Editor's Note:

The U.S. market ended the week on an up note although some have suggested it was merely short covering ahead of the weekend.

AYI hit our entry trigger. OMC was stopped out.


Current Portfolio:


CALL Play Updates

The Boeing Company - BA - close: 131.10 change: +0.53

Stop Loss: 128.40
Target(s): to be determined
Current Option Gain/Loss: -12.9%
Time Frame: 6 to 9 weeks
New Positions: see below

Comments:
05/10/14: Shares of BA bounced near the $130 level and managed to outperform the S&P 500 with a +0.4% gain. The stock looks poised to move higher if the market will cooperate. Readers might want to wait for a new rise above $131.50 before considering new positions.

- Suggested Positions -

Long Jul $135 Call (BA1419G135) entry $2.75

05/05/14 triggered at $132.00

chart:

Entry on May 05 at $132.00
Average Daily Volume = 3.7 million
Listed on May 03, 2014


Gilead Sciences - GILD - close: 79.76 change: +1.03

Stop Loss: 75.75
Target(s): to be determined (potentially $85.00)
Current Option Gain/Loss: +36.3%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/10/14: Biotech stocks spiked lower on Friday morning and then rebounded with a big bounce to outperform the major indices. Shares of GILD followed a similar path. The stock dipped to short-term support at its 10-dma and rebounded to a +1.3% gain. GILD is once again testing round-number resistance near $80.00.

Tonight I am moving our stop loss up to $75.75. More conservative traders may want to move their stop closer to the 10-dma instead.

- Suggested Positions -

Long Jun $80 call (GILD1421F80) entry $2.12

05/10/14 new stop @ 75.75
05/01/14 new stop @ 74.45
04/30/14 triggered @ 77.00

chart:

Entry on April 30 at $77.00
Average Daily Volume = 23 million
Listed on April 29, 2014


3M Company - MMM - close: 141.34 change: +0.51

Stop Loss: 138.45
Target(s): to be determined
Current Option Gain/Loss: -15.6%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/10/14: Traders continue to buy the dips in MMM. The stock is less than a dollar away from new all-time highs. Investors may want to wait for MMM to trade above $142.00 again before initiating new positions.

Earlier Comments:
We're not setting an exit target yet but the Point & Figure chart for MMM is bullish with a $174 target.

- Suggested Positions -

Long Jun $140 call (MMM1421F140) entry $3.45*

05/08/14 triggered @ $142.00

chart:

Entry on May 08 at $142.00
Average Daily Volume = 2.65 million
Listed on May 07, 2014


Pacira Pharmaceuticals - PCRX - close: 73.50 change: -2.06

Stop Loss: 69.95
Target(s): to be determined
Current Option Gain/Loss: - 28.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/10/14: It was another volatile week for shares of PCRX with big intraday swings. The stock was underperforming on Friday and closed down -2.7%. Traders may want to look for another bounce off its simple 10-dma (currently at 71.70) before considering new bullish positions.

Earlier Comments:
If PCRX does breakout it could see a short squeeze. The most recent data listed short interest at 17% of the 33.6 million share float. This is a somewhat aggressive trade because the option spreads on PCRX are a bit wider than we like. The Point & Figure chart for PCRX is bullish with a $93 target.

- Suggested Positions -

Long Aug $80 call (PCRX1416H80) entry $7.00

05/06/14 triggered on gap higher at $75.32, suggested entry was $74.25

chart:

Entry on May 06 at $75.32
Average Daily Volume = 602 thousand
Listed on May 05, 2014


Potasch Corp. of Saskatchewan - POT - close: 36.04 change: -0.22

Stop Loss: 34.45
Target(s): to be determined
Current Option Gain/Loss: -15.0%
Time Frame: 3 to 4 months
New Positions: see below

Comments:
05/10/14: POT held up well on Friday considering disappointing earnings from a rival. Shares of POT did close below their 10-dma for the first time in three weeks. There is short-term support near $35.75 but I would not be surprised to see a pullback into the $35.50-35.00 area.

POT's failure at a new trend line of higher highs is somewhat troubling. I am not suggesting new positions.

- Suggested Positions -

Long Sept $35 call (POT1420i35) entry $2.65

05/02/14 triggered @ 36.50

chart:

Entry on May 02 at $36.50
Average Daily Volume = 5.0 million
Listed on April 26, 2014


Ventas, Inc. - VTR - close: 67.76 change: -0.64

Stop Loss: 65.75
Target(s): to be determined
Current Option Gain/Loss: +20.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/10/14: Warning! The action in VTR on Friday looks bearish. The stock was showing relative strength all week long. Then on Friday it spiked up to $69.09 before reversing lower. Technically Friday's move is a bearish engulfing candlestick reversal pattern.

I am moving our stop loss up to $65.75. More conservative traders may want to move theirs higher. I am not suggesting new positions at this time.

- Suggested Positions -

Long Aug $65 call (VTR1416H65) entry $2.75

05/10/14 new stop @ 65.75
05/01/14 triggered @ 66.35

chart:

Entry on May 01 at $66.35
Average Daily Volume = 1.6 million
Listed on April 28, 2014




PUT Play Updates

ASML Holdings - ASML - close: 80.32 change: -0.58

Stop Loss: 82.05
Target(s): to be determined
Current Option Gain/Loss: -19.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/10/14: It looks like ASML's bounce is fading and shares look ready to resume the down trend. Shares are currently resting on round-number support near $80.00. The intraday low on May 6th was $79.66. Readers might want to wait for ASML to trade below this level before initiating new bearish positions.

Earlier Comments:
ASML might have some support near $75.00, which is near a long-term trend line of higher lows. However, the Point & Figure chart for ASML is bearish with a $67.00 target.

- Suggested Positions -

Long Jun $80 (ASML1421F80) entry $2.60*

05/06/14 triggered @ 79.85
*option entry price is an estimate since the option did not trade at the time our play was opened.

chart:

Entry on May 06 at $79.85
Average Daily Volume = 1.4 million
Listed on April 30, 2014


Acuity Brands, Inc. - AYI - close: 119.93 change: +0.69

Stop Loss: 121.75
Target(s): 112.00
Current Option Gain/Loss: -16.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
05/10/14: AYI fell to new relative lows on Friday. The plan was to buy puts at $118.75 but AYI actually gapped down at $118.51. Unfortunately the stock bounced after slipping to an intraday low of $116.77. AYI rebounded back toward prior support and what should be new resistance at the $120.00 mark.

Our trade is open but I would watch for this bounce to fail before initiating new positions.

Earlier Comments:
Our target is $112.00. More aggressive traders could aim lower since the Point & Figure chart for AYI is bearish with a $98 target.

- Suggested Positions -

Long Jun $115 PUT (AYI14R115) entry $2.80

05/09/14 triggered on gap down at $118.51, suggested entry point $118.75

chart:

Entry on May 09 at $118.51
Average Daily Volume = 375 thousand
Listed on May 08, 2014


Fluor Corp. - FLR - close: 75.10 change: -0.18

Stop Loss: 75.55
Target(s): to be determined (possibly $67.00)
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

Comments:
05/10/14: FLR is still churning sideways between support at $74.00 and resistance at its trend of lower highs. This pattern is bearish and should produce a breakdown soon.

Earlier Comments:
I am suggesting a trigger to buy puts at $73.25. We're not setting an exit target yet but I am tentatively aiming for the $67 area. The Point & Figure chart for FLR is bearish with a $64 target.

Trigger @ $73.25

- Suggested Positions -

Buy the Jun $72.50 PUT (FLR1421R72.5) current ask $1.20

chart:

Entry on May -- at $---.--
Average Daily Volume = 1.2 million
Listed on May 05, 2014


LinkedIn Corp. - LNKD - close: 148.69 change: + 3.62

Stop Loss: 155.25
Target(s): to be determined
Current Option Gain/Loss: -27.6%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/10/14: It was a painful week for internet-related stocks. LNKD has seen a $12 bounce off its intraday low from Wednesday. Thus far the bounce has been failing at short-term technical resistance at its simple 10-dma. If LNKD can push up through the $150 level it will probably sprint toward $155 or even $160. Currently our stop loss is at $155.25. I am not suggesting new positions at this time.

Earlier Comments:
Traders should consider this an aggressive, higher-risk trade due to LNKD's volatility. The stock can see big swings. Many of its bounces within the current down trend are $20-$30 each. I suggest small positions to limit risk.

*small positions* - Suggested Positions -

Long Jun $140 PUT (LNKD1421R140) entry $7.05

05/06/14 new stop @ 155.25
05/05/14 trade opens. LNKD gapped down at $144.40
(the whole market gapped/spiked down at the open and then bounced)

chart:

Entry on May 05 at $144.40
Average Daily Volume = 3.8 million
Listed on May 03, 2014


CLOSED BEARISH PLAYS

Omnicom Group - OMC - close: 67.66 change: +1.46

Stop Loss: 67.55
Target(s): 60.50
Current Option Gain/Loss: -41.8%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/10/14: OMC's business and its stock price was starting to suffer from an increasingly contentious merger with its rival Publicis. Investors applauded the surprising news on Friday morning that OMC and Publicis were canceling their $35 billion "merger of equals".

The stock reacted with a big bounce that erased several days worth of losses. Our stop loss was hit at $67.55.

- Suggested Positions -

Jul $65 PUT (OMC1419S65) entry $2.65 exit $1.54* (-41.8%)

05/09/14 stopped out after OMC canceled merger plans
*option exit price is an estimate since the option did not trade at the time our play was closed.
05/07/14 triggered @ 65.75

chart:

Entry on May 07 at $65.75
Average Daily Volume = 2.0 million
Listed on May 06, 2014