Editor's Note:
There was a lack of progress out of the EU summit today but traders bought stocks anyway.

We did see BMY and SPLS get stopped out. We're dropping MDR following its earnings warning tonight. Our trade on MDR was not open yet.

-James

Current Portfolio:


BULLISH Play Updates

Adobe Systems - ADBE - close: 27.81 change: -0.04

Stop Loss: 25.95
Target(s): 29.50
Current Gain/Loss: +2.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
10/26 update: ADBE closed virtually unchanged on the session. Traders bought the dip today at $27.25, near its 100-dma. Please note that we are raising our stop loss to $25.95. Readers may want to raise their stop even higher. I am not suggesting new positions at this time.

Current Position: Long ADBE @ 27.13

- or -

Long NOV $27 call (ADBE1119K27) Entry $1.27

10/26 new stop loss @ 25.95
10/20 new stop loss @ 25.45
10/18 new stop loss @ 25.35, today's bounce looks like an entry
10/14 ADBE gapped higher at $27.13

Entry on October 14 at $27.13
Earnings Date 12/15/11 (unconfirmed)
Average Daily Volume = 7.1 million
Listed on October 11, 2011


Autodesk, Inc. - ADSK - close: 32.74 change: +0.37

Stop Loss: 30.45
Target(s): 33.80
Current Gain/Loss: +7.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
10/26 update: If you were looking for a new entry point in ADSK this might be it. The intraday rebound is bullish although if you're launching positions now you will want to consider a tighter stop loss (and raise your exit target). Speaking of stops I am raising our stop loss to $30.90.

Earlier Comments:
The plan was to keep our position size small since ADSK is short-term overbought here.

*Small Positions*

current Position: Long ADSK stock @ 30.35

- or -

Long NOV $32 call (ADSK1119K32) Entry $1.60

10/24 new stop loss @ 30.45, adjust target to $33.80
10/20 ADSK provided another entry point on the dip to $30.00
10/15 new stop loss @ 29.75, adjusted target to $34.00

Entry on October 12 at $30.35
Earnings Date 11/17/11 (unconfirmed)
Average Daily Volume = 4.5 million
Listed on October 11, 2011


Lowe's Companies - LOW - close: 21.64 change: +0.13

Stop Loss: 20.90
Target(s): 22.85
Current Gain/Loss: + 4.2%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
10/26 update: LOW continues to consolidate sideways. Shares managed a bounce near its rising 10-dma but the rebound underperformed the broader market. I don't see any changes from my prior comments.

Earlier Comments:
I would keep our position size small.

current Position: Long LOW stock @ 20.75

- or -

Long NOV $21 call (LOW1119K21) Entry $0.85

10/22 new stop loss @ 20.90
10/22 Cautious traders may want to take profits now
LOW +6.6%, Nov. $21 call +81%

Entry on October 10 at $20.75
Earnings Date 11/14/11 (confirmed)
Average Daily Volume = 16.7 million
Listed on October 08, 2011


Morgan Stanley - MS - close: 16.64 change: +0.12

Stop Loss: 15.45
Target(s): 19.75
Current Gain/Loss: - 3.8%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
10/26 update: Hmm... I find MS' relative weakness a troubling sign. Most of the banking stocks were up +1.6% to +2% or more. MS only gained +0.7%. Traders did buy the dip at the rising 10-dma. I am neutral on launching new positions at this time.

Earlier Comments:
Our target is $19.75 but I am concerned the 100-dma might be overhead resistance. FYI: The Point & Figure chart for MS is bullish with a $29 target.

(Small Positions)

Current Position: Long MS stock @ $17.30

- or -

Long NOV $18 call (MS1119K18) Entry $0.72

Entry on October 24 at $17.30
Earnings Date 10/19/11
Average Daily Volume = 42.8 million
Listed on October 22, 2011


VeriFone Systems - PAY - close: 39.60 change: +0.34

Stop Loss: 37.95
Target(s): 44.85
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
10/26 update: PAY still looks like it is coiling (build up steam) for a breakout higher.

There is no change from my prior comments. Currently our plan is to open bullish positions at $40.50.

Earlier Comments:
We will aim for $44.85 as our exit target. More conservative traders may want to exit near the 200-dma. FYI: The Point & Figure chart for PAY is bullish with a $59 target.

Trigger @ 40.50

Suggested Position: buy PAY stock @ $40.50

- or -

buy the NOV $42 call (PAY1119K42)

Entry on October xx at $ xx.xx
Earnings Date 12/01/11 (unconfirmed)
Average Daily Volume = 2.3 million
Listed on October 13, 2011


Ultra (long) Russell 2000 ETF - UWM - close: 34.26 chg: +1.16

Stop Loss: 29.85
Target(s): 39.00
Current Gain/Loss: +3.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
10/26 update: It was another volatile session for small cap stocks but the UWM bounced near its rising 10-dma and rallied to a +3.5% gain for the session.

(Small Positions)

Suggested Position: Long UWM stock @ 33.25

- or -

Long NOV $35 call (UWM1119K35) Entry $1.70

10/24 triggered @ 33.25

Entry on October 24 at $33.25
Earnings Date --/--/--
Average Daily Volume = 3.9 million
Listed on October 22, 2011


Financial Sector ETF - XLF - close: 13.25 change: +0.23

Stop Loss: 11.95
Target(s): 14.45
Current Gain/Loss: +4.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
10/26 update: Financial stocks held up pretty well considering the lack of positive news out of Europe's EU summit. Traders bought the dip in the XLF near $13.00. This intraday bounce could be used as a new entry point. Readers may want to raise their stop loss.

current Position: Long XLF @ $12.71

- or -

Long NOV $13 call (XLF1119K13) $0.42

11/20 trade opened. XLF at $12.71
11/19 try again. New stop loss @ 11.95

Entry on October 20 at $12.71
Earnings Date --/--/--
Average Daily Volume = 125 million
Listed on October 18, 2011


BEARISH Play Updates

None. We do not have any active bearish trades.


CLOSED BULLISH PLAYS

Bristol-Myers Squibb - BMY - close: 32.51 change: +0.40

Stop Loss: 31.95
Target(s): 33.50
Current Gain/Loss: +2.5%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
10/26 update: We were planning to exit our BMY positions tonight at the closing bell but shares broke support at $32.00 and hit our stop loss at $31.95 first. The company is due to report earnings tomorrow morning.

closed Position: Long BMY stock @ $31.15, exit $31.95 (+2.5%)

- or -

Long 2012 Jan. $30 call (BMY1221A30) Entry $2.26, exit $2.55 (+12.8%)

10/26 BMY hit our stop loss at $31.95
10/25 Remember, we want to exit tomorrow at the close
10/24 new stop loss @ 31.95
10/22 plan on exiting October 26th if not sooner
10/17 sold half 2012 Jan. $30 call open (bid) @ 2.90 (+28.3%)
10/15 new stop loss @ 31.75
10/15 Plan to take profits on the call, sell half on Monday
10/10 new stop loss @ 30.95
10/04 new stop loss @ 30.75
09/27 new stop loss @ 29.90
09/26 trade opened

chart:

Entry on September 26 at $31.15
Earnings Date 10/27/11 (confirmed)
Average Daily Volume = 13.6 million
Listed on September 22, 2011


MdDermott Intl. Inc. - MDR - close: 14.63 change: +0.53

Stop Loss: 13.95
Target(s): 17.90
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
10/26 update: We can thank the trading gods that MDR did not trade above resistance at $15.00 today. Traders bought the dip near $14.00 and shares outperformed the market with a +3.7% gain on the session. Unfortunately, MDR issued an earnings warning after the closing bell. The company now expects Q3 earnings in the 3-to-5 cent range compared to Wall Street estimates at $0.30.

In reaction to this news the stock is trading down under $12.00 a share in after hours markets. We are dropping MDR as a bullish candidate with the trade unopened.

Trigger @ 15.15 was never hit.

Trade did not open

10/26 MDR issued an earnings warning. Down sharply after hours.

chart:

Entry on October xx at $ xx.xx
Earnings Date 11/08/11 (unconfirmed)
Average Daily Volume = 4.8 million
Listed on October 24, 2011


Staples Inc. - SPLS - close: 14.66 change: +0.19

Stop Loss: 14.35
Target(s): 16.75
Current Gain/Loss: - 5.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
10/26 update: SPLS fell toward support near last week's low and a few moving averages before bouncing. Shares dipped to $14.20 intraday. Our stop loss was hit at $14.35. Disappointing earnings from rival ODP yesterday did not help matters.

closed Position: Long SPLS stock @ 15.11, exit $14.35 (-5.0%)

- or -

NOV $16 call (SPLS1119K16) Entry $0.30, exit $0.10* (-66.6%)

*this is an estimate. Option did not trade when SPLS hit our stop loss.
10/26 stopped out at $14.35
10/24 trade opened at $15.11 (trigger)

chart:

Entry on October 24 at $15.11
Earnings Date 11/15/11 (confirmed)
Average Daily Volume = 9.2 million
Listed on October 22, 2011