Editor's Note:
Fed Chairman Bernanke's speech on Friday failed to produce any significant movement in the market. There was some volatility on Friday morning but the major indices continued to churn sideways.

We are going to prune a few nonperformers off our play list this weekend. Prepare to exit THRX, TPX, and TESO on Tuesday morning.

The U.S. markets are closed on Monday.

Current Portfolio:


BULLISH Play Updates

eBay Inc. - EBAY - close: 47.47 change: +0.92

Stop Loss: 45.75
Target(s): 49.75
Current Gain/Loss: + 2.6%

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:
09/01/12: EBAY rebounded after Thursday's relative weakness. The stock added +1.9% on Friday and is once again looks poised to test short-term resistance near $48.00.

I am raising our stop loss up to $45.75. I am not suggesting new positions at this time.

current Position: Long EBAY stock @ $46.25

- or -

Long Oct $47 call (EBAY1220J47) Entry $1.89

09/01/12 new stop loss @ 45.75
08/17/12 triggered at $46.25

chart:



Energy XXI Ltd. - EXXI - close: 32.89 change: +0.10

Stop Loss: 32.45
Target(s): 37.75
Current Gain/Loss: - 3.4%

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:
09/01/12: I am still worried about our EXXI trade. The stock tried to bounce but it failed at the 150-dma. This moving average has been both support and resistance over the last few weeks. If the market moves lower next week I would expect EXXI to hit our stop at $32.45 pretty quickly.

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:



CarMax - KMX - close: 30.59 change: +0.30

Stop Loss: 29.30
Target(s): 33.00
Current Gain/Loss: + 1.6%

Entry on August 30 at $30.10
Listed on August 29, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.2 million
New Positions: Yes, see below

Comments:
09/01/12: KMX posted another gain on Friday (+0.99%) and closed at new three and a half month highs. If you missed our entry point readers might want to wait for a new dip near $30.00 before launching positions. Broken resistance at $30 and the 200-dma should offer some support.

current Position: Long KMX stock @ $30.10

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

Long Sep $30 call (KMX1222i30) entry $1.08

08/30/12 trade opened on gap down at $30.10

chart:



PulteGroup - PHM - close: 13.68 change: +0.33

Stop Loss: 12.65
Target(s): 13.90
Current Gain/Loss: +11.3%
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:
09/01/12: Many of the homebuilders are still holding up pretty well. PHM seems to be coiling for a breakout past resistance near $14.00 but there is no guarantee that will happen.

Our exit target is $13.90. Cautious traders will want to take profits now. Aggressive traders might want to aim higher instead.

I am not suggesting new positions.

Current Position: Long PHM stock @ $12.29

- or -

Long Oct $13 call (PHM1220j13) Entry $0.70

08/29/12 new stop loss @ 12.65
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: 26.67 change: -0.43

Stop Loss: 25.90
Target(s): 31.00
Current Gain/Loss: - 3.5%

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:
09/01/12: THRX is not cooperating with us. The rally failed at resistance near $28 and its 30-dma a few days ago. Now shares have broken down under their 50-dma and the stock looks poised for more profit taking.

I am suggesting an early exit at the open on Tuesday morning (market is closed on Monday).

*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

09/01/12 prepare to exit on Tuesday morning.
(the plan was to limit our position size to reduce our risk)

chart:



Tempur Pedic Intl. - TPX - close: 31.24 change: -0.04

Stop Loss: 30.90
Target(s): 39.00
Current Gain/Loss: - 3.9%
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:
09/01/12: We are throwing in the towel with our TPX trade. Shares lost four cents on Friday and TPX looks poised for further declines after a week of moving sideways. I am suggesting we exit positions on Tuesday morning (the market is closed on Monday).

Earlier Comments:
I do consider this somewhat of an aggressive trade so we will want to limit the size of our position.

(small positions)

current Position: Long TPX stock @ $32.50

- or -

Long Sep $33 call (TPX1222I33) Entry $1.75

09/01/12 prepare to exit on Tuesday morning
08/29/12 new stop loss @ 30.90
08/16/12 triggered @ 32.50

chart:



BEARISH Play Updates

Cabot Corp. - CBT - close: 34.83 change: +0.17

Stop Loss: 35.85
Target(s): 31.50
Current Gain/Loss: + 0.1%

Entry on August 29 at $34.85
Listed on August 28, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 338 thousand
New Positions: see below

Comments:
09/01/12: CBT produced a bounce on Friday but it was merely in-line with the market's major indices. The stock is still struggling with prior support and what should be resistance near $35.00.

I would still consider new bearish positions at current levels.

Our multi-week target is $31.50. The Point & Figure chart for CBT is bearish with a $25.00 target.

current Position: short CBT stock @ $34.85

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

Long Oct $35 PUT (CBT1220v35) entry $2.05

chart:



Dolby Labs - DLB - close: 33.18 change: +0.17

Stop Loss: 35.11
Target(s): 30.15
Current Gain/Loss: + 1.3%

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:
09/01/12: DLB trimmed its Friday morning gains to settle with a +0.5% bounce. The overall trend remains bearish. Friday's intraday pullback looks like a new bearish entry point. More conservative traders might want to start adjusting their stop loss lower.

*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:



Navistar Intl. - NAV - close: 21.98 change: +0.51

Stop Loss: 24.05
Target(s): 20.25
Current Gain/Loss: +5.3%

Entry on August 28 at $ 23.22
Listed on August 25, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.7 million
New Positions: see below

Comments:
09/01/12: NAV saw a sharp oversold bounce on Friday morning. You'll notice that the rally reversed at short-term technical resistance at the simple 10-dma. More conservative traders might want to lower their stops closer to Friday's high (which was 23.49).

I am not suggesting new positions at this time. NAV should be reporting earnings in the next week or two. We don't have much time left.

Suggested Position: short NAV stock @ $23.22

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

Long Sep $20 PUT (NAV1222u20) Entry $0.70

08/30/12 new stop loss @ 24.05
08/28/12 trade opens with NAV at $23.22
08/27/12 NAV gaps open above our stop loss, effectively negating our trade. We are reloading and trying again. Launch positions at the open tomorrow

chart:



Strayer Education - STRA - close: 64.78 change: +0.10

Stop Loss: 67.05
Target(s): 61.50
Current Gain/Loss: + 4.0%

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:
09/01/12: STRA has churned sideways in the $64-66 zone for three days in a row. Has the stock found new support? Or is this just a paused before STRA continues lower? More conservative traders may want to take profits now.

I am lowering our stop loss to $67.05. I am not suggesting new positions at this time.

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

09/01/12 new stop loss @ 67.05
08/30/12 new stop loss @ 67.75
08/27/12 new stop loss @ 68.65
08/25/12 new stop loss @ 70.25

chart:



Tesco Corp. - TESO - close: 10.16 change: +0.20

Stop Loss: 10.55
Target(s): 8.15
Current Gain/Loss: - 4.1%

Entry on August 28 at $9.76
Listed on August 27, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 304 thousand
New Positions: see below

Comments:
09/01/12: We are not seeing any momentum in TESO. The larger trend is very bearish but short-term the stock keeps bouncing back above the $10.00 level. As broken support $10 should be new resistance.

I am suggesting we exit early to cut our losses now. We can revisit TESO if shares reverse lower. You could make the case that TESO is merely consolidating in a bear-flag pattern.

We will exit positions on Tuesday morning at the open.

current Position: short TESO stock @ $9.76

09/01/12 prepare to exit on Tuesday morning

chart:



TIM Participacoes S.A. - TSU - close: 19.51 change: +0.73

Stop Loss: 20.05
Target(s): 17.50
Current Gain/Loss: + 1.5%

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:
09/01/12: TSU was down 7 out of the last 8 sessions until Friday. The stock produced a strong oversold bounce on Friday (+3.8%). Shares are nearing what should be new resistance at the simple 10-dma (19.56) and the $20.00 mark.

I am adjusting our stop loss down to $20.05. Wait for this bounce to reverse before considering new bearish positions.

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

09/01/12 new stop loss @ 20.05
08/27/12 new stop loss @ 20.55
08/22/12 triggered @ 19.80

chart:



CLOSED BULLISH PLAYS

Integra Life Sciences - IART - close: 39.34 change: -0.79

Stop Loss: 39.45
Target(s): 44.50
Current Gain/Loss: - 2.8%

Entry on August 29 at $40.60
Listed on August 21, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 171 thousand
New Positions: see below

Comments:
09/01/12: Our new IART play didn't last very long. The bullish breakout past resistance at $40.00 suddenly looks like a bull-trap pattern. Shares underperformed the market on Friday with a -1.9% decline. Our stop loss was hit at $39.45.

current Position: Long IART stock @ $40.60 exit $39.45 (-2.8%)

chart: