Editor's Note:
Shares of Smith & Wesson underperformed today as investors decided to sell the news on rival RGR's earnings report last night. SWHC hit our new stop loss at $5.15 (+6.6%).

Meanwhile I am adjusting our entry point on WFC.

Current Portfolio:


BULLISH Play Updates

Archer-Daniels-Midland Co - ADM - close: 31.74 change: +0.19

Stop Loss: 29.75
Target(s): 34.00
Current Gain/Loss: + 1.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
02/23 update: ADM continues to drift higher. Shares closed at new six-month highs today. More conservative traders may want to start raising their stop loss.

Earlier Comments:
More conservative traders might want to consider waiting to buy a dip near ADM's rising 10-dma. FYI: The Point & Figure chart for ADM is bullish with a $40.00 target.

current Position: Long ADM stock @ $31.21

- or -

Long Mar $32 call (ADM1217C32) Entry $0.47

Entry on February 15 at $31.21
Earnings Date 05/03/12 (unconfirmed)
Average Daily Volume = 5.6 million
Listed on February 14, 2011


Discover Financial Services - DFS - close: 30.04 change: +0.32

Stop Loss: 27.95
Target(s): 31.50
Current Gain/Loss: + 6.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: It was a good day for DFS. Shares didn't see that big of a dip this morning and the stock managed to close over round-number resistance at $30.00. Granted at $30.04 the breakout isn't that convincing yet.

Current Position: Long DFS stock @ $28.15

- or -

Long MAR $28 call (DFS1217C28) Entry $1.10

02/16/12 new stop loss @ 27.95
02/15/12 new stop loss @ 27.75
02/10/12 triggered at $28.15
02/08/12 new trigger @ 28.15, stop loss 27.25
02/07/12 still not open. Adjust strategy to buy a dip at $28.30, stop loss at $27.40
02/06/12 not open yet. try again.

Entry on February 10 at $28.15
Earnings Date 03/22/12 (unconfirmed)
Average Daily Volume = 6.2 million
Listed on February 04, 2011


Digital River - DRIV - close: 18.23 change: +0.33

Stop Loss: 17.45
Target(s): 21.50
Current Gain/Loss: - 1.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
02/23 update: DRIV managed to outperform the market with a +1.8% gain but shares remain inside its $17.50-18.50 trading range. I am not suggesting new positions at this time.

Earlier Comments:
DRIV can definitely see some volatility so we want to keep our position size small to limit our risk. There potential price resistance at $20.00. There is potential technical resistance at the 150-dma and exponential 200-dma.

(small positions)

current Position: Long DRIV stock @ $18.50

- or -

Long Mar $18 call (DRIV1217c18) Entry $1.00

Entry on February 17 at $18.50
Earnings Date 04/30/12 (unconfirmed)
Average Daily Volume = 727 thousand
Listed on February 13, 2011


Energy XXI Ltd. - EXXI - close: 39.03 change: +0.36

Stop Loss: 36.45
Target(s): 42.50
Current Gain/Loss: + 1.5%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
02/23 update: EXXI bounced off the $38.00 level and its 10-dma to rally +0.9% by the closing bell. Shares look poised to breakout past its early February high. If both EXXI and the S&P 500 index open positive I would use it as a new bullish entry point.

Earlier Comments:
The plan was to keep our position size small to limit our risk. Our multi-week target is $42.50. FYI: The Point & Figure chart for EXXI is bullish with a long-term $62 target.

(small positions)

current Position: Long EXXI stock @ $38.43

- or -

Long Mar $40 call (EXXI1217C40) Entry $1.00

Entry on February 17 at $38.43
Earnings Date 04/26/12 (unconfirmed)
Average Daily Volume = 1.2 million
Listed on February 16, 2011


First Cash Financial - FCFS - close: 42.87 change: +0.06

Stop Loss: 41.85
Target(s): 49.00
Current Gain/Loss: - 2.5%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
02/23 update: FCFS spiked down toward $42.00 before bouncing back to close in positive territory. It was a bit of a rocky session for FCFS and I remain cautious. I'm not suggesting new positions at this time.

Earlier Comments:
Our multi-week target is $49.00. FYI: Further gains could spark some short covering. The most recent data listed short interest at 6.4% of the small 27 million-share float. The Point & Figure chart for FCFS is bullish with a long-term $65.00 target.

current Position: Long FCFS stock @ $44.00

- or -

Long Mar $45 call (FCFS1217C45) Entry $1.05

Entry on February 17 at $44.00
Earnings Date 04/18/12 (unconfirmed)
Average Daily Volume = 351 thousand
Listed on February 16, 2011


Graco Inc. - GGG - close: 51.10 change: +1.07

Stop Loss: 48.95
Target(s): 54.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Comments:
02/23 update: GGG did its part with a higher open but the S&P 500 index did not, which negated our entry this morning. That's too bad since GGG outperformed with a +2.1% gain. The breakout past $50 is bullish. I am suggesting we try again. Launch bullish positions tomorrow at the open but only if both GGG and the S&P 500 index open positive. Our target is $54.50. FYI: The Point & Figure chart for GGG is bullish with a long-term $77 target.

Do not enter position unless GGG and the S&P 500 are both positive at the open

suggested position: buy GGG stock @ (the open)

02/23/12 trade did not open, try again.
02/22/12 trade did not open, try again.

Entry on February xx at $ xx.xx
Earnings Date 04/26/12 (unconfirmed)
Average Daily Volume = 414 thousand
Listed on February 21, 2012


Jos. A. Bank Clothiers - JOSB - close: 52.11 change: +0.91

Stop Loss: 49.75
Target(s): 54.00
Current Gain/Loss: + 2.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: JOSB rebounded off the $51.00 level this morning to outperform the market with a +1.7% gain. I am not suggesting new positions at this time.

Earlier Comments:
Further gains could spark a short squeeze. The most recent data listed short interest at 19.8% of the 27.5 million-share float.

current Position: long JOSB stock @ $50.75

- or -

Long Mar $50 call (JOSB1217C50) Entry $1.90

02/18/12 adjusted exit target to $54.00.
02/14/12 new stop loss @ 49.75

Entry on February 13 at $50.75
Earnings Date 03/29/12 (unconfirmed)
Average Daily Volume = 301 thousand
Listed on February 11, 2011


KB Home - KBH - close: 11.75 change: +0.49

Stop Loss: 10.90
Target(s): 13.50
Current Gain/Loss: + 5.8%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: Good news! KBH completely erased yesterday's losses with a +4.3% bounce today. Shares look poised to re-challenge the $12.00 level soon. I am not suggesting new positions at this time but aggressive trades could buy this bounce with a stop just under $11.00.

Earlier Comments:
A breakout higher could produced another short squeeze. The most recent data listed short interest at 41% of the 65 million-share float. Bear in mind that KBH can be a volatile stock. Readers may want to keep their position size small. Our exit target is $13.50. FYI: The Point & Figure chart for KBH is bullish with a long-term $20.00 target.

current Position: Long KBH stock @ $11.10

- or -

Long Mar $12 call (KBH1217C12) Entry $0.50

02/21/12 new stop loss @ 10.90
02/13/12 readers may want to start taking profits now (+11.6%). The call option is +122%
02/09/12 new stop loss @ 10.75

Entry on February 09 at $11.10
Earnings Date 04/05/12 (unconfirmed)
Average Daily Volume = 7.8 million
Listed on February 08, 2011


NYSE Euronext - NYX - close: 30.37 change: +0.10

Stop Loss: 28.45
Target(s): 34.75
Current Gain/Loss: unopened
Time Frame: 4 to 8 weeks
New Positions: Yes, see below

Comments:
02/23 update: Both NYX and the S&P 500 saw a small gap open lower this morning, which negated our entry point. Both of them recovered to close up on the day. I am suggesting we try again.

We want to open small bullish positions at the open tomorrow but only if both the NYX and the S&P 500 index open positive. If triggered we'll use a stop loss at $28.45. Our multi-week target is $34.75. FYI: The Point & Figure chart for NYX is bullish with a $41.00 target.

Do not enter position unless NYX and the S&P 500 are both positive at the open

(small positions)

Suggested Position: buy NYX stock @ (the open)

- or -

buy the Mar $30 call (NYX1217C30)

02/23/12 not open yet, try again.

Entry on February xx at $ xx.xx
Earnings Date 04/30/12 (unconfirmed)
Average Daily Volume = 3.4 million
Listed on February 22, 2011


United States Oil Fund (ETF) - USO - close: 41.37 change: +0.78

Stop Loss: 38.75
Target(s): 43.00
Current Gain/Loss: + 2.7%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: Oil prices ignored the rise in U.S. inventory numbers this morning and rallied to new relative highs. The USO surged +1.9% to close at eight-month highs. At this point I am not suggesting new positions at this time. The USO looks a little bit overbought.

Remember, the plan was to keep our position size small to limit our risk. Our multi-week target is $43.50.

Earlier Comments:
We do not want to use the USO for long-term positions. This ETF is constantly rolling over its futures positions over time, which can have a negative impact on the share price. FYI: The Point & Figure chart for USO is bullish with a long-term $58.00 target.

(small positions!)

current Position: Long the ETF @ $40.25

- or -

Long April $40 call (USO1221D40) Entry $2.10

Entry on February 21 at $40.25
Earnings Date --/--/--
Average Daily Volume = 8.8 million
Listed on February 18, 2011


Wells Fargo & Co. - WFC - close: 30.65 change: +0.06

Stop Loss: 29.75
Target(s): 34.00
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Comments:
02/23 update: WFC almost made it! Shares dipped to $30.28 before bouncing back to close up on the session. Our trigger to open positions was not hit at $30.25. After today's market-wide bounce I am suggesting we adjust our entry point strategy. We'll open positions tomorrow at the opening bell but only if both WFC and the S&P 500 index open positive.

We will use a stop loss at $29.75. More conservative traders could wait for a rally past $31.50 as their entry point instead.

Do not enter position unless WFC and the S&P 500 are both positive at the open

Suggested Position: buy WFC stock @ (trigger)

- or -

buy the April $32 call (WFC1221D32)

02/23/12 adjust entry point strategy. open positions tomorrow morning if both WFC and the S&P 500 open positive.
02/21/12 based on WFC's intraday reversal lower we are adjusting our entry point strategy to "buy a dip" at $30.25 with a stop loss at $29.75
02/21/12 trade did not open because S&P 500 opened lower.

Entry on February xx at $ xx.xx
Earnings Date 04/19/12 (unconfirmed)
Average Daily Volume = 30.5 million
Listed on February 18, 2011


Zumiez Inc. - ZUMZ - close: 30.50 change: -0.42

Stop Loss: 28.90
Target(s): 32.25 or 34.50
Current Gain/Loss: + 6.0%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: I was a bit surprised by the relative weakness in ZUMZ today. Looks like we can blame a broker downgrade for the gap down and spike lower to $29.51. ZUMZ managed to pare its losses. If both ZUMZ and the S&P 500 index open positive tomorrow I would use it as a new bullish entry point.

NOTE: I am listing the March $30 calls as a potential trade here.

Earlier Comments:
I am setting two different targets. Conservative traders can exit at $32.25. More aggressive traders can exit at $34.50.

current Position: Long ZUMZ stock @ 28.75

- or -

buy the Mar $30 call (ZUMZ1217C30) current ask $2.15
if ZUMZ and S&P 500 index open positive tomorrow morning.

02/16/12 new stop loss @ 28.90
02/15/12 exited Feb. $30 calls. bid @ $0.55 (-45%)
02/14/12 prepare to exit Feb. $30 calls at the close tomorrow
02/11/12 new stop loss @ 28.45
02/08/12 new stop loss @ 27.90
02/01/12 Trade opened with ZUMZ gapping higher at $28.75

Entry on February 01 at $28.75
Earnings Date 03/12/12 (unconfirmed)
Average Daily Volume = 627 thousand
Listed on January 31, 2011


BEARISH Play Updates

None. We do not have any active bearish trades.


CLOSED BULLISH PLAYS

Smith & Wesson Holding Corp. - SWHC - close: 5.30 change: -0.13

Stop Loss: 5.15
Target(s): 5.60
Current Gain/Loss: + 6.6%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
02/23 update: The action in SWHC and RGR today was disappointing. I was expecting both to gap open higher today in reaction to RGR's earnings report last night especially when RGR was trading higher after hours last night. Unfortunately investors decided to sell the news and both stocks spiked lower. SWHC dipped to $5.11 intraday, which hit our new stop loss at $5.15.

Earlier Comments:
I do consider this a very aggressive trade and we want to keep our position size small. FYI: The Point & Figure chart for SWHC is bullish with a long-term $10.25 target.

(Small Positions)

closed Position: long SWHC stock @ $4.83 exit $5.15 (+6.6%)

02/21/12 new stop loss @ 5.15
02/18/12 new stop loss @ 4.95
02/08/12 big intraday dip and bounce, low was $4.93
02/04/12 new stop loss @ 4.90, adjust exit to $5.60
02/02/12 new stop loss @ 4.75
01/28/12 new stop loss @ 4.65
01/24/12 new stop loss @ 4.55

chart:

Entry on January 17 at $4.83
Earnings Date 03/12/12 (unconfirmed)
Average Daily Volume = 962 thousand
Listed on January 14, 2011