Today's market dip was enough to trigger one of our bullish candidates.


CALL Play Updates

Apple Inc. - AAPL - close: 167.41 change: -1.99 stop: 163.40

AAPL dipped toward its 10-dma and managed to bounce at $166.76. That was almost enough of a dip to hit our trigger at $166.50. As it stands now we're still on the sidelines waiting for AAPL to pull back so we can buy calls.

I am suggesting readers buy calls (small positions only, 1/2 to 1/4 our normal trade) on a dip at $166.50. We'll use a tight stop loss at $163.40. More aggressive traders can use a stop loss under $160 and the August low of $159.42. If we are triggered at $166.50 our first target to take profits is at $174.00. Our second target is $179.00. FYI: The P&F chart points to a $231 target.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 166.50
Change since picked:      + 0.00
Earnings Date           10/21/09 (unconfirmed)
Average Daily Volume =        14 million  
Listed on August 25, 2009         


CF Industries - CF - close: 82.71 change: +0.52 stop: 79.75

The action in CF yesterday looked like a bearish engulfing (reversal) candlestick. The lack of follow through lower is good news for the bulls.

Currently our plan is to buy calls on a breakout over resistance with a trigger to launch positions at $85.25. If triggered at $85.25 our stop loss is at $79.75 and our first target is $89.85. Our second target is $97.50. My time frame is four to six weeks. FYI: A breakout over $85.00 would produce a new triple-top breakout buy signal on the Point & Figure chart.

Trading note: Investors should note that Agrium (AGU) has been trying to buy CF for months. CF has been trying to buy Terra Industries (TRA) for months. Nobody is selling because they claim the offers don't fully value the company (a.k.a. it's not enough money). There is potential upside if AGU finally makes a high enough offer or someone else steps in. There is potential downside if CF makes too high a bid for TRA and the market thinks they overpaid. This M&A merger dance hasn't affected the stock much lately but it is a risk either direction.

Picked on   August xx at $ xx.xx <-- TRIGGER 85.25
Change since picked:      + 0.00
Earnings Date           10/27/09 (unconfirmed)
Average Daily Volume =       872 thousand 
Listed on August 24, 2009         


EOG Res. Inc. - EOG - close: 73.98 change: -0.43 stop: 69.90

Yesterday I lowered our trigger to buy calls from $74.00 down to $72.50. EOG gapped open lower at $73.75 and plunged to $72.65 before bouncing. Unfortunately, we're still on the sidelines here. The low today was very close to its exponential 200-dma (at 72.54). I am altering our entry point again with a suggestion to go ahead and buy calls on this bounce. I'm keeping the stop loss at $69.90. More conservative traders may want to raise theirs toward the 50-dma or the $72.00 level. Since we're using a more aggressive entry point I'd suggest trading small position sizes.

Our first target is $79.50. Our second target is $88.00. The daily chart is building an inverse H&S pattern that is forecasting a rally toward $100.

Chart:

Picked on   August 26 at $ 73.98 <-- New Entry @ 73.98
Change since picked:      + 0.00
Earnings Date           11/03/09 (unconfirmed)
Average Daily Volume =       2.4 million  
Listed on August 22, 2009         


FISERV Inc. - FISV - close: 49.46 change: -0.04 stop: 46.60

FISV is still hovering under round-number resistance at $50.00. I am expecting another dip toward the $48.50-48.00 zone. Our first target to take profit is at $52.50. I'm setting a second target to exit completely at $54.00.

Picked on   August 21 at $ 48.60 *triggered         
Change since picked:      + 0.86
Earnings Date           10/28/09 (unconfirmed)
Average Daily Volume =       1.5 million  
Listed on August 19, 2009         


Fluor Corp. - FLR - close: 53.93 change: -1.03 stop: 49.95

FLR is contracting. The stock should find support at its long-term trendline of higher lows. Look for an entry point and a bounce near $52.50. FLR has already hit our first target near $55.00. Our second and final target is $59.00.

Picked on   August 17 at $ 51.00 *triggered            
Change since picked:      + 2.93
                           /1st target exceeded @ 55.10 gap open (+8.0%)
Earnings Date           08/10/09 (confirmed)
Average Daily Volume =       2.4 million  
Listed on  July 25, 2009         


Flowserve - FLS - close: 88.52 change: -1.01 stop: 84.75

Our play in FLS is now open. The stock dipped to $87.15. Our trigger to buy calls (small positions) was at $87.50. Our first target is $92.25. Our second target is $98.50. Our time frame is several weeks.

Chart:

Picked on   August 26 at $ 87.50  (1/2 pos)
Change since picked:      + 1.02
Earnings Date           10/28/09 (unconfirmed)
Average Daily Volume =       1.1 million  
Listed on August 17, 2009         


Genesse & Wyoming - GWR - close: 31.31 change: -0.51 stop: 27.75

Railroad stocks weighed on the transportation sector. The railroad index lost 1.5%. GWR gave up 1.6%. I would expect a dip back toward $30.00 and its 10-dma. More conservative traders may want to raise their stops a bit. I'm not suggesting new positions at this time. Our first target is $32.90. Our second target is $34.75.

FYI: The plan was to use small position sizes to limit our risk.

Picked on   August 15 at $ 28.66 /gap down entry
                               /originally listed at $29.30
Change since picked:      + 2.65
Earnings Date           11/03/09 (unconfirmed)
Average Daily Volume =       230 thousand
Listed on August 15, 2009         


Grainger W.W. - GWW - close: 88.93 change: -0.39 stop: 84.50

GWW is still consolidating sideways under resistance at $90.00. We're waiting for a dip. The plan is to buy calls at $86.50. Our first target is $93.50.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 86.50      
Change since picked:      + 0.00
Earnings Date           10/14/09 (unconfirmed)
Average Daily Volume =       635 thousand 
Listed on August 22, 2009         


Intl.Business Machines - IBM - cls: 119.47 change: +0.64 stop: 117.45

IBM almost hit our stop loss this morning. Shares spiked down to $117.51 and bounced. Volume was pretty light on the session. I am suggesting readers wait for a close over $120.00 or an intraday move over Monday's high before launching new call positions. Our first target is $124.50. Our second target is $129.00.

Picked on   August 24 at $120.25 
Change since picked:      - 0.78
Earnings Date           10/08/09 (unconfirmed)
Average Daily Volume =       7.9 million  
Listed on August 08, 2009         


IDEXX Labs - IDXX - close: 51.06 change: -0.10 stop: 49.75

IDXX has failed at $52.00 for the second day in a row. At this time I'd wait for a rise over $52.00 before buying calls.

Currently our first target to take profits is at $54.90. Our second target is $58.00.

Picked on   August 25 at $ 51.75 *small position sizes (1/2 to 1/4)
Change since picked:      - 0.69
Earnings Date           07/24/09 (confirmed)
Average Daily Volume =       383 thousand 
Listed on  July 25, 2009         


Legg Mason - LM - close: 28.92 change: +0.15 stop: varies

LM is drifting higher in spite of the terribly low volume. The stock looks poised to breakout over resistance in the $29.00-29.25 zone. We have a trigger to buy the breakout.

Our aggressive trade is to buy calls with a trigger at $29.50 and a stop loss at $26.40 and we want to use small position sizes (1/2 to 1/4 normal size).

Our buy the dip trade is to open positions on a dip at $26.60 with a stop loss at $24.95. We want to trade small here as well. FYI: The P&F chart is bullish with a $39 target.

Picked on     July xx at $ xx.xx <-- TRIGGER 26.60 & 29.50
Change since picked:      + 0.00
Earnings Date           07/20/09 (confirmed)
Average Daily Volume =       3.4 million  
Listed on  July 25, 2009         


Lorillard Inc. - LO - close: 76.28 change: -0.90 stop: 72.75

LO continues to see profit taking. The stock gave up another 1.1%. We can probably look for a dip back toward broken resistance near $75.00. Right now our only target to take profits is at $79.90.

Picked on   August 24 at $ 75.75 *triggered   
Change since picked:      + 0.53
Earnings Date           07/27/09 (confirmed)
Average Daily Volume =       1.5 million  
Listed on August 01, 2009         


Mettler Toledo - MTD - close: 87.54 change: +0.25 stop: varies

I am adjusting our entry point strategy on MTD. We'll lower our buy-the-dip entry from $86.00 to $85.25 and keep the stop loss at $83.95. We're going to add a breakout trigger to buy calls at $88.50 and we'll use a stop loss at $84.95. If triggered at $88.50 we want to use very small position sizes (about 1/4 our normal trade). If triggered our first target is $93.50. Our second target is $99.00. I am labeling this an aggressive play because volume is pretty light for this stock.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 85.25 & 88.50
Change since picked:      + 0.00
Earnings Date           11/05/09 (unconfirmed)
Average Daily Volume =       234 thousand 
Listed on August 22, 2009         


Newmarket Corp. - NEU - close: 85.05 change: -1.08 stop: 79.00

After two days of impressive gains NEU finally found some profit taking. We still have a trigger to buy the second half of our position on a dip at $80.50.

Our first target to take profits is at $88.50. Our second and final target is $92.50.

Picked on   August 24 at $ 84.33 <- buy half now 8/24/09
                    /originally listed at $83.54, gapped higher @ 84.33
Change since picked:      + 0.72

Picked on   August xx at $ xx.xx <-- TRIGGER @ 80.50 for 2nd half
Change since picked:      + 0.00
Earnings Date           10/27/09 (unconfirmed)
Average Daily Volume =       141 thousand 
Listed on August 24, 2009         


State Street (Bank) STT - close: 53.47 change: -0.76 stop: varies

There is no change from my prior comments. STT is still trading sideways in the $53.00-54.75 zone.

We have an aggressive breakout trigger at $55.60 and we'll use a stop loss at $51.45. Our first target is $59.80. This is an aggressive entry so I'm suggesting smaller position sizes at least 1/2 to 1/4 our normal trade.

We also have a buy the dip entry point at $52.00 with a stop loss at $48.90. Our first target is $55.00. Our second target is $59.80. Currently the Point & Figure chart is bullish with a $62 target.

Picked on   August xx at $ xx.xx <-- TRIGGER 52.00 or 55.60
Change since picked:      + 0.00
Earnings Date           10/13/09 (unconfirmed)
Average Daily Volume =       5.3 million  
Listed on August 19, 2009         


U.S. Oil Fund - USO - close: 36.95 change: -0.22 stop: 33.99

The oil inventories came out this morning. Economists were expecting a drop in inventories and both the API and EIA reported a build. Oil sank on the news. The USO dipped to $36.57.

Our plan is to buy calls on the USO on a dip at $36.00. More conservative traders may want to wait for a dip closer to the trendline of higher lows and its 50-dma near $34.40. If triggered at $36.00 our first target to take profits is $39.75.

Picked on   August xx at $ xx.xx <-- TRIGGER @ 36.00 
Change since picked:      + 0.00
Earnings Date           00/00/00
Average Daily Volume =      11.5 million  
Listed on August 15, 2009         


PUT Play Updates

First Solar - FSLR - close: 126.75 chg: -1.43 stop: 141.50

The oversold bounce in FSLR stalled a bit on Wednesday. Investors reacted to news that the company just lost its executive vice president John Carrington. FSLR and Carrington "mutually agreed" to end his employment effective Monday, August 24th.

I would still expect a bounce toward the 10-dma and possibly $140. More conservative traders may want to exit early than endure that kind of volatility. I am not suggesting new bearish positions at this time. FSLR has already hit our first target at $122.50. Our second and final target is $111.00.

Picked on   August 17 at $135.88 *triggered/gap down entry
Change since picked:      - 9.13
                               /1st target hit @ 122.50 (-9.8%)
Earnings Date           11/03/09 (unconfirmed)
Average Daily Volume =       3.5 million  
Listed on August 15, 2009         


Marvel Entertainment - MVL - close: 38.61 change: -0.03 stop: 39.05

This morning the failed rally at $39.00 looked like a new bearish entry point but there was no follow through. The intraday chart has MVL slowly inching higher. More conservative traders will want to seriously consider an early exit right now. I'd definitely wait for a drop under $38.00 before considering new put positions. Our target is $34.10.

Picked on   August 17 at $ 37.90 *triggered         
Change since picked:      + 0.71
Earnings Date           11/04/09 (unconfirmed)
Average Daily Volume =       710 thousand 
Listed on August 10, 2009         


Shanda Interactive - SNDA - close: 48.43 chg: +0.46 stop: 50.25 *new*

The indicators are definitely mixed on SNDA. On a very short-term basis it looks like SNDA wants to bounce. Looking at a more intermediate time frame SNDA still has a pattern of lower highs and lower lows. I am lowering our stop loss to $50.25. I would hesitate to open new bearish positions here. Our target is the $41.50-40.00 zone. Remember, SNDA is a volatile stock and readers may want to use smaller position sizes.

Picked on   August 08 at $ 48.10 /gap higher entry
                               /originally listed at $47.83
Change since picked:      + 0.33
Earnings Date           09/01/09 (unconfirmed)
Average Daily Volume =       1.5 million  
Listed on August 08, 2009         


Strangle & Spread Play Updates

(What is a strangle? It's when a trader buys an out-of-the-money (OTM) call and an OTM put on the same stock. The strategy is neutral. You do not care what direction the stock moves as long as the move is big enough to make your investment profitable.)

Research In Motion - RIMM - close: 74.83 chg: -0.73 stop: n/a

RIMM is now testing the bottom trendline of its neutral triangle pattern. A breakdown from here would be pretty bearish. I would still open new strangle positions at current levels. We're suggesting a $73.50-76.50 entry zone. The closer to $75.00 the better. The options suggested were the September $80 calls (RFY-IP) and the September $70 puts (RFY-UN). Our estimated cost was $2.64. We want to sell if either option hits $6.00 or higher.

Picked on   August 25 at $ 75.56
Change since picked:      - 0.73
Earnings Date           09/24/09 (confirmed)
Average Daily Volume =      11.7 million  
Listed on August 25, 2009         


Schlumberger - SLB - close: 56.58 change: +0.45 stop: n/a

SLB slipped to $55.43 and bounced. I suspect the next move will be higher. I am not suggesting new strangle positions at this time.

The options we suggested were the September $60.00 calls (SLB-IL) and the September $45.00 puts (SLB-UI). Our estimated cost is $1.00 and we want to sell if either option hits $2.50 or higher.

Picked on   August 15 at $ 52.00 /gap down entry Aug. 17th
Change since picked:      + 4.58
Earnings Date           10/15/09 (unconfirmed)
Average Daily Volume =       9.2 million  
Listed on August 15, 2009