Editor's Note:

The SOX index tagged its upward trend line and is still above its 20-day SMA. We remain bullish on our positions in this sector and have also added a bearish play in the real estate sector to take advantage of any market declines.

Current Portfolio:


BULLISH Play Updates

AU Optronics - AUO - close: 11.29 change: -0.28 stop: 10.90

AUO continued its decline today but there are encouraging signs the stock could bounce from here. AUO traded down to $11.19 early in the session which was essentially the same low as last week. This level is also near to the 50-day SMA. The 50-day SMA coupled with a potential double bottom pattern is enough for me to keep this trade open. However, if the stock cannot hold the $11.00 area you should exit the trade to preserve capital. Readers who have not initiated positions may want to consider doing so if the stock trades above $11.36 which would clear intraday resistance from today's sell-off. Our first target is $13.25. This set-up also offers an attractive 4:1 risk/reward ratio, risking $0.46 to make $1.89. FYI: The Point & Figure chart is very bullish and forecasts a $21 long-term target. I consider this an aggressive trade and recommend small position size to limit risk.

Current Position: AUO stock @ 11.77

Entry on April 05 at $11.77
Earnings Date 04/22/10 (unconfirmed)
Average Daily Volume: 2.5 million
Listed on April 3rd, 2010


Broadcom Corp. - BRCM - close: 33.70 change: -0.43 stop: 31.75

The SOX semiconductor index was weak today posting a -1.44% decline. BRCM also saw more profit taking. On the bright side, BRCM and the SOX index both bounced off their upward trend lines and BRCM also bounced off its 20-day SMA. In addition, BRCM and the SOX are at the bottom end of their upward channels which have remained intact over the past two months. The stock continues to look poised to rally higher as long as the broader market cooperates. More aggressive traders could use the intraday bounce as a bullish entry point but if you do I would consider a tighter stop loss. Our first target is $34.95. Our second, more aggressive target is $37.40 with a time frame of several weeks.

Current Position: BRCM stock @ 32.66

Entry on March 11 at $32.66
Earnings Date 04/21/10 (unconfirmed)
Average Daily Volume: 8.0 million
Listed on March 10th, 2010


BorgWarner Inc. - BWA - close: 38.03 change: +0.56 stop: 36.90

BWA closed +1.49% higher in today's session. Yesterday we mentioned that "Upon further review we might want to consider buying the stock on a bounce from the $37.00 level and its rising 50-day SMA." BWA did in fact trade down to its 50-day SMA today and then immediately bounced closing near its highs at $38.03. BWA may experience some resistance in this area as it represents previous highs form late March. So if you did take the trade I would tighten up stops to protect your profits.

Officially our trigger to open positions is at $40.25. If triggered our target is $44.75. BWA doesn't move super fast so this could take a few weeks for the stock to get there. Our initial entry point and stop loss set up is somewhat aggressive. More conservative traders may want to use a tighter stop. The Point & Figure chart looks very bullish and is forecasting a long-term $55 target.

Trigger to open bullish positions $40.25

Suggested Position: BWA stock @ 40.25 (unopened)

Option Traders:
Suggested Position: Buy CALL May $40.00 (BWA 10E40.00) current ask $1.15

Entry on April xx at $xx.xx
Earnings Date 04/29/10 (unconfirmed)
Average Daily Volume: 1.8 million
Listed on April 3rd, 2010


Cash America - CSH - close: 40.28 change: +0.05 stop: 38.99

CSH managed to rally almost +2.00% off of its intraday low today. The stock managed to close above its 20-day SMA which keeps me cautiously optimistic in leaving the trade open. We are looking for the stock to bounce from here, however, it needs to prove itself soon or we will be looking for a quick exit on the trade. Conservative traders should consider tightening up stops or selling into strength if the stock starts to rally. Aggressive traders can consider opening positions at current levels. Our first target is $44.90.

Current Position: CSH stock at $41.05

Entry on April 06 at $41.05
Earnings Date 04/22/10 (unconfirmed)
Average Daily Volume: 263 thousand
Listed on April 5th, 2010


Linear Tech. - LLTC - close: 28.56 change: -0.47 stop: 27.70

Traders once again came in and bought the dip near on LLTC today near $28.40 which also corresponds to its 20-day SMA. LLTC looks poised to breakout past short-term resistance near the $29.00 level. If it does we expect the stock to challenge its 2010 highs near $30.00. If you own April options don't forget that they expire in less in 6 trading days. I would recommend selling those options to prevent any further time decay. You should be at break-even or better if LLTC can rally tomorrow. Our first target is $29.95. Our second target is $30.95.

Current Position: LLTC stock @ 28.25

Option Traders:
Current Position: CALL APR 28.00 (LLTC 10D28.00) @ $1.00

Entry on March 16 at $28.25
Earnings Date 04/13/10 (unconfirmed)
Average Daily Volume: 3.9 million
Listed on March 11th, 2010


Patterson Companies - PDCO - close: 30.82 change: -0.24 stop: 29.95

We are waiting for PDCO to breakout to new relative highs. Currently PDCO has resistance near $31.30. I am suggesting we open bullish positions at $31.50. If triggered we'll use a stop at $29.95. Our multi-week target is the $34.50 level.

Trigger to open bullish positions at $31.50

Suggested Position: PDCO stock at $31.50(unopened)

Entry on April xx at $xx.xx
Earnings Date 05/17/10 (unconfirmed)
Average Daily Volume: 975 thousand
Listed on April 6th, 2010



BEARISH Play Updates

Corrections Corp. of America - CXW - close: 19.60 chg: +0.05 stop: 20.55*new*

CXW had a rather quiet day closing marginally higher. The stock seems to have found support just over the $20.00 area. It also has its 20-day and 50-day SMA's overhead. We are looking for CXW to break through $20.00 which should give us a good chance of hitting our target of $18.00.

Current Position: SHORT CXW stock @ 19.90

Entry on March 19 at $19.90
Earnings Date 05/06/10 (unconfirmed)
Average Daily Volume: 1.1 million
Listed on March 17th, 2010


MAXIMUS Inc. - MMS - close: 61.55 change: +0.37 stop: 62.11

I do not see any changes from our prior comments other than the stock peaked its head out to a new 52- week intraday high today before retreating slightly. If MMS keeps knocking on the $62 resistance level, the door should eventually open. But for now MMS remains stuck inside its $60.00-62.00 range. However, shares appear to be coiling more tightly and inching toward a breakout higher. We have two different triggers - one for a bullish trade and one for a bearish trade.

If MMS hits our bearish trigger for shorts at $59.80 our target is $55.25.

If MMS hits our bullish trigger at $62.25 our target is $67.00. I do need to label this trade somewhat aggressive since we normally do not trade stocks with average volume under 250K a day.

TWO TRIGGERS, One Bearish, One Bullish

Trigger for bearish positions at $59.80

Suggested Position: (SHORT) MMS stock at $59.80 (unopened)

Trigger for bullish positions @ 62.25

Suggested Position: BUY MMS stock at $62.25 (unopened)

Entry on April xx at $59.80 (unopened)
Earnings Date 05/06/10 (unconfirmed)
Average Daily Volume: 83 thousand
Listed on March 31st, 2010


Warner Chilcott - WCRX - close: 25.78 change: -0.54 stop: 26.26

WCRX has been bouncing off of the $25.00 level since late January. The stock appears to have formed a new lower high and may be forming a descending triangle. Its 20-day, 50-day, and 100-day SMA are all overhead. We're still waiting for a breakdown under support at $25.00 but will need the overall market to cooperate.

I am suggesting we use a trigger to open bearish positions at $24.80. If triggered our first target is $22.60. The 200-dma is nearing the $22.50 region and could offer technical support. Our second, more aggressive target is the $20.25 mark.

Trigger to open bearish positions @ 24.80

Suggested Position: SHORT WCRX stock at $24.80 (unopened)

Option Traders:
BUY the April $25.00 PUT (WCRX 10P25.00) current ask $0.50

Entry on March xx at $xx.xx
Earnings Date 05/11/10 (unconfirmed)
Average Daily Volume: 1.5 million
Listed on March 29th, 2010


CLOSED BULLISH PLAYS

Palomar Medical Tech. - PMTI - close: 11.21 change: -0.12 stop: 10.80

PMTI traded down to exactly $10.80 early in the session which triggered stops on any remaining shares. The stock was immediately bought and shares closed at $11.21. PMTI already hit our first target at $11.45 on 3/22/10 which was a nice +8.50% gain.

Stopped out

Closed Position: PMTI stock @ $10.80, Entry was @ $10.55

1st Target Hit (03/22/10) @ $11.45

Entry on March 16 at $10.55
Earnings Date 04/29/10 (unconfirmed)
Average Daily Volume: 132 thousand
Listed on March 13th, 2010