Editor's Note:
The market recovered from its Tuesday swoon with an intraday rebound back into positive territory.

EMC and HGR hit our entry trigger.
MDCA was closed this morning.
We want to close our TX trade tomorrow morning.


Current Portfolio:


BULLISH Play Updates

Avis Budget Group, Inc. - CAR - close: 40.75 change: -0.21

Stop Loss: 39.85
Target(s): 45.00
Current Gain/Loss: - 0.2%

Entry on January 15 at $40.85
Listed on January 14, 2014
Time Frame: Exit PRIOR to earnings in mid February
Average Daily Volume = 1.3 million
New Positions: see below

Comments:
01/21/14: CAR underperformed on Tuesday. The stock pierced its 10-dma and fell to $40.22 before bouncing. Even with the midday bounce CAR still closed down -0.5%. I cautioned readers in the previous letter to look for this dip. If this bounce continues tomorrow then investors can use it as a new bullish entry point.

current Position: Long CAR stock @ $40.85

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

Long Feb $40 call (CAR1422B40) entry $2.50*

01/15/14 new stop loss @ 39.85, triggered at $40.85
*option entry price is an estimate since the option did not trade at the time our play was opened.



EMC Corp. - EMC - close: 26.33 change: +0.00

Stop Loss: 25.70
Target(s): TBD, exit prior to earnings
Current Gain/Loss: - 0.5%

Entry on January 21 at $26.45
Listed on January 18, 2014
Time Frame: Exit PRIOR to earnings on January 29th
Average Daily Volume = 23 million
New Positions: Yes, see below

Comments:
01/21/14: EMC followed the market's volatility today. The morning gains were enough to hit our suggested entry point at $26.45. Then when stocks reversed lower EMC dipped to support near $26.00. Shares bounced back to unchanged on the session. Investors might want to wait for a breakout past $26.50 before initiating positions. Keep in mind our short time frame. We will plan on exiting prior to EMC's earnings report on January 29th.

current Position: long EMC stock @ $26.45

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

Long Feb $27 call (EMC1422B27) entry $0.53

01/21/14 triggered @ 26.45



Hanger, Inc. - HGR - close: 40.18 change: -0.10

Stop Loss: 39.45
Target(s): 44.50
Current Gain/Loss: - 1.3%

Entry on January 21 at $40.70
Listed on January 16, 2014
Time Frame: 4 to 5 weeks
Average Daily Volume = 159 thousand
New Positions: see below

Comments:
01/21/14: HGR is another example of the market's early morning gains lifting stocks to a new high only to reverse lower. HGR hit our suggested entry point at $40.70 before reversing. The intraday high was $40.71.

The stock did find short-term support near $40.00 most of the session so you could argue this dip to support can be used as an entry point. Or as an alternative you could wait for another new high before launching positions.

Earlier Comments:
Our target is $44.50. However, we will plan on exiting prior to HGR's earnings report (estimated in mid February).

current Position: Long HGR stock @ $40.70

01/21/14 triggered @ $40.70



Hewlett-Packard Co. - HPQ - close: 29.90 change: +0.10

Stop Loss: 28.75
Target(s): 34.50
Current Gain/Loss: unopened

Entry on January -- at $--.--
Listed on January 18, 2014
Time Frame: exit PRIOR to earnings on Feb. 20th
Average Daily Volume = 13.2 million
New Positions: Yes, see below

Comments:
01/21/14: HPQ did not escape the market's intraday weakness. Yet traders bought the dip at $29.45 and shares bounced back into positive territory. There is no change from my weekend new play description.

Earlier Comments:
HPQ is now testing major resistance near the $30.00 mark. A breakout here could inspire more buying pressure. I am suggesting a trigger to launch bullish positions at $30.15. If triggered our target is $34.50. However, that might be a little optimistic since we plan to exit prior to HPQ's earnings report in late February. FYI: The Point & Figure chart for HPQ is bullish with a long-term $47 target.

Trigger @ 30.15

Suggested Position: buy HPQ stock @ (trigger)

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

Buy the Feb $30 call (HPQ1422B30) current ask $1.30



Lannett Company, Inc. - LCI - close: 35.90 change: -0.05

Stop Loss: 34.40
Target(s): 39.50
Current Gain/Loss: +2.1%

Entry on January 10 at $35.15
Listed on January 09, 2014
Time Frame: exit PRIOR to earnings in early February
Average Daily Volume = 261 thousand
New Positions: see below

Comments:
01/21/14: LCI spent Tuesday's session churning sideways on either side of the $36.00 level. I am not suggesting new positions at this time.

Earlier Comments:
Our target is $39.50. However, we will plan on exiting prior to LCI's earnings report in early February (no date confirmed yet).

current Position: Long LCI stock @ $35.15

01/18/14 new stop loss @ 34.40
01/14/14 new stop loss @ 33.95
01/13/14 new stop loss @ 33.65
01/10/14 triggered @ 35.15




Pandora Media - P - close: 35.01 change: -0.11

Stop Loss: 33.75
Target(s): 39.50
Current Gain/Loss: + 1.3%

Entry on January 15 at $34.55
Listed on January 14, 2014
Time Frame: exit PRIOR to earnings on February 5th
Average Daily Volume = 9.6 million
New Positions: see below

Comments:
01/21/14: Pandora spent much of today churning sideways and eventually settled with a -0.3% decline. We can look for potential short-term support near $34.00.

Earlier Comments:
If this rally continues it could spark more short covering. The most recent data listed short interest at 18% of the 154 million share float. Our target is $39.50. However, we will plan on exiting prior to Pandora's earnings report on February 5th.

current Position: long P stock @ $34.55

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

Long Feb $35 call (P1422B35) entry $2.55*

01/16/14 new stop loss @ 33.75
01/15/14 triggered @ 34.55
*option entry price is an estimate since the option did not trade at the time our play was opened.



Solar ETF - TAN - close: 41.18 change: -0.59

Stop Loss: 39.75
Target(s): 48.50
Current Gain/Loss: - 2.5%

Entry on January 16 at $42.25
Listed on January 14, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 442 thousand
New Positions: see below

Comments:
01/21/14: TAN underperformed the broader market on Tuesday with a -1.4% decline. I cautioned readers over the weekend that we could see TAN testing its 10-dma. Shares actually pierced their 10-dma today with a drop to $40.28 before paring its losses. More aggressive traders could buy this bounce.

Earlier Comments:
Our plan was to use small positions to limit our risk. Our multi-week target is $48.50. This could turn into a multi-month trade so we'll have to try and be patient.

FYI: A rise past $42.00 has created a new triple-top bullish breakout buy signal on TAN's point & figure chart, which is currently forecasting a long-term target of $61.

*small positions*

current Position: long TAN @ $42.25

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

Long April $45 call (TAN1419D45) entry $2.25*

01/18/14 Caution: Friday's move has created a candlestick reversal pattern but it needs to see confirmation
01/16/14 triggered at $42.25 (thanks to SCTY's +12% rally)
*option entry price is an estimate since the option did not trade at the time our play was opened.



Ternium S.A. - TX - close: 31.00 change: -0.59

Stop Loss: 29.90
Target(s): 35.00
Current Gain/Loss: - 2.4%

Entry on January 14 at $31.75
Listed on January 13, 2014
Time Frame: exit PRIOR to earnings on Feb. 19th
Average Daily Volume = 204 thousand
New Positions: see below

Comments:
01/21/14: Most of the market shot higher this morning before reversing lower. It was a different story with TX. Shares spiked lower and then stayed there with a sideways consolidation under the $31.00 level. I didn't see any specific news to account for the relative weakness today. TX ended the session with a -1.8% loss. We are turning defensive on this trade and suggesting an immediate exit tomorrow morning.

current Position: long TX stock @ $31.75

01/21/14 prepare to exit immediately tomorrow morning
01/14/14 triggered @ 31.75



BEARISH Play Updates

Ecopetrol SA - EC - close: 35.16 change: -0.40

Stop Loss: 36.25
Target(s): 31.00
Current Gain/Loss: + 5.9%

Entry on January 06 at $37.35
Listed on December 30, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 716 thousand
New Positions: see below

Comments:
01/21/14: EC tried to bounce but the stock failed near its 10-dma again. The path of least resistance still appears to be lower.

Earlier Comments:
Our target is $31.00. Once it's below $37.50 the next level of support appears to be the $30.00 level.

current Position: short EC stock @ $37.35

01/14/14 new stop loss @ 36.25
01/08/14 new stop loss @ 38.25
01/06/14 triggered @ 37.35




CLOSED BULLISH PLAYS

MDC Partners Inc. - MDCA - close: 25.80 change: -0.22

Stop Loss: 24.95
Target(s): 28.50
Current Gain/Loss: - 0.5%

Entry on January 09 at $26.20
Listed on January 07, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 215 thousand
New Positions: see below

Comments:
01/21/14: MDCA has not been working for us. We decided in the previous newsletter to exit positions for lack of movement. MDCA opened at $26.06 this morning.

closed Position: long MDCA stock @ $26.20 exit $26.06 (-0.5%)

01/21/14 planned exit
01/18/14 prepare to exit immediately
01/14/14 new stop loss @ 24.95
01/09/14 triggered @ 26.20

chart: