Editor's Note:
Oil spiked higher for a second day and energy stocks were one of the few pockets of strength in the stock market. Our new VNR play is off to a strong start. Unfortunately, we had a few candidates get stopped out during today's market weakness.

REMINDER: I am away from the office this week for a seminar. Play updates will be brief and we might see fewer new positions added to the newsletter.

-James

Current Portfolio:


BULLISH Play Updates

Alcoa Inc - AA - close: 16.44 change: -0.10

Stop Loss: 15.95
Target(s): 18.50, 19.75
Current Gain/Loss: - 7.9%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: Industrial and commodity names continued to get sold unless you were a gold miner or an oil company. Shares of AA spiked down to $15.96 before paring its losses. Yes, that was $15.96. Yesterday we adjusted our stop loss down to $15.95 so our trade is still active. I would use this intraday bounce as an entry point to launch new positions.

Current Position: Long AA stock @ $17.65

- or -

Long the March $17.00 calls (AA1119C17) Entry @ $0.98

02/23 use the bounce as a new entry point.
02/22 Adjust the stop loss to $15.95
02/18 AA provides another entry point
02/14 AA hits our breakout trigger @ 17.65, Stop @ 16.25

Entry on February 14 at $17.65
Earnings Date 04/11/11 (unconfirmed)
Average Daily Volume: 41 million
Listed on February 2nd, 2010


AnnTaylor Stores - ANN - close: 23.55 change: -1.06

Stop Loss: 22.85
Target(s): 25.90, 27.85
Current Gain/Loss: - 1.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: Consumer-related names were hit hard today as investors grow worried that rising oil prices and fuel costs will hurt retailers. ANN reversed yesterday's gains and produced a one-day bearish reversal engulfing candlestick pattern. More conservative traders may want to exit early now. I am raising our stop loss to $22.85. The low today was $23.09. No new positions at this time.

Small Positions

Current Position: Long ANN stock @ $23.86

- or -

Long the March $22.50 calls (ANN1119C22.5) Entry @ $2.35

02/23 New stop loss @ 22.85
02/22 New stop loss @ 22.40

Entry on February 14 at $23.86
Earnings Date 03/11/11 (confirmed)
Average Daily Volume: 3.0 million
Listed on February 8th, 2010


Allied Nevada Gold Corp. - ANV - close: 29.28 change: +0.17

Stop Loss: 27.40
Target(s): 33.00, 34.75
Current Gain/Loss: - 1.9%
Time Frame: 2+ weeks
New Positions: see below

Comments:
02/23 update: Gold mining stocks were one of the few industries to close in positive territory today. I was disappointed that ANV (+0.5%) did not perform better since the XAU gold & silver index was up +1.9%. We can still use today's move as a bullish entry point.

We want to keep our position size small because gold mining stocks can be very volatile. Our first target is $33.00. However, we may have to exit early. I've found two different earnings report dates for ANV but the most likely report date is Feb. 28th and we do not want to hold over the announcement.

- Small Bullish positions -

Current Position: Long ANV stock @ $29.85

- or -

Long the March $30 calls (ANV1119C30) Entry @ $1.45

Entry on February 17 at $29.85
Earnings Date 02/28/11 (unconfirmed)
Average Daily Volume: 689 thousand
Listed on February 16th, 2010


Baxter Intl. - BAX - close: 51.72 change: -0.58

Stop Loss: 49.90
Target(s): 54.90, 57.50
Current Gain/Loss: - 0.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: BAX is still holding up reasonably well but shares do appear like they are headed lower. Readers may want to wait for a dip near $51.00 or even the 50-dma before initiating positions. We want to keep our position size small to limit our risk.

FYI: The Point & Figure chart for BAX is bullish with a $73 target.

(small positions only)

Current Position: Long BAX stock @ 52.00

- or -

Long the May $55 call (BAX1121E55) Entry @ $1.05

Entry on February 22 at $52.00
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume: 5.8 million
Listed on February 19th, 2010


Hansen Natural Corp. - HANS - close: 55.86 change: +0.17

Stop Loss: 53.75
Target(s): 59.50
Current Gain/Loss: + 0.5%
Time Frame: just a couple of weeks left.
New Positions: see below

Comments:
02/23 update: HANS held up pretty well on Wednesday. Tomorrow is our last day. We want to exit on Thursday at the closing bell to avoid holding over earnings.

- Small Positions to limit our risk -

Current Position: HANS stock @ $55.54

02/23 Prepare to exit tomorrow
02/22 Consider an early exit now!
02/12 New stop loss @ 53.75
01/29 Exit call positions early. @ $1.15 (-23.3%)
01/26 the CBOE listed the MAR $60 call's open @ $1.50

Entry on January 26 at $55.54
Earnings Date 02/24/11 (unconfirmed)
Average Daily Volume: 654 thousand
Listed on January 25th, 2010


Lincare Holdings Inc. - LNCR - close: 28.94 change: -0.38

Stop Loss: 27.45
Target(s): 29.90, 31.75
Current Gain/Loss: + 2.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: LNCR has started to participate in the market's correction. The stock looks poised for more declines tomorrow. The next level of support is probably the $28.00 level. I am not suggesting new bullish positions at this time.

FYI: The Point & Figure chart for LNCR is bullish with a $40 target. Plus, investors will be interested to note that LNCR has relatively high short interest. The most recent data listed short interest at 11.6% of the 86-million share float. With the recent breakout this stock could see a short squeeze.

- Small Bullish Positions -

Current Position: Long LNCR stock @ 28.37

- or -

Long the March $29.00 calls (LNCR1119C29) Entry @ $0.75

02/22 New stop loss @ 27.95
02/19 New stop loss @ 27.45
02/12 Adjusted entry point to current levels.

Entry on February 14 at $28.37
Earnings Date 04/19/11 (unconfirmed)
Average Daily Volume: 932 thousand
Listed on February 9th, 2010


Oracle Corp. - ORCL - close: 32.18 change: -0.35

Stop Loss: 31.65
Target(s): 34.90
Current Gain/Loss: - 0.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: ORCL has pulled back toward short-term support near $32.00 and its 50-dma. We can use this dip as an entry point to open new positions although readers may want to keep their position size small.

Our target on ORCL is the $34.90 mark since $35.00 looks like the next level of resistance.

small positions to limit our risk.

Current Position: ORCL stock @ $32.62

- or -

Long the 2011 March $33 calls (ORCL1119C33) Entry @ $0.80

02/23 New entry point on dip near $32.00
02/12 New stop loss @ 31.65
02/10 ORCL is improving. This looks like a new entry point.
01/29 Consider an early exit, especially the calls.
01/27 The CBOE listed the open for our calls at $0.80

Entry on January 27 at $32.62
Earnings Date 03/24/11 (unconfirmed)
Average Daily Volume: 27 million
Listed on January 26th, 2010


Signet Jewelers Limited - SIG - close: 43.96 change: -1.25

Stop Loss: 42.40
Target(s): 49.75
Current Gain/Loss: - 3.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: SIG tagged its 50-dma and bounced. It also tagged its recent high and failed. Aggressive traders may want to buy this bounce. I'm leaning toward waiting another day to see what happens in the market next.

FYI: The Point & Figure chart for SIG is bullish with a $79 target.

Current Position: Long SIG stock @ $45.25

- or -

Long the March $45 calls (SIG1119C45) Entry @ $1.85

Entry on February 18 at $45.25
Earnings Date 03/30/11 (unconfirmed)
Average Daily Volume: 436 thousand
Listed on February 16th, 2010


UnitedHealth Group - UNH - close: 42.91 change: -0.05

Stop Loss: 41.80
Target(s): 44.75
Current Gain/Loss: + 4.2%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
02/23 update: UNH is still holding up pretty well but it is worth noting that the rally attempt this morning reversed. Shares could be setting up for a bearish double top pattern. I remain cautious. No new positions at this time.

Current Position: UNH stock @ $41.15

02/22: New stop loss @ 41.80
02/17: New stop loss @ 41.49
02/12: New stop loss @ 41.25
02/12: Exit the call options early (bid $1.47 +22.5%)
02/08: New stop loss @ 40.75

Entry on January 28 at $41.15
Earnings Date 01/20/11 (unconfirmed)
Average Daily Volume: 5.9 million
Listed on January 20th, 2010


Vanguard National Res. - VNR - close: 33.04 change: +0.99

Stop Loss: 30.70
Target(s): 34.95
Current Gain/Loss: +0.0%
Time Frame: 1 week
New Positions: see below

Comments:
02/23 update: Our VNR play is off to a good start. Energy was one of the few sectors in positive territory on Wednesday. Shares opened higher and surged to a new all-time high and a +3% gain. If you missed the entry point this morning you may want to wait for VNR to pull back a bit before launching positions.

The company is due to report earnings in very early March. We will plan on exiting at the end of February so we only have a few days. I would open small bullish positions now or wait for a dip into the $31.50-31.00 zone. We'll use a stop loss just under the rising 30-dma. Keep your positions small to limit your risk.

small bullish positions

Current Position: Long GNR stock @ $32.17

- or -

Long the March $30 call (VNR1119C30) Entry @ $2.80

Entry on February 23 at $32.17
Earnings Date 03/01/11 (unconfirmed)
Average Daily Volume: 277 thousand
Listed on February 22nd, 2010


CLOSED BULLISH PLAYS

Adobe Systems Inc. - ADBE - close: 33.74 change: -1.65

Stop Loss: 32.95
Target(s): 37.45
Current Gain/Loss: - 3.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: The NASDAQ underperformed on Wednesday and that did not help shares of ADBE. The stock slipped to $32.93 intraday, which was just enough to hit our stop loss at $32.95. The play is closed.

Closed Position: ADBE stock @ $34.00, Exit @ 32.95 (-3.0%)

- or -

April $35 calls (ADBE1116D35) Entry @ $1.34, Exit @ $0.97 (-27.6%)

02/23 Stopped out @ 32.95 (-3.0%), Option @ -27.6%
02/19 new stop loss @ 32.95

chart:

Entry on February 16 at $34.00
Earnings Date 03/22/11 (unconfirmed)
Average Daily Volume: 5.0 million
Listed on February 15th, 2010


Autodesk, Inc. - ADSK - close: 42.10 change: -1.30

Stop Loss: 40.95
Target(s): 46.00
Current Gain/Loss: - 2.7%
Time Frame: 2 weeks
New Positions: see below

Comments:
02/23 update: ADSK garnered some positive analyst comments today but that failed to help the share price. It looks like someone yanked the rug out from under ADSK with today's -5.9% crash through the bottom of its bullish channel. Our stop loss was hit at $40.95.

Closed Position: Long ADSK stock @ 42.10, Exit @ 40.95 (-2.7%)

- or -

March $45 call (ADSK1119C45) Entry @ $0.90, Exit @ $0.50 (-44.4%)

02/23 Stopped out @ $40.95 (-2.7%), Option @ -44.4%
02/22 Conservative traders should consider an early exit.
02/19 New stop loss @ 40.95

chart:

Entry on February 9 at $42.10
Earnings Date 02/24/11 (confirmed)
Average Daily Volume: 2.5 million
Listed on February 7th, 2010


BMC Software - BMC - close: 48.04 change: -0.97

Stop Loss: 47.95
Target(s): 54.50
Current Gain/Loss: - 2.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: Relative weakness in the tech sector on Wednesday did not help shares of BMC. The stock slipped to $47.85 intraday and closed under its 50-dma. Our stop loss was hit at $47.95. Our plan was to keep our position size small to limit our risk.

Closed Position: Long BMC stock @ 49.30, Exit @ $47.95 (-2.7%)

- or -

March $50 call (BMC1119C50) Entry @ $1.40, Exit @ $0.65 (-53.5%)

02/23 Stopped out @ 47.95 (-2.7%), option @ -53.5%
02/19 New stop loss @ 47.95

chart:

Entry on February 11 at $49.30
Earnings Date 05/05/11 (unconfirmed)
Average Daily Volume: 1.9 million
Listed on February 10th, 2010


Paychex Inc. - PAYX - close: 32.49 change: -0.44

Stop Loss: 32.49
Target(s): 35.90, 37.90
Current Gain/Loss: - 2.6%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
02/23 update: Two days of big market losses was too much for PAYX and the stock hit our stop loss at $32.49.

Closed Position: Long PAYX stock @ 33.37, Exit @ 32.49 (-2.6%)

- or -

March $34 calls (PAYX1119C34) Entry @ $0.35, Exit @ $0.15 (-57.1%)

02/23 Stopped out @ 32.49 (-2.6%), Option @ -57%
02/22 Adjusted stop loss to $32.49

chart:

Entry on February 22 at $33.37
Earnings Date 03/23/11 (unconfirmed)
Average Daily Volume: 2.1 million
Listed on February 19th, 2010