NEW BULLISH Plays

iShares China Large Cap ETF - FXI - close: 38.14 change: +0.42

Stop Loss: 36.70
Target(s): 41.75
Current Gain/Loss: unopened

Entry on October -- at $--.--
Listed on October 10, 2013
Time Frame: 6 to 9 weeks
Average Daily Volume = 17.6 million
New Positions: Yes, see below

Company Description

Why We Like It:
The FXI is the large cap Chinese company ETF that tracks the FTSE China 25 index. There is always a lot of opinion about China. Lately there seems to have been a resurgence in warnings that China's economy might be slowing down too fast again. There is no consensus and some analysts believe China's economy is actually improving. If the action in the FXI is any indication then investors seem to be bullish.

The FXI has been respecting its three-month trend line of support with traders buying the dips this past week. If this trend continues we could see the FXI make a run at its 2013 highs near $42.00.

I am suggesting a trigger to open bullish positions at $38.25. There is a good chance that the FXI might gap open above our trigger and that's okay. This ETF might see some short-term resistance in the $39.25 area and the $40.00 level but our multi-week target is $41.75.

Trigger @ 38.25

Suggested Position: buy the FXI (ETF) @ (trigger)

- (or for more adventurous traders, try this option) -

buy the 2014 Jan $40 call (FXI1418a40) current ask $0.96

Annotated chart:



HEALTHSOUTH Corp. - HLS - close: 36.10 change: +0.79

Stop Loss: 34.75
Target(s): 39.75
Current Gain/Loss: unopened

Entry on October -- at $--.--
Listed on October 10, 2013
Time Frame: exit PRIOR to earnings on Oct. 28th
Average Daily Volume = 459 thousand
New Positions: Yes, see below

Company Description

Why We Like It:
HLS is in the healthcare sector. The company provides specialized rehabilitative treatment. The stock has been showing consistent relative strength. HLS was relatively unaffected by the market's sell-off from its September highs. Instead HLS has managed to keep the rally going and is now up six weeks in a row. Today saw HLS breakout past short-term resistance at $36.00 and set a new closing high.

I am suggesting a trigger to open bullish positions at $36.25. If triggered our target is $39.75 but we do not want to hold over the earnings report scheduled for October 28th.

Trigger @ 36.25

Suggested Position: buy HLS stock @ (trigger)

Annotated chart: