Editor's Note:
For the most part stocks were higher on Thursday. This also applies to our current list of plays. We did see ECL hit our trigger to launch bullish positions.

-James

Current Portfolio:


BULLISH Play Updates

Cheesecake Factory Inc. - CAKE - close: 31.84 change: +0.96

Stop Loss: 28.95
Target(s): 33.95, 37.00
Current Gain/Loss: + 0.9%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
05/26 update: It was a strong day for CAKE with shares surging +3.1%. The stock is now testing last week's highs and the above average volume behind today's gain is a bullish sign.

Keep in mind that CAKE doesn't move very fast (at least not normally) so we'll need some patience for this trade to work. FYI: The Point & Figure chart for CAKE is bullish with a $59 target.

Current Position: Long CAKE stock @ $31.53

- or -

Long the July $33 call (CAKE1116G33) Entry @ $0.75

Entry on May 20 at $31.53
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 1.0 million
Listed on May 19th, 2011


Capital One Financial - COF - close: 52.87 change: +0.46

Stop Loss: 51.75
Target(s): 57.00, 59.50
Current Gain/Loss: - 0.3%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/26 update: COF almost hit our stop this morning with a drop under the $52.00 level but shares managed to recover quickly. I would consider new bullish positions on this bounce.

Current Position: Long COF stock @ $53.07

- or -

Long the June $55 calls (COF1118F55) Entry @ $0.96

05/17 New stop loss @ 51.75

Entry on May 5 at $53.07
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 3.7 million
Listed on May 4th, 2011


Danaher Corp. - DHR - close: 53.64 change: -0.27

Stop Loss: 52.65
Target(s): 58.00-60.00 zone
Current Gain/Loss: - 2.7%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
05/26 update: There was no follow through on yesterday's rebound. I would stay cautious on DHR. Let's wait for a new close over $54.50 before we consider new positions.

Current Position: Long DHR stock @ $55.17

- or -

Long the Sept. $57.50 call (DHR1117I57.5) Entry @ $1.90

Entry on May 19 at $55.17
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 3.5 million
Listed on May 18th, 2011


Dr. Pepper Snapple Group - DPS - close: 41.56 change: +0.12

Stop Loss: 37.90
Target(s): 44.90
Current Gain/Loss: unopened
Time Frame: 8 to 10 weeks
New Positions: Yes, see trigger

Comments:
05/26 update: DPS produced a minor bounce but shares still look poised for profit taking. I'm suggesting a buy-the-dip entry point at $40.25. If triggered we'll use a stop loss at $37.90. Our target is $44.90.

buy-the-dip Trigger @ $40.25

Suggested Position: buy DPS stock @ $40.25

- or -

Buy the August $45 call (DPS1120H45) current ask $0.80

Entry on May x at $xx.xx
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 2.1 million
Listed on May 14th, 2011


Ecolab Inc. - ECL - close: 53.30 change: +0.20

Stop Loss: 50.95
Target(s): 57.00, 59.90
Current Gain/Loss: - 0.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: Our ECL trade is now open. Shares rallied to $53.42 intraday. We had a trigger to launch positions at $53.35. I would still consider new positions now at current levels.

Current Position: Long ECL stock @ 53.35

- or -

Long July $55 call (ECL1116G55) Entry @ $0.60

chart:

Entry on May 26 at $53.35
Earnings Date 07/26/11 (unconfirmed)
Average Daily Volume: 1.5 million
Listed on May 18th, 2011


EMC Corp. - EMC - close: 28.21 change: +0.62

Stop Loss: 26.45
Target(s): 29.95, 32.25
Current Gain/Loss: + 2.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: EMC displayed relative strength with a +2.2% gain. The stock has rallied to new three-week highs. Volume was strong behind today's gains. Keep in mind that the $28.70 level is overhead resistance. Our first target is $29.95.

Current Position: Long EMC stock @ $27.55

- or -

Long the June $27.00 calls (EMC1118F27) Entry @ $1.35

Second Option Position (listed 05/12/11)

Long the June $29.00 calls (EMC1118F29) Entry @ $0.45

05/12 New entry point. Added second option position.

Entry on May 3 at $27.55
Earnings Date 04/20/11
Average Daily Volume: 21.4 million
Listed on April 27th, 2011


Expedia Inc. - EXPE - close: 27.36 change: +0.03

Stop Loss: 24.74
Target(s): 27.75, 29.75
Current Gain/Loss: + 5.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: EXPE is still not moving. The stock has been consolidating sideways. The lack of profit taking is a show of strength but I would not launch positions here. Our final target is $29.75.

Current Position: Long EXPE stock @ 25.85

- or -

Long the June $25 call (EXPE1118F25) Entry @ $1.20

- or -

Long the July $27 call(EXPE1116G27) Entry @ $0.95

05/21 New stop loss @ 25.40
05/20 1st Target Hit @ 27.75 (+7.3%), June $25 call @ $2.70 (+125%), July $27 call @ $1.40 (+47.3%)

Entry on May 18 at $25.85
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 5.5 million
Listed on May 17th, 2011


Kansas City Southern - KSU - close: 58.50 change: +0.90

Stop Loss: 53.45
Target(s): 59.75, 63.50
Current Gain/Loss: + 3.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: KSU displayed relative strength again with a +1.5% gain on Thursday. The stock is getting pretty close to potential resistance at its April highs. If you don't feel like launching positions now then wait for a dip near the 10-dma. Our upside targets are $59.75 and $62.50.

Current Position: Long KSU stock @ $56.39

- or -

Long the June $60 call (KSU1118F60) Entry @ $0.53

Entry on May 19 at $56.39
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume: 1.0 million
Listed on May 18th, 2011


Rosetta Resources - ROSE - close: $48.16 change: +0.46

Stop Loss: 43.90
Target(s): 54.00
Current Gain/Loss: + 1.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: ROSE is off to a good start. Shares opened at $47.35, rallied off its morning lows, and closed up +0.9%. I would still consider new positions now. The $50.00 level is still overhead resistance but we're aiming for $54.00.

-Small Bullish Positions-

Current Position: Long ROSE stock @ $47.35

- or -

Long July $50 call (ROSE1116G50) Entry @ $1.95

Entry on May 26 at $47.35
Earnings Date 08/08/11 (unconfirmed)
Average Daily Volume: 967 thousand
Listed on May 25th, 2011


Riverbed Technology, Inc. - RVBD - close: 37.57 change: +0.46

Stop Loss: 34.95
Target(s): 39.90, 43.00
Current Gain/Loss: + 0.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: RVBD has managed a second day of gains. Volume remains light. If you launch positions here I would keep your position size small to limit your risk.

Current Position: Long RVBD stock @ $37.25

- or -

Long the June $40 call (RVBD1118F40) Entry @ $1.15

Entry on May 12 at $37.25
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 5.1 million
Listed on May 11th, 2011


DENTSPLY Intl. - XRAY - close: 39.05 change: +0.48

Stop Loss: 37.30
Target(s): 42.00, 44.50
Current Gain/Loss: + 0.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: We were looking for a dip toward $38.00 but the closest XRAY got was to $38.22 this morning and yesterday. Readers can buy this bounce but consider upping your stop loss closer to the $38 level. FYI: The Point & Figure chart for XRAY is bullish with a $59 target.

NOTE: Readers may want to avoid the options. XRAY doesn't have a lot of option volume and the spreads are wide, which puts traders at a disadvantage.

Current Position: Long XRAY stock @ 39.00

- or -

Long the June $40 call (XRAY1118F40) Entry @ 0.60

Entry on May 12 at $39.00
Earnings Date 07/25/11 (unconfirmed)
Average Daily Volume: 904 thousand
Listed on May 7th, 2011


BEARISH Play Updates

Aon Corp. - AON - close: 51.94 change: +0.25

Stop Loss: 53.05
Target(s): 46.50
Current Gain/Loss: - 0.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: AON has bounced back toward prior support and what should be new resistance near $52.00. A failure here or at the 50-dma near $52.50 can be used as a new bearish entry point.

Our target is the $46.50 level. I would expect some support near $50.00 and the 100-dma so don't be surprised to see an initial bounce near this area. NOTE: The option spreads on AON are a little wide. Conservative traders may not want to play the options.

(small positions only)

Current Position: short AON stock @ 51.61

- or -

Long the June $50 PUT (AON1118R50) entry @ $0.45

05/23 gap down entry @ 51.61

Entry on May 23 at $51.61
Earnings Date 07/29/11 (unconfirmed)
Average Daily Volume: 1.7 million
Listed on May 21st, 2011


Ford Motor Co. - F - close: 14.56 change: -0.02

Stop Loss: 15.15
Target(s): 13.25
Current Gain/Loss: - 1.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: Shares of Ford still look weak. The stock failed to truly participate in the market's rebound this Thursday or Wednesday. While we could launch positions here readers may want to wait. We might get a better entry point on a failed rally near $14.75 or $15.00 if the market continues to bounce. Currently our target is $13.25. Do not be surprised if Ford produces a short-term bounce near its March lows near $13.75. I would keep our position size small to limit our risk.

Small Positions!

Current Position: Short F stock @ $14.40

- or -

Long July $15 PUT (F1116S15) Entry @ $0.90

Entry on May 25 at $14.40
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 57 million
Listed on May 24th, 2011


St. Jude Medical - STJ - close: 50.19 change: +0.77

Stop Loss: 52.26
Target(s): 47.00
Current Gain/Loss: + 1.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/26 update: There are no surprises here. We were expecting an oversold bounce in STJ. The stock should find resistance near $51.00 or near its 50-dma. Wait for the bounce to stall or roll over before considering new positions. Currently our target is $47.00. More aggressive traders may want to aim lower.

Earlier Comments:
We wanted to keep our position size small (about half or less than a normal trade) to limit our risk.

(Small Positions)

Current Position: Short STJ stock @ 51.00

- or -

Long the June $50 PUT (SJT1118R50) Entry @ $1.00

05/23 New stop loss @ 52.26

Entry on May 20 at $51.00
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 2.6 million
Listed on May 16th, 2011


Valero Energy - VLO - close: 26.42 change: +0.16

Stop Loss: 27.05
Target(s): 23.00
Current Gain/Loss: - 3.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
05/26 update: There is no change from my Wednesday night comments on VLO. Readers might want to consider an early exit right now to cut our losses. Our bearish play is in jeopardy do to recent strength in the energy sector (and crude oil prices). I am not suggesting new positions at this time.

Current Position: Short VLO stock @ $25.49

- or -

Long June $25 PUT (VLO1118R25) Entry @ $0.90

05/23 Triggered @ 25.49.

Entry on May 23 at $25.49
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume: 11 million
Listed on May 14th, 2011