Volume was low but today's rebound is offering us a couple of new bullish entry points.


CALL Play Updates

Alcon Inc. - ACL - close: 140.86 change: -0.33 stop: 132.99

The action in ACL was a bit odd. The market shot higher and ACL did too but shares of ACL suddenly reversed and slid lower the rest of the session. I couldn't find any specific news behind this relative weakness.

Wait and watch for a bounce near the $136-134 zone before considering new bullish positions. ACL has already hit our first target. Our second target is $148.00.

Picked on September 10 at $136.75
Change since picked:       + 4.11
                             /1st target hit @ 142.50 (+4.2%)
Earnings Date            10/21/09 (unconfirmed)
Average Daily Volume =        299 thousand 
Listed on September 10, 2009         


Allegheny Tech. - ATI - close: 35.55 change: +1.13 stop: 31.45

ATI rallied 3.2% but volume was light and momentum indicators are still slightly bearish.

More conservative traders will want to consider an early exit now. I'm not suggesting new positions until we see ATI test support. ATI has exceeded our first target. We're currently aiming for $37.00.

Picked on   August 31 at $ 30.25 *triggered         
Change since picked:      + 5.30
                               /1st target hit @ 33.85 (+11.9%)
Earnings Date           10/21/09 (unconfirmed)
Average Daily Volume =       2.7 million  
Listed on August 27, 2009         


Best Buy Inc. - BBY - close: 37.73 change: +0.43 stop: 36.45

The RLX retail index gained 1.7% and BBY lagged behind with a 1.1% gain. An oversold bounce is not surprising with BBY so close to the trendline of support but the rally today stalled under $38.00. I'm still wary here and would wait for a move over $38.25 or even $39.00 before launching new positions. Our first target to take profits is at $41.40. Our second target 46.50. The Point & Figure chart is bullish with a $54 target.

Picked on September 21 at $ 38.45
Change since picked:       - 0.72
Earnings Date            12/16/09 (unconfirmed)
Average Daily Volume =        8.7 million  
Listed on September 21, 2009         


Caterpillar - CAT - close: 52.18 change: +0.98 stop: 47.49

Volume on CAT's bounce today was pretty low - only 6 million shares versus the normal 10 million. I still think CAT will retest the $50 level. Right now our plan is to buy calls at $50.50. Considering the weakness in the S&P 500 readers may want to wait for a dip closer to the $49.00 level.

If we are triggered at $50.00 our first target is $54.50. Our second target is $59.00. FYI: The P&F chart is bullish with an $85 target.

Picked on September xx at $ xx.xx <-- TRIGGER @ 50.50
Change since picked:       + 0.00
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =         10 million  
Listed on September 19, 2009         


CF Industries - CF - close: 86.06 change: +1.77 stop: 83.65

CF probably tagged a few stop losses with the morning gap down under short-term support at $84.00. Yet shares quickly rallied from its low of $83.82. The stock was due for an oversold bounce after a multi-day decline. I suggested buying calls on a bounce and we got it!

Our first target to take profits is at $92.50. Our second target is $98.00. FYI: The P&F chart has a quadruple-top bullish breakout buy signal with a $99 target.

FYI: Agrium (AGU) is trying to buy CF but CF keeps rejecting the offer calling it too late. At the same time CF is trying to buy Terra Industries (TRA) and TRA keeps rejecting the offer calling it too low. Eventually one of these companies is going to give up or they're finally going to make a big enough offer or somebody else might step in and start bidding. There is a risk that someone bids too much and the market could think they overpaid, which might push the stock lower. CF started their bid in January at $2.1 billion, bumped it to $2.2 billion in March, and then raised it to $4 billion in August. TRA has consistently rejected CF's offers.

This M&A dance has been going on for months and it will probably continue for months so I'm not expecting it to have much short-term impact on the stock. However, it's worth noting that CF recently filed a lawsuit to force TRA to hold their annual shareholder meeting. This way CF can try and vote some members onto the board of directors.

Late Thursday night (Sept. 24th) TRA announced a one-time, special cash dividend to shareholders of $7.50 per share, worth about $750 million. Details and dates of the dividend are not know yet but it's expected to be paid in the fourth quarter of 2009. It's been suggested that TRA is doing this to make themselves look less attractive to CF.

M&A UPDATE 09/28/09 :
CF is getting more aggressive with its bid to acquire TRA. The company announced this morning that it had already purchased 7 percent of TRA's stock on the open market.

Picked on September 05 at $ 85.93
Change since picked:       + 0.13
Earnings Date            10/27/09 (unconfirmed)
Average Daily Volume =        653 thousand 
Listed on September 05, 2009         


Core Labs - CLB - close: 101.72 change: +2.65 stop: 92.25

News that Iran began test firing missiles over the weekend helped produce a bounce in oil. This fueled a move in the oil service stocks and CLB gained 2.6%. Volume was very light today and I'm not suggesting positions at this time.

Picked on September xx at $ xx.xx <-- TRIGGER @ 96.00
Change since picked:       + 0.00
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        175 thousand 
Listed on September 23, 2009         


Compass Minerals - CMP - close: 60.82 chg: +1.62 stop: 54.75

The widespread market bounce helped lift CMP to new multi-month highs over $60.00.

I'm not suggesting new positions at this time. CMP has already hit our first target at $59.75. Our second and final target is $64.00. FYI: The Point & Figure chart has turned bullish with a $69 target.

Picked on September 03 at $ 55.55
Change since picked:       + 5.27
                               /1st target hit @ 59.75 (+7.5%)
Earnings Date            10/28/09 (unconfirmed)
Average Daily Volume =        415 thousand 
Listed on September 02, 2009         


Consol Energy - CNX - close: 45.71 change: +1.42 stop: 39.45

CNX erased Friday's loss with a 3.2% bounce today. I would still consider new positions here in the $44-46 zone but a better entry point would be a dip near $42.00.

Our first target is $48.50. Our second target is $52.40. We'll plan to exit ahead of the late October earnings report. FYI: The Point & Figure chart is forecasting a $73 target.

Picked on September 25 at $ 43.77 /gap down entry
Change since picked:       + 1.94
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        3.0 million  
Listed on September 19, 2009         


Danaher Corp. - DHR - close: 67.11 change: +1.00 stop: 63.95

Volume was almost half the norm with today's 1.5% bounce. I'm not suggesting new positions at this time.

Our first target is $69.50. The Point & Figure chart is bullish with a $77 target. Currently we only have half a position open to limit our risk given the aggressive entry point.

Picked on September 05 at $ 66.37 (buy 1/2 position)
               /originally listed at $65.76, gap higher entry @ 66.37
Change since picked:       + 0.74
Earnings Date            10/22/09 (confirmed)
Average Daily Volume =        2.4 million  
Listed on September 05, 2009         


Diamond Offshore - DO - close: 93.37 change: +2.12 stop: 88.49

The rebound in oil helped lift DO, which was already bouncing from support near $90.00. I would still consider new positions right here. The plan was to use small position sizes.

We will take some money off the table at $99.90 (1st target). Our second target is $104.50. More aggressive traders can aim for $110. The P&F chart is forecasting a $114 target.

Picked on September 15 at $ 94.69 *adjusted entry point
Change since picked:       - 1.32
Earnings Date            10/22/09 (unconfirmed)
Average Daily Volume =        1.8 million  
Listed on September 12, 2009         


Dril-Quip, Inc. - DRQ - close: 49.18 change: +1.35 stop: 45.90

DRQ has broken out to new highs and hit our trigger to buy calls at $48.50. Our first target is $53.00. Our second target is $57.50. The Point & Figure chart is bullish with a $65.00 target.

Chart:

Picked on September 28 at $ 48.50
Change since picked:       + 0.68
Earnings Date            11/10/09 (unconfirmed)
Average Daily Volume =        282 thousand 
Listed on September 26, 2009         


Flowserve - FLS - close: 98.78 change: -0.04 stop: 88.95

FLS under performed the market on Monday by trading sideways under the $100 level instead of participating in the widespread rebound. We're still waiting for a dip into the $95-92 zone. More cautious traders may want to raise their stops closer to $92.00. Our plan is to buy calls on a dip at $95.00.

If we are triggered our first target is $99.25. Our second target is $107.50. However, we will plan to exit ahead of the late October earnings report. FYI: The P&F chart is bullish with a $128 target.

Picked on September xx at $ xx.xx <-- TRIGGER @ 95.00
Change since picked:       + 0.00
Earnings Date            10/28/09 (unconfirmed)
Average Daily Volume =        1.2 million  
Listed on September 19, 2009         


Fomento Economico Mex. - FMX - close: 36.70 chg: +0.41 stop: 34.99

FMX is still coiling for a bullish breakout higher. Our trigger is at $37.55. If triggered our first target is $40.00. Our second target is $42.50. The Point & Figure chart is much more bullish with a $66 target.

Picked on September xx at $ xx.xx <-- TRIGGER @ 37.55
Change since picked:       + 0.00
Earnings Date            10/26/09 (unconfirmed)
Average Daily Volume =        1.0 million  
Listed on September 24, 2009         


General Dynamic - GD - close: 64.54 change: +1.55 stop: 57.85

Hmm... we may need to alter our entry plans for GD. The stock gapped higher this morning after getting upgraded before the bell. The rally stalled near its 2009 highs.

We'll keep our entry point at $61.00 for now but we might want to raise it toward $62.00.

Our first target is $64.90. Our second target is $69.00. Investors with a longer-term time frame may want to aim a lot higher. GD has produced an inverse H&S pattern that is forecasting an $85

Picked on September xx at $ xx.xx <-- TRIGGER @ 61.00
Change since picked:       + 0.00
Earnings Date            10/28/09 (unconfirmed)
Average Daily Volume =        2.3 million  
Listed on September 09, 2009         


Genesse & Wyoming - GWR - close: 31.51 change: +0.98 stop: 29.75

Today's bounce did not alleviate the bearish trend for the railroad sector. GWR is still out performing its peers but if the sector sinks I doubt GWR will hold up on its own. Technically GWR is bouncing from support near $30 and its 50-dma but it stalled near its short-term trend of lower highs.

We've already taken profits once and our second target is $34.75. We want 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:      + 2.85
                              /take profits 09/16/09 @ 32.45 (+13.2%)
Earnings Date           11/03/09 (unconfirmed)
Average Daily Volume =       230 thousand
Listed on August 15, 2009         


Intl. Bus. Mach. - IBM - close: 119.33 chg: -1.75 stop: 117.75

Warning! More conservative traders may want to exit immediately. IBM saw its early morning bounce reverse at the $122 level and the stock under performed the market with a 1.4% decline. The close under $120 is also bearish. I am not suggesting new bullish positions at this time.

Our first target to take profits is at $126.00. Our second target is $129.75. We will plan to exit ahead of IBM's earnings report in mid October.

Picked on September 16 at $121.82
Change since picked:       - 2.49
Earnings Date            10/15/09 (unconfirmed)
Average Daily Volume =        5.3 million  
Listed on September 16, 2009         


Illumina Inc. - ILMN - close: 41.28 change: +0.62 stop: 37.45

Biotech stocks were showing strength today. ILMN gained 1.5% but shares stalled near their September highs. Currently our plan is to buy calls on a dip at $39.10.

If we are triggered at $39.10 our first target is $42.40. Our second target is $46.75 but that's probably being optimistic given our time frame. ILMN reports earnings in less than four weeks. We'll plan to exit before earnings are announced.

Picked on September xx at $ xx.xx <-- TRIGGER @ 39.10
Change since picked:       + 0.00
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =        1.6 million  
Listed on September 26, 2009         


iShares Financials - IYF - close: 53.25 change: +1.66 stop: 49.49

Banking stocks looked a lot stronger today and the IYF gained 3.2%. Over the weekend I suggested buying calls on a bounce and we got a bounce. Our first target is $57.00. Our second target is $60.00.

Picked on September 15 at $ 52.60 *triggered  
Change since picked:       + 0.65
Earnings Date            00/00/00
Average Daily Volume =        5.1 million  
Listed on September 01, 2009         


NYSE Euronext - NYX - close: 28.78 change: +0.76 stop: 27.75

Over the weekend I suggested readers buy calls on a bounce over $28.75 and NYX delivered. This is our new entry point. Our first target is $31.95. Our second target is $34.50.

Picked on September 22 at $ 29.82
Change since picked:       - 1.04
Earnings Date            10/30/09 (unconfirmed)
Average Daily Volume =        3.0 million  
Listed on September 22, 2009         


PPG Inds. Inc. - PPG - close: 58.76 change: +1.11 stop: 54.95

PPG posted a 1.9% gain. I'm not suggesting new positions at this time. PPG has already exceeded our first target and we're currently aiming for $63.00. The P&F chart is very bullish with a $90 target.

Picked on   August 28 at $ 55.65
Change since picked:      + 3.11
                             /1st target exceeded @ 60.05 (7.9%)
Earnings Date           10/27/09 (unconfirmed)
Average Daily Volume =       1.6 million  
Listed on August 27, 2009         


SPX Corp. - SPW - close: 61.48 change: +0.03 stop: 57.75

SPW's three-cent gain looks like under performance with the S&P 500 up 1.7%. I'm sticking to the plan, which is to buy calls on a dip at $60.00. If triggered our first target is $64.95. Our second target is $68.75.

Picked on September xx at $ xx.xx <-- TRIGGER @ 60.00 *new*
Change since picked:       + 0.00
Earnings Date            10/28/09 (unconfirmed)
Average Daily Volume =        570 thousand 
Listed on September 12, 2009         


SOHU.com Inc. - SOHU - close: 67.21 change: +0.31 stop: 63.75

The trading in SOHU was a little worrisome. The rally stalled early this morning and shares under performed the market. Actually I'm surprised SOHU wasn't weaker given the big losses in the Chinese markets on Monday.

Currently our plan is to buy calls on a dip into the $66.00-64.00 zone. I'm upping our stop loss to $63.75.

Our first target is $72.50. Our second target is $77.00.

Picked on September xx at $ xx.xx <-- TRIGGER @ 66.00
Change since picked:       + 0.00
Earnings Date            10/26/09 (unconfirmed)
Average Daily Volume =        577 thousand 
Listed on September 15, 2009         


Waters Corp. - WAT - close: 55.43 change: +0.66 stop: 49.30

We're going to have to get more aggressive with WAT. I'm suggesting readers open small positions (about 1/2 to 1/4 our normal size) on today's bounce. We'll raise the stop loss to $51.90. I'm giving up on our plan to wait for a dip near $53.50.

Our first target is $59.50. The P&F chart is bullish with a $69 target. We do not want to hold over the mid October earnings report.

NOTE: I was suggest the November $55 calls (WAT-KK).

Chart:

Picked on September 28 at $ 55.43 *new entry
Change since picked:       + 0.00
Earnings Date            10/20/09 (unconfirmed)
Average Daily Volume =        809 thousand 
Listed on September 12, 2009         


Wells Fargo - WFC - close: 28.90 change: +0.71 stop: 27.25

I suggested looking for a new bounce over $28.50 as our next entry point and we just got it! I'd still consider bullish positions now. Our first target is $32.50. Our second target is $34.75 but we may not have time. The plan is to exit ahead of the mid October earnings report.

Picked on September 22 at $ 29.39
Change since picked:       - 0.49
Earnings Date            10/14/09 (unconfirmed)
Average Daily Volume =         42 million  
Listed on September 22, 2009         


PUT Play Updates

*Currently we do not have any put play updates*


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.)

Cigna Corp. - CI - close: 29.04 change: +0.73 stop: n/a

After a very sharp two-week plunge CI is bouncing. I'm not suggesting new positions at this time.

The options I suggested were the October $35 calls (CI-JG) and the October $25 puts (CI-VE). Our estimated cost was $1.20. We want to sell if either option hits $2.50 or higher. The closer we can open this trade to $30.00 the better.

Picked on September 08 at $ 29.40
Change since picked:       - 0.36
Earnings Date            11/05/09 (unconfirmed)
Average Daily Volume =        3.8 million  
Listed on September 08, 2009