Editor's Note:
The combination of falling oil prices and a widespread stock decline weighed heavily on the energy sector. Our XCO trade underperformed and hit our stop loss.

Current Portfolio:


BULLISH Play Updates

Cirrus Logic - CRUS - close: 28.46 change: -0.93

Stop Loss: 26.35
Target(s): 32.00
Current Gain/Loss: + 0.3%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/30 update: Ouch! CRUS hit some profit taking. After yesterday's +7.0% gain the stock gave up -3.1% today. Broken resistance near $28.00 should offer some short-term support. More conservative traders may want to inch up their stop loss.

current Position: Long CRUS stock @ $28.35

- or -

Long Jul $30 call (CRUS1221G30) Entry $1.85

05/29/12 triggered @ 28.35

Entry on May 29 at $28.35
Earnings Date 07/19/12 (unconfirmed)
Average Daily Volume = 2.4 million
Listed on May 26, 2011


Market Leader, Inc. - LEDR - close: 4.49 change: +0.09

Stop Loss: 4.15
Target(s): 6.00
Current Gain/Loss: + 3.2%
Time Frame: 6 to 8 weeks
New Positions: see below

Comments:
05/30 update: LEDR displayed some relative strength with a +2.0% gain as traders bought the dip near its rising 10-dma. I am not suggesting new positions at current levels.

Earlier Comments:
We'll try and limit our risk by keeping our position size small. FYI: The Point & Figure chart for LEDR is bullish with a $6.75 target. Remember, small positions. Don't go overboard just because the share price is low. I would consider this a higher-risk trade.

Current Position: Long LEDR stock @ $4.35

05/29/12 new stop loss @ 4.15
05/23/12 new stop loss @ 3.95
05/21/12 triggered at $4.35

Entry on May 21 at $4.35
Earnings Date 05/01/12
Average Daily Volume = 77 thousand
Listed on May 19, 2011


Potash Corp. - POT - close: 39.42 change: -0.62

Stop Loss: 38.90
Target(s): the 50-dma (currently 43.15)
Current Gain/Loss: - 2.1%
Time Frame: 3 to 4 weeks
New Positions: see below

Comments:
05/30 update: The market wide decline helped push POT to a -1.5% pull back. Shares closed near their simple 10-dma. I would wait for a new close over $40.00 before considering new positions. Any follow through lower tomorrow and POT will probably hit our stop loss at $38.90.

Earlier Comments:
POT can be a volatile stock so I am suggesting we keep our position size small. We want to use a trigger at $40.30 to open small bullish positions. We'll stop loss at $38.90. There is potential resistance near $42.00 but we're aiming for the 50-dma (currently at $43.20).

(small positions)

current Position: Long POT stock @ $40.30

- or -

Long JUN $40 call (POT1216F40) Entry $1.36

05/29/12 triggered @ 40.30

Entry on May 29 at $40.30
Earnings Date 07/26/12 (unconfirmed)
Average Daily Volume = 5.4 million
Listed on May 24, 2011


BEARISH Play Updates

American Railcar Ind. - ARII - close: 20.81 change: -0.76

Stop Loss: 22.75
Target(s): 20.05 or 18.55
Current Gain/Loss: + 6.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/30 update: ARII broke down to new relative lows with today's -3.5% decline. The low today was $20.39. We have two exit targets. Our conservative exit target is $20.05 since the $20.00 mark could be round-number support.

Earlier Comments:
We have two targets. Our conservative target is $20.05. Our aggressive target is $18.55. FYI: The Point & Figure chart for ARII is bearish with a long-term $14.00 target.

Suggested Position: short ARII stock @ $22.23

05/26/12 new stop loss @ 22.75
05/17/12 new stop loss @ 23.55

Entry on May 16 at $22.23
Earnings Date 07/25/12 (unconfirmed)
Average Daily Volume = 108 thousand
Listed on May 15, 2011


DeVry Inc. - DV - close: 27.51 change: -1.08

Stop Loss: 29.05
Target(s): 26.75
Current Gain/Loss: + 7.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/30 update: DV underperformed the market's major indices with a -3.7% decline and a breakdown to new multi-year lows. Our exit target is $26.75. I am not suggesting new positions at this time.

FYI: The Point & Figure chart for DV is bearish with a $19.00 target.

current Position: short DV stock @ $29.62

- or -

Long Jun $30 PUT (DV1216R30) Entry $1.35

05/26/12 new stop loss @ 29.05
05/24/12 adjusting exit target to $26.75
05/17/12 new stop loss @ 30.35

Entry on May 14 at $29.62
Earnings Date 08/09/12 (unconfirmed)
Average Daily Volume = 1.0 million
Listed on May 12, 2011


Ebix, Inc. - EBIX - close: 17.53 change: -0.44

Stop Loss: 19.05
Target(s): 16.05
Current Gain/Loss: + 2.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/30 update: EBIX slipped -2.4% and set a new multi-month closing low today. I am not suggesting new positions.

Earlier Comments:
Our first target is $16.15. We want to keep our position size small to limit our risk because EBIX could see a short squeeze. The most recent data listed short interest at 29% of the small 34.6 million share float. Readers may want to use put options to limit risk instead of shorting the stock.
FYI: The Point & Figure chart for EBIX is bearish with a $12.00 target.

Current Position: short EBIX stock @ $17.90

- or -

Long JUN $18 PUT (EBIX1216R18) Entry $0.90

05/24/12 triggered @ 17.90

Entry on May 23 at $17.90
Earnings Date 08/07/12 (unconfirmed)
Average Daily Volume = 386 thousand
Listed on May 23, 2011


Fusion-io, Inc. - FIO - close: 20.11 change: -0.98

Stop Loss: 22.05
Target(s): 17.00
Current Gain/Loss: - 0.1%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/30 update: The volatile shares of FIO reversed most of yesterday's gains. The stock is back to testing the $20 level. The recent action sort of looks like a bear flag pattern. Readers might want to wait for a new drop under $19.40 before initiating new positions.

Earlier Comments:
This is a higher-risk, aggressive trade. We want to keep our position size small because there has been some M&A rumors with FIO as a takeover target. Traders may want to limit their risk by using put options. FYI: The Point & Figure chart for FIO is bearish with a $16.00 target.

(small positions)

Suggested Position: short FIO stock @ $20.09

- or -

Long Jun $17.50 PUT (FIO1216R17.5) Entry $0.85

Entry on May 18 at $20.09
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 4.1 million
Listed on May 17, 2011


Foster Wheeler AG - FWLT - close: 18.16 change: -1.16

Stop Loss: 19.75
Target(s): 17.25
Current Gain/Loss: + 7.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/30 update: Another day of big declines in Europe and the follow through here in the States pushed FWLT to a -6.0% plunge. Shares closed at new five-month lows. I am not suggesting new positions at this time.

current Position: short FWLT stock @ $19.53

- or -

Long Jun $20 PUT (FWLT1216R20) Entry $1.40

05/26/12 new stop loss @ 19.75
05/22/12 new stop loss @ 20.35

Entry on May 17 at $19.53
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 1.4 million
Listed on May 16, 2011


Hospira Inc. - HSP - close: 31.92 change: -0.68

Stop Loss: 33.55
Target(s): 30.25
Current Gain/Loss: + 3.1%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/30 update: HSP's oversold bounce appears to have reversed lower. The stock gave up -2.0% today. I am not suggesting new positions at this time.

FYI: Readers should note that HSP does have above average short interest. The most recent data listed short interest at 7.8% of the 165 million share float.

current Position: short HSP stock @ $32.95

- or -

Long Jun $30 PUT (HSP1216R30) Entry $0.35

05/23/12 new stop loss @ 33.55
05/14/12 opened on the gap down at $32.95, trigger was 33.20

Entry on May 14 at $32.95
Earnings Date 07/26/12 (unconfirmed)
Average Daily Volume = 1.1 million
Listed on May 9, 2011


Netgear Inc. - NTGR - close: 30.73 change: -0.15

Stop Loss: 31.55
Target(s): 26.00
Current Gain/Loss: - 3.3%
Time Frame: 4 to 6 weeks
New Positions: see below

Comments:
05/30 update: Hmm... the action in NTGR today should worry you if you're bearish. The stock really did not participate in the market's decline. The larger trend is bearish but NTGR appears to be in an oversold bounce at the moment. If the market rebounds tomorrow we could see NTGR hit our stop loss at $31.55. I am not suggesting new positions at this time.

current Position: short NTGR stock @ $29.75

- or -

Long Jun $30 PUT (NTGR1216R30) Entry $1.70

05/25/12 triggered @ 29.75

Entry on May 25 at $29.75
Earnings Date 07/26/12 (unconfirmed)
Average Daily Volume = 549 thousand
Listed on May 24, 2011


Silicon Motion Tech. - SIMO - close: 13.79 change: -0.52

Stop Loss: 14.15
Target(s): 10.25
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Comments:
05/30 update: There was no follow through on SIMO's bounce. Shares lost -3.6%. Yet we are still waiting for a breakdown under support. Currently the plan is to launch bearish positions if SIMO hits $12.85.

Trigger @ 12.85

Suggested Position: short SIMO stock @ (trigger)

- or -

buy the Jun $15 PUT (SIMO1216R15)

Entry on May xx at $ xx.xx
Earnings Date 07/26/12 (unconfirmed)
Average Daily Volume = 819 thousand
Listed on May 26, 2011


Teva Pharmaceuticals - TEVA - close: 39.20 change: +1.10

Stop Loss: 40.05
Target(s): 35.25
Current Gain/Loss: - 3.7%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/30 update: The rally in shares of TEVA today is a bit of a mystery. The stock gapped open lower and then erupted higher to outperform the rest of the market. Shares of TEVA made the jump from trading on the NASDAQ to trading on the NYSE today. That's why TEVA was booted off the NASDAQ-100 index. Meanwhile there was news that the FDA was warning consumers that there is a fake version of TEVA's ADHD drug Adderall being sold on the Internet. Elsewhere TEVA and Par Pharmaceuticals lost a court battle to win approval to make a generic version of Amarin's Lovaza drug.

Given all the negative news I would have expected TEVA to trade lower. Instead today's move has created a big bullish engulfing candlestick (reversal) pattern. Of course these patterns need to see confirmation but I am not suggesting new bearish positions at this moment.

current Position: short TEVA stock @ $37.81

- or -

Long Jun $37.50 PUT (TEVA1216R37.5) Entry $0.95

05/30/12 trade opened with TEVA gapping down at $37.81

Entry on May 30 at $37.81
Earnings Date 07/25/12 (unconfirmed)
Average Daily Volume = 4.8 million
Listed on May 29, 2011


Marriott Vacations Worldwide - VAC - close: 28.67 change: -0.02

Stop Loss: 29.25
Target(s): 25.25
Current Gain/Loss: - 2.0%
Time Frame: 3 to 6 weeks
New Positions: see below

Comments:
05/30 update: The trading activity in VAC today was not very encouraging if you're bearish. Shares did not participate in the market's widespread decline. Yet at the same time the stock failed to breakout past resistance near its 50-dma. I am worried that if the market bounces tomorrow it could push VAC over this resistance near $29.00. I am not suggesting new positions at this time.

(small positions)

current Position: short VAC stock @ $28.10

05/26/12 new stop loss @ 29.25

Entry on May 25 at $28.10
Earnings Date 08/02/12 (unconfirmed)
Average Daily Volume = 495 thousand
Listed on May 24, 2011


CLOSED BULLISH PLAYS

EXCO Resources - XCO - close: 7.24 change: -0.68

Stop Loss: 7.45
Target(s): 9.25
Current Gain/Loss: - 7.4%
Time Frame: 4 to 8 weeks
New Positions: see below

Comments:
05/30 update: Oil stocks were hammered today. Another rally in the U.S. dollar pushed oil prices lower. The combination of weak oil and a widespread market decline weighed heavily on the oil sector. XCO underperformed the market and its peers with a -8.5% plunge. Our stop loss was hit at $7.45.

Earlier Comments:
If XCO can see a convincing breakout it could see a short squeeze. The most recent data listed short interest at 27% of the 135 million-share float.

closed Position: Long XCO stock @ $8.05 exit $7.45 (-7.4%)

- or -

JUN $8.00 call (XCO1216F8) Entry $0.50 exit $0.12 (-76.0%)

05/30/12 stopped out @ 7.45
05/25/12 triggered at $8.05

chart:

Entry on May 25 at $8.05
Earnings Date 07/31/12 (unconfirmed)
Average Daily Volume = 7.0 million
Listed on May 22, 2011