Editor's Note:
Stocks end a down week with a bounce. Trading volumes remain low.

STX was stopped out. THRX was triggered. We want to exit our SPH trade early on Monday.

Current Portfolio:


BULLISH Play Updates

Bank of America - BAC - close: 8.16 change: +0.01

Stop Loss: 7.90
Target(s): 9.25 or 9.75
Current Gain/Loss: - 1.1%

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:
08/25/12 update: The last few days we have been expecting a dip toward the $8.05 level as our next entry point. BAC just provided it on Friday. Shares ht $8.03 and bounced. I would still consider new bullish positions at current levels.

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

chart:



eBay Inc. - EBAY - close: 47.10 change: +0.30

Stop Loss: 44.75
Target(s): 49.75
Current Gain/Loss: + 1.8%

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:
08/25/12 update: EBAY hit new seven-year highs this past week. Readers may want to look for a dip toward the 10-dma or the $46.00 level as our next potential entry point to jump on board.

current Position: Long EBAY stock @ $46.25

- or -

Long Oct $47 call (EBAY1220J47) Entry $1.89

08/17/12 triggered at $46.25

chart:



Energy XXI Ltd. - EXXI - close: 34.12 change: +0.37

Stop Loss: 32.45
Target(s): 37.75
Current Gain/Loss: + 0.2%

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:
08/25/12 update: There was not much follow through on Thursday's decline in EXXI. Traders bought the dip at $33.30 on Friday. Readers may want to adjust their stops closer to the $33 level. I am not suggesting new positions.

current Position: Long EXXI stock @ $34.05

- or -

Long Sep $35 call (EXXI1222i35) Entry $1.45

08/15/12 triggered at $34.05

chart:



Integra Life Sciences - IART - close: 39.60 change: +0.14

Stop Loss: 39.45
Target(s): 44.50
Current Gain/Loss: unopened

Entry on August xx at $ xx.xx
Listed on August 21, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 171 thousand
New Positions: Yes, see below

Comments:
08/25/12 update: Traders bought the dip in IART near support at $39.00 again. Aggressive traders may want to launch positions here and just use a stop loss under Friday's low. I am suggesting we wait for a breakout higher. We'll use a trigger at $40.60 as our entry point. We'll use a stop loss at $39.45. Our multi-week target is $44.50. FYI: The Point & Figure chart for IART is bullish with a long-term $61 target.

Trigger @ 40.60

Suggested Position: buy IART stock @ $40.60

chart:



Nuance Comm. - NUAN - close: 23.89 change: -0.04

Stop Loss: 23.40
Target(s): 28.00
Current Gain/Loss: - 2.5%

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:
08/25/12 update: I am concerned that last week's move in NUAN is starting to look like a failed rally pattern at resistance near its simple 200-dma. Friday saw shares briefly trade under potential short-term support at the 10-dma before bouncing. I want to try and limit our risk by raising the stop loss up to $23.40. I am not suggesting new positions at this time.

current Position: Long NUAN stock @ $24.50

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

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

08/25/12 new stop loss @ 23.40
08/21/12 triggered @ 24.50
*option entry price is an estimate. it did not trade at the time our play was opened.

chart:



PulteGroup - PHM - close: 13.51 change: +0.19

Stop Loss: 12.45
Target(s): 13.90
Current Gain/Loss: + 9.9%
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:
08/25/12 update: Homebuilding stocks have continued to show relative strength. Shares of PHM are nearing overhead resistance at $14.00 again. The August 17th high was $13.91. I am adjusting our exit target down to $13.90. I am not suggesting new positions at this time in PHM but you may want to look at some of the other homebuilders (like: MHO, RYL, BZH).

Current Position: Long PHM stock @ $12.29

- or -

Long Oct $13 call (PHM1220j13) Entry $0.70

08/25/12 adjust exit target to $13.90
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.

chart:



Theravance Inc. - THRX - close: 27.91 change: +0.50

Stop Loss: 25.90
Target(s): 31.00
Current Gain/Loss: + 0.9%

Entry on August 24 at $ 27.65
Listed on August 23, 2011
Time Frame: 4 to 8 weeks
Average Daily Volume = 492 thousand
New Positions: see below

Comments:
08/25/12 update: Our new THRX trade is off to a good start. Shares initially spiked lower and fell toward $26.70 on Friday morning before quickly reversing higher. The stock rallied to a +1.8% gain and is now testing potential short-term resistance at $28.00. Our trigger to open bullish positions was hit at $27.65.

Earlier Comments:
THRX is a biotech firm and the stock could see a short squeeze. The most recent data listed short interest at 22% of the 52.6 million-share float. We do want to keep our position size small.

*small positions*

current Position: Long THRX stock @ $27.65

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

Long Oct $30 call (THRX1220j30) entry $1.55

chart:



Tempur Pedic Intl. - TPX - close: 32.26 change: +0.54

Stop Loss: 29.75
Target(s): 39.00
Current Gain/Loss: - 0.7%
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:
08/25/12 update: After a four-day pullback in TPX the stock is still in the game. Traders bought the dip at $31.11 on Friday near its rising 20-dma. TPX rebounded to a +1.7% gain on the session. I would be tempted to launch new positions on this bounce (see the chart below). More conservative traders may want to up their stop closer to the $31.00 level.

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

chart:



BEARISH Play Updates

Cliffs Natural Resources - CLF - close: 38.89 change: -0.43

Stop Loss: 41.60
Target(s): 36.50
Current Gain/Loss: + 7.4%

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:
08/25/12 update: CLF continues to sink, marking its second weekly decline in a row. The close under $40 this week is bearish but shares might be due for a bounce. Do not be surprised to see a rebound back to $40 or the simple 10-dma.

We are adjusting our stop loss down to $41.60.

current Position: short CLF stock @ $41.99

- or -

Long Oct $40 PUT (CLF1220V40) Entry $2.20

08/25/12 new stop loss @ 41.60
08/21/12 new stop loss @ 43.05

chart:



Dolby Labs - DLB - close: 33.97 change: +0.33

Stop Loss: 35.11
Target(s): 30.15
Current Gain/Loss: - 1.1%

Entry on August 24 at $33.60
Listed on August 23, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 992 thousand
New Positions: see below

Comments:
08/25/12 update: DLB recouped about a third of Thursday's decline with a bounce on Friday. Yet the overall pattern remains bearish. I would still consider new positions now at current levels.

*Small Positions*

current Position: short DLB stock @ $33.60

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

Long Sep $35 PUT (DLB1222u35) Entry $1.90

chart:



Suburban Propane Partners - SPH - close: 37.77 change: +0.37

Stop Loss: 38.05
Target(s): 35.50
Current Gain/Loss: + 2.6%
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:
08/25/12 update: SPH has been declining for days yet the pace of the decline has been extremely slow. Friday's gain breaks the short-term trend of lower highs and suggests SPH could see a larger oversold bounce. We want to quickly exit early on Monday morning to avoid seeing this trade turn into a loser. FYI: The current bid/ask on our option is $2.35/2.60.

current Position: short SPH @ $38.76

- or -

Long Sep $40 PUT entry @ $2.20

08/25/12 prepare to exit on Monday morning
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)

chart:



Strayer Education - STRA - close: 66.46 change: -1.15

Stop Loss: 70.25
Target(s): 61.50
Current Gain/Loss: + 1.5%

Entry on August 23 at $67.50
Listed on August 22, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 294 thousand
New Positions: see below

Comments:
08/25/12 update: STRA continues to underperform the market. Shares lost another -1.7% on Friday setting new multi-year lows. We are adjusting our stop loss down to $70.25.

Earlier Comments:
Part of our challenge is that the for-profit education stocks have been bearish for a while. The most recent data listed short interest in STRA at 41% of the very small 11 million share float. That raises our risk of a short squeeze. Given this risk I'd rather buy put options but the options spreads are too wide to trade. We'll try and limit our risk by keeping our position size small.

*Small Positions Only!*

current Position: short STRA stock @ $67.50

08/25/12 new stop loss @ 70.25

chart:



TIM Participacoes S.A. - TSU - close: 19.69 change: +0.39

Stop Loss: 21.25
Target(s): 17.50
Current Gain/Loss: + 0.6%

Entry on August 22 at $19.80
Listed on August 21, 2011
Time Frame: 4 to 6 weeks
Average Daily Volume = 2.3 million
New Positions: see below

Comments:
08/25/12 update: I cautioned readers on Thursday that TSU might see an oversold bounce into the $19.70-20.00 zone. Sure enough that's what happened on Friday. The $20.00 level and the July lows near $20.18 should be overhead resistance. I would wait for the bounce to fail before considering new bearish positions.

current Position: short TSU stock @ $19.80 (Small Positions)

08/22/12 triggered @ 19.80

chart:



CLOSED BULLISH PLAYS

Seagate Technology - STX - close: 34.06 change: +0.37

Stop Loss: 33.35
Target(s): 38.00
Current Gain/Loss: -4.0%

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:
08/25/12 update: Traders bought the dip in STX twice on Friday morning but shares fell low enough to hit our stop loss at $33.35.

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.

closed Position: Long STX stock @ $34.75 exit $33.35 (-4.0%)

- or -

Dec $37 call (STX1222L37) Entry $2.35 exit $1.75*(-25.5%)

*option exit is an estimate, shares did not trade at time of our exit
08/24/12 stopped out at $33.35
08/17/12 triggered @ 34.75

chart: