Editor's Note:
The stock market's rally is looking a little bit tired. A pull back would be a welcome event since we would like to buy a dip. We had both Citigroup (C) and LRCX hit our final exit targets today. Plus, WWE hit our trigger to open bullish positions.

-James

Current Portfolio:


BULLISH Play Updates

Alcoa Inc - AA - close: 14.36 change: +0.11

Stop Loss: 12.90
Target(s): 14.95, 15.95
Current Option Gain/Loss: + 8.9%
Time Frame: 8 to 10 weeks
New Positions: Yes, but see below

Comments:
12/13 update: Weakness in the dollar fueled gains in the commodity space and AA added +0.77% but the rally stalled at last week's highs. I don't see any changes from my weekend comments. There is short-term support at $14.00 but I would wait for a dip near $13.60 before considering new positions. (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: 56.49 change: -0.46

Stop Loss: 53.90
Target(s): 59.75
Current Option Gain/Loss: + 2.8%
Time Frame: 8 to 9 weeks
New Positions: see below

Comments:
12/13 update: Airline stocks were underperformers today and the XAL index looks poised to breakdown under its 50-dma. That could be bad news for ALK. Shares of ALK actually hit new relative highs this morning but if the sector breaks down then ALK could be headed for $55 or lower. I would hesitate to launch new positions at this time.

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: 46.37 change: +0.11

Stop Loss: 41.95
Target(s): 47.50, 49.85
Current Option Gain/Loss: unopened
Time Frame: 10 to 12 weeks
New Positions: Yes, see trigger

Comments:
12/13 update: AXP extended its gains but found new short-term resistance near $46.75 all day long. We are still waiting for a correction. We want to buy AXP or calls on AXP on a dip to $44.50.

Trigger @ $44.50 Suggested Position: Buy AXP stock at $44.50

- 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


Popular Inc. - BPOP - close: 3.03 change: -0.08

Stop Loss: 2.69
Target(s): 3.40, 3.95
Current Option Gain/Loss: unopened
Time Frame: 12 to 16 weeks
New Positions: Yes, see trigger

Comments:
12/13 update: BPOP gapped open higher this morning only to see the rally immediately fail. Shares lost -2.5% and look poised to hit $3.00 tomorrow. I am very tempted to lower our trigger but we will keep our entry point to buy the dip at $3.00. Cautious traders may want to use a trigger at $2.95 or even $2.90 instead. If triggered our first target is $3.40. Our second, much longer-term target is $3.90.

Buy the Dip trigger @ $3.00

Suggested Position: Buy BPOP stock @ $3.00

- or -

Buy the 2011 April $3.00 calls (BPOP1116D3) current ask $0.36

Entry on December xx at $xx.xx
Earnings Date 01/20/11 (unconfirmed)
Average Daily Volume: 11.7 million
Listed on December 11th, 2010


Companhia Brasileira de Distribuicao - CBD - close: 39.96 change: +0.39

Stop Loss: 36.75
Target(s): 44.95, 49.00
Current Option Gain/Loss: - 0.7%
Time Frame: 10 to 12 weeks
New Positions: Yes, see below

Comments:
12/13 update: After the recent correction CBD is bouncing near the rising 40-dma. I would still consider new bullish positions here but there is a decent chance that CBD could dip toward $38 if the market corrects.

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: 60.15 change: -0.09

Stop Loss: 54.75
Target(s): 60.00, 64.00
Current Option Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
12/13 update: CYN tagged a new relative high before consolidating sideways the rest of the day. There is no change from my prior comments. We don't want to chase CYN. The plan is to wait for a dip to $57.00. FYI: The Point & Figure chart is bullish with a $77 target.

Trigger @ $57.00

Suggested Position: buy CYN stock @ $57.00

- or -

Buy the 2011 February $60 calls (cyn1119B60)*

*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


Microsoft Corp. - MSFT - close: 27.25 change: -0.10

Stop Loss: 25.45
Target(s): 27.45, 29.00
Current Gain/Loss: + 6.6%
Time Frame: 8 to 10 weeks
New Positions: Yes, see below

Comments:
12/13 update: MSFT tagged a new relative high and reversed late this afternoon. I'm still expecting a correction. If you're looking for a new entry point I would wait for a dip toward the $26.00 area.
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

12/11/10 New stop @ 25.45
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: 10.65 change: +0.11

Stop Loss: 9.75
Target(s): 11.90
Current Option Gain/Loss: + 4.0%
Time Frame: 10 to 12 weeks
New Positions: No

Comments:
12/13 update: PIR is still inching higher. There is no change from my weekend comment. We have to decide by Wednesday's close if we want to hold over this high-risk event. Currently I am tempted to close this position ahead of the earnings report. I'm not suggesting new positions at this time. Please note that I am raising our stop loss to $9.75.

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: 31.99 change: -0.60

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:
12/13 update: SBUX is finally starting to see some profit taking. I'm expecting a dip toward support near $31.00. We have a trigger to launch bullish positions at $31.25. If triggered our first target is $34.75.

FYI: 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.

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


SAKS Inc. - SKS - close: 11.51 change: -0.41

Stop Loss: 10.90
Target(s): 13.95, 14.95
Current Option Gain/Loss: - 3.9%
Time Frame: 10 to 12 weeks
New Positions: No

Comments:
12/13 update: Ouch! What happened to SKS on Monday? I could not find any specific news to account for this stock's relative weakness. The S&P 500 posted a very minor gain. The RLX retail index only lost 0.7%. Yet SKS gave up -3.4% and failing at the $12.00 level this morning. Today's session has created a bearish engulfing candlestick (reversal) pattern. Normally these patterns need to see confirmation. I am not suggesting new bullish positions at this time. Cautious traders may want to raise their stop loss (maybe toward $11.30-11.40ish).

Suggested Position: Long SKS stock @ $11.98

- or -

Buy the 2011 February $12.50 calls (SKS1119B12.5) Entry @ $0.65

Entry on December 13 at $11.98
Earnings Date 02/22/11 (unconfirmed)
Average Daily Volume: 3.1 million
Listed on December 11th, 2010


Sara Lee Corp - SLE - close: 15.89 change: -0.11

Stop Loss: 14.70
Target(s): 17.00, 17.90
Current Option Gain/Loss: + 1.3%
Time Frame: 10 to 12 weeks
New Positions: see below

Comments:
12/13 update: SLE was hit with some profit taking this morning but traders were buying the dip this afternoon. There is no change from my weekend comments. 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: 35.88 change: +0.05

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:
12/13 update: SNE managed a bounce this morning but shares failed twice under $36.15. I am still expecting a correction lower toward the bullish trend line of higher lows. Currently our plan is to launch bullish positions on a dip at $34.50.

Trigger @ $34.50

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

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


Trimble Navigation - TRMB - close: 41.66 change: +0.40

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:
12/13 update: TRMB rallied again with a spike over $42 this morning. We do not want to chase this move. I'm going to keep TRMB on the newsletter for a couple of more days. If we don't see a correction soon we'll drop it. Currently our plan is to launch bullish positions at $38.50.

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: 30.22 change: -0.05

Stop Loss: 27.90
Target(s): 29.25, 31.90
Current Option Gain/Loss: +12.4%
Time Frame: 10 to 12 weeks
New Positions: see below

Comments:
12/13 update: After last week's impressive gains we knew that banks would see some profit taking sooner rather than later. Today's losses were pretty mild for WFC. If you're looking for a new entry point I would wait for WFC to pull back and redefine short-term support. That support might be $29.25 or it could be the 200-dma near $28.00. 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


World Wrestling Entertainment - WWE - close: 14.28 change: -0.20

Stop Loss: 13.75
Target(s): 14.95, 16.40
Current Option Gain/Loss: + 1.2%
Time Frame: 10 to 12 weeks
New Positions: see below

Comments:
12/13 update: Ah-hah! I really wasn't expecting this much volatility out of WWE. Shares have been quietly drifting sideways, building base, over the last couple of months. The stock gapped open lower this morning but managed a bounce at $14.10. The gap down today can be explained by the company's dividend. Shares began trading ex-dividend this morning. The decline today was low enough to hit our trigger at $14.10. Now that the play is open we have a stop loss at $13.75.

Suggested Position: Long WWE stock @ $14.10

- or -

Buy the 2011 April $15.00 calls (WWE1116D15), entry @ $0.45

*Note: The call options on WWE have very large spreads, making them a higher-risk trade.

chart:

Entry on December 13 at $14.10
Earnings Date 02/10/11 (unconfirmed)
Average Daily Volume: 242 thousand
Listed on December 9th, 2010


CLOSED BULLISH PLAYS

Citigroup Inc - C - close 4.81 change +0.04

Stop Loss: 4.35
Target(s): 4.60, 4.85
Current Option Gain/Loss: +16.5%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/13 update: Bingo! Target achieved. Shares of Citigroup continued to rally on Monday and the stock hit an intraday high of $4.85. Our final target to exit was $4.85. This play is closed. I would keep C on your watch list. We might reconsider new bullish positions following a significant correction.

Closed Position: Long C stock, entry @ $4.16, exit @ $4.85 (+16.5%)

12/13: Final target hit @ $4.85 (+16.5%)
12/07: Target achieved @ $4.60 (+10.5%)
12/04 Exit the December $4.00 calls (+40%)

chart:

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


Lam Research - LRCX - close: 52.13 change: +0.52

Stop Loss: 47.75
Target(s): 48.50, 52.50
Current Option Gain/Loss: +14.0%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
12/13 update: Target achieved. The trading gods have smiled on us today. The SOX semiconductor index posted a -0.8% loss. Yet LRCX gained another +1% and more importantly hit an intraday high of $52.57. Our final target to exit was $52.50. This play is closed but I would keep LRCX on your watch list. We might reconsider new positions on a dip toward support.

Closed Position: Long LRCX stock @ 45.25, exit @ $52.50 (+16.0%)
- or -
Closed Position: Long the 2011 January $45 calls (LRCX1122A45) Entry @ $2.85, exit @ $6.80 (+138.5%)

12/13 Final Target Hit @ $52.50, option @ $6.80 (+138.5%)
12/11 New stop loss @ $47.75
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%)

chart:

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