3%
Time Frame: exit PRIOR to earnings on April 22nd
New Positions: see below

Comments:
04/12/14: LMT also confirmed Thursday's drop with a new relative low on Friday (-1.0%). The stock gapped open lower at $154.97 and quickly hit our suggested entry point at $154.50. The next hurdle for the bears is getting LMT past potential support at its simple 100-dma near $152.55. Our target is $146.00 but keep a wary eye on the $150.00 mark, which is potential round-number support.

Earlier Comments:
This is a short-term trade. LMT is scheduled to report earnings on April 22nd and we do not want to hold over the announcement.

- Suggested Positions -

Long May $150 PUT (LMT1417Q15) entry $2.35*

04/12/14 triggered @ 154.50
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on April 11 at $154.50
Average Daily Volume = 1.7 million
Listed on April 10, 2014



CLOSED BULLISH PLAYS

Visa Inc. - V - close: 196.63 change: -4.92

Stop Loss: 199.95
Target(s): to be determined
Current Option Gain/Loss: -49.1%
Time Frame: exit PRIOR to earnings on April 24th
New Positions: Yes, see below

Comments:
04/12/14: It was another rough day for shares of Visa on Friday. The stock has now broken below multiple layers of support. It's broken through the simple 200-dma. It's broken below the $200.00 level. More importantly V has now broken down below its long-term up trend with Friday's decline. Our stop loss was at $199.95 but shares gapped down at $199.23.

- Suggested Positions -

May $210 call (V1417E210) entry $5.90 exit $3.00* (-49.1%)

04/11/14 stopped out on gap down at $199.23
*option exit price is an estimate since the option did not trade at the time our play was closed.
04/10/14 Trade opens. Visa gapped higher at $208.26

chart:

Entry on April 10 at $208.26
Average Daily Volume = 3.8 million
Listed on April 09, 2014