NEW BULLISH Plays

Asbury Automotive Group - ABG - close: 34.59 change: +0.98

Stop Loss: 33.40
Target(s): 38.50
Current Gain/Loss: unopened

Entry on January -- at $--.--
Listed on January 23, 2012
Time Frame: Exit PRIOR to earnings on Feb. 19th
Average Daily Volume = 275 thousand
New Positions: Yes, see below

Company Description

Why We Like It:
ABG is a chain of automotive dealerships across the U.S. The stock has been showing strength as traders continue to buy the dips. Now ABG is on the verge of breaking out to new all-time, record highs. The early January high was $35.07. I am suggesting a trigger to open small bullish positions at $35.25. If triggered our target is $38.50 but we will plan on exiting prior to the Feb. 19th earnings report.

Please note that we do want to keep our position size small to limit our risk.

Trigger @ 35.25 *Small positions*

Suggested Position: buy ABG stock @ (trigger)

Annotated chart:



NEW BEARISH Plays

Multi-Fineline Electronix - MFLX - close: 15.49 change: -0.10

Stop Loss: 15.55
Target(s): 12.65
Current Gain/Loss: unopened

Entry on January -- at $--.--
Listed on January 23, 2012
Time Frame: exit PRIOR to earnings on Feb. 7th
Average Daily Volume = 108 thousand
New Positions: Yes, see below

Company Description

Why We Like It:
MFLX makes flexible printed circuit boards and other electronic components. The huge drop a couple of weeks ago was market reaction to the company's earnings warning. Actually the warning was about margins, which are expected to contract from 12.2% a year ago down to about 8.5% in its Q1. Management actually raised their revenue estimates but that didn't help and the stock was crushed. Now MFLX is nearing its 2012 lows set in November near $15.12.

The most recent data available does not show a lot of short interest but that could be out of date. Hypothetically, even if there was not a lot of short interest I would still be cautious when it comes to position size because MFLX only has 8.7 million shares in its float. Therefore, if you choose to open positions, I would keep them small.

We want to wait for a breakdown under $15.00. If MFLX breaks below $15.00 the next levels of support appear to be $12.50 and $10.00. I am suggesting a trigger to open bearish positions at $14.85. If triggered our target is $12.65.

NOTE: We may have to abandon this play early, since we normally do not hold over a company's earnings report and MFLX is scheduled to report on Feb. 7th.

Trigger @ 14.85 *Small Positions*

Suggested Position: short MFLX stock @ (trigger)

Annotated chart: