Editor's Note:
The rally continues for chip stocks and banks turn up the heat with big gains. Cautious traders may want to consider early exits in LRCX and WFC to lock in gains.

-James

Current Portfolio:


BULLISH Play Updates

Alcoa Inc - AA - close: 14.15 change: +0.01

Stop Loss: 12.90
Target(s): 14.95, 15.95
Current Option Gain/Loss: + 7.3%
Time Frame: 8 to 10 weeks
New Positions: Yes, but see below

Comments:
12/09 update: AA is going nowhere fast. Shares closed virtually unchanged again. The bearish reversal from Dec. 7th could still be in effect even though AA hasn't seen any follow through yet. The bigger picture is still bullish for AA. Look for a dip toward $13.60. I would consider new positions on a dip near the $13.60-13.50 zone. (If we do see another entry point we might consider buying some 2011 call options).

Current Position: Long AA stock @ 13.18

Entry on November 16 at $13.18
Earnings Date 01/10/11 (unconfirmed)
Average Daily Volume: 26.1 million
Listed on November 6th, 2010


Alaska Air Group - ALK - close: 56.37 change: +0.34

Stop Loss: 51.90
Target(s): 59.75
Current Option Gain/Loss: + 2.6%
Time Frame: 8 to 9 weeks
New Positions: see below

Comments:
12/09 update: It was another lackluster session for ALK. Shares slowly drifted higher. While the path of least resistance seems to be higher I remain cautious on ALK. I would hesitate to launch new positions at the moment. More conservative traders might want to consider a stop closer to $54.

Current Position: Long ALK stock @ $54.91

- or -

Long the 2011 January $60 calls (symbol: ALK1122A60) entry @ $1.60

Entry on November 22 at $54.91
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume: 331 thousand
Listed on November 20th, 2010


American Express - AXP - close: 45.81 change: +0.18

Stop Loss: 41.49
Target(s): 47.50, 49.85
Current Option Gain/Loss: unopened
Time Frame: 10 to 12 weeks
New Positions: Yes, see trigger

Comments:
12/09 update: Financials were the best performing sector on Thursday. Yet AXP's +0.3% gain significantly underperformed the 2.2% gains in the banking indices. There is no change from my previous comments. I'm suggesting we launch bullish positions on a dip at $43.50. If triggered we'll use a stop loss at $41.49, under the 200-dma. We will plan on taking profits at $47.50 and at $49.85. Our time frame is several weeks.

Trigger @ $43.50 Suggested Position: Buy AXP stock at $43.50

- or -

Buy the 2011 April $45 calls (AXP1116D45)

Entry on December xx at $xx.xx
Earnings Date 01/20/11 (unconfirmed)
Average Daily Volume: 9.0 million
Listed on December 2nd, 2010


Citigroup Inc - C - close 4.69 change +0.05

Stop Loss: 4.08
Target(s): 4.60, 4.85
Current Option Gain/Loss: +12.7%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/09 update: Citigroup is still melting higher, extending its gains to 8 out of the last 9 sessions. This stock is overbought and due for some profit taking. I am not suggesting new positions at this time.

Current Position: Long C stock, entry was at $4.16

12/07: Target achieved @ $4.60 (+10.5%)
12/04 Exit the December $4.00 calls (+40%)

Entry on October 27, 2010
Earnings Date 01/19/11 (unconfirmed)
Average Daily Volume: 523 million
Listed on October 25, 2010


Companhia Brasileira de Distribuicao - CBD - close: 40.01 change: -0.58

Stop Loss: 36.75
Target(s): 44.95, 49.00
Current Option Gain/Loss: - 0.6%
Time Frame: 10 to 12 weeks
New Positions: Yes, see below

Comments:
12/09 update: Uh-oh! CBD has seen two down days in a row. That's been relatively uncommon of late. Shares are now testing potential support near $40.00. If this level fails look for additional support near $39 and its 50-dma. I would consider new positions here near $40 or at $39 but readers may want to wait for a bounce first! More conservative traders may want to consider a stop loss closer to $38.00. We have a wide stop because CBD can be so volatile. Bear in mind this is a higher-risk trade.

Current Position: Long CBD stock @ $40.25

Entry on November 23 at $40.25
Earnings Date 03/02/11 (unconfirmed)
Average Daily Volume: 608 thousand
Listed on November 20th, 2010


City National Corp. - CYN - close: 59.06 change: +0.60

Stop Loss: 52.95
Target(s): 58.00, 60.00+
Current Option Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
12/09 update: The banking sector's sprint higher continues. We still don't want to chase this move but we might need to reconsider our entry point strategy. Currently the plan is to buy CYN (or calls) at $55.50. FYI: The Point & Figure chart is bullish with a $71 target.

Trigger @ $55.50

Suggested Position: buy CYN stock @ $55.50

- or -

Buy the 2011 February $60 calls (cyn1119B60) current ask $1.90*

*Caution: most of the option spreads on CYN seem a little too wide. I consider the options a more aggressive trade. You may want to keep your position size small.

Entry on December xx at $xx.xx
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume: 223 thousand
Listed on December 4th, 2010


Hansen Natural Corp. - HANS - close: 50.10 change: -0.94

Stop Loss: 48.95
Target(s): 54.90, 57.45
Current Option Gain/Loss: - 1.7%
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
12/09 update: Okay, now I'm worried. HANS tried to bounce this morning but didn't get very far. Shares closed under technical support at the 50-dma. Yet managed to stay above round-number, psychological support at $50.00 - at least for now. While I would normally consider this dip to $50 as a new bullish entry point readers may want to wait for some sign of a bounce first before initiating positions.

Current Position: Long HANS stock @ $51.00

- or -

Long the January $55.00 calls (HANS1122A55) Entry @ $0.65

Entry on December 8th @ $51.00
Earnings Date 11/04/10 (confirmed)
Average Daily Volume: 750 thousand
Listed on October 16, 2010


Lam Research - LRCX - close: 51.27 change: +1.06

Stop Loss: 45.90
Target(s): 48.50, 52.50
Current Option Gain/Loss: +13.3%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
12/09 update: Wow! The semis continue to post gains. LRCX outperformed its peers with a +2.1% gain. We need to be ready to exit. The SOX closed at 416 and should find resistance in the 420-430 zone dating back to 2008. Odds are good the SOX could see its rally stall and reverse near 420. In the meantime LRCX just grows more and more overbought. I am not suggesting new bullish positions at this time. Feel free to exit at any time here! Cautious traders will want to seriously consider exiting tomorrow (Friday) before the closing bell. Officially our final exit target is $52.50. FYI: I am raising our stop loss to $45.90.

Current Position: Long LRCX stock @ 45.25
- or -
Current Position: Long the 2011 January $45 calls (LRCX1122A45) Entry @ $2.85

12/09 New stop loss $ $45.90
12/04 New stop loss @ $44.90
12/02 Target hit @ $48.50, LRCX +7.2%, option @ $4.55 (+59.5%)

Entry on November 30 at $45.25
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume: 4.5 million
Listed on November 18th, 2010


Microsoft Corp. - MSFT - close: 27.08 change: -0.15

Stop Loss: 24.70
Target(s): 27.45, 29.00
Current Gain/Loss: + 5.9%
Time Frame: 8 to 10 weeks
New Positions: Yes, see below

Comments:
12/09 update: MSFT's early morning gap higher quickly failed. There is no change from my prior comments. I would still expect a pull back before shares breakout past $27.50. Wait for a dip toward the $26.00-25.50 zone before considering new positions.
FYI: We may need to adjust our time frame and focus on three or four months for MSFT to pay off. If you're buying calls, keep that in mind.

Current Position: Long MSFT stock @ 25.55

- or -

Buy the 2011 January $25.00 calls (symbol: MSFT1122A25) Entry @ $1.39

11/29/10 New stop @ 24.70

Entry on November 17 at $25.55
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume: 68.4 million
Listed on November 15th, 2010


Peir 1 Imports - PIR - close: 10.46 change: +0.03

Stop Loss: 9.15
Target(s): 11.90
Current Option Gain/Loss: + 2.1%
Time Frame: 10 to 12 weeks
New Positions: See below

Comments:
12/09 update: PIR traded sideways in a narrow range. There is no change from my prior comments. I would still expect a retracement to the $10.00 level. If the market sees any sharp declines then PIR could hit $9.50. Wait for the dip or a bounce from these level before considering new positions.

Investors should know that PIR is due to report earnings on December 16th. We plan to hold over that event. I consider holding over the earnings announcement a high-risk event. Keep that in mind as you plan your trades.

Current Position: Long PIR stock @ $10.24

- or

Buy the 2011 March $10.00 calls (PIR1119C10) Entry @ $1.55

Entry on December 2 at $10.24
Earnings Date 12/16/10 (confirmed)
Average Daily Volume: 2.3 million
Listed on December 1st, 2010


Starbucks Corp. - SBUX - close: 32.40 change: -0.18

Stop Loss: 29.90
Target(s): 34.75
Current Option Gain/Loss: unopened
Time Frame: 8 to 10 weeks
New Positions: Yes, see trigger

Comments:
12/09 update: SBUX saw a little bit of profit taking today. I'm hoping it continues for another couple of days. We want to launch bullish positions on a dip at $31.25. If triggered our first target is $34.75. I should mention that SBUX is currently in a legal battle with Kraft Foods (KFT) over distribution of SBUX's ground coffee brand but investors seem to be ignoring it.
FYI: The Point & Figure chart is very bullish with a long-term target of $54.

Trigger @ $31.25

Suggested Position: Buy SBUX stock @ $31.25

- or -

Buy the 2011 January $32.00 call (SBUX1122A32)
Buy the 2011 April $33.00 call (SBUX1116D33)

Entry on December xx at $xx.xx
Earnings Date 01/20/11 (unconfirmed)
Average Daily Volume: 7.1 million
Listed on December 8th, 2010


Sara Lee Corp - SLE - close: 15.84 change: +0.25

Stop Loss: 14.70
Target(s): 17.00, 17.90
Current Option Gain/Loss: + 1.0%
Time Frame: 10 to 12 weeks
New Positions: Yes, see below

Comments:
12/09 update: SLE is showing relative strength again. Shares gained +1.6% to set a new two-year closing high. If you're looking for a new position I would prefer to buy a dip near $15.50.
FYI: the Point & Figure chart is suggesting a long-term bullish target of $32 for SLE.

Current Position: Long SLE stock @ $15.68

- or -

Long the 2011 April $15.00 calls (SLE1116D15) Entry @ $1.35

Entry on December 8 at $15.68
Earnings Date 02/03/11 (unconfirmed)
Average Daily Volume: 7.6 million
Listed on December 7th, 2010


Sony Corp. - SNE - close: 36.20 change: -0.16

Stop Loss: 33.45
Target(s): 36.50, 39.00
Current Option Gain/Loss: unopened
Time Frame: 10 to 12 weeks
New Positions: Yes, see trigger

Comments:
12/09 update: SNE is still drifting sideways. There is no change from my previous comment. The stock is still consolidating sideways above $36.00 but it looks like the stock could correct soon. We want to see a dip toward $34.00. Our trigger to open bullish positions is $34.50.

Trigger @ $34.50

Suggested Position: Buy SNE stock
- or -
Buy the 2011 APRIL $35 calls (SNE1116D35) current ask $2.45

Entry on December xx at $xx.xx
Earnings Date 02/03/11 (unconfirmed)
Average Daily Volume: 888 thousand
Listed on November 23rd, 2010


Tractor Supply Co. - TSCO - close: 46.81 change: +0.63

Stop Loss: 39.90
Target(s): 47.50
Current Option Gain/Loss: unopened
Time Frame: 8 to 10 weeks
New Positions: Yes, see trigger

Comments:
12/09 update: Don't chase this move in TSCO. We are waiting for a correction. Currently the plan is to launch bullish positions at $43.00.

Buy-the-Dip Trigger @ $43.00

Suggested Position: Buy TSCO stock
- or -
Buy the 2011 January $45 calls (symbol:TSCO1122A45)

Entry on December xx at $xx.xx
Earnings Date 01/27/11 (unconfirmed)
Average Daily Volume: 751 thousand
Listed on November 11th, 2010


Trimble Navigation - TRMB - close: 41.02 change: +0.34

Stop Loss: 36.40
Target(s): 41.00, 43.00
Current Option Gain/Loss: unopened
Time Frame: 8 to 10 weeks
New Positions: Yes, see trigger

Comments:
12/09 update: TRMB extended its gain and managed to close over $41.00, a feat not seen since 2007. There is no change from my prior comment. The stock is short-term overbought and due for some profit taking. I am suggesting we wait for a dip to $38.50 and then open positions. If triggered we'll use a stop loss at $36.40. Our first target is $41.00. FYI: The Point & Figure chart is bullish with a $65 target for TRMB.

Trigger @ $38.50

Suggested Position: Buy TRMB stock @ $38.50

- or -

Buy the 2011 February $40.00 calls (TRMB1119B40) current ask $2.35

Entry on December xx at $xx.xx
Earnings Date 02/02/11 (unconfirmed)
Average Daily Volume: 435 thousand
Listed on December 4th, 2010


Wells Fargo & Co - WFC - close: 30.07 change: +0.70

Stop Loss: 27.90
Target(s): 29.25, 31.90
Current Option Gain/Loss: +11.8%
Time Frame: 10 to 12 weeks
New Positions: see below

Comments:
12/09 update: Banking stocks were the best performers on Thursday. WFC certainly did its part in the rally with a +2.3% gain. Shares closed over the $30.00 level but I want to caution readers that the $30.25-30.30 zone could be overhead resistance. Fortunately, broken resistance near $29.25 should be new support. I am not suggesting new positions at this time. Please note our new stop loss at $27.90. Our final target to exit is $31.90.

Current Position: Long WFC stock @ $26.88

- or -

Long the 2011 January $27.50 call (WFC1122A27.5) Entry @ $1.16

12/09: New stop loss @ $27.90
12/08: Target Hit $29.25 (+8.8%), Option @ $2.30 (+98.2%)

Entry on November 30 at $26.88
Earnings Date 01/19/11 (unconfirmed)
Average Daily Volume: 32.7 million
Listed on November 29th, 2010