Editor's Note:
Keynote Systems rallied to a new ten-year high on Friday. Shares hit one of our profit targets.

-James

Current Portfolio:


BULLISH Play Updates

ACI Worldwide Inc. - ACIW - close: 31.97 change: +0.00

Stop Loss: 30.90
Target(s): --.--, 34.75
Current Gain/Loss: + 7.9%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
04/16 update: ACIW was unchanged on Friday as the stock hovered near the $32.00 level for the third day in a row. The correction may not be over yet but if ACIW can close back above its 10-dma then this past week may prove to be nothing more than a higher low.

There is no change from my prior comments. I am still suggesting more conservative traders to take profits early. I am not suggesting new positions.

Officially we're aiming for the $34.75 level but plan to exit ahead of the late April earnings report.

FYI: ACIW does have options but the spreads are very wide, which puts us at a significant disadvantage.

SMALL bullish positions

Current Position: Long ACIW stock @ $29.63

04/02 New stop loss @ 30.90
03/24 first exit was at $32.25 (+8.8%)
03/23 Sell half now! exit price at the open on 3/24
03/22 New stop loss @ 29.75, 1st Target adjusted to $32.85
03/19 New stop loss @ 29.35

chart:

Entry on February 25 at $29.63
Earnings Date 04/28/11 (unconfirmed)
Average Daily Volume: 122 thousand
Listed on February 24th, 2010


Aon Corp. - AON - close: 52.47 change: +0.23

Stop Loss: 51.70
Target(s): 59.00
Current Gain/Loss: -2.4%
Time Frame: 4 to 5 weeks
New Positions: see below

Comments:
04/16 update: If you're feeling optimistic then AON appears to have produced a mini-double bottom near its rising 50-dma in the last couple of sessions. Readers could use Friday's bounce as a new entry point. I would prefer to see a new rally past $53.00 before considering new positions.

Our time frame is the end of April since earnings are due out in early May. FYI: The Point & Figure chart for AON is bullish with a $90 target.

Current Position: Long AON stock @ $53.76

- or -

Long the May $55.00 call (AON1121E55) Entry @ $0.95

04/12 New stop loss @ 51.70

chart:

Entry on April 4 at $53.76
Earnings Date 05/02/11 (unconfirmed)
Average Daily Volume: 2.2 million
Listed on April 2nd, 2011


Discover Financial Services - DFS - close: 23.95 change: -0.28

Stop Loss: 20.95
Target(s): 24.90
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
04/16 update: The financial sector has not had a good week. Traders have been selling the news with JPM and BAC both falling on their earnings report. Plus, GS has been falling on news it is in trouble with the government again. The BKX banking index is nearing potential support at its March lows. The BIX banking index has fallen below its March lows. The trend for banks is down. However, DFS isn't really a bank. Weakness in the financial sector is a problem but thus far seems to be holding up. Shares actually look poised to breakout higher from their current consolidation.

Aggressive traders may want to consider bullish positions on a move past $24.50 with a tight stop under this week's low. I am still concerned that DFS looks a little overbought here. A dip toward $22 or its 50-dma would be a much more attractive entry point. I am adjusting our buy-the-dip entry point to $22.55 (from $22.25) and we'll raise our stop loss to $21.75 since $22.00 should be support.

Buy-the-Dip Trigger @ $22.55 <-- new trigger

Suggested Position: buy DFS stock @ $22.55

- or -

Buy the May $24 calls (DFS1121E24) <-- new strike

chart:

Entry on April x at $xx.xx
Earnings Date 06/23/11 (unconfirmed)
Average Daily Volume: 5.9 million
Listed on April 12th, 2011


Danaher Corp. - DHR - close: 52.71 change: +0.79

Stop Loss: 50.75
Target(s): 55.90
Current Gain/Loss: + 0.2%
Time Frame: about 3 weeks
New Positions: see below

Comments:
04/16 update: The action in DHR is improving. The rally past $52.50 could be used as a bullish entry point or you could wait for a new relative high over $53.01. Bear in mind that we have less than one week. DHR is due to report earnings on April 21st and we do not want to hold over the announcement. The 50-dma and the bottom of the bullish channel have risen to $51.00. I am adjusting our stop loss to $50.75.

Current Position: long DHR stock @ $52.57

- or -

Long the May $55 call (DHR1121E55) entry @ $0.70

04/16 New stop loss @ 50.75

chart:

Entry on April 4 at $52.57
Earnings Date 04/21/11 (confirmed)
Average Daily Volume: 2.9 million
Listed on April 2nd, 2011


Dick's Sporting Goods Inc. - DKS - close: 41.20 change: +0.58

Stop Loss: 38.95
Target(s): 42.75, 44.75
Current Gain/Loss: +4.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
04/16 update: After more than a week of consolidating sideways DKS is finally showing a little strength. Yet shares remain under resistance in the $41.80-42.00 zone. I would use Friday's bounce as a new bullish entry point to launch positions. We will raise our stop loss to $38.95, near the 50-dma. More conservative traders may want to use a stop loss closer to the $40.00 level instead. Our first target is $42.75.

FYI: The Point & Figure chart for DKS is bullish with a $65 target.

- Small Positions -

Current Position: Long DKS stock @ $39.39

- or -

Long the June $40 calls (DKS1118F40) Entry @ $2.35

04/16 New stop loss @ 38.95
04/09 New stop loss @ 38.45, New targets @ 42.75 and $44.75
04/02 New stop loss @ 37.45

chart:

Entry on March 21 at $39.39
Earnings Date 05/18/11 (unconfirmed)
Average Daily Volume: 1.6 million
Listed on March 19th, 2010


Ford Motor Co. - F - close: 14.71 change: -0.10

Stop Loss: 14.45
Target(s): 16.45, 17.45
Current Gain/Loss: - 2.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
04/16 update: Investors remain nervous about the auto makers and any potential supply disruptions from the disaster in Japan. The recent news about Ford recalling more than one million vehicles due to a potential fault in the airbag system doesn't help matters. If you look at the weekly chart the action over the past couple of weeks, with the failed rally at $16.00, definitely looks like a bearish reversal pattern. Yet on a more short-term basis Ford is trying to hold support at its rising 200-dma.

Ford's inability to break the short-term trend of lower highs makes me wary. I would prefer to see a rally past $15.15 before considering new bullish positions.

Our targets are $16.45 and $17.45.

Our April $15.00 calls have expired worthless (-100%).

Current Position: Long F stock @ $15.05

- or -

April $15 calls (F1116D15) Entry @ $0.33, Expired -100%

04/16 April $15 calls have expired (-100%)

chart:

Entry on March 24 at $15.05
Earnings Date 04/21/11 (unconfirmed)
Average Daily Volume: 82 million
Listed on March 15th, 2010


iShares Gold Trust - IAU - close: 14.53 change: +0.12

Stop Loss: 13.75
Target(s): 15.75
Current Gain/Loss: + 1.1%
Time Frame: 9 to 12 weeks
New Positions: see below

Comments:
04/16 update: The rally in precious metals continued on Friday with both gold and silver hitting new all-time highs. The IAU added +0.8%. There is no change from my prior comments. I would prefer to launch new positions on dips near $14.20.

We do want to keep our position size small. Going long anything gold these days is a very crowded trade. If and when it reverses gold could drop quickly. Until then the trend is up. Our first upside target is $15.75.

FYI: If the IAU moves too slowly for you then check out the double-long (2x) gold ETF (symbol: DGP).

- Small Positions Only -

Current Position: Long the IAU @ $14.36

- or -

Long the July $14.00 call (IAU1116G14) Entry @ $0.60

chart:

Entry on April 11 at $14.36
Earnings Date --/--/--
Average Daily Volume: 3.8 million
Listed on April 9th, 2011


Keynote Systems Inc. - KEYN - close: 21.84 change: +0.36

Stop Loss: 19.45
Target(s): 22.25, 24.75
Current Gain/Loss: +7.8%
Time Frame: less than two weeks
New Positions: see below

Comments:
04/16 update: Target achieved. KEYN saw an afternoon rally past $22.00 and shares hit $22.30 intraday. Our first target to take profits was hit at $22.25. The May $20 calls traded at $2.50 (bid was near $1.95, so +18.1%).

If you're looking for a new bullish entry point I'd wait for a dip in the $21.00-20.50 zone. Please note our new stop loss at $19.45.

This remains an aggressive, higher-risk trade. Our upside targets are $22.25 and $24.75 but this is a very speculative play and we will not hold over the earnings announcement on April 26th.

FYI: The Point & Figure chart for KEYN is bullish with a $41 target.

- Small Bullish Positions -

Current Position: Long KEYN stock @ $20.25

- or -

Long the May $20 calls (KEYN1121E20) entry @ $1.65

04/16 New stop loss @ 19.45
04/15 1st Target Hit @ 22.25 (+9.8%), Option @ +18.1%

chart:

Entry on April 14 at $20.25
Earnings Date 04/26/11 (confirmed)
Average Daily Volume: 193 thousand
Listed on April 13th, 2011


PACCAR Inc. - PCAR - close: 51.43 change: +1.43

Stop Loss: 48.95
Target(s): 54.75, 57.00
Current Gain/Loss: + 0.8%
Time Frame: two or three weeks
New Positions: see below

Comments:
04/16 update: PCAR is finally seeing some buy-the-dip action after its week and a half correction lower. The stock was outperforming the markets on Friday with a +2.8% gain on above average volume. On Thursday I suggesting buying PCAR on a move past $51.00.

NOTE: We still don't have a confirmed earnings date yet but it looks like PCAR is due to report on April 19th. That's Tuesday. Unfortunately, PCAR has a habit of reporting before the opening bell. Believe it or not, just as PCAR starts to look interesting again, we need to plan an exit. The newsletter will exit this trade on Monday, April 18th at the closing bell to avoid the risk of holding over the earnings report.

Current Position: Long PCAR stock @ 51.00

- or -

Long the May $49.70 call (PCAR1121E49.70) Entry @ $3.00

04/16 Plan to exit on Monday, April 18th, at the close.

chart:

Entry on April 11 at $51.00
Earnings Date 04/19/11 (unconfirmed)
Average Daily Volume: 2.8 million
Listed on April 6th, 2011


Ryder Systems Inc. - R - close: 50.96 change: +0.82

Stop Loss: 48.75
Target(s): 53.00
Current Gain/Loss: + 1.4%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
04/16 update: I am a little surprised that Ryder didn't spend Friday's session hovering near the $50.00 strike price. The stock was showing relative strength with a +1.6% gain instead. We only have a few days left. Earnings are April 26th and we will plan to exit before the report. Due to our time frame, I am raising our stop loss to $48.75, which is just under the 50 and 100-dma. Our target is the $53.00 level.

Current Position: Long R stock @ $50.25

- or -

Long the May $50 call (R1121E50) Entry @ $2.55

04/16 New stop loss @ 48.75
04/09 New stop loss @ 47.95

chart:

Entry on March 30 at $50.25
Earnings Date 04/26/11 (confirmed)
Average Daily Volume: 388 thousand
Listed on March 26th, 2011


SAIC, Inc. - SAI - close: 17.00 change: +0.08

Stop Loss: 16.75
Target(s): 18.40
Current Gain/Loss: - 1.9%
Time Frame: 8 to 9 weeks
New Positions: see below

Comments:
04/16 update: SAI bounced back toward $17.00, which has been both support and resistance over the past couple of months. I remain cautious and don't see any changes from my prior comments. Look for a close over $17.00 or an intraday rally past $17.20 before considering new bullish positions in SAI. I would keep your position size small. The daily chart is starting to form what looks like a bear wedge pattern.

Our first bullish target is $18.40. Keep in mind that SAI does not move very fast. While the stock does have options I prefer the stock to avoid the time decay on the options. I will list the August $18 calls for more aggressive traders.

Current Position: long SAI stock @ $17.33

- or -

Long the August $18.00 call (SAI1120H18) entry @ $0.55

chart:

Entry on April 6 at $17.33
Earnings Date 06/02/11 (unconfirmed)
Average Daily Volume: 2.4 million
Listed on April 5th, 2011


BEARISH Play Updates

Overseas Shipholding Group - OSG - close: 28.04 change: -0.24

Stop Loss: 32.25
Target(s): 27.75, 26.25
Current Gain/Loss: +12.9%
Time Frame: 8 to 9 weeks
New Positions: see below

Comments:
04/16 update: OSG spent Friday's session hovering near the $28.00 level. I don't see any changes from my prior comments. The stock is short-term oversold and probably due for a bounce. Broken support at $30.00 overhead should be new resistance. More conservative traders may want to tighten their stops. I am not suggesting new positions at current levels. Our second and final target is the $26.25 level.

Our plan was to use small positions to limit our risk.

- Small Bearish Positions -

Current Position: Short OSG stock @ $32.20

04/12 Exit April Puts now ($1.45bid, +93.3%)
04/12 Take Profits (sell half) of our OSG position (+11.5%)
04/11 New stop loss @ 32.25
04/05 New stop loss @ 33.10
03/16 New stop loss @ 33.55

chart:

Entry on March 11 at $32.20
Earnings Date 05/04/11 (unconfirmed)
Average Daily Volume: 705 thousand
Listed on March 10th, 2010