Editor's Note:
There is a decent chance that stocks decline on Friday no matter what Bernanke says in what could be a "sell the news" type of move. We've adjusted our entry points on DIG and SLX. Meanwhile we've locked in some gains on ALXN, AUXL and RLD.

-James

Current Portfolio:


BULLISH Play Updates

Alexion Pharmaceuticals - ALXN - close: 52.99 change: -0.52

Stop Loss: 49.45
Target(s): --.--, 57.00
Current Gain/Loss: + 4.5%
Time Frame: 2 to 5 weeks
New Positions: see below

Comments:
08/25 update: Our plan was to sell half of our stock position at the open today. ALXN opened at $53.49, then immediately bounced between $54 and $52 before settling in to hover around the $53 level. If Bernanke disappoints the market tomorrow then we could see ALXN retesting $50 soon. I am not suggesting new positions at this time.

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

08/25 Sold Half @ 53.49 (+5.5%) -stock only, not the option
08/24 new stop loss @ 49.45
08/24 Take profits now. Sell half at the open tomorrow. ALXN is currently up +5.6% (stock only). We'll leave our option position unchanged. Current bid is $1.40 (+0.0%)
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: 17.07 change: -0.19

Stop Loss: 15.25
Target(s): --.--, 19.75
Current Gain/Loss: +5.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
08/25 update: The short-term trend in AUXL is up but I'm worried shares are looking a little overbought here. The plan today was sell half of our position at the close tonight to avoid any potential weakness on Friday. The option closed with a bid of $0.60 (+33.3%).

I am not suggesting new positions at this time. More conservative traders may want to raise their stop loss. Our final target remains $19.75 but AUXL will have to chew through some resistance to get there.

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

08/25 Planned exit to sell half. AUXL @ 17.07 (+5.8%)
sold half of Sep. $17.50 call, bid @ 0.60 (+33.3%)
08/24 Take profits (sell half) Tomorrow at the close
08/24 new stop loss @ 15.25
08/23 new stop loss @ 14.95.
08/23 added 2nd target at $19.75

chart:

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: 21.37 change: -0.36

Stop Loss: 19.95
Target(s): 23.50, 24.40
Current Gain/Loss: - 2.4%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
08/25 update: AVP rallied to short-term resistance near $22 and reversed this morning. The stock closed down -1.6% and erased yesterday's gains. I am not suggesting new positions at this time. Any significant market weakness tomorrow could see AVP retesting the $20.50-20.00 zone.

- 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


Ultra Oil & Gas ETF - DIG - close: 39.09 change: -1.90

Stop Loss: 35.45
Target(s): 48.50
Current Gain/Loss: unopened
Time Frame: 2 to 6 weeks
New Positions: Yes, see below

Comments:
08/25 update: I was surprised to see that our play did not open today. DIG was showing strength this morning and gapped open higher at $41.38. The S&P500 was pushing higher on strength in the financial sector. Yet the opening print for the S&P500 was down. Thus our trade here was not open. Maybe that's a good thing. The market reversed and DIG lost -4.6%.

I am adjusting our entry point strategy. The market could sell-off on disappointing comments from Bernanke tomorrow. If that happens then DIG could retest its lows near the $37-36 area. The August 9th low was $35.78. I am now suggesting we buy a dip at $36.00. More aggressive trades could buy a dip near $37.00 instead. If triggered at $36.00 we'll use a stop loss at $35.45. I have updated our option strike. We want to keep our position size small.

New Strategy: Buy the dip at $36.00

Suggested Position: buy this ETF @ at $36.00

- or -

buy the SEP $40 call (DIG1117I40)

08/25 New strategy: buy a dip at $36.00 instead, new stop loss at $35.45
08/24 Readers may want to wait on launching new positions until after we see the market's reaction to Bernanke's comments on Friday.

Entry on August xx at $ xx.xx
Earnings Date --/--/--
Average Daily Volume = 1.4 million
Listed on August 23, 2011


Giant Interactive Group Inc. - GA - close: 8.17 change: +0.27

Stop Loss: 7.55
Target(s): 9.30
Current Gain/Loss: - 3.4%
2nd position Gain/Loss: +3.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
08/25 update: GA displayed some relative strength today with a +3.4% gain. The rally stalled at short-term resistance near $8.20. I am not suggesting new positions at this time. Let's wait and see how the market performs on Friday.

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

- Add 2nd position - entry on 08/24/11

Second Position (small): Long GA stock @ 7.92

Long SEP $7.50 call (GA1117I7.5) Entry $0.65

08/23 new stop loss @ 7.55
08/23 adding a 2nd position
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: 31.22 change: +0.13

Stop Loss: 27.25
Target(s): 33.75
Current Gain/Loss: + 3.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
08/25 update: RGR was still drifting higher but most of the action was sideways. Investors could choose to sell the news tomorrow so we're not suggesting new positions at this time. Nimble traders could look for a dip near the $29.00 or $28.00 levels as a potential entry point should RGR see a pull back. Cautious traders may want to raise their stop loss.

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: 14.61 change: -0.58

Stop Loss: 13.25
Target(s): 18.00
Current Gain/Loss: + 4.0%
Time Frame: 6 to 10 weeks
New Positions: see below

Comments:
08/25 update: Ouch! It looks like we should have taken profits at the opening bell instead of the closing bell. I was concerned that RLD might see some profit taking tomorrow (Friday) so the plan was to take some money off the table tonight at the close. Unfortunately, RLD gave up -3.8% and settled on its lows for the day. I did not see any news behind this relative weakness. It's probably just profit taking after the strong move from the $12 area. The Sep. $15 call ended the day with a bid at $0.90 (+50%).

I am not suggesting new positions at this time. We'll keep our final target at $18.00.

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

08/25 planned exit to sell half at the close.
RLD +4.0%, option @ $0.90 (+50%)
08/24 Prepare to take profits early and sell half tomorrow at the closing bell.
08/24 new stop loss at $13.25
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


Steel ETF - SLX - close: 51.03 change: -1.19

Stop Loss: 49.40
Target(s): 55.75, 59.75
Current Gain/Loss: unopened
Time Frame: 2 to 6 weeks
New Positions: Yes, see below

Comments:
08/25 update: Our trade is still not open yet. The SLX opened strong but the opening print on the S&P500 was down. It looks like the SLX will test support near $50.00 soon. We will adjust our strategy. We'll plan to buy a dip at $50.00 and tweak our stop loss to $49.40. I would still keep our position size small.

New Strategy: Buy a dip at $50.00

Suggested Position: buy this ETF @ open

- or -

buy the SEP $55 call (SLX1117I55)

08/25 new strategy: buy a dip at $50.00, new stop 49.40

Entry on August xx at $ xx.xx
Earnings Date --/--/--
Average Daily Volume = 126 thousand
Listed on August 23, 2011


BEARISH Play Updates

Nordic American Tanker - NAT - close: 17.12 change: -0.29

Stop Loss: 18.55
Target(s): 12.75, 10.50
Current Gain/Loss: - 0.4%
Time Frame: 6 to 12 weeks
New Positions: see below

Comments:
08/25 update: The morning rally failed and NAT ended the session down -1.6%. I would still consider launching new bearish positions at current levels. Just remember to keep our positions small. 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*

08/24 NAT provides another entry point with failed rally at $18
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: 15.05 change: -0.44

Stop Loss: 17.55
Target(s): 12.50, 10.25
Current Gain/Loss: + 3.0%
Time Frame: 6 to 12 weeks
New Positions: see below

Comments:
08/25 update: So far so good. The morning rally attempt in OSG failed at the $16.00 level. Shares closed on their lows with a -2.8% drop for the day. OSG looks poised to breakdown under support at $15.00 soon. A new relative low under $14.75 could be used as another entry point. I would keep positions very small to start.

- 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