Editor's Note:
Both BAC and NUAN hit our entry triggers today. STMP was stopped out. We want to exit our ARUN trade tomorrow if shares don't cooperate.

Current Portfolio:


BULLISH Play Updates

Aruba Networks - ARUN - close: 17.34 change: +0.08

Stop Loss: 16.75
Target(s): 18.00
Current Gain/Loss: +7.5%
Time Frame: 2 to 4 weeks

Entry on August 09 at $16.13
Listed on August 8, 2011
Average Daily Volume = 3.4 million
New Positions: see below

Comments:
08/21/12 update: We are almost out of time on this trade. ARUN continues to churn sideways above short-term support at $17.00. We currently have an exit target at $18.00 but we need to exit before earnings. I am suggesting traders exit positions at the closing bell tomorrow. We will leave our stop at $16.75. (FYI: Current option bid is $2.10)

Earlier Comments:
ARUN could see a short squeeze. The most recent data listed short interest at 24% of the 104.8 million-share float.

current position: Long ARUN stock @ $16.13

- or -

Long Sep $16 call (ARUN1222i16) Entry $1.55

08/21/12 prepare to exit tomorrow if ARUN doesn't hit our target
08/20/12 new stop loss @ 16.75, plan to exit on Wednesday at the close
08/18/12 adjust exit target to $18.00
08/16/12 adjust exit target to $18.25
08/09/12 new stop loss @ 15.49
08/09/12 triggered on gap higher at $16.13. Trigger was $15.75.



Bank of America - BAC - close: 8.19 change: +0.04

Stop Loss: 7.90
Target(s): 9.25 or 9.75
Current Gain/Loss: - 0.7%

Entry on August 21 at $8.25
Listed on August 20, 2011
Time Frame: 6 to 9 weeks
Average Daily Volume = 103 million
New Positions: see below

Comments:
08/21/12 update: The financials continue to rally. BAC posted another gain today but the action actually looks a little bearish. The stock gapped open higher at $8.25 and rallied to $8.40 before paring its gains. This almost looks like a failed rally or bull-trap type of move. Our trade was opened at $8.25 but I'd be a little cautious on launch positions tomorrow. Nimble traders might try buying a dip or a bounce near $8.05.

The plan was to use small positions to limit our risk.

current Position: Long BAC stock @ $8.25

- or -

Long 2013 Jan $9.00 call (BAC1319a9) Entry $0.47

08/21/12 triggered @ 8.25



Darden Restaurants, Inc. - DRI - close: 53.15 change: -0.31

Stop Loss: 52.90
Target(s): 58.50
Current Gain/Loss: unopened

Entry on August xx at $ xx.xx
Listed on August 18, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.3 million
New Positions: Yes, see below

Comments:
08/21/12 update: DRI continues to pullback from its test of resistance near $54.00. Right now the plan is to wait for a breakout past resistance at $54.00. We have a trigger at $54.15. If triggered we will aim for $58.50. More aggressive traders could aim higher. FYI: The Point & Figure chart for DRI is bullish with a $65 target.

Trigger @ 54.15

Suggested Position: buy DRI stock @ (trigger)

- (or for more adventurous traders, try this option) -

Buy the Oct $55 call (DRI1220J55)



eBay Inc. - EBAY - close: 45.85 change: -0.55

Stop Loss: 44.75
Target(s): 49.75
Current Gain/Loss: - 0.9%

Entry on August 17 at $46.25
Listed on August 16, 2011
Time Frame: 4 to 6 weeks
Average Daily Volume = 12.3 million
New Positions: see below

Comments:
08/21/12 update: Today's move in EBAY is a little disappointing. Broken resistance at $46.00 should have held up as new support. Today's close under that level is short-term bearish in my book. I would wait for a new rise past $46.25 before considering new positions.

current Position: Long EBAY stock @ $46.25

- or -

Long Oct $47 call (EBAY1220J47) Entry $1.89

08/17/12 triggered at $46.25



Energy XXI Ltd. - EXXI - close: 34.80 change: +0.57

Stop Loss: 32.45
Target(s): 37.75
Current Gain/Loss: + 2.2%

Entry on August 15 at $34.05
Listed on August 11, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 968 thousand
New Positions: see below

Comments:
08/21/12 update: EXXI was showing some strength right off the bat with a surge to $35.43 this morning. Gains eventually faded but EXXI still added +1.6%. Readers might want to consider raising their stop closer to the $33.00 or $33.50 levels.

current Position: Long EXXI stock @ $34.05

- or -

Long Sep $35 call (EXXI1222i35) Entry $1.45

08/15/12 triggered at $34.05



Nuance Comm. - NUAN - close: 24.32 change: +0.44

Stop Loss: 22.90
Target(s): 28.00
Current Gain/Loss: - 0.7%

Entry on August 21 at $24.50
Listed on August 18, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 4.1 million
New Positions: see below

Comments:
08/21/12 update: Our new trade on NUAN has been triggered. The stock shot higher at the open and rallied past technical resistance at its 200-dma. NUAN hit our trigger to launch positions at $24.50. Unfortunately, shares pared their gains but still managed a +1.8% gain on the session.

Our multi-week target is $28.00.

current Position: Long NUAN stock @ $24.50

- (or for more adventurous traders, try this option) -

Long Oct $25 call (NUAN1220j25) Entry $1.30*

08/21/12 triggered @ 24.50
*option entry price is an estimate. it did not trade at the time our play was opened.



PulteGroup - PHM - close: 12.79 change: -0.22

Stop Loss: 12.45
Target(s): 14.50
Current Gain/Loss: + 4.1%
Time Frame: 6 to 8 weeks

Entry on August 09 at $12.29
Listed on August 8, 2011
Average Daily Volume = 14.5 million New Positions: see below

Comments:
08/21/12 update: PHM's correction is now three days old and shares just settled on their simple 10-dma, the first level of technical support. If there is any follow through lower then PHM will likely hit our stop loss at $12.45 soon. I am not suggesting new positions at this time.

Current Position: Long PHM stock @ $12.29

- or -

Long Oct $13 call (PHM1220j13) Entry $0.70

08/20/12 new stop loss @ 12.45
08/18/12 new stop loss @ 11.95
08/17/12 PHM stalls/reverses at resistance near $14.00
08/09/12 new stop loss @ 11.80
08/09/12 triggered on gap higher at $12.29. Trigger was $12.25.



Seagate Technology - STX - close: 34.72 change: -0.36

Stop Loss: 33.35
Target(s): 38.00
Current Gain/Loss: -0.1%

Entry on August 17 at $34.75
Listed on August 16, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 11.6 million
New Positions: see below

Comments:
08/21/12 update: STX is still holding up reasonably well. Traders bought the dip at short-term technical support at the rising 10-dma midday. More conservative traders might want to consider a tighter stop loss.

Earlier Comments:
STX is arguably overbought here and overdue for a correction. I am suggesting we keep our position size small to limit our risk.

current Position: Long STX stock @ $34.75

- or -

Long Dec $37 call (STX1222L37) Entry $2.35

08/17/12 triggered @ 34.75



Tempur Pedic Intl. - TPX - close: 33.04 change: +0.29

Stop Loss: 29.75
Target(s): 39.00
Current Gain/Loss: + 1.7%
Time Frame: 6 to 8 weeks

Entry on August 16 at $32.50
Listed on August 7, 2011
Average Daily Volume = 2.5 million New Positions: see below

Comments:
08/21/12 update: TPX displayed some strength with a +0.8% gain but shares essentially churned sideways after the opening gap higher. Nimble traders can use dips to the simple 10-dma as a bullish entry point.

Earlier Comments:
I do consider this somewhat of an aggressive trade so we will want to limit the size of our position. Our multi-week target is $39.00 since the $40.00 level is probably round-number resistance.

(small positions)

current Position: Long TPX stock @ $32.50

- or -

Long Sep $33 call (TPX1222I33) Entry $1.75

08/16/12 triggered @ 32.50



BEARISH Play Updates

Cliffs Natural Resources - CLF - close: 40.64 change: -1.00

Stop Loss: 43.05
Target(s): 36.50
Current Gain/Loss: + 3.2%

Entry on August 15 at $41.99
Listed on August 14, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 5.3 million
New Positions: see below

Comments:
08/21/12 update: It looks like CLF's down trend is starting to pick up a little bit of momentum. Shares fell -2.4% today. The stock is approaching what could be round-number support at the $40.00 mark so I'm not suggesting new positions at this time.

Please note our new stop loss at $43.05.

current Position: short CLF stock @ $41.99

- or -

Long Oct $40 PUT (CLF1220V40) Entry $2.20

08/21/12 new stop loss @ 43.05



Suburban Propane Partners - SPH - close: 37.60 change: +0.10

Stop Loss: 38.05
Target(s): 35.50
Current Gain/Loss: + 3.0%
Time Frame: 6 to 8 weeks

Entry on August 08 at $38.76
Listed on August 6, 2011
Average Daily Volume = 625 thousand New Positions: see below

Comments:
08/21/12 update: Volume was pretty light today and there was very steady selling at the $37.70 level throughout the session. Overall, SPH ended Tuesday little changed.

current Position: short SPH @ $38.76

- or -

Long Sep $40 PUT entry @ $2.20

08/14/12 I repeat, readers may want to lock in gains now and exit early
08/13/12 new stop loss @ 38.05
08/09/12 new stop loss @ 39.15
08/08/12 triggered on gap down at $38.76 (trigger was 39.75)



CLOSED BEARISH PLAYS

Stamps.com Inc. - STMP - close: 20.76 change: +0.36

Stop Loss: 20.65
Target(s): 17.00
Current Gain/Loss: - 5.9%

Entry on August 14 at $19.50
Listed on August 9, 2011
Time Frame: 3 to 6 weeks
Average Daily Volume = 319 thousand
New Positions: see below

Comments:
08/21/12 update: The oversold bounce is starting to look like a short squeeze in STMP. The stock is up five days in a row with a move from $19 to over $21 during that period. Our stop loss was hit at $20.65 early this morning.

closed Position: short STMP @ $19.50 exit $20.65 (-5.9%)

- or -

Sep $20 PUT (STMP1222u20) Entry $1.85 exit $0.80 (-56.7%)

08/21/12 stopped out at $20.65
08/14/12 triggered @ 19.50

chart: