NEW BULLISH Plays

Prudential Financial - PRU - close: 49.14 change: +1.59

Stop Loss: 47.49
Target(s): 53.00
Current Gain/Loss: unopened
Time Frame: exit prior to the Aug. 1st earnings report.
New Positions: Yes, see below

Company Description

Why We Like It:
PRU appears to be building a bottom over the last eight weeks. You could almost call it a bullish double bottom with the June lows. PRU was showing relative strength on Friday with a +3.3% gain and a breakout past the 50-dma. We want to see confirmation and a breakout past resistance.

I am suggesting a trigger to launch positions at $49.50. Please note that the $50.00 level could still be round-number resistance so more conservative traders may want to use a trigger above the $50.00 mark. Our target is $53.00 but we'll plan to exit ahead of the August 1st earnings report.

Trigger @ 49.50

Suggested Position: buy PRU stock @ (trigger)

- or -

buy the Aug $50 call (PRU1218H50) current ask $1.31

Annotated chart:

Entry on July xx at $ xx.xx
Earnings Date 08/01/12 (confirmed)
Average Daily Volume = 3.0 million
Listed on July 14, 2011


NEW BEARISH Plays

Harley-Davidson - HOG - close: 43.95 change: +0.42

Stop Loss: 45.25
Target(s): 40.25
Current Gain/Loss: unopened
Time Frame: exit prior to the Aug. 1st earnings
New Positions: Yes, see below

Company Description

Why We Like It:
It looks like HOG has built a big bearish head-and-shoulders top over the last several months. The stock's breakdown under support near $45.00 and now under its 200-dma doesn't help matters. The H&S pattern would suggest a bearish target near $36.00. We think HOG could see a quick drop toward $40 before its earnings report.

I am suggesting bearish positions now at the open on Monday with a stop loss at 45.25. Our target is $40.25. We do not want to hold over the Aug. 1st earnings report. FYI: The Point & Figure chart for HOG is bearish with a $35.00 target.

Suggested Position: short HOG stock @ (the open)

- or -

buy the Aug $42 PUT (HOG1218T42) current ask $1.57

Annotated chart:

Entry on July xx at $ xx.xx
Earnings Date 08/01/12 (confirmed)
Average Daily Volume = 2.2 million
Listed on July 14, 2011