Editor's Note:
Energy stocks were some of the market's best performers on Friday. Our aggressive trade on WNR is doing well. We have a few stocks with earnings coming up this week so be prepared to exit prior to the report.

-James

Current Portfolio:


BULLISH Play Updates

American Express Co. - AXP - close: 51.81 change: +0.43

Stop Loss: 50.95
Target(s): 54.95
Current Gain/Loss: + 0.0%
Time Frame: exit on July 20th at the close
New Positions: see below

Comments:
07/16 update: AXP came within two cents of our entry point. We wanted to buy the stock at $51.00. Shares hit $51.02 on Friday morning and then bounced. I am suggesting we go ahead and launch small bullish positions now with a stop loss at $50.95. We have three days. AXP reports earnings on July 20th after the closing bell. We will plan on exiting July 20th at the close to avoid holding over earnings.

- open SMALL positions now -

Suggested Position: buy AXP stock @ current levels

- or -

buy the Aug. $52.50 call (AXP1120H52.5) current ask $1.30

07/16 new entry point strategy. buy AXP now. small positions
07/16 new stop loss @ 50.95
07/13 AXP is underperforming. New trigger @ 51.00, stop @ 49.85
07/12 new trigger @ 51.75
07/11 new stop loss @ 50.90

chart:

Entry on July 18 at $xx.xx
Earnings Date 07/20/11 (confirmed)
Average Daily Volume: 7.0 million
Listed on July 2, 2011


Cheesecake Factory Inc. - CAKE - close: 32.69 change: -0.01

Stop Loss: 31.90
Target(s): 33.60, 37.00
Current Gain/Loss: + 3.6%
Time Frame: 8 to 10 weeks
New Positions: see below

Comments:
07/16 update: CAKE saw a late day swoon on Friday but the stock recovered to unchanged. Time is running out. CAKE will report earnings on July 20th after the closing bell. I am suggesting we exit this position on July 20th at the close to avoid holding over the announcement. More conservative traders may want to exit early. I am not suggesting new positions.

Current Position: Long CAKE stock @ $31.53

07/16 plan on exiting July 20th at the close
07/09 new stop loss @ 31.90
07/07 Target hit @ 33.60. CAKE +6.5%, option @ $0.80 (+6.6%)
07/05 adjusted 1st target to $33.60
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 07/20/11 (confirmed)
Average Daily Volume: 1.0 million
Listed on May 19th, 2011


Dr. Pepper Snapple - DPS - close: 40.83 change: -0.04

Stop Loss: 39.90
Target(s): 46.00
Current Gain/Loss: - 2.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/16 update: We need to be careful here. DPS has been underperforming the last couple of days and the close under its 50-dma is bearish. At this point I'm expecting a dip toward the $40.00 mark. If you look at the weekly chart the candle two weeks ago looks like a top and last week looks like confirmation. Cautious traders may want to abandon ship right now or raise their stop toward the trendline (see chart below). We have a stop at $39.90. I am not suggesting new positions at this time.

Current Position: Long DPS stock @ $41.71

- or -

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

07/16 DPS is underperforming. Cautious traders may want to exit

chart:

Entry on July 11 at $41.71
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 1.8 million
Listed on June 30, 2011


Ecolab Inc. - ECL - close: 55.72 change: +0.24

Stop Loss: 53.90
Target(s): --.--, 59.90
Current Gain/Loss: + 4.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/16 update: ECL slipped to $55.17 before rebounding back into positive territory. I have been cautioning readers to expect a dip toward $55.00 or the $54.00 level. ECL has found support near its 30 and 40-dma in the past few weeks so shares could be poised to rally but I would hesitate to launch new positions. We do not want to hold bullish positions over the late July earnings report.

Current Position: Long ECL stock @ 53.35

07/09 new stop loss @ 53.90
07/08 planned exit. July $55 call @ $1.45 (+141.6%)
07/07 Plan on exiting our July calls tomorrow at the close
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


Globe Specialty Metals, Inc. - GSM - close: 24.37 change: -0.53

Stop Loss: 23.40
Target(s): 27.25, 29.50
Current Gain/Loss: - 3.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/16 update: There was a Bloomberg story out on Friday morning regarding China changing its policies on rare-earth exports. The country is the largest rare-earth exporter in the world. While China almost doubled its export quotas for the second half of 2011 it's actually a tighter restriction than what the country exported in 2010. The news did not seem to have much impact on shares of GSM. The stock is hovering near $24.00 and retested short-term technical support at its 10-dma.

Readers may want to wait for a bounce in GSM before initiating new positions. The plan was to keep our positions small to limit our risk.

Earlier Comments:
We should consider this an aggressive, higher-risk trade so let's keep our position size small to limit risk. We can always add to positions down the road. FYI: The Point & Figure chart for GSM is bullish with a $28.50 target.

- SMALL positions -

Current Position: Long GMS stock @ $25.18

- or -

Long AUG $25 call (GSM1120H25) Entry @ $1.60

chart:

Entry on July 14 at $25.18
Earnings Date 09/15/11 (unconfirmed)
Average Daily Volume = 874 thousand
Listed on July 13, 2011


Kaiser Aluminum - KALU - close: 54.24 change: -0.23

Stop Loss: 51.90
Target(s): 59.75
Current Gain/Loss: + 1.2%
Time Frame: 3 to 5 weeks
New Positions: see below

Comments:
07/16 update: KALU is still consolidating sideways. Shares actually have a neutral pattern of higher lows and lower highs. Naturally, I am expecting a breakout higher. I would consider new positions now although more conservative traders may want to raise their stop lsos a little bit. Keep in mind that we do not want to hold over the July 27th earnings report.

Earlier Comments:
Our target is the $59.75 mark since the $60 level looks like resistance. Investors could certainly aim higher. KALU has a high amount of short interest and the stock could experience a short squeeze. FYI: Investors should note that the most recent data listed short interest at 9.9% of the very small 18.5 million share float.

- Small Positions -

Current Position: Long KALU @ $53.56

- or -

Long AUG $55 call (KALU1120H55) Entry @ $1.30

chart:

Entry on July 11 at $53.56
Earnings Date 08/01/11 (unconfirmed)
Average Daily Volume = 183 thousand
Listed on July 9, 2011


KLA-Tencor - KLAC - close: 40.95 change: +0.20

Stop Loss: 39.95
Target(s): 45.75
Current Gain/Loss: - 3.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/16 update: It was a very rough week for the semiconductor sector index (SOX). The SOX corrected all the way back to its June lows. Now a bounce from here in the SOX might be a new bullish double bottom. In the meantime KLAC has been outperforming its peers but shares still look vulnerable. The action in KLAC's weekly chart looks like a bearish engulfing (reversal) candlestick pattern. I am willing to hold on a couple more days but I'm not suggesting new positions. We do not want to hold over the July 27th earnings report.

Current Position: Long KLAC @ $42.49

- or -

Long AUG $45 call (KLAC1120H45) Entry @ $1.20

07/14 Traders may want to exit early here.

chart:

Entry on July 11 at $42.49
Earnings Date 07/27/11 (confirmed)
Average Daily Volume = 2.4 million
Listed on July 9, 2011


Macy's Inc. - M - close: 29.98 change: -0.08

Stop Loss: 28.90
Target(s): 29.90, 32.25
Current Gain/Loss: + 5.9%
2nd Position Gain/Loss: + 0.4% Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/16 update: Macy's posted a minor loss for the entire week but shares have not broken the bullish trend of higher lows. If the market does turn lower then we should expect a dip toward the $29.00 level or the 50-dma. I am raising our stop loss to $28.90. While the trend is up I am not suggesting new positions at this time. At the moment our final target is $32.25 but we might consider adjusting this target higher.

Earlier Comments:
Our plan was to keep positions small to limit our risk.

- small positions -

Current Position: Long M stock @ $28.30

- or -

Long Aug. $30 call (M1120H30) Entry @ $0.85

- 2nd Position, entry 7/11/11 -

suggested position: Long M stock @ $29.86

Long Aug. $32 call (M1120H32) Entry @ $0.63

07/16 new stop loss @ 28.90
07/09 new stop loss @ 28.49
07/09 Add 2nd position, buy stock/calls now
07/08 Planned exit. July $29 call @ $1.50 (+167.8%)
07/07 plan on exiting July calls tomorrow at the close
07/02 new stop loss @ 27.90
07/01 1st Target Hit @ 29.90 (+5.6%), options @ +107.1% (July) & +52.9% (Aug)

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


UnitedHealth Group Inc. - UNH - close: 51.97 change: -0.30

Stop Loss: 49.85
Target(s): 54.75
Current Gain/Loss: + 1.4%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/16 update: Monday is our last day. We need to exit this position on Monday at the closing bell to avoid holding over UNH's earnings report on Tuesday morning. I am raising our stop loss to $50.40.

- small positions -

Suggested Position: Long UNH stock @ $51.25

- or -

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

07/16 Prepare to exit on July 18th at the close.
07/16 new stop loss @ 50.40
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


Western Refining Inc. - WNR - close: 21.13 change: +1.04

Stop Loss: 18.45
Target(s): 24.00, 27.50
Current Gain/Loss: + 8.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
07/16 update: Our aggressive, higher-risk trade in WNR is performing well. Oil and energy stocks got a boost on Friday. This helped WNR added +5.1% and close at new multi-year highs. I would not chase it here. Traders could look for a dip near $20.00 or the 10-dma as a potential entry point but keep your position size small.

FYI: The Point & Figure chart for WNR is bullish with a $28.50 target. Plus, the most recent data listed short interest at 38% of the 54.2 million-share float. That's plenty of fuel for a short squeeze.

Current Position: Long WNR stock @ 19.50

- or -

Long AUG. $22 call (WNR1120H22) Entry @ $0.65

chart:

Entry on July 11 at $19.50
Earnings Date 08/04/11 (unconfirmed)
Average Daily Volume = 4.0 million
Listed on July 9, 2011


CLOSED BULLISH PLAYS

Alexion Pharma - ALXN - close: 52.37 change: +1.10

Stop Loss: 47.75
Target(s): 52.25
Current Gain/Loss: unopened
Time Frame: up to its earnings report
New Positions: Yes, see trigger

Comments:
07/16 update: I'm giving up on ALXN. The stock continues to show impressive relative strength. Shares rallied +2.1% on Friday and ALXN is on the verge of a new breakout. Yet the stock remains very short-term overbought and we're out of time. The company is due to report earnings in four trading days. That's not enough time to wait for a dip and then see ALXN bounce. It's possible shares will see some profit taking after the earnings report. I would keep ALXN on your watch list.

Our entry point was never hit.

chart:

Entry on July xx at $ xx.xx
Earnings Date 07/21/11 (confirmed)
Average Daily Volume = 1.1 million
Listed on July 11, 2011