Editor's Note:
Both of our new candidates have been showing relative strength.

-James


NEW BULLISH Plays

Alaska Air Group - ALK - close: 55.03 change: +0.89

Stop Loss: 59.50
Target(s): 51.90
Current Option Gain/Loss: unopened
Time Frame: 8 to 9 weeks
New Positions: Yes

Company Description:
Alaska Airlines and Horizon Air, subsidiaries of Alaska Air Group, together serve more than 90 cities through an expansive network in Alaska, the Lower 48, Hawaii, Canada and Mexico. Alaska Airlines ranked "Highest in Customer Satisfaction Among Traditional Network Carriers" in the J.D. Power and Associates 2008, 2009 and 2010 North America Airline Satisfaction Studies(SM). For reservations, visit alaskaair.com (source: company press release or website)

Why We Like It:
There are plenty of analysts that would argue the U.S. airline industry has some serious flaws but there is no denying the sector's strength this year. I like ALK because shares have broken out to new highs this month and the recent consolidation appears to be ending. I am suggesting bullish positions now with a stop loss at $51.90. Our first target is $59.50. FYI: The Point & Figure chart is bullish with a $79 target.

Suggested Position: Buy ALK stock @ current levels

- or -

Buy the 2011 January $60 calls (symbol: ALK1122A60)

Annotated chart:

Entry on November 22 at $xx.xx
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume: 331 thousand
Listed on November 20th, 2010


Companhia Brasileira de Distribuicao - CBD - close: 40.69 change: +0.00

Stop Loss: 36.75
Target(s): 44.95, 49.00
Current Option Gain/Loss: unopened
Time Frame: 10 to 12 weeks
New Positions: Yes, see trigger

Company Description:
CBD operates over 1,000 stores throughout Brazil. Stores range from grocery, home appliances and products, apparel, and more.

Why We Like It:
The growing economy and middle class of Brazil has been a huge boon for CBD. The stock is currently trading at all-time highs and recently completed a stock split. I am tempted to buy the stock now but if we're patient I suspect we'll see a better entry point on a dip into the $39-40 zone. I am suggesting a trigger to launch bullish positions at $40.25. We'll use a relatively wide (aggressive) stop loss at $36.75 because CBD shares can be somewhat volatile. If triggered at $40.25 our first target is $44.95. My time frame is two to three months.

Suggested Position: Buy CBD stock @ $40.25

Annotated chart:

Entry on November xx at $xx.xx
Earnings Date 03/02/11 (unconfirmed)
Average Daily Volume: 608 thousand
Listed on November 20th, 2010