Editor's Note:
The market spiked lower on Friday morning but managed to pare its losses by the closing bell.

We have removed MU and MYL as active candidates.


Current Portfolio:


BULLISH Play Updates

Autodesk, Inc. - ADSK - close: 51.25 change: -0.27

Stop Loss: 49.25
Target(s): 56.50
Current Gain/Loss: + 0.3%

Entry on January 28 at $51.10
Listed on January 27, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 2.6 million
New Positions: see below

Comments:
02/01/14: The market's weakness on Friday morning helped push ADSK to gap down at $50.77. Fortunately the stock quickly bounced. Unfortunately the rebound stalled at short-term resistance near its simple 10-dma. Investors might want to wait for a close above the 10-dma or a rally past $52.00 as alternative entry points to start bullish positions.

current Position: Long ADSK stock @ $51.10

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

Long MAR $55 call (ADSK1422C55) entry $1.44

01/30/14 ADSK rallies on an upgrade
01/28/14 triggered @ 51.10

chart:



Hewlett-Packard Co. - HPQ - close: 29.00 change: -0.25

Stop Loss: 27.70
Target(s): TBD
Current Gain/Loss: + 1.6%

Entry on January 27 at $28.53
Listed on January 18, 2014
Time Frame: exit PRIOR to earnings on Feb. 20th
Average Daily Volume = 13.2 million
New Positions: see below

Comments:
02/01/14: HPQ managed a bounce off its simple 20-dma on Friday morning but shares still posted a -0.8% decline. That underperformed the major indices. The simple 50-dma has risen to $27.74. I am raising our stop loss up to $27.70. More conservative investors might want to raise their stop closer to the simple 30-dma near $28.50.

current Position: long HPQ stock @ $28.53

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

Long Mar $30 call (HPQ1422C30) entry $0.96

02/01/14 new stop loss @ 27.70
01/27/14 trade opens at $28.53
01/25/14 adjust entry strategy and open positions on Monday morning (Jan 27th)
01/25/14 new stop loss @ 26.95
01/23/14 new stop @ 28.95
Nimble traders may want to look for support near $28.70 as an alternative entry point.

chart:



JPMorgan Chase & Co - JPM - close: 55.36 change: -0.64

Stop Loss: 53.90
Target(s): 59.75
Current Gain/Loss: - 1.6%

Entry on January 30 at $56.25
Listed on January 25, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 18 million
New Positions: see below

Comments:
02/01/14: Hmm... the financial sector underperformed on Friday with the XLF down -1.1%. Shares of JPM helped lead the group lower with its own -1.1% decline. This stock should find support near its 100-dma and 150-dma in the $54.60-55.00 zone. If those levels fail then the $54.00 level could offer support especially since it's underpinned by the simple 200-dma. Investors may want to wait for a bounce from these levels before considering new bullish positions.

current Position: Long JPM stock @ $56.25

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

Long MAR $55 call (JPM1422C55) entry $2.53

01/30/14 triggered @ 56.25. Use stop loss at $53.90
01/28/14 add a secondary entry trigger at $56.25
adjust the exit target to $59.75

chart:

Weekly chart:



Penn Virginia Corp. - PVA - close: 11.99 change: +0.07

Stop Loss: 11.15
Target(s): 17.00
Current Gain/Loss: unopened

Entry on January -- at $--.--
Listed on January 28, 2014
Time Frame: exit PRIOR to earnings on Feb.19th
Average Daily Volume = 3.2 million
New Positions: Yes, see below

Comments:
02/01/14: We're not giving up on PVA just yet. Shares gapped down like so much of the market on Friday morning. Yet the stock quickly recovered and managed to outperform the major indices with a +0.5% gain by the closing bell. The stock is consolidating sideways in a neutral pattern of higher lows and lower highs (a pennant shaped consolidation). We are waiting on a breakout higher.

Earlier Comments:
Driving the stock higher has been some very bullish analyst comments on the stock. One analyst listed PVA as a likely takeover target. All this bullish talk on PVA has got to make the shorts nervous and there are a lot of shorts. The most recent data listed short interest at 32% of the 49.9 million share float. New highs from here could spark more short covering.

So far the January high for PVA has been $12.49. We are suggesting a trigger to open bullish positions at $12.55. If triggered our target is $17.00 but that is very, very optimistic goal. Odds are more likely we won't capture that big of a move because PVA is due to report earnings on February 19th and we do not want to hold over the announcement.

Investors may want to consider PVA as a longer-term trade. The Point & Figure chart for PVA is bullish with a long-term $25.00 target.

Trigger @ 12.55

Suggested Position: buy PVA stock @ (trigger)

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

Buy the Mar $12.50 call (PVA1422C12.5)

chart:



BEARISH Play Updates

Best Buy Co. - BBY - close: 23.54 change: +0.82

Stop Loss: 24.75
Target(s): 20.25
Current Gain/Loss: + 3.1%

Entry on January 30 at $24.29
Listed on January 29, 2014
Time Frame: Exit PRIOR to earnings on Feb. 27th
Average Daily Volume = 17.6 million
New Positions: see below

Comments:
02/01/14: BBY spiked down to new ten-month lows on Friday morning and hit $22.15 before surging in a big oversold bounce. The stock ended another down week with a +3.6% gain. More conservative investors might want to lower their stop loss just in case this bounce continues on Monday. I am not suggesting new positions at this time. The overall trend for BBY remains bearish.

Earlier Comments:
The plan is to use small positions to limit our risk.

*Small Positions*

current Position: short BBY stock @ $24.29

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

Long MAR $20 PUT (BBY1422o20) entry $0.45

01/30/14 new stop loss @ 24.75
01/30/14 trade opens with BBY gapping open higher at $24.29

chart:



Ecopetrol SA - EC - close: 34.26 change: -0.56

Stop Loss: 35.25
Target(s): 31.00
Current Gain/Loss: + 8.3%

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:
02/01/14: EC spent much of the week churning sideways inside the $34-35 zone. The stock should be ready for the next step lower. A drop under $34.00 could be used as another entry point for bearish positions.

current Position: short EC stock @ $37.35

01/29/14 new stop loss @ 35.25
01/28/14 investors may want to start taking some money off the table
01/27/14 new stop loss @ 35.65
01/14/14 new stop loss @ 36.25
01/08/14 new stop loss @ 38.25
01/06/14 triggered @ 37.35

chart:



GameStop Corp. - GME - close: 35.07 change: -0.24

Stop Loss: 37.75
Target(s): 31.00
Current Gain/Loss: + 1.5%

Entry on January 29 at $35.60
Listed on January 28, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 6.2 million
New Positions: see below

Comments:
02/01/14: Friday was a relatively quiet session for GME with the stock keeping pace with the broader market's decline (-0.6%). Friday also capped its fourth weekly loss in a row. The simple 10-dma has declined to $36.87 and should be the first line of defense for the bears (a.k.a. short-term resistance). We're lowering the stop loss to $37.10.

Earlier Comments:
We should probably consider this a more aggressive, higher-risk trade because there is so much short interest. The most recent data listed short interest at 25% of the 113 million share float. That could make GME volatile and we run the risk of the stock seeing short-term spikes. However, long-term GME could be in trouble as the video industry moves more and more to an online, download purchase system instead of consumers going to their local game story to buy games.

More conservative traders may want to wait for a drop below $35.00 before initiating positions. Our target is $31.00. More aggressive traders could aim lower. The Point & Figure chart for GME is bearish with a $20.00 target.

current Position: short GME stock @ $35.60

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

Long MAR $35 PUT (GME1422o35) entry $1.65

02/01/14 new stop loss @ 37.10
01/29/14 trigger @ 35.60

chart:



Vitamin Shoppe, Inc. - VSI - close: 44.82 change: -0.18

Stop Loss: 46.55
Target(s): 41.00
Current Gain/Loss: + 2.2%

Entry on January 24 at $45.85
Listed on January 23, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 535 thousand
New Positions: see below

Comments:
02/01/14: The action in VSI on Friday looked a lot like the major indices. Shares gapped down at the open, quickly bounce but failed to close in positive territory. I see the $46.00 level as overhead resistance. A new failed rally near $46 could be used as another entry point for bearish positions.

Earlier Comments:
I do consider this a slightly more aggressive trade. The most recent data listed short interest at almost 15% of the 27.5 million share float. Therefore I'm suggesting small positions to limit our risk.

*small positions*

current Position: short VSI stock @ $45.85

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

Long Feb $45 PUT (VSI1422N45) entry $1.62

01/29/14 new stop loss @ 46.55
01/24/14 triggered @ $45.85

chart:




CLOSED BULLISH PLAYS

Micron Tech. - MU - close: 23.04 change: -0.41

Stop Loss: 21.95
Target(s): 28.50
Current Gain/Loss: unopened

Entry on January -- at $--.--
Listed on January 30, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 37 million
New Positions: see below

Comments:
02/01/14: MU did not perform well on Friday. Granted the market produced a widespread decline but MU underperformed with a -1.74% decline. Our trade has not opened yet and after Friday's weakness we're removing MU as an active candidate. The long-term trend is still higher so I would keep MU on your watch list. A dip and bounce from its rising 50-dma (near $22.00) might be a better entry point.

Trade did not open.

02/01/14 removed from the newsletter. suggested trigger was $23.85

chart:



Mylan, Inc. - MYL - close: 45.41 change: -0.14

Stop Loss: 41.90
Target(s): 48.00
Current Gain/Loss: unopened

Entry on January -- at $--.--
Listed on January 25, 2014
Time Frame: Exit PRIOR to earnings in late February
Average Daily Volume = 3.0 million
New Positions: see below

Comments:
02/01/14: We are removing MYL as a candidate. Our trade has not opened yet. The long-term trend for this stock is still bullish so I would keep it on your watch list. Another dip and bounce from its simple 50-dma might be the next entry point.

Trade did not open.

02/01/14 removed from the newsletter. suggested trigger was $43.55

chart: