Editor's Note:
Shares of Navistar continue to plunge and hit our exit target today.

Elsewhere we closed THRX, TPX, and TESO at the open this morning. SMG, ADTN, and RHI all hit our entry triggers. EXXI was stopped out.

Current Portfolio:


BULLISH Play Updates

eBay Inc. - EBAY - close: 47.36 change: -0.12

Stop Loss: 45.75
Target(s): 49.75
Current Gain/Loss: + 2.4%

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:
09/04/12: EBAY continues to coil under resistance near $48.00. If the market cooperates this stock could see a bullish breakout soon.

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



CarMax - KMX - close: 30.65 change: +0.06

Stop Loss: 29.30
Target(s): 33.00
Current Gain/Loss: + 1.8%

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:
09/04/12: KMX dipped to $30.28 before rebounding back to positive territory. There is no change from my weekend comments.

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



PulteGroup - PHM - close: 13.75 change: +0.07

Stop Loss: 12.65
Target(s): 13.90
Current Gain/Loss: +11.9%
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:
09/04/12: One penny! That's how close PHM got to our exit target at $13.90. I am suggesting we go ahead and exit positions at the opening bell tomorrow. More aggressive traders might want to consider holding positions if you think PHM can break through resistance at $14.00.

Current Position: Long PHM stock @ $12.29

- or -

Long Oct $13 call (PHM1220j13) Entry $0.70

09/04/12 prepare to exit at the opening bell tomorrow!
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.



Scotts Miracle-Gro Company - SMG - close: 42.07 change: +0.42

Stop Loss: 40.60
Target(s): 44.85
Current Gain/Loss: + 0.5%

Entry on September 04 at $41.85
Listed on September 01, 2011
Time Frame: 4 to 6 weeks
Average Daily Volume = 500 thousand
New Positions: see below

Comments:
09/04/12: SMG provided nimble traders an entry point on a dip near technical support at the 30-dma before bouncing higher. Shares hit our entry trigger at $41.85 on the afternoon rally. I would still consider new positions now at current levels.

FYI: The Point & Figure chart for SMG is bullish with a long-term $54 target.

current Position: Long SMG stock @ $41.85

09/04/12 triggered @ 41.85



BEARISH Play Updates

ADTRAN Inc. - ADTN - close: 20.27 change: -0.02

Stop Loss: 21.15
Target(s): 17.50
Current Gain/Loss: - 2.1%

Entry on September 04 at $19.85
Listed on September 01, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 973 thousand
New Positions: see below

Comments:
09/04/12: I want to urge caution here. The market's weakness this morning helped push ADTN under support at $20.00. Yet the market's big bounce this afternoon pulled ADTN back above this key level. Our trade was opened at $19.85 but I would wait for a new drop under $19.85 before initiating new positions.

FYI: The Point & Figure chart for ADTN is bearish with a long-term $10.00 target.

current Position: short ADTN stock @ $19.85

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

Long Oct $19 PUT (ADTN1220v19) Entry $1.05*

09/04/12 triggered @ 19.85
*option entry price is an estimate since the option did not trade at the time our play was opened



Cabot Corp. - CBT - close: 34.54 change: -0.29

Stop Loss: 35.85
Target(s): 31.50
Current Gain/Loss: + 0.9%

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:
09/04/12: CBT tagged a new multi-month low at $33.90 before bouncing with the market this afternoon. I am not suggesting new positions at this time.

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



Dolby Labs - DLB - close: 33.44 change: +0.26

Stop Loss: 35.11
Target(s): 30.15
Current Gain/Loss: + 0.5%

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:
09/04/12: DLB managed a bounce today (+0.7%). Look for short-term resistance near $34.00. 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



Robert Half Intl. - RHI - close: 25.97 change: -0.33

Stop Loss: 26.85
Target(s): 22.50
Current Gain/Loss: - 0.9%

Entry on September 04 at $25.75
Listed on September 01, 2011
Time Frame: 4 to 6 weeks
Average Daily Volume = 1.2 million
New Positions: see below

Comments:
09/04/12: RHI continues to show relative weakness but I am a little bit cautious here. Shares broke down to new lows and hit our entry point at $25.75. Yet the market's widespread bounce lifted RHI as well. I would suggest waiting for a new drop to $25.75 or $25.70 before initiating new positions.

FYI: The Point & Figure chart for RHI is bearish with a $20.00 target.

current Position: short RHI stock @ $25.75

09/04/12 triggered @ 25.75



Strayer Education - STRA - close: 64.50 change: -0.28

Stop Loss: 67.05
Target(s): 61.50
Current Gain/Loss: + 4.4%

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:
09/04/12: STRA hit another new relative low at $62.81 this morning. There is no change from my prior comments. More conservative traders may want to take profits now.

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



TIM Participacoes S.A. - TSU - close: 19.32 change: -0.19

Stop Loss: 20.05
Target(s): 17.50
Current Gain/Loss: + 2.4%

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:
09/04/12: There was no follow through on TSU's big bounce from Friday. Looks like the 10-dma is acting as short-term resistance. I am not suggesting new positions at this time.

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



CLOSED BULLISH PLAYS

Energy XXI Ltd. - EXXI - close: 33.17 change: +0.28

Stop Loss: 32.45
Target(s): 37.75
Current Gain/Loss: - 4.7%

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:
09/04/12: The stock market's widespread weakness this morning was enough to push EXXI to a new relative low. The stock hit our stop loss at $32.45.

closed Position: Long EXXI stock @ $34.05 exit $32.45 (-4.7%)

- or -

Sep $35 call (EXXI1222i35) Entry $1.45 exit $0.40*(-72.4%)

*option exit price is an estimate since the option did not trade at the time our play was closed.
09/04/12 stopped out at $32.45
08/15/12 triggered at $34.05

chart:



Theravance Inc. - THRX - close: 25.85 change: -0.82

Stop Loss: 25.90
Target(s): 31.00
Current Gain/Loss: - 3.1%

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:
09/04/12: Looks like our instincts on THRX were correct. Shares looked vulnerable late last week. Over the weekend we suggested everyone exit at the open on Tuesday morning.

THRX opened at $26.79 before plunging -3.0%.

*small positions*

closed Position: Long THRX stock @ $27.65 exit $26.79 (-3.1%)

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

Oct $30 call (THRX1220j30) entry $1.55 exit $0.85*(-45.1%)

*option exit price is an estimate since the option did not trade at the time our play was closed.
09/04/12 planned exit this morning.
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: 31.62 change: +0.38

Stop Loss: 30.90
Target(s): 39.00
Current Gain/Loss: - 4.2%
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:
09/04/12: TPX displayed some relative strength with a +1.2% gain today. Shares spent the morning bouncing along support at $31.00 before rebounding. Over the weekend I suggested we go ahead and exit all positions at the opening bell today.

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

(small positions)

closed Position: Long TPX stock @ $32.50 exit $31.15 (-4.2%)

- or -

Sep $33 call (TPX1222I33) Entry $1.75 exit $0.53 (-69.7%)

09/04/12 planned exit at the open this morning
09/01/12 prepare to exit on Tuesday morning
08/29/12 new stop loss @ 30.90
08/16/12 triggered @ 32.50

chart:



CLOSED BEARISH PLAYS

Navistar Intl. - NAV - close: 19.99 change: -1.99

Stop Loss: 24.05
Target(s): 20.25
Current Gain/Loss: +12.8%

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:
09/04/12: Target achieved.

Shares of NAV accelerated lower and failed to bounce with the rest of the market this afternoon. The stock plunged -9% to close near round-number, psychological support at the $20.00 level. Our exit target was hit at $20.25.

closed Position: short NAV stock @ $23.22 exit $20.25 (+12.8%)

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

Sep $20 PUT (NAV1222u20) Entry $0.70 exit $1.30 (+ 85.7%)

09/04/12 target hit at $20.25
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:



Tesco Corp. - TESO - close: 9.92 change: -0.24

Stop Loss: 10.55
Target(s): 8.15
Current Gain/Loss: - 3.8%

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:
09/04/12: Hmm... over the weekend we decided to close our TESO trade at the open today because shares appeared to be bouncing. Yet the rebound reversed at short-term technical resistance at the 10-dma. Honestly today looks like a new bearish entry point. However, the newsletter has closed this play at the open this morning ($10.13).

Nimble traders may want to short TESO under today's low ($9.84) and use a stop above today's high ($10.17).

closed Position: short TESO stock @ $9.76 exit $10.13 (-3.8%)

09/04/12 closed at the opening bell today
09/01/12 prepare to exit on Tuesday morning

chart: