Editor's Note:
The S&P 500 index is back above technical resistance at its simple 200-dma yet it is still trading under the December resistance in the 1265-1270 zone.

Traders may want to be cautious on launching new positions here.

-James

Current Portfolio:


BULLISH Play Updates

GlaxoSmithKline - GSK - close: 45.68 change: +0.39

Stop Loss: 44.40
Target(s): 49.25
Current Gain/Loss: - 0.1%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
12/29 update: Traders bought the dip in GSK near its rising 10-dma. The stock closed up +0.8% on the session. Readers can choose to buy this bounce or wait for a breakout past $46.00.

Our multi-week target is $49.25 (GSK doesn't move very fast).
FYI: The Point & Figure chart for GSK is bullish with a $56 target.

current Position: long GSK stock @ 45.75

- or -

Long Feb $46 call (GSK1218B46) entry $1.05

Entry on December 23 at $45.75
Earnings Date --/--/?? (unconfirmed)
Average Daily Volume = 2.5 million
Listed on December 22, 2011


Lam Research - LRCX - close: 37.05 change: +0.45

Stop Loss: 34.75
Target(s): 39.75
Current Gain/Loss: + 0.0%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
12/29 update: The action in the previous two sessions looked like a potential bearish reversal in LRCX. It is encouraging to see that there was no follow through lower but I remain cautious here. Readers may want to raise their stop loss. I am not suggesting new positions.

(small positions)

current Position: Long LRCX stock @ $37.02

- or -

Long 2012Jan $38 call (LRCX1221A38) entry $0.60

12/23/11 trade opened.
12/22/11 trade not open yet. try again.

Entry on December 23 at $37.02
Earnings Date 01/25/12 (unconfirmed)
Average Daily Volume = 4.0 million
Listed on December 21, 2011


PetMed Express Inc. - PETS - close: 10.28 change: +0.27

Stop Loss: 9.90
Target(s): 11.90
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
12/29 update: PETS completely erased yesterday's losses with a strong +2.6% gain today. Traders bought the dip near support at $10.00 this morning. The stock is about to test technical resistance at its 150-dma. I am suggesting readers open small bullish positions at $10.45. The stock could see a short squeeze due to the high amount of short interest. The most recent data listed short interest is almost 29% of the very small 19.8 million-share float.

Earlier Comments:
PETS has potential technical resistance at the simple 150-dma at $10.35. I would keep our position size small to limit our risk. The simple and exponential 200-dma could be significant overhead resistance and PETS struggled with resistance near $11.50 in the past.

NOTE: I would prefer to trade the stock over the options but we're listing the options as an alternative.

Trigger @ 10.45 (small positions)

Suggested Position: buy PETS stock @ $10.45

- or -

buy the Feb $10 call (PETS1218B10)

Entry on December xx at $ xx.xx
Earnings Date 01/24/12 (unconfirmed)
Average Daily Volume = 231 thousand
Listed on December 27, 2011


Ross Stores Inc. - ROST - close: 48.56 change: +0.08

Stop Loss: 45.75
Target(s): 51.75
Current Gain/Loss: + 1.0%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
12/29 update: ROST was a bit of a dud today. The stock chopped sideways and barely posted a gain. The lack of participation in the market's rally today is a bit worrisome. I would hesitate to open new bullish positions.

Earlier Comments:
Our exit target is $51.75. Yet more conservative traders may want to exit early near $50.00, which could be round-number, psychological resistance. Plus the $50 level is currently near the top of ROST's rising channel. I am not suggesting new positions at this time.

current Position: long ROST stock @ 48.05

- or -

Long 2012Jan $50 call (ROST1221A50) entry $0.45

12/24/11 adjusted target to $51.75

Entry on December 21 at $48.05
Earnings Date 03/19/12 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on December 20, 2011


Starbucks Corp. - SBUX - close: 46.45 change: +0.67

Stop Loss: 43.75
Target(s): 49.75
Current Gain/Loss: + 0.8%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/29 update: Our entry conditions have been met and our SBUX trade opened this morning. Shares rallied +1.4% toward new all-time highs. I would still consider new positions now or you can look for dips near the $45.50-45.00 zone.

Earlier Comments:
Broken resistance near $45.00 should be new support. The same can be said for the $44 level. Our multi-week target is $49.75. FYI: The Point & Figure chart for SBUX is bullish with a long-term $75 target.

current Position: long SBUX stock @ $46.08

- or -

Long FEB $47 call (SBUX1218B47) entry $1.56

Entry on December 29 at $46.08
Earnings Date 01/25/12 (unconfirmed)
Average Daily Volume = 5.1 million
Listed on December 28, 2011


Trinity Industries - TRN - close: 30.32 change: +0.69

Stop Loss: 28.75
Target(s): 34.75
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
12/29 update: TRN made a lot of progress today with a +2.3% gain and a rally back above $30 and its 200-dma. Yet we are still waiting for a breakout to new relative highs. The plan is to open positions at $30.85.

FYI: The Point & Figure chart for TRN is currently bearish but a breakout past $31.00 would produce a new triple-top breakout buy signal.

*Trigger @ 30.85

Suggested Position: buy TRN stock @ $30.85

- or -

buy the Jan $30 call (TRN1221A30)

12/28/11 adjusted entry point strategy to use a trigger at $30.85

Entry on December xx at $ xx.xx
Earnings Date 02/15/12 (unconfirmed)
Average Daily Volume = 633 thousand
Listed on December 24, 2011


BEARISH Play Updates

EZchip Semiconductor - EZCH - close: 28.86 change: +0.44

Stop Loss: 30.10
Target(s): 25.50
Current Gain/Loss: - 1.6%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/29 update: EZCH bounced back toward prior support, now new resistance, at $29.00 and stalled. I would use this bounce as a new entry point for bearish positions.

Earlier Comments:
We want to keep our position size small to limit our risk. The $26.60 level has been support in the past but we're aiming for $25.50. More aggressive trades may want to aim for $23 over the next several weeks. FYI: The Point & Figure chart for EZCH is bearish with a $24 target.

Suggested Position: short EZCH @ 28.38

- or -

Long Jan $28 PUT (EZCH1221M28) entry $0.95

Entry on December 29 at $28.38
Earnings Date 02/08/12 (unconfirmed)
Average Daily Volume = 280 thousand
Listed on December 28, 2011


PACCAR Inc. - PCAR - close: 37.46 change: +0.63

Stop Loss: 38.25
Target(s): 32.50
Current Gain/Loss: + 4.2%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/29 update: PCAR recouped a good chunk of yesterday's losses with a +1.7% bounce today. Look for a reversal near $38.00 as a new bearish entry point.

NOTE: Our 2012Jan $36 puts are now $35.30 puts thanks to the recent dividend.

(Small Positions)

current Position: short PCAR stock @ $39.11

- or -

Long 2012Jan $35.30 PUT (PCAR1221M35.3) Entry $0.80

12/22/11 readers may want to exit early now
12/19/11 new stop loss @ 38.25
12/17/11 new stop loss @ 39.05
12/15/11 thanks to a 70-cent dividend our 2012Jan $36 puts are now 35.30 puts.

Entry on December 09 at $39.11
Earnings Date 02/01/12 (unconfirmed)
Average Daily Volume = 2.7 million
Listed on December 08, 2011


Vera Bradley, Inc. - VRA - close: 32.16 change: +0.34

Stop Loss: 32.55
Target(s): 27.50
Current Gain/Loss: + 3.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
12/29 update: VRA managed a +1.0% gain today. Yet the stock has essentially churned sideways the last five days in a row. If VRA does not show some relative weakness tomorrow we will most likely drop VRA this weekend. I am not suggesting new positions at this time.

Earlier Comments:
Traders need to keep in mind this is an aggressive, higher-risk trade. We want to keep our position size very small to limit risk. The most recent data listed short interest at almost 80% of VRA's very small 19.7 million share float. If there is some sort of unexpected rally in this stock it could spark a short squeeze and stops may not work very well in a fast market environment. I would suggest using put options in a situation like this to limit your risk but the spreads on the January puts are too wide. Our target is $27.50 although readers may want to take profits near $30.00 since it could prove to be round-number support. FYI: The Point & Figure chart for VRA is bearish with a $26 target.

(very small positions only!)

current Position: short VRA stock @ $33.17

12/24/11 new stop loss @ 32.55
12/21/11 new stop loss @ 34.05, readers may want to exit early now to lock in a gain.
12/19/11 new stop loss @ 35.25
12/15/11 this is an aggressive, higher-risk trade.

Entry on December 16 at $33.17
Earnings Date 12/07/11
Average Daily Volume = 796 thousand
Listed on December 15, 2011