Editor's Note:
Stock market gains faded on Friday afternoon thanks to Russian leader Putin's remarks in support of Syria.

DRI was stopped out on Friday.


Current Portfolio:


BULLISH Play Updates

Alliance Healthcare Services - AIQ - close: 25.08 change: -0.02

Stop Loss: 23.45
Target(s): 29.50
Current Gain/Loss: -2.4%

Entry on September 04 at $25.70
Listed on September 03, 2013
Time Frame: 4 to 8 weeks
Average Daily Volume = 120 thousand
New Positions: see below

Comments:
09/07/13: AIQ is still seeing some intraday volatility but when it comes to where it closes each night the stock isn't moving much. Traders did buy the dip near its rising 10-dma on Friday morning. Readers may want to wait for a new rise past $26.00 before initiating new positions.

*small positions*

current Position: Long AIQ stock @ $25.70

09/04/13 adjust stop loss down to $23.45

chart:



Sunshine Heart - SSH - close: 10.90 change: -0.17

Stop Loss: 10.39
Target(s): 13.70
Current Gain/Loss: unopened

Entry on September -- at $--.--
Listed on September 05, 2013
Time Frame: 3 to 6 weeks
Average Daily Volume = 329 thousand
New Positions: Yes, see below

Comments:
09/07/13: SSH did not see any follow through on its Thursday rebound. Instead shares underperformed the market on Friday with a -1.5% pullback. We're not giving up yet. There is no change from my Thursday night new play comments that I've reposted below:

Why We Like It:
SSH is in the medical device industry. They specialize on heart assist systems. It's been a rough ride for investors over the last couple of years. Yet it looks like SSH found a bottom in spring and summer this year. The stock took off back in July. Takeover chatter inside the last few months may have boosted SSH's upward momentum. The rally got too hot in August and SSH peaked at $13.80. Since then SSH has seen a -26% correction lower.

Traders just started buying the pullback near round-number support at the $10.00 level Wednesday. The rebound continued Thursday with SSH outperforming the market with a +6.7% gain. Technically the recent action looks like a bullish reversal and a bounce from support.

I do consider this an aggressive, higher-risk trade due to SSH's recent volatility. Nimble traders may want to launch positions immediately. I am suggesting we wait for SSH to trade above Thursday's high (11.47). We'll use a trigger to open positions at $11.55. If triggered our target is $13.70. That's just below the August peak.

I am suggesting we keep our position size small to limit our risk.

Trigger @ 11.55 (small positions)

Suggested Position: buy SSH stock @ (trigger)

chart:



Constellation Brands Inc. - STZ - close: 56.52 change: +0.51

Stop Loss: 55.75
Target(s): 60.00
Current Gain/Loss: +4.2%

Entry on August 23 at $55.35
Listed on August 22, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.3 million
New Positions: see below

Comments:
09/07/13: Shares of STZ were upgraded to a "buy" on Friday morning and the stock responded by gapping open higher. STZ ended the day with a +2.0% gain and a new all-time high. We are raising our stop loss up to $55.75.

Our short-term target is $60.00 but if you're patient you might want to aim higher.

current Position: Long STZ stock @ $55.35

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

Long Oct $60 call (STZ1319j60) entry $0.70

09/07/13 new stop loss @ 55.75
09/05/13 new stop loss @ 55.25
08/24/13 new stop loss @ 53.75

chart:



BEARISH Play Updates

Community Health Systems - CYH - close: 39.68 change: +0.40

Stop Loss: 40.65
Target(s): 35.25
Current Gain/Loss: -1.7%

Entry on September 05 at $39.00
Listed on September 04, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.3 million
New Positions: see below

Comments:
09/07/13: CYH is not cooperating with us. The stock has bounced two days in a row and Friday's +1.0% gain outperformed the major indices. The stock is now testing short-term overhead resistance near $40.00 and its simple 10-dma. Nimble traders could use a failed rally here as a new entry point for bearish positions.

current Position: short CYH stock @ $39.00

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

Long Oct $37 PUT (CYH1319v37) entry $0.98

chart:



Mellanox Technologies - MLNX - close: 38.16 change: -0.47

Stop Loss: 40.15
Target(s): 35.25
Current Gain/Loss: + 3.4%

Entry on August 21 at $39.50
Listed on August 20, 2013
Time Frame: 3 to 6 weeks
Average Daily Volume = 713 thousand
New Positions: see below

Comments:
09/07/13: MLNX spent most of last week churning sideways beneath its simple 10-dma. Yet the overall trend remains bearish and MLNX underperformed the market on Friday with a -1.2% decline.

I am not suggesting new positions.

Earlier Comments:
I would keep position small because MLNX does have above average short interest at 15% of the 37.5 million share float. FYI: The Point & Figure chart for MLNX is bearish with a $27.00 target.

current Position: short MLNX stock @ $39.50

09/04/13 new stop loss @ 40.15
08/22/13 warning! MLNX has produced a one-day bullish reversal pattern

chart:



Meritage Homes Corp. - MTH - close: 39.76 change: +0.84

Stop Loss: 40.25
Target(s): 35.25
Current Gain/Loss: unopened

Entry on August -- at $--.--
Listed on August 27, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 691 thousand
New Positions: Yes, see below

Comments:
09/07/13: The homebuilding-related stocks outperformed the market on Friday. Shares of MTH followed the group higher with a +2.1% gain. I couldn't find any specific news to account for the show of strength except for the possibility that the jobs report may have been bad enough to postpone the QE taper (thus interest rates may rise slower than previously expected).

We are still on the sidelines waiting for a new relative low.

Earlier Comments:
We are suggesting a trigger to launch bearish positions at $38.40. If triggered our multi-week target is $35.25. FYI: The Point & Figure chart for MTH is bearish with a $31.00 target.

Trigger @ 38.40

Suggested Position: short MTH stock @ (trigger)

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

Buy the Oct $35 PUT (MTH1319v35)

chart:



Rentech Nitrogen Partners - RNF - close: 25.55 change: +0.90

Stop Loss: 25.75
Target(s): 21.00
Current Gain/Loss: - 3.9%

Entry on September 04 at $24.60
Listed on September 03, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 167 thousand
New Positions: see below

Comments:
09/07/13: RNF spent the week underperforming the market and then revered higher on Friday with a +3.6% gain. I can't explain the sudden strength. Almost none of RNF's peers rallied on Friday. Looking at RNF the stock was strong almost all day without the intraday volatility so many stocks saw on Friday morning. Shares stalled at short-term technical resistance near its 10-dma. The high on Friday was $25.62. If there is any follow through higher on Monday then we will likely see RNF hit our stop loss at $25.75.

Earlier Comments:
Our target is $21.00. Investors may want to aim lower since the Point & Figure chart for RNF is bearish with a $17.00 target.

current Position: short RNF stock @ $24.60

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

Long Oct $25 PUT (RNF1319v25) entry $1.60

chart:



CLOSED BEARISH PLAYS

Darden Restaurants - DRI - close: 47.45 change: +0.59

Stop Loss: 47.75
Target(s): 44.25
Current Gain/Loss: -1.3%

Entry on August 26 at $47.16
Listed on August 24, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.2 million
New Positions: see below

Comments:
09/07/13: The oversold bounce in DRI continued on Friday. Nearly all of the market's major indices spiked down on Friday morning. Not so for shares of DRI, which spiked higher following new analyst coverage with a $50 price target. Our new stop loss was hit at $47.75.

closed Position: short DRI stock @ $47.16 exit $47.75 (-1.3%)

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

Oct $45 PUT (DRI1319v45) entry $0.90 exit $0.75 (-16.6%)

09/06/13 stopped out
09/05/13 new stop loss at $47.75

chart: