Editor's Note:
Stocks managed a big bounce off their Friday morning lows but the market still closed in negative territory. Launching new positions could be tough on Monday since I'm expecting the market to gap one way or the other due progress (or lack thereof) on the debt ceiling extension.

-James

Current Portfolio:


BULLISH Play Updates

China Sunergy Co. Ltd. - CSUN - close: 1.58 change: +0.04

Stop Loss: 1.48
Target(s): 2.00, 2.25
Current Gain/Loss: - 5.3%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/30 update: Friday was a victory for bulls in CSUN. The market's widespread weakness on Friday morning was not enough to push CSUN below support at $1.50. Shares did in fact test $1.50 again and then rebounded to close up +2.5%, a nice show of relative strength. This continues to look like a bullish entry point but I am expecting the market and most likely CSUN to gap open, up or down, on Monday morning due to the debt ceiling issue.

Earlier Comments:
We should consider this an aggressive, higher-risk trade given the trend lower so trade small. Our first target is $2.00. I would expect some resistance at the 50-dma. Our final target is $2.25 but we do not want to hold over the earnings report in mid August.

Current Position: Long CSUN stock @ $1.67

07/27 the dip toward $1.50 looks like a new entry point.

chart:

Entry on July 25 at $ 1.67
Earnings Date 08/15/11 (unconfirmed)
Average Daily Volume = 325 thousand
Listed on July 23, 2011


Sandridge Energy, Inc. - SD - close: 11.52 change: -0.08

Stop Loss: 11.20
Target(s): 13.20, 13.90
Current Gain/Loss: - 2.2%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
07/30 update: Friday was another volatile session for SD. Shares gapped open lower at $11.30 and then rocketed to $11.96 before paring its gains and closing in the red. I would still consider new positions now at current levels but I'm expecting the market to gap open, one way or the other on Monday. Keep in mind that we want to exit ahead of the Aug. 4th earnings report.

Earlier Comments:
SD could see a short squeeze. The most recent data listed short interest at almost 10% of SD's 346 million-share float. We do not want to hold over the August 4th earnings report so we don't have much time. FYI: The Point & Figure chart for SD is bullish with a long-term target at $31.

Current Position: Long SD stock @ $11.78

chart:

Entry on July 25 at $11.78
Earnings Date 08/04/11 (confirmed)
Average Daily Volume = 12.1 million
Listed on July 23, 2011


Proshares Ultra Russell 2000 ETF - UWM - cls: 43.72 chg: -0.27

Stop Loss: 40.99
Target(s): 50.00
Current Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/30 update: The UWM gapped open lower at $42.71 and then dipped toward $42 before bouncing back. This ETF seemed to struggle with the $44 level and its 200-dma has overhead resistance on Friday afternoon. The plan was to launch bullish positions on Friday at the closing bell. I'm suggesting a stop loss at $40.99, which is under the June low. More conservative traders could place their stop closer to $42.00 instead. Friday was our entry point. No new entries at this time.

Earlier Comments:
This is an aggressive, higher-risk, speculative trade. We're betting that lawmakers will come to some sort of agreement by Monday morning. If there is a deal on Monday then the market and the UWM will likely gap open higher and rally. If there is no deal then the UWM will probably gap open down. That's why we want to keep our position size small to limit our risk.

- SMALL positions -

Suggested Position: Long UMW @ $43.72

- or -

Long AUG $45 call (UWM1120H45) Entry $2.05

07/30 stop loss @ 40.99

chart:

Entry on July 29 at $43.72
Earnings Date --/--/--
Average Daily Volume = 2.1 million
Listed on July 28, 2011


Vanguard Natural Resources - VNR - cls: 30.53 chg: +0.26

Stop Loss: 29.40
Target(s): 33.25
Current Gain/Loss: - 0.2%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/30 update: The relative strength in VNR on Friday was impressive. Shares did decline on Friday morning like most of the market but the weakness was not that bad. The stock failed to penetrate the lows set on Wednesday. VNR looks poised to breakout from this two-week trading range. Unfortunately we're almost out of time. Earnings are expected on August 4th. We'll plan to exit on Aug. 3rd at the closing bell. I am raising our stop loss up to $29.40.

Current Position: Long VNR stock @ $30.61

- or -

Long AUG $30 call (VNR1120H30) Entry @ $1.20

07/30 new stop loss @ 29.40
07/30 prepare to exit on Aug. 3rd at the close.
07/19 Play is opened @ 30.61
07/18 The requirements to launch positions was not met. Try again. Both VNR and the S&P 500 need to open higher tomorrow.

chart:

Entry on July 19 at $30.61
Earnings Date 08/04/11 (unconfirmed)
Average Daily Volume = 193 thousand
Listed on July 16, 2011


BEARISH Play Updates

Jack Henry & Associates Inc. - JKHY - close: 28.95 change: -0.15

Stop Loss: 30.70
Target(s): 28.10, 26.25
Current Gain/Loss: + 1.5%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
07/30 update: Hmm... we need to be careful here. Friday's weakness pushed JKHY down toward $28.50 and its June lows. Shares managed a bounce but failed to close in positive territory. Further gains from here would look like a potential double bottom. I am not suggesting new positions at this time. JKHY should have resistance near $29.50 and again near $30.00-30.50.

Earlier Comments:
Our first target to take profits is $28.10. Our secondary target is $26.25. We do not want to hold over the mid August earnings report so the secondary target is unlikely to get hit. NOTE: The option spreads are too wide to trade options on JKHY.I would keep our position size small. If lawmakers do agree on a debt ceiling deal the entire market could rally.

- small positions -

Current Position: short JKHY @ $29.39

chart:

Entry on July 27 at $29.39
Earnings Date 08/16/11 (unconfirmed)
Average Daily Volume = 427 thousand
Listed on July 26, 2011