Editor's Note:
This morning's gap open higher helped launch some of our new trades. Actually all of our new bullish plays from the weekend are open but I would be cautious with RGR.

-James

Current Portfolio:


BULLISH Play Updates

Alexion Pharmaceuticals - ALXN - close: 50.41 change: -0.05

Stop Loss: 47.90
Target(s): 54.00, 57.00
Current Gain/Loss: - 0.5%
Time Frame: 2 to 5 weeks
New Positions: see below

Comments:
08/22 update: ALXN spent another day consolidating sideways above support at $50.00. Unfortunately it's building a new pattern of lower highs, which would suggest a breakdown soon. I don't see any changes from my weekend comments. There is still a good chance that ALXN will retest the $48 area if the market's major indices continue to slide. More aggressive traders may want to use a wider stop loss. I am reluctant to open new positions given the market's recent weakness.

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

Current Position: ALXN stock @ $50.67

- or -

Long SEP $55 call (ALXN1117I55) Entry $1.40

08/15 new stop loss @ 47.90
08/12 trade is open.
08/11 open positions if ALXN and S&P500 are positive Friday morning
08/09 new entry point strategy, new stop loss, new targets.

Entry on August 12 at $50.67
Earnings Date 10/20/11 (unconfirmed)
Average Daily Volume = 1.7 million
Listed on August 8, 2011


Auxilium Pharma - AUXL - close: 16.13 change: +0.22

Stop Loss: 14.49
Target(s): 17.95
Current Gain/Loss: +0.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
08/22 update: Our new trade in AUXL is open. Yet we did not make any progress because shares gapped open higher at $16.13 and closed at $16.13. Readers may want to wait for a dip toward the $15.50 zone and then consider new bullish positions. More conservative traders could try a stop closer to the 10-dma near $14.82 instead. Our first target is $17.95 or the 50-dma.

Given the market's recent volatility we do want to keep our position size small.

Current Position: Long AUXL stock @ $16.13

- or -

Long SEP $17.50 call (AUXL1117I17.5) Entry $0.45

Entry on August 22 at $16.13
Earnings Date 11/03/11 (unconfirmed)
Average Daily Volume = 1.4 million
Listed on August 20, 2011


Avon Products Inc. - AVP - close: 20.65 change: +0.12

Stop Loss: 19.95
Target(s): 23.50, 24.40
Current Gain/Loss: - 5.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
08/22 update: Take a moment to look at a 5-minute chart of AVP. The trading in AVP is almost identical to the trading in the S&P500 over the last three days. This morning's early morning gap didn't last and shares closed on their lows while still managing a gain.

I don't see any changes from my weekend comments. I would wait for a dip near $20.30 or a bounce from this region before considering new bullish positions.

- small bullish positions -

Suggested Position: Long AVP stock @ $21.91

- or -

Long SEP $23 call (AVP1117I23) entry $0.50

08/20 new stop loss at $19.95

Entry on August 17 at $21.91
Earnings Date 10/27/11 (unconfirmed)
Average Daily Volume = 5.1 million
Listed on August 15, 2011


Giant Interactive Group Inc. - GA - close: 7.68 change: -0.02

Stop Loss: 7.38
Target(s): 9.30
Current Gain/Loss: - 9.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
08/22 update: Traders bought the dip near $7.60 for the second day in a row. Aggressive traders may want to buy the stock now. I'd like to see shares post a gain and end this five-day losing streak before considering new positions.

Earlier Comments:
Readers should consider this a higher-risk, more aggressive trade. We want to keep our position size small to limit our risk.

Current Position: Long GA stock @ $8.46

- or -

Long SEP $7.50 call (GA1117I7.5) Entry $0.95

08/20 new stop loss @ 7.38

Entry on August 15 at $ 8.46
Earnings Date 11/16/11 (unconfirmed)
Average Daily Volume = 1.3 million
Listed on August 13, 2011


Sturm Ruger & Co - RGR - close: 28.48 change: -1.02

Stop Loss: 27.25
Target(s): 33.75
Current Gain/Loss: - 5.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
08/22 update: Monday was not a good day for RGR fans. After its recent relative strength the stock decided to switch sides and display relative weakness. Worse than that RGR appears to have just performed a bearish reversal pattern. The stock opened higher at $30.25 (our new entry point) only to reverse at $31.00 intraday and then drop for a -8% plunge off its intraday high. There was no news on this weakness but volume was very strong.

The action today concerns me. I would wait for a bounce near $28.00 before considering new bullish positions.

More aggressive traders may want to put their stop under the 30-dma instead.

Current Position: Long RGR stock @ 30.25

- or -

Long SEP $30 call (RGR1117I30) Entry $1.95

08/22 RGR gaps open higher at $30.25 (entry point)

Entry on August 22 at $30.25
Earnings Date 10/27/11 (unconfirmed)
Average Daily Volume = 310 thousand
Listed on August 20, 2011


RealD Inc. - RLD - close: 14.47 change: +0.84

Stop Loss: 11.99
Target(s): 18.00
Current Gain/Loss: + 3.0%
Time Frame: 6 to 10 weeks
New Positions: see below

Comments:
08/22 update: RLD continues to show relative strength. The stock gapped open at $14.04 and rallied to a +6.1% gain. The close over the $14.00 level is a small victory for the bulls since that was the next level of overhead resistance.

If you missed the entry this morning you may want to wait for a dip back toward the $14.00-13.50 zone before considering new positions.

Earlier Comments:
We want to use small positions to limit our risk. NOTE: If you trade options you may want to use the November instead of Octobers but the spreads are a little wider.

current Position: Long RLD stock @ $14.04

- or -

Long SEP $15.00 call (RLD1117I15) Entry $0.60

08/22 gap open entry at $14.04

Entry on August 22 at $14.04
Earnings Date 11/02/11 (unconfirmed)
Average Daily Volume = 1.4 million
Listed on August 20, 2011


Susser Holdings - SUSS - close: 19.90 change: +0.50

Stop Loss: 17.30
Target(s): 21.75
Current Gain/Loss: unopened
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
08/22 update: SUSS continues to show relative strength. Unfortunately we're still looking for an entry point. Today's +2.5% gain was significant because it left shares above potential resistance at $19.50. SUSS is starting to look overbought with the rally from $16.00 that started two weeks ago.

We do not want to chase it here. Odds are we'll drop SUSS as a candidate but we'll leave it on the play list for another day and re-evaluate tomorrow.

No Entry Point Tonight. Just Wait and Watch

Entry on August xx at $ xx.xx
Earnings Date 11/09/11 (unconfirmed)
Average Daily Volume = 88.5 thousand
Listed on August 18, 2011


BEARISH Play Updates

Nordic American Tanker - NAT - close: 16.88 change: +0.18

Stop Loss: 18.55
Target(s): 12.75, 10.50
Current Gain/Loss: + 1.0%
Time Frame: 6 to 12 weeks
New Positions: see below

Comments:
08/22 update: NAT spent the day consolidating sideways. Yet shares did gap open higher at $17.05, providing us a better entry point. I would still consider new positions now or you can wait for a bounce or failed rally near $18.00 and/or the 10-dma instead as your entry point.

I'm listing a stop loss at $18.55, which is a little wide and another reason why we want to keep our position size small to limit our risk. Start small and add to positions later. You may want to consider using put options instead since your risk is limited to the cost of the put you purchase.

- small positions -

Current Position: short NAT stock @ $17.05

- or -

Long OCT $15 PUT (NAT1122V15) Entry $0.75*

08/22 gap open entry @ 17.05
* option entry is an estimate. option did not trade today

Entry on August 22 at $17.05
Earnings Date 11/07/11 (unconfirmed)
Average Daily Volume = 583 thousand
Listed on August 20, 2011


Overseas Shipholding Group - OSG - close: 14.94 change: -0.41

Stop Loss: 17.55
Target(s): 12.50, 10.25
Current Gain/Loss: + 3.7%
Time Frame: 6 to 12 weeks
New Positions: see below

Comments:
08/22 update: OSG continues to underperform. The gap open higher this morning provided a better entry point at $15.52. The close under the $15.00 mark is definitely a show of weakness since $15.00 could have been support.

There is no change from my prior comments. I would keep positions very small to start. We are suggesting new bearish positions now but you could wait for a bounce or failed rally near the 10-dma or the $17.00 area instead as your entry point. We will start this trade with a stop loss at $17.55. Our current targets are $12.50 and $10.25.

- Small Bearish Positions -

Current Position: short OSG stock @ $15.52

- or -

Long OCT $14 PUT (OSG1122V14) Entry $1.50

08/22 gap open entry at $15.52

Entry on August 22 at $15.52
Earnings Date 11/02/11 (unconfirmed)
Average Daily Volume = 981 thousand
Listed on August 20, 2011