Editor's Note:

Stocks produced a relief rally thanks to news of a "resolution" for the Greek debt problem. Details of the EU aid package were few and far between but that didn't stop stocks from another oversold bounce. We are right back where we were several days ago where stocks look poised to rally higher but have stalled at short-term resistance.

Nimble traders could try playing the upside with some very short-term trades but I suspect this bounce will fail and we will eventually use it as a new entry point to launch bearish positions.

Investors are nervous and the one thing Wall Street hates the most is the unknown.


BULLISH Play Updates

Estee Lauder - EL - close: 56.87 change: +0.81 stop: 53.75 *new*

The market's widespread bounce was enough to produce a new closing high for EL but shares are still struggling with resistance near $57.00. The trend is up. The market's bounce may not be over. Traders could risk small bullish positions here. I am inching our stop loss up to $53.75 since the $54.00 level should be support.

We want to keep positions small. Our target is $59.50. Our time frame is three to four weeks. FYI: The Point & Figure chart is forecasting at $69 target.

Entry on  February 06 at $55.40 
Change since picked:     + 0.66   			
Earnings Date          04/27/10 (unconfirmed)    
Average Daily Volume:       2.5 million 
Listed on  February 06, 2009    


Illionois Tool Works - ITW - close: 43.90 change: +0.91 stop: 41.75

The market's bounce certainly didn't hurt ITW. Shares gained 2.1% and they are back above their exponential 200-dma but still struggling with previous resistance near $44.00. I'm bullish but this is an aggressive trade. Keep your positions small. Our first target is $44.85. Our second target is the $46.45 level.

Entry on  February 06 at $42.66 (small positions)
Change since picked:     + 1.24   			
Earnings Date          04/15/10 (unconfirmed)    
Average Daily Volume:       3.6 million 
Listed on  February 06, 2009    


Joy Global - JOYG - close: 47.46 change: +2.17 stop: 42.25

EU leaders announced some sort of agreement to help Greece. There weren't any details but the euro rallied anyway. This pushed the dollar lower and commodities higher. Commodity strength fueled gains for stocks like JOYG. I am short-term bullish but this is an aggressive trade. Keep your positions small to limit risk. Our target to exit is $49.75. The $50.00 level should be resistance. We might consider switching directions and going short on a failed rally near $50.

Entry on  February 06 at $44.54 (small positions)
Change since picked:     + 2.92   			
Earnings Date          02/24/10 (unconfirmed)    
Average Daily Volume:       4.1 million 
Listed on  February 06, 2009    


Patterson Companies - PDCO - close: 28.96 change: +0.10 stop: 27.95

The bounce in PDCO was somewhat disappointing. Traders bought the dip at $28.46, which looks like a new "higher low" but PDCO still has resistance under $29.50. We are down to our last few days. PDCO is due to report earnings on Feb. 18th and we don't want to hold over the report. I'm not suggesting new positions.

Our first target to take some money off the table is $30.90. Our second target is $32.45.

Entry on  February 02 at $29.16 /gap down entry
Change since picked:     - 0.20   			
Earnings Date          02/18/10 (confirmed)    
Average Daily Volume:       1.3 million 
Listed on  February 02, 2009    


BEARISH Play Updates

Ameritrade - AMTD - close: 16.98 change: -0.09 stop: 18.60

Financials struggled to build on yesterday's bounce. AMTD closed in negative territory. I remain bearish but I'm not suggesting new positions at this time. I would look for the rebound to fail near $18.00 before considering new shorts. Our first target is $16.10. Our second target is $15.05. Our time frame is about six weeks.

Entry on   January 28 at $17.88 
Change since picked:     - 0.90   			
Earnings Date          04/21/10 (unconfirmed)    
Average Daily Volume:       6.1 million 
Listed on   January 28, 2009    


Best Buy - BBY - close: 35.65 change: +0.25 stop: 38.75

BBY dipped toward $35.00 again and managed another bounce. Shares are very oversold and testing support. More conservative traders may want to exit completely right here. While the trend is down I am not suggesting new positions at this time. BBY has already hit our first target at $35.25. Our second and final target is $32.25.

Entry on   January 12 at $38.95 (small positions)
Change since picked:     - 3.30
                           /1st target hit @ 35.25 (-9.4%)
Earnings Date          03/25/10 (unconfirmed)    
Average Daily Volume:       8.0 million      
Listed on   January 02, 2009    


Companhia Brasileira de Distribuicao - CBD - cls: 70.10 chg: +0.76 stop: 72.65

The volatility continues. Investors are nervous about this European debt situation and it's producing volatility around the globe. CBD rallied from its 10-dma to close up 1%. I remain bearish with shares under $72.00 and its 50-dma. Our first target is $61.00. Our second target is $56.00. Time frame is several weeks.

Entry on   January 26 at $69.40 (very small positions)
Change since picked:     + 0.70 
Earnings Date          03/03/10 (unconfirmed)    
Average Daily Volume:       261 thousand
Listed on   January 23, 2009    


Rockwell Collins - COL - close: 53.55 change: +0.65 stop: 55.26

The bounce in COL is back on track. Shares closed above their 100-dma. Our plan is to open bearish positions on a bounce at $54.50. More conservative traders can wait for the bounce to fail and roll over under the 50-dma (near 55.23). If triggered at $54.50 our first target is $50.25. More aggressive traders may want to aim for the 200-dma currently near $48.00. Our time frame is less than three weeks.

Entry on  February xx at $xx.xx <-- TRIGGER @ 54.50
Change since picked:     + 0.00   			
Earnings Date          04/28/10 (unconfirmed)    
Average Daily Volume:       834 thousand
Listed on  February 09, 2009    


FISERV Inc. - FISV - close: 46.44 change: +0.91 stop: 47.26

FFIV has broken out from its $45-46 range and is nearing resistance at its 200-dma. We are still waiting for a breakdown under support at $45.00. I am suggesting a trigger to open bearish positions at $44.70. If triggered our first target is $40.15.

Entry on  February xx at $xx.xx <-- TRIGGER @ 44.70
Change since picked:     + 0.00   			
Earnings Date          04/29/10 (unconfirmed)    
Average Daily Volume:       1.4 million  
Listed on  February 00, 2009    


GATX Corp. - GMT - close: 26.39 change: +0.21 stop: 27.65

The rebound in GMT was pretty mild and shares remain inside their recent range. I am suggesting readers wait for a drop under $25.65 before considering new positions.

Our first target is $23.15. Our second target is $21.00. It could take several weeks to get there.

Entry on  February 04 at $25.95 
Change since picked:     + 0.44   			
Earnings Date          04/22/10 (unconfirmed)    
Average Daily Volume:       467 thousand
Listed on  February 04, 2009    


Life Technologies - LIFE - close: 47.92 change: +0.57 stop: 52.01

The oversold bounce in LIFE has produced a mini bullish engulfing pattern. I would expect a bounce toward its 100-dma or the $50.00 level. Our target to take profits is at $45.55. More aggressive traders could aim lower but the 200-dma is probably support.

Entry on   January 30 at $49.71 
Change since picked:     - 1.79   			
Earnings Date          01/28/10 (confirmed)    
Average Daily Volume:       2.6 million 
Listed on   January 30, 2009    


SBA Communications - SBAC - close: 33.81 change: +0.57 stop: 35.05

If we count the intraday rebound on February 5th the bounce in SBAC is now five days old. Shares are nearing resistance at $34.00 and their 50-dma. Look for the rebound to stall soon, which we can use as a new entry point. Our target is $30.15. More aggressive traders could aim for the 200-dma.

Entry on   January 28 at $33.45
Change since picked:     + 0.36   			
Earnings Date          02/25/10 (unconfirmed)    
Average Daily Volume:       1.5 million 
Listed on   January 26, 2009    


J.M.Smucker CO - SJM - close: 59.70 change: -0.01 stop: 61.51

SJM did not participate very much in the market's strength. Shares did bounce from last week's lows near $59.00. We can still open positions now but we might want to wait for another failed rally near the 50-dma before initiating new positions. Our target is $55.15.

Entry on  February 05 at $59.49
Change since picked:     - 0.23   			
Earnings Date          02/24/10 (unconfirmed)    
Average Daily Volume:       698 thousand
Listed on   January 30, 2009    


Warner Chilcott - WCRX - close: 25.94 change: +0.48 stop: 28.05

WCRX is seeing an oversold bounce from support near $25.00 and its 100-dma. Today's gain has broken the very short-term trend of lower highs. More conservative traders may want to exit early now and consider jumping back in on a failed rally near the 50-dma. I'm not suggesting new positions at this time. WCRX has already hit our first target at $25.00. Our second target is $22.25.

Entry on   January 30 at $26.65 /gap down entry point
Change since picked:     - 0.71
                             /1st target hit @ 25.00 (-6.1%)
Earnings Date          02/26/10 (unconfirmed)    
Average Daily Volume:       1.3 million 
Listed on   January 30, 2009    


WIPRO Ltd - WIT - close: 20.54 change: +0.51 stop: 22.15

The oversold bounce continues and WIT has now clearly closed above support/resistance at $20.00 and its 100-dma. I am expecting an oversold bounce toward the $21.00-21.50 zone. Our plan is to open bearish positions at $20.95. If we are triggered at $20.95 our first target is $18.05.

Entry on  February xx at $xx.xx <-- TRIGGER @ 20.95
Change since picked:     + 0.00   			
Earnings Date          04/22/10 (unconfirmed)    
Average Daily Volume:       934 thousand
Listed on  February 00, 2009    


CLOSED BEARISH PLAYS

American Tower Corp. - AMT - close: 42.52 change: +0.93 stop: 42.75

As of yesterday it looked like the oversold bounce was losing steam. Not true! The rally surged again with a breakout past $42.00 and its 50-dma. The move over resistance was enough to hit our stop loss at $42.75 and close this play. Personally I would keep AMT on your watch list. I don't trust this bounce.

chart:

Entry on   January 27 at $41.90
Change since picked:     + 0.85 <-- stopped @ 42.75 (+2.0%)
                          /1st target hit @ 40.10 (-4.2%)
Earnings Date          02/24/10 (unconfirmed)    
Average Daily Volume:       2.8 million 
Listed on   January 26, 2009    


F5 Networks - FFIV - close: 53.71 change: +3.75 stop: 52.55

FFIV does not have a lot of short interest (less than 4%) but today's action certainly looks like a short squeeze. I could not find any news to account for today's 7.5% rally in FFIV. Weird days like today can make you wonder about market manipulation. FFIV soared through resistance near $52.00, resistance at its 50-dma and kept right on going. The stock hit our stop loss at $52.55.

chart:

Entry on   January 29 at $49.45 
Change since picked:     + 3.10 <-- stopped @ 52.55 (+6.2%)
Earnings Date          04/22/10 (unconfirmed)    
Average Daily Volume:       1.2 million 
Listed on   January 28, 2009