Editor's Note:
The rally began overseas this morning as investors found hope there might be improvement for Greece's situation. A sharp bounce at the open fueled some short covering and bargain hunting. We saw our FFIV trade get triggered and the JCI trade get stopped out.

-James

Current Portfolio:


BULLISH Play Updates

Cheesecake Factory Inc. - CAKE - close: 30.32 change: +0.28

Stop Loss: 28.95
Target(s): 33.95, 37.00
Current Gain/Loss: - 3.8%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
06/21 update: I found the +0.9% bounce in CAKE today rather disappointing since the S&P 500 rallied +1.3% and the NASDAQ soared +2.1%. Volume was above average on today's gain, which is a little bit alarming. Are investors selling into strength? More conservative traders may want to exit early now. I am not suggesting new bullish positions at this time.

Earlier Comments:
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

06/09 CAKE is bouncing from the 200-dma as expected.
06/04 More conservative traders may want to exit early. We are expecting a drop to the 200-dma.

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


Dr. Pepper Snapple Group - DPS - close: 40.81 change: -0.09

Stop Loss: 39.65
Target(s): 44.90
Current Gain/Loss: + 1.3%
Time Frame: 8 to 12 weeks
New Positions: see below

Comments:
06/21 update: Warning! The relative weakness in DPS today is a warning signal. Shares rallied toward recent resistance near $41.25 and rolled over into the afternoon. I am still expecting a dip toward the 50-dma but I'm no longer suggesting new positions there. Please note our new stop loss at $39.65.

Current Position: Long DPS stock @ $40.25

- or -

Long Aug $45 call (DPS1120H45) Entry @ $0.30

06/21 new stop loss @ 39.65
06/14 new stop loss @ 39.40
06/04 new stop loss @ 38.95

Entry on June 3 at $40.25
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 2.1 million
Listed on May 14th, 2011


Ecolab Inc. - ECL - close: 54.87 change: +0.65

Stop Loss: 52.45
Target(s): 57.00, 59.90
Current Gain/Loss: + 2.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: ECL managed a +1.1% gain but volume was weak. I am not suggesting new positions at this time.

Current Position: Long ECL stock @ 53.35

- or -

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

06/18 new stop loss @ 52.45
06/04 new stop loss @ 51.90

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


Nanometrics Inc. - NANO - close: 16.89 change: +0.53

Stop Loss: 15.85
Target(s): 19.25, 22.00
Current Gain/Loss: + 0.4%
Time Frame: 6 to 8 weeks or more
New Positions: see below

Comments:
06/21 update: NANO's big bounce today (+3.2%) helped put us back into the black. The stock managed to close just above technical resistance at the 100-dma. If you were waiting for some follow through before initiating positions then you just got it!

We'll start with multi-week targets at $19.25 and $22.00. FYI: NANO does have options but the spreads are so wide I wouldn't trade them.

Current Position: Long NANO stock @ $16.82

Entry on June 13 at $16.82
Earnings Date 08/04/11 (unconfirmed)
Average Daily Volume: 467 thousand
Listed on June 11th, 2011


BEARISH Play Updates

Aon Corp. - AON - close: 50.21 change: +0.63

Stop Loss: 52.05
Target(s): 47.00
Current Gain/Loss: + 2.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: The close over $50.00 is technically a bullish move but AON still has a bearish trend of lower highs. I am not suggesting new positions at this time.

(small positions only)

Current Position: short AON stock @ 51.61

06/18 adjusted exit target to $47.00
06/16 planned exit, June $50 put @ +11.1%
06/16 new stop loss @ 52.05
05/31 New stop loss @ 52.75
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


AO Smith Corp. - AOS - close: 41.05 change: +0.55

Stop Loss: 42.05
Target(s): 36.00, 33.00
Current Gain/Loss: - 2.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: Right on cue AOS bounced toward its 50-dma. This should be technical resistance but after yesterday's close above the 200-dma I would not open new positions at this time. We have a stop loss at $42.05. More conservative traders may want to inch that down toward $41.75 or closer to $41.50ish.

FYI: The Point & Figure chart for AOS is bearish with a $33 target. Traders should also note that the most recent data listed short interest at 5% of the relatively small 38.2 million share float. That does raise the risk for a possible short squeeze and explains the volatile rallies in this stock.

NOTE: AOS does have options but the spreads appear too wide for us to trade them.

Current Position: short AOS stock @ $39.92

Entry on June 6 at $39.92
Earnings Date 07/20/11 (unconfirmed)
Average Daily Volume: 312 thousand
Listed on June 4th, 2011


Allegheny Technologies - ATI - close: 61.47 change: +1.47

Stop Loss: 62.05
Target(s): 52.75, 50.50
Current Gain/Loss: unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see trigger

Comments:
06/21 update: ATI has bounced back toward resistance in the $62.00-62.50 area. A failed rally here might be used as a new entry point for bearish positions. Officially I'm suggesting we wait for a new relative low at $57.40 to launch positions.

If ATI does hit our trigger at $57.40 I'm suggesting a stop loss at $62.05. Our targets are $52.75 and $50.50. We do not want to hold over the late July earnings report.

Trigger @ $57.40 (but keep watch for a failed rally near $62.00 as an alternative entry point).

Suggested Position: Short ATI stock @ $57.40

- or -

buy the July $55 PUT (ATI1116S55) current ask $1.60

Entry on June x at $xx.xx
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume: 1.9 million
Listed on June 18th, 2011


Ford Motor Co. - F - close: 13.32 change: +0.38

Stop Loss: 13.85
Target(s): final target @ 12.55
Current Gain/Loss: + 7.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: The market's widespread bounce sparked some short covering this morning and Ford surged from $13 to $13.50 only to stall at this resistance level. That doesn't mean the oversold bounce is over.

There is no change from my prior comments. More conservative traders may want to exit now to lock in a gain or lower their stops. I am not suggesting new positions at this time. The plan was to 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

06/16 new stop loss @ 13.85
06/13 New stop loss @ 14.26. Final target at $12.55
06/13 Take Profits Now! Ford @ 13.14 (+8.75%), Option @ $1.89 (+110%)
06/11 new targets at $12.75 and TBD.
06/11 new stop loss @ 14.55
06/08 new stop loss @ 15.01

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


F5 Networks - FFIV - close: 103.00 change: +4.82

Stop Loss: 108.05
Target(s): 95.75, 85.50
Current Gain/Loss: + 0.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/21 update: Technology stocks witnessed a big bounce today and FFIV soared +4.9%. The stock got a boost thanks to some bullish analyst comments this morning. Shares hit our trigger to buy puts at $103.00. I would still consider new positions now or you can wait for a bounce closer to the $105.00 area instead. Our targets are $95.75 and $85.50. We do not want to hold over the late July earnings report. FYI: The Point & Figure chart for FFIV is bearish with a $78 target.

Current Position: Short FFIV stock @ 103.00

- or -

Long July $100 PUT (FFIV1116S100) entry @ $3.30

chart:

Entry on June 21 at $103.00
Earnings Date 07/20/11 (unconfirmed)
Average Daily Volume: 2.3 million
Listed on June 18th, 2011


Honeywell Intl. - HON - close: 57.81 change: +1.38

Stop Loss: 59.05
Target(s): 54.00
Current Gain/Loss: - 0.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: A strong bounce in the industrial names lifted HON toward resistance near $58.00 and its 100-dma. There is no change from my prior comments. I am not suggesting new positions at current levels. More conservative traders may want to lower their stops near the $58.00 level.

Earlier Comments:
We do want to keep our position size small to limit our risk.

- Small Positions -

Current Position: short HON stock @ 57.65

- or -

Long July $55 PUT (HON1116S55) Entry @ $0.75

06/18 new stop @ 59.05

Entry on June 2 at $57.65
Earnings Date 07/22/11 (unconfirmed)
Average Daily Volume: 4.1 million
Listed on June 1st, 2011


Kohl's Corp. - KSS - close: 51.16 change: +0.10

Stop Loss: 51.75
Target(s): 47.50, 45.25
Current Gain/Loss: - 2.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: KSS saw very little follow through on yesterday's bounce but our bearish play remains in danger here. If the market continues to surge higher we could get stopped out at $51.75. I am not suggesting new positions at this time.

The plan was to keep our position size small to limit our risk. FYI: The Point & Figure chart for KSS is bearish with a $43 target.

- Small Positions-

Current Position: short KSS stock @ $49.80

- or -

Long July $47.50 put (KSS1116S47.5) Entry @ $0.75

Entry on June 13 at $49.80
Earnings Date 08/11/11 (unconfirmed)
Average Daily Volume: 4.1 million
Listed on June 11th, 2011


Marriott Intl. Inc. - MAR - close: 34.31 change: +1.19

Stop Loss: 36.05
Target(s): 33.65, and 30.50
Current Gain/Loss: + 3.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
06/21 update: Cautious traders may want to exit their July puts now. We have been expecting an oversold bounce in MAR, which seems to have begun, but there is no guarantee MAR is going to roll over again. The stock should see resistance in the $35-36 area. I am not suggesting new bearish positions at this time.

Current Position: Short MAR stock @ $35.39

- or -

Long July $33 PUT (MAR1116S33) Entry @ $0.60

06/21 readers may want to exit July options now
06/18 new stop loss @ 36.05
06/13 1st Target Hit @ $33.65 (+4.9%), Option @ 0.90 (+50%)
06/13 New stop loss @ 36.55
06/11 Adjusted exit targets to $33.65 and 30.50

Entry on June 8 at $35.39
Earnings Date 07/13/11 (unconfirmed)
Average Daily Volume: 3.7 million
Listed on June 7th, 2011


Charles Schwab - SCHW - close: 16.42 change: +0.32

Stop Loss: 17.55
Target(s): 15.25
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see trigger

Comments:
06/21 update: SCHW's rebound lifted shares toward short-term resistance at $16.50. The 200-dma has risen to $16.85 so I am raising our trigger to open bearish positions to $16.85. If triggered we'll use a stop loss at $17.55 and aim for a drop to $15.25. This could take several weeks but we do not want to hold over the mid July earnings report.

Trigger @ 16.85 -- adjusted entry

Suggested Position: short SCHW stock @ $16.85

- or -

Buy the July $17.00 PUT (SCHW1116S17)

Entry on June x at $xx.xx
Earnings Date 07/18/11 (unconfirmed)
Average Daily Volume: 10.2 million
Listed on June 13th, 2011


St. Jude Medical - STJ - close: 49.62 change: +0.32

Stop Loss: 51.05
Target(s): 47.00, 45.75
Current Gain/Loss: + 2.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
06/21 update: There are no surprises here. STJ has bounced back toward resistance near $50.00. I am not suggesting new positions at this time. Our first target to take profits is at $47.00.

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

06/16 exit June $50 put @ $1.95 (+95%)
06/15 prepare to exit our June $50 puts on Thursday at the close
06/04 New stop loss @ 51.05, added second target at $45.75
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


CLOSED BEARISH PLAYS

Johnson Controls Inc. - JCI - close: 38.54 change: +1.15

Stop Loss: 38.25
Target(s): 33.75, 31.00
Current Gain/Loss: - 5.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
06/21 update: JCI rallied past resistance at its 200-dma and 30-dma putting bears on the defensive. Our stop loss was hit at $38.25. Our plan was to keep positions small to limit risk.

-Small Positions Only-

Closed Position: Short JCI stock @ $36.36, exit 38.25 (-5.2%)

- or -

July $35 PUT (JCI1116S35) Entry @ $0.90, exit $0.15 (-83.3%)

06/21 stopped out @ 38.25 (-5.2%), Option @ -83.3%

chart:

Entry on June 16 at $36.36
Earnings Date 07/25/11 (unconfirmed)
Average Daily Volume: 4.4 million
Listed on June 15th, 2011