Editor's Note:
Stocks hit new six-week lows as investors sell ahead of the long weekend. Technically it's not a four-day weekend but the market is only open half a day on Friday. Trading volumes will be light.

Unfortunately today's widespread market decline stopped out four of our trades.

-James

Current Portfolio:


BULLISH Play Updates

AutoNation Inc. - AN - close: 34.06 change: -0.77

Stop Loss: 32.45
Target(s): 39.50
Current Gain/Loss: - 1.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
11/23 update: AN succumbed to the market-wide sell-off today. Shares lost -2.2% but did not break down under the $34.00 level. I would still open new positions here but readers may want to consider only buying AN if both the stock and the S&P 500 open positive on Friday.

Earlier Comments:
Our multi-week target is $39.50. More conservative traders may want to exit in the $37.75 region instead.

current Position: Long AN stock @ $34.45

- or -

Long Jan $35 call (AN1221A35) Entry $1.95

Entry on November 22 at $34.45
Earnings Date 02/02/12 (unconfirmed)
Average Daily Volume = 1.3 million
Listed on November 21, 2011


Carlisle Companies - CSL - close: 39.93 change: -2.13

Stop Loss: 39.85
Target(s): 49.50
Current Gain/Loss: - 4.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
11/23 update: CSL was hammered lower today. Investors were in a mood to sell everything and this stock fell -5.0%. Shares stalled near round-number support at the $40.00 level. Today's intraday low was $39.89. We have a stop loss at $39.85. If the weakness continues on Friday we will likely see CSL hit our stop. Alternatively the $40 level should be support and if the market and CSL starts to bounce on Friday then readers could use it as a new entry point.

Earlier Comments:
We want to keep our position size small to limit our risk on this aggressive entry point.

(small positions)

current Position: Long CSL stock @ $41.75

11/21 trade opened at $41.75
11/19 moved our trigger down to $41.75
11/17 adjusted entry point to trigger @ 42.25, stop loss to $39.85
11/16 adjusted entry point strategy to use a trigger at $45.05

Entry on November 21 at $41.75
Earnings Date 02/07/12 (unconfirmed)
Average Daily Volume = 327 thousand
Listed on November 14, 2011


Hi Tech Pharmacal Co. - HITK - close: 38.76 change: -0.47

Stop Loss: 35.80
Target(s): 44.00
Current Gain/Loss: + 2.4%
Time Frame: 2 to 3 weeks
New Positions: see below

Comments:
11/23 update: HITK experienced some minor profit taking on Wednesday with a -1.1% decline. I would consider a dip into the $38-37 zone as a new bullish entry point. Or readers could look for a dip or a bounce off the rising 10-dma instead.

Earlier Comments:
The stock could see a short squeeze. The most recent data listed short interest at 14% of the very small 9.9 million-share float. The $40.00 level might be resistance but if HITK does see a short squeeze I am expecting a much bigger move. FYI: The Point & Figure chart for HITK is bullish with a $58.00 target. NOTE: We do not want to hold over the December earnings report so we only have two or three weeks.

current Position: Long HITK stock @ $37.84

- or -

Long DEC $40 call (HITK1117L40) Entry $1.65

Entry on November 22 at $37.84
Earnings Date 12/08/11 (unconfirmed)
Average Daily Volume = 180 thousand
Listed on November 21, 2011


Kodiak Oil & Gas - KOG - close: 7.75 change: -0.24

Stop Loss: 7.38
Target(s): 9.75
Current Gain/Loss: + 3.2%
Time Frame: two to three months
New Positions: see below

Comments:
11/23 update: Readers may want to take profits in KOG now. The stock gave up -3.0% today and looks poised to breakdown below its trend of higher lows. I am moving our stop loss up to $7.38. If we do get stopped out I would keep KOG on your watch list to buy a dip near $7.00, which should be support. More aggressive traders may want to just keep their trade open and move their stop below the $7.00 level instead.

I am not suggesting new positions at this time.

Technical note: KOG's MACD and RSI indicators both look bearish on the daily chart.

Earlier Comments:
Our multi-month target is $9.75. FYI: The Point & Figure chart for KOG is bullish with a $13.75 target. KOG is a potential takeover target.

current Position: Long the stock @ 7.51

- or -

Long 2012 MAR $7.50 call (KOG1217C7.5) Entry $1.25

11/23 new stop loss @ 7.38
11/15 gap down at 7.41 and hit 7.21 before bouncing.
11/14 new stop loss @ 7.20
11/14 KOG announces plans to sell an additional 37.5 million shares of new stock
11/08 trade opened at $7.51.

Entry on November 08 at $ 7.51
Earnings Date 03/05/12 (unconfirmed)
Average Daily Volume = 6.6 million
Listed on November 5, 2011


Blue Nile Inc. - NILE - close: 33.76 change: -0.33

Stop Loss: 31.70
Target(s): 39.75
Current Gain/Loss: unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Comments:
11/23 update: NILE produced a mild decline (-0.9%) versus a -2.4% drop in the NASDAQ composite. If the market bounces then NILE could breakout from its trading range. I don't see any changes from my prior comments.

I am suggesting we open small bullish positions with a trigger at $34.60. If triggered we'll use a stop loss at $31.70. Readers should consider this an aggressive, higher-risk trade. If triggered our target is $39.75. More conservative traders may want to exit at the 50 or 100-dma instead.

Trigger @ $34.60 (small positions)

Suggested Position: buy NILE stock @ 34.60

- or -

buy the 2012Jan $35 call (NILE1221A35)

Entry on November xx at $ xx.xx
Earnings Date 02/09/12 (unconfirmed)
Average Daily Volume = 491 thousand
Listed on November 22, 2011


Stamps.com - STMP - close: 25.89 change: -1.14

Stop Loss: 24.75
Target(s): 32.50
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
11/23 update: Our trade in STMP is still not open yet. The stock gapped open lower and fell toward prior support in the $26.00-25.50 zone. I am suggesting we try yet again. Open bullish positions in the morning but only if both STMP and the S&P 500 index open positive (if the S&P500 opens flat then we'll go off of STMP's open alone).

*See Entry Details Above*

Suggested Position: buy STMP stock @ the open

- or -

buy the Feb $30 call (STMP1218C30)

11/23 STMP gapped down again. Trade not open.
11/22 trade did not open. STMP opened lower by one cent.
11/21 trade not open. try again. Move stop loss to $24.75

Entry on November xx at $ xx.xx
Earnings Date 02/09/12 (unconfirmed)
Average Daily Volume = 646 thousand
Listed on November 19, 2011


BEARISH Play Updates

AFLAC Inc. - AFL - close: 39.49 change: -1.52

Stop Loss: 43.55
Target(s): 37.50
Current Gain/Loss: + 6.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
11/23 update: Financial stocks, including the insurance stocks, traded lower today. AFL reversed yesterday's bounce and closed down -3.7%. setting a new relative low. Please note our new stop loss at $43.55.

I am not suggesting new positions at this time.

Earlier Comments:
The plan was to keep our position size small to limit risk.

(Small Positions)

current Position: Short AFL stock @ 42.12

- or -

Long DEC $40 PUT (AFL1117x40) Entry $1.52

11/23 new stop loss @ 43.55
11/21 new stop loss @ 44.05

Entry on November 18 at $42.12
Earnings Date 02/01/12 (unconfirmed)
Average Daily Volume = 4.3 million
Listed on November 17, 2011


Forest Labs Inc. - FRX - close: 28.77 change: -0.46

Stop Loss: 30.55
Target(s): 25.25
Current Gain/Loss: + 0.6%
Time Frame: 9 to 12 weeks
New Positions: see below

Comments:
11/23 update: FRX sank to a new 52-week low this morning at $28.74 and shares look poised to hit new lows on Friday. I am somewhat surprised that FRX didn't post bigger losses today. We are not suggesting new positions at this time.

Earlier Comments:
Our multi-week target is $25.25. FRX doesn't move very fast so we have to give it some time. FYI: The Point & Figure chart for FRX is bearish with a $19 target.

NOTE: You may want to trade the options instead of the stock to limit risk. FRX has about 6 or 7 days worth of short interest (approximately 9% of the float). Looking at the chart you can see the super sharp bounces caused by short covering.

current Position: short FRX stock @ 28.95

- or -

Long FEB $30 put (FRX1218N30) Entry $2.25

Entry on November 21 at $28.95
Earnings Date 01/17/12 (unconfirmed)
Average Daily Volume = 2.5 million
Listed on November 19, 2011


CLOSED BULLISH PLAYS

Beazer Homes - BZH - close: 1.94 change: -0.01

Stop Loss: 1.88
Target(s): 3.25
Current Gain/Loss: -14.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
11/23 update: BZH ended the session down one cent today. Unfortunately the intraday low happened to be $1.88. It just so happens that we moved our stop loss down to $1.88 last night so the play has been stopped out. I would keep BZH on your watch list for a new close above $2.10 or $2.15, which might be a new bullish entry point.

closed Position: Long BZH stock @ $2.19, exit 1.88 (-14.1%)

- or -

2012 Jan $3.00 call (BZH1221A3) Entry $0.15, exit 0.05 (-66.6%)

11/23 stopped out at $1.88
11/22 adjust stop loss to $1.88
11/12 new stop loss @ 1.90. More conservative traders may want to exit prior to the earnings report to lock in a gain.

chart:

Entry on October 31 at $2.19
Earnings Date 11/15/11 (confirmed)
Average Daily Volume = 2.4 million
Listed on October 29, 2011


Casey's General Stores - CASY - close: 48.81 change: -1.54

Stop Loss: 49.40
Target(s): 54.50
Current Gain/Loss: - 3.5%
Time Frame: up to its earnings report.
New Positions: see below

Comments:
11/23 update: CASY is another casualty of the market's sharp decline lower today. The stock broke support near $50.00 and hit our stop loss at $49.40 before ending the session off -3.0%.

closed Position: Long CASY stock @ $51.19, exit 49.40 (-3.5%)

- or -

DEC $50 call (CASY1117L50) Entry $2.90 exit $0.85 (-70.6%)

11/23 stopped out at $49.40
11/15 new stop loss @ 49.40
11/12 new stop loss @ 48.75
11/08 new stop loss @ 47.95
11/08 trade opened.

chart:

Entry on November 08 at $51.19
Earnings Date 12/06/11 (unconfirmed)
Average Daily Volume = 250 thousand
Listed on November 5, 2011


KB Home - KBH - close: 6.69 change: -0.39

Stop Loss: 6.70
Target(s): 9.50
Current Gain/Loss: -11.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
11/23 update: Our aggressive trader on KBH did not pan out. Shares have found support near the $6.70-6.75 zone the last few days. KBH was holding at this level again today until the last few minutes of trading when shares saw a spike lower. Our stop loss was hit at $6.70.

Earlier Comments:
The most recent data listed short interest at more than 50% of the relatively small 65.4 million-share float. That's definitely enough fuel for a significant short squeeze.

KBH can be a volatile stock so we need to use a wide stop loss. This raises the risk profile on this trade.

current Position: Long KBH stock @ 7.55, exit $6.70 (-11.2%)

- or -

Jan $7.50 call (KBH1221A7.5) Entry $0.91, exit $0.45 (-50.5%)

11/23 stopped out at $6.70 (-11.2%)
11/11 trade opened at $7.55

chart:

Entry on November 11 at $ 7.55
Earnings Date 01/09/12 (unconfirmed)
Average Daily Volume = 5.8 million
Listed on November 10, 2011


Newfield Exploration Co. - NFX - close: 38.85 change: -1.14

Stop Loss: 39.70
Target(s): 43.90
Current Gain/Loss: - 2.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
11/23 update: Our bullish play in NFX was closed first thing this morning thanks to the stock's gap open lower at $39.17. That was below our stop loss at $39.70. Now that NFX has broken support near $40.00 the stock could be headed for a test of its prior lows near $35.00.

Earlier Comments:
I am suggesting we keep our position size small to limit our risk.

(small positions)

closed Position: Long NFX stock @ $40.25, exit 39.17 (-2.6%)

- or -

DEC $40 call (NFX1117L40) Entry $2.50 exit $1.55 (-38.0%)

11/23 stopped out on gap down at $39.17, under our stop loss
11/18 trade opened at $40.25
11/17 adjusted our entry strategy to buy-the-dip at $40.25, stop loss 39.70
11/16 adjusted entry strategy to use a trigger at $44.25, stop @ 41.95

chart:

Entry on November 18 at $40.25
Earnings Date 02/16/12 (unconfirmed)
Average Daily Volume = 4.1 million
Listed on November 12, 2011