Editor's Note:
Macy's has hit our first profit target near resistance at $30.00. I am also suggesting we take profits in our ECL trade.

The market's sharp move higher continues to stop out our bearish trades. KSS and MAR both got stopped on Friday. I am removing SCHW as a bearish candidate.

Don't forget that July options expire in two weeks.

-James

Current Portfolio:


BULLISH Play Updates

Cheesecake Factory Inc. - CAKE - close: 32.83 change: +1.46

Stop Loss: 30.75
Target(s): 33.95, 37.00
Current Gain/Loss: + 4.1%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
07/02 update: The first day of July proved to be a bullish one for CAKE. After failing at resistance near $32 twice this past week CAKE suddenly surged +4.6% to close at new six-month highs. The next level of resistance should be the $34.00 level and our first target is $33.95. I am raising our stop loss to $30.75

We only have two weeks left on July call options so readers may want to consider an early exit if you're holding these calls.

Don't be surprised to see a dip back toward $32, which should be new support. I am not suggesting new 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

07/02 new stop loss @ 30.75
06/30 consider the opportunity cost of staying in CAKE. maybe you should exit early
06/28 New stop loss @ 29.65
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.

chart:

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 - DPS - close: 42.15 change: +0.22

Stop Loss: 39.40
Target(s): 46.00
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Comments:
07/02 update: DPS rallied again and is nearing resistance at its May highs. I don't see any changes from my Thursday night comments.

I am suggesting we launch positions at $41.25 with a stop loss at $39.40. Normally I would avoid holding over earnings but I am tempted to hold over DPS' late July earnings report. Our multi-week target is $46.00.

Trigger @ $41.25

Suggested Position: buy DPS stock @ $41.25

- or -

buy the Aug. $40 call (DPS1120H40)

chart:

Entry on July x at $xx.xx
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 1.8 million
Listed on June 30, 2011


Ecolab Inc. - ECL - close: 56.76 change: +0.38

Stop Loss: 53.45
Target(s): 57.00, 59.90
Current Gain/Loss: + 6.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/02 update: We have been aiming for $57.00, which is currently our first target for ECL. Yet shares only hit $56.82 on Friday. I am suggesting we go ahead and take some money off the table now. We'll exit half of our stock and half of our options positions immediately. Conservative traders may want to exit all of our option position now since July options expire in two weeks. I am not suggesting new positions at current levels.

Current Position: Long ECL stock @ 53.35

- or -

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

07/02 Sell half. ECL @ 56.76 (+6.3%), Option @ $1.75 (+191.6%)
06/30 new stop loss @ 53.45
06/18 new stop loss @ 52.45
06/04 new stop loss @ 51.90

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


Interpublic Group - IPG - close: 12.71 change: +0.21

Stop Loss: 11.49
Target(s): 13.20
Current Gain/Loss: + 4.4%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
07/02 update: IPG continues to extend its gains. The stock managed to outperform on Friday with a +1.6% gain. The stock is up more than +10% for the week. I would expect a pull back soon. Broken resistance near $12.00 should be support. I am raising our stop loss to $11.49. More conservative traders may want to use a stop closer to $12.00 instead. I am not suggesting new positions at this time.

Our plan was to keep our position size small. Our first target is $13.20 near the 2011 highs. FYI: We do not want to hold over the late July earnings report.

- small positions -

Current Position: Long IPG stock @ $12.17

- or -

Long Aug $12.00 call (IPG1120H12) Entry @ $0.85

07/02 new stop loss @ 11.49

chart:

Entry on June 29 at $12.17
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 7.5 million
Listed on June 28, 2011


Macy's Inc. - M - close: 29.88 change: +0.64

Stop Loss: 27.90
Target(s): 29.90, 32.25
Current Gain/Loss: + 5.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/02 update: Target achieved. M hit $29.96 intraday on Friday. Our first target to take profits was hit at $29.90 (+5.6%). The July $29 call had a bid at $1.16 (+107.1%). The August $30 call had a bid at $1.30 (+52.9%). If you have not taken some money off the table yet I would certain do so now. The rally stalled at resistance near the $30.00 level. After last week's rally I would expect a pull back. We are raising our stop loss to $27.90. Our final target remains $32.25 but cautious traders may want to exit our July calls completely right here. We only have two weeks left on July options.

I am not suggesting new positions at this time. Our plan was to keep positions small to limit our risk.

- small positions -

Current Position: Long M stock @ $28.30

- or -

(short-term)
Long July $29 call (M1116G29) Entry @ $0.56

- or -

(a bit longer-term)
Long Aug. $30 call (M1120H30) Entry @ $0.85

07/02 new stop loss @ 27.90
07/01 1st Target Hit @ 29.90 (+5.6%), options @ +107.1% & +52.9%

chart:

Entry on June 28 at $28.30
Earnings Date 08/10/11 (unconfirmed)
Average Daily Volume: 8.6 million
Listed on June 27, 2011


Nanometrics Inc. - NANO - close: 20.01 change: +1.02

Stop Loss: 17.45
Target(s): 19.25, 22.00
Current Gain/Loss: +18.9%
Time Frame: 6 to 8 weeks or more
New Positions: see below

Comments:
07/02 update: NANO engineered another very strong session on Friday with a +5.3% gain. Cautious traders may want to exit now with NANO up +18.9%. The rally stalled at round-number, psychological resistance at the $20.00 level. After last week's huge surge higher I would expect a pull back soon. I am not suggesting new positions at this time. We are raising our stop loss to $17.45. Our final target remains $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

07/02 new stop loss @ 17.45. Consider an early exit right here @ $20.00
06/30 new stop loss @ 16.90
06/28 First Target hit @ 19.25 (+14.4%)
06/28 New stop loss @ 16.49

chart:

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


UnitedHealth Group Inc. - UNH - close: 53.13 change: +1.55

Stop Loss: 49.85
Target(s): 54.75
Current Gain/Loss: + 3.6%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/02 update: UNH shook off its midweek stupor and rallied to a new multi-year high on Friday. I am raising our stop loss to $49.85. I'd prefer to wait and buy a dip in the $51.00-50.00 area before launching new positions.

We do not want to hold over the July 19th earnings report.

- small positions -

Suggested Position: Long UNH stock @ $51.25

- or -

Long July $50 call (UNH1116G50) Entry @ $2.07

07/02 new stop loss @ 49.85

chart:

Entry on June 24 at $51.25
Earnings Date 07/19/11 (confirmed)
Average Daily Volume: 7.9 million
Listed on June 23, 2011


BEARISH Play Updates

Aon Corp. - AON - close: 51.71 change: +0.41

Stop Loss: 52.05
Target(s): 47.00
Current Gain/Loss: - 0.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/02 update: Our bearish play on AON just turned negative on us. The stock managed to close over technical resistance at its 50-dma. Yet it was unable to breakout past its 100-dma or the $52.00 level. Readers may want to consider an early exit anyway since the stock market's short-term trend is now higher.

I am not suggesting new positions at this time.

(small positions only)

Current Position: short AON stock @ 51.61

07/02 Readers may want to exit early with AON @ 51.75
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

chart:

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


St. Jude Medical - STJ - close: 48.58 change: +0.90

Stop Loss: 50.05
Target(s): 47.00, 45.25
Current Gain/Loss: + 4.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/02 update: Right on cue shares of STJ have filled the gap just as we discussed earlier this week. The $48.60 area should be resistance that is now bolstered by the 30-dma. I don't see any changes from my prior comments.

I'm not suggesting new positions at this time. More conservative traders may want to exit early now.

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

07/01 STJ has filled the gap just as expected
06/25 Adjusted final target to $45.25
06/23 1st target exceeded. Gap down at $46.50 (+8.8%)
06/23 new stop loss @ 50.05
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

chart:

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

Kohl's Corp. - KSS - close: 51.79 change: -1.78

Stop Loss: 51.75
Target(s): 47.50, 45.25
Current Gain/Loss: - 3.9%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/02 update: Almost anything related to consumers rallied sharply on Friday. KSS surged +3.5% to outperform the market's major indices and the RLX retail index. Our stop loss was hit at $51.75. After four weeks of moving sideways KSS might be able to build on this breakout but shares still have plenty of resistance in the $52-54 area.

The plan was to keep our position size small to limit our risk.

- Small Positions-

Current Position: short KSS stock @ $49.80, exit 51.75 (-3.9%)

- or -

July $47.50 put (KSS1116S47.5) Entry @ $0.75, exit 0.10 (-86.6%)

07/01 stopped out @ 51.75 (-3.9%), Option @ -86.6%

chart:

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: 36.82 change: +1.33

Stop Loss: 36.05
Target(s): 33.65, and 30.50
Current Gain/Loss: - 1.8%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
07/02 update: The short covering continued in shares of MAR and the stock rocketed higher on Friday with a breakout past several layers of resistance. Our stop loss was hit at $36.05 early on.

Position: Short MAR stock @ $35.39, exit 36.05 (-1.8%)

- or -

July $33 PUT (MAR1116S33) Entry @ $0.60, exit 0.05 (-91.6%)

07/01 stopped out @ 36.05 (-1.8%), Option @ -91.6%
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

chart:

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: 16.72 change: +0.27

Stop Loss: 16.55
Target(s): 14.00
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see trigger

Comments:
07/02 update: SCHW has broken out above resistance at the $16.50 level. While there is still plenty of overhead resistance for this stock it could be a while before shares hit our current trigger at $15.60. I am removing SCHW as an active bearish candidate.

Our Trade Never Opened!

chart:

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