Editor's Note:
The small cap Russell 2000 index managed another gain on Wednesday. This is a show of strength for the markets but the $RUT actually looks a little bit short-term overbought here.

AZZ was triggered. CLF has been removed.


Current Portfolio:


BULLISH Play Updates

Engility Holdings - EGL - close: 29.16 change: +0.15

Stop Loss: 28.25
Target(s): 32.50
Current Gain/Loss: + 3.2%

Entry on June 25 at $28.25
Listed on June 24, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 96 thousand
New Positions: see below

Comments:
07/10/13: EGL spent most of Wednesday's session hovering sideways near the $29.00 level. A late-day bounce helped lift it to a +0.5% gain. I am still cautious here. We're not suggesting new positions.

Earlier Comments:
A breakout could spark some short covering. The most recent data listed short interest a 10% of the small 12.7 million share float.

current Position: Long EGL stock @ $28.25

07/09/13 new stop loss @ 28.25
07/06/13 new stop loss @ 27.85
06/29/13 new stop loss @ 27.45



iShares Japan Index - EWJ - close: 11.54 change: -0.04

Stop Loss: 10.98
Target(s): 12.40
Current Gain/Loss: - 0.1%

Entry on July 02 at $11.55
Listed on July 01, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 66 million
New Positions: see below

Comments:
07/10/13: The EWJ has been drifting sideways the last couple of sessions. That might be a sign that investors are on the sidelines waiting for news out of Japan's central bank. Japan is currently implementing a record-breaking amount of stimulus to try and jolt the country out of a 20-year stagnation. The government's goal is to raise inflation to 2%. The Bank of Japan started a two-day meeting today. Tomorrow afternoon they will provide their latest decision on interest rates and update their economic forecasts. No one expects any changes to their QE program. BoJ Governor Haruhiko Kuroda will hold a press conference tomorrow as well.

Odds are good that we will see the EWJ move one way or the other tomorrow!

current Position: Long EWJ stock @ $11.55

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

Long 2014 Jan $12 call (EWJ1418a12) entry $0.58



Fiesta Restaurant Group. - FRGI - close: 34.89 change: -0.11

Stop Loss: 33.80
Target(s): 39.50
Current Gain/Loss: -1.5%

Entry on July 05 at $35.42
Listed on July 02, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 245 thousand
New Positions: Yes, see below

Comments:
07/10/13: FRGI is still churning sideways near resistance at the $35.00 level.

Readers may want to use a trigger at $35.50 to initiate new positions.

current Position: Long FRGI stock @ $35.42

07/05/13 trade opened on gap higher at $35.42. Trigger was $35.25.



MetLife, Inc. - MET - close: 48.61 change: -0.17

Stop Loss: 46.25
Target(s): 49.75
Current Gain/Loss: + 5.1%

Entry on July 01 at $46.25
Listed on June 27, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 8.7 million
New Positions: see below

Comments:
07/10/13: Hmm... MET might be poised for a pullback. The stock failed twice at the $49.00 level today. More conservative traders might want to just take profits now. I am not suggesting new positions. We will raise our stop loss up to $46.25.

*small positions*

current Position: Long MET stock @ $46.25

07/10/13 new stop loss @ 46.25
07/09/13 new stop loss @ 45.90, adjust target down to $49.75
07/02/13 new stop loss @ 45.40



Nexstar Broadcasting - NXST - close: 38.39 change: -0.14

Stop Loss: 35.75
Target(s): 39.50
Current Gain/Loss: + 8.0%

Entry on June 27 at $35.53
Listed on June 26, 2013
Time Frame: 4 to 8 weeks
Average Daily Volume = 615 thousand
New Positions: see below

Comments:
07/10/13: NXST spent the day hovering near the $38.00 level. I don't see any changes from my prior comments. Readers may want to go ahead and take profits now.

*small positions*

current Position: Long NXST stock @ $35.53

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

Long Aug $40 call (NXST1317H40) entry $1.14

07/09/13 new stop loss @ 35.75
07/08/13 new stop loss @ 34.85
07/06/13 new stop loss @ 33.85
06/27/13 triggered on gap higher at $35.53 (trigger was 35.50)



Polypore Intl. Inc. - PPO - close: 41.65 change: -0.36

Stop Loss: 39.90
Target(s): 44.75
Current Gain/Loss: + 2.2%

Entry on July 01 at $40.75
Listed on June 29, 2013
Time Frame: 3 to four weeks (unless you're trading the options)
Average Daily Volume = 3.3 million
New Positions: see below

Comments:
07/10/13: PPO underperformed the market with a -0.8% decline. Look for short-term support at $41.00 and $40.00.

Earlier Comments:
PPO could see another short squeeze. The most recent data listed short interest at 39% of the small 42.7 million share float.

*small positions*

current Position: Long PPO stock @ $40.75

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

Long Jul $40 call (PPO1320G40) entry $1.75*

07/09/13 new stop loss @ 39.90
*07/01/13 option entry price is an estimate since the option did not trade at the time our play was opened.



The Charles Schwab Corp. - SCHW - close: 21.94 change: -0.26

Stop Loss: 21.35
Target(s): 24.50
Current Gain/Loss: + 1.8%

Entry on July 01 at $21.55
Listed on June 29, 2013
Time Frame: Exit prior to earnings on July 15th
Average Daily Volume = 12.2 million
New Positions: see below

Comments:
07/10/13: SCHW dipped toward one of its short-term trend lines of higher lows. I didn't see any specific headlines behind today's relative weakness. Although I did see a story that Massachusetts regulators had sent subpeonas to most of the big, nationwide brokerage firms. The investigators are worried that senior citizens might be targeted by riskier alternative investments.

Note: we will probably exit SCHW by week's end to avoid holding over the earnings report (expected early next week).

*small positions*

current Position: Long SCHW stock @ $21.55

07/09/13 new stop loss @ 21.35



Seagate Tech. - STX - close: 45.83 change: +0.10

Stop Loss: 44.90
Target(s): 49.85
Current Gain/Loss: - 0.5%

Entry on July 08 at $46.05
Listed on July 06, 2013
Time Frame: exit PRIOR to earnings on July 24th
Average Daily Volume = 3.5 million
New Positions: see below

Comments:
07/10/13: STX spent another day consolidating sideways between the $45-46 levels. Today's high was $46.16. Readers may want to look for a move above this level before initiating new positions.

current Position: Long stock @ $46.05

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

Long Aug $47 call (STX1317H47) entry $1.80

07/09/13 new stop loss @ 44.90



Whole Foods Market - WFM - close: 54.66 change: -0.05

Stop Loss: 52.25
Target(s): 58.50
Current Gain/Loss: + 1.7%

Entry on July 08 at $53.75
Listed on July 06, 2013
Time Frame: exit PRIOR to earnings on July 31st.
Average Daily Volume = 2.2 million
New Positions: see below

Comments:
07/10/13: After a six-day rally shares of WFM finally paused on Wednesday with a very minor pullback.

Our target is $58.50. However, we will plan to exit prior to the earnings report on July 31st. FYI: The Point & Figure chart for WFM is bullish with a $78.00 target.

current Position: Long WFM stock @ $53.75

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

Long Aug $55 call (WFM1317H55) entry $1.60



BEARISH Play Updates

AZZ Inc. - AZZ - close: 35.40 change: +0.23

Stop Loss: 36.25
Target(s): 30.50
Current Gain/Loss: - 1.9%

Entry on July 10 at $34.75
Listed on July 09, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 231 thousand
New Positions: see below

Comments:
07/10/13: Our new play on AZZ has been triggered. Shares fell to a new relative low this morning and hit $34.61. Our entry trigger was hit at $34.75. Unfortunately the stock recovered and reversed into a +0.6% gain on the session.

The overall trend remains bearish but readers may want to look for a new relative low before initiating positions.

FYI: AZZ will begin trading ex-dividend on July 10th. The quarterly dividend should be 14 cents.

current Position: short AZZ stock @ $34.75

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

Long Aug $35 PUT (AZZ1317T35) entry $1.60



DR Horton Inc. - DHI - close: 21.05 change: -0.17

Stop Loss: 20.55
Target(s): 17.00
Current Gain/Loss: unopened

Entry on July -- at $--.--
Listed on July 08, 2013
Time Frame: Exit PRIOT to earnings on July 25th
Average Daily Volume = 8.1 million
New Positions: Yes, see below

Comments:
07/10/13: There was no follow through on yesterday's bounce in DHI. Let's give it another day or two and then we'll re-evaluate our trade. Currently we are on the sidelines. I am suggesting a trigger to launch positions at $19.60.

Trigger @ 19.60

Suggested Position: short DHI stock @ (trigger)

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

Buy the Aug $20 PUT (DHI1317T20)



CLOSED BEARISH PLAYS

Cliffs Natural Res. - CLF - close: 16.68 change: +0.29

Stop Loss: 16.31
Target(s): 12.15
Current Gain/Loss: unopened

Entry on June -- at $--.--
Listed on June 26, 2013
Time Frame: exit PRIOR to earnings in late July
Average Daily Volume = 11.5 million
New Positions: see below

Comments:
07/10/13: It's got to be frustrating as a corporate executive to announce your retirement and see your company's stock rally on the news. CLF said its CEO was retiring and the stock popped higher this morning.

We've been waiting for a breakdown below support but that seems unlikely to happen any time soon. Therefore we are removing CLF as a candidate. Our trade did not open.

Trade did not open.

07/10/13 removed from the newsletter
07/06/13 CLF came close ($15.41) but did not hit our suggested entry trigger at $15.40. Tonight we are adjusting the entry trigger down to $15.30 and the stop loss to $16.31.

chart: