Editor's Note: Good evening. I am expecting quite a bit of volatility in the coming days/weeks on both the upside and downside. Often times volatility signals an important turning point (or at least reflection point) in the current trend. It is going to take a monumental effort by the bears to do significant damage to the rally over the past six weeks. I do think we could see more selling but I also believe the dips will get bought. Our new plays this week have been break-out candidates which keeps things more conservative, i.e. entering positions when the stock is moving in the right direction as opposed to picking a top or bottom, which has been extremely challenging over the past six months. Staying nimble is key and working both sides of the market can be lucrative. I would view weakness as opportunities to tighten stops or take profits on short positions, while also considering launching new long positions with tighter stops. Please email me with any questions.

Current Portfolio:

BULLISH Play Updates

Boyd Gaming - BYD - close 7.61 change -0.20 stop 7.28

Target(s): 8.95, 9.20, 9.50
Key Support/Resistance Areas: 9.60, 9.25, 8.75, 8.00, 7.40
Current Gain/Loss: -7.20%
Time Frame: 1 to 2 weeks
New Positions: Neutral

10/19: BYD looked promising this morning but completely lost it in the afternoon. I suggest we keep our stop in place for now and not panic out of the position. BYD is still above the 20-day and 50-day SMA's and has support near current levels.

10/18: I do not see many changes from James' comments below. BYD experienced a relief rally after the Thursday/Friday sell-off. Broken support near $8.00 was a key level that BYD will have to contend with on bounces. Readers may want to consider exiting positions early or tightening stops to the $7.45 area to protect capital, especially considering the overbought broader market conditions.

10/16 (James): Uh-oh! BYD was showing some relative weakness on Friday. We were expecting a pull back but the $8.00 level should have offered stronger support. While I do think BYD has put in a bottom with the September low, I am somewhat concerned that shares are seeing above average volume lately. Normally above average volume on the rally, like we saw in early October, is bullish but we're also seeing strong volume on the pullback, which can be bearish. On a short-term basis I would expect BYD to hit support near $7.50 and its 50-dma. Readers may want to wait for a bounce from the $7.50 level before considering new bullish positions.

Current Position: Long BYD stock, entry was at $8.20

Entry on October 14, 2010
Earnings 10/27/10 (unconfirmed)
Average Daily Volume: 1.8 million
Listed on October 9, 2010

Companhia Brasileira de Distribuicao - CBD - cls: 37.26 chg: -0.35 stop: 37.45

Target(s): 39.00
Key Support/Resistance Areas: 35.00, 36.50, 39.00
Current Gain/Loss: +1.39%
Time Frame: 4 to 6 weeks
New Positions: Yes

10/19: CBD traded right down to our trigger of $36.75 and bounced nicely. The comments below all remain valid.

10/18: We are waiting to be triggered at $36.75 which I expect to happen in the coming days. This is a prior long term resistance area which should now be support. The comments from the play release below remain the same.

10/16: Shares of Brazilian grocery food chain CBD appear to be in breakout mode. The Brazilian economy continues to grow and the surging middle class likes to spend. This has pushed CBD toward all-time highs. Now normally I wouldn't list a stock in the $70s as a PremierInvestor play. However, CBD will see a 2-for-1 split on Monday morning (Oct. 18th). The stock should open around $38.20. I am suggesting we look to buy CBD on a pull back. Broken resistance near $73.50 (post-split will be $36.75) should be new support. Thus, use a trigger at $36.75 to open bullish positions. We'll use a stop loss at $34.75 since the $70 level (post-split: $35) should be additional support.

If triggered our first target is $39.00 (pre-split $78.00). Our second, longer-term target is $42.00. The inverse (bullish version) head-and-shoulders pattern would suggest a bullish target of $88 (post-split would be $44). The Point & Figure chart is very bullish with a price target of $101.00 (post-split $50.50).

Current Position: Long CBD stock, entry was at $36.75

Entry on October 19, 2010
Earnings Date 11/10/10 (unconfirmed)
Average Daily Volume: 545,000
Listed on October 16th, 2010

Hansen Natural Corp. - HANS - close: 49.73 change: -0.27 stop: 44.95

Target(s): 50.00, 52.50,
Key Support/Resistance Areas: 45.00, 47.50, 50.00, etc.
Current Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see below for details

10/18 & 10/19: We are waiting for our trigger at $48.25. I like the set-up and suggest we remain patient. We could get a pullback in the coming days and using the dips as buying opportunities is the right strategy.

10/16: HANS is probably best known for their Monster brand energy drinks. The stock has been a monster in its own right and shares have been a popular momentum trade over the years. Well once again shares of HANS are surging higher. We'd like to hop on board but we don't want to chase it at these levels. I'm suggesting a trigger to buy the stock (or call options) at $48.25 since broken resistance at $48.00 should be new support. I'm suggesting a stop loss at $44.95 but we may want to raise the stop closer to the rising 50-dma (technical support) currently near 46.20.

If triggered at $48.25 our first target is $51.00. Our second target is $52.50. FYI: The point & figure chart is very bullish and is forecasting a long-term target of $78.

Suggested Position: BUY the stock at $48.25

- or -

BUY the November $50.00 calls (on a dip at $48.25).

Entry on October xx
Earnings Date 11/04/10 (unconfirmed)
Average Daily Volume: 4.5 million
Listed on October 16, 2010

Itron, Inc - ITRI - close 60.37 change -2.33 stop 57.45

Target(s): 63.00, 64.00, 65.00, 66.00
Key Support/Resistance Areas: 66.00, 64.00, 60.50, 59.00, 57.00
Current Gain/Loss: +0.20%
Time Frame: 1 to 3 weeks
New Positions: Yes

10/19: The correction came a little faster than I anticipated but ITRI hit our trigger of $60.25 to enter long positions. I am a little concerned about the strength of today's sell-off and we may need to exhibit some patience in the coming days. Tighter stops could be considered at $58.45. When the selling subsides ITRI should move back to the $63.00 level with ease and I would target incremental $1 moves higher from there, possibly all the way up to $66.00. I would view any further dips as buying opportunities with tighter stops.

10/18: Let's keep the strategy below as our trigger. My guess is ITRI will print $60.25 in the coming days as the broader market also corrects.

10/14 (James): So far we're still waiting on an entry point in ITRI. Shares held up pretty well with bulls immediately buying the dip this morning near $61.60. The trend is up but the stock is struggling with resistance near $63.00 and its exponential 200-dma. If you don't mind I would like to adjust our entry point strategy. Let's plan on buying the dip at $60.25, not 61.00 and if triggered at $60.25 we'll move the stop loss to $57.45.

Plus, just in case ITRI does not correct, I'd like to use a trigger to buy a breakout at $63.55. If this trigger is hit we'll move the stop loss to $59.49. The 200-dma near $65 is probably overhead resistance but I would aim for resistance near $67.50.

Current Position: Long ITRI stock, entry was at $60.25

Entry on October 19, 2010
Earnings 10/27/2010 (unconfirmed)
Average Daily Volume: 412,000
Listed on October 4, 2010

Mylan Inc. - MYL - close: 18.83 change: -0.11 stop: 18.45

Target(s): 19.80, 20.45, 21.00, 22.00
Key Support/Resistance Areas: 18.50, 19.00, 20.00, 20.50
Current Gain/Loss: -2.18%
Time Frame: 4 to 6 weeks
New Positions: No

10/19: I could not find any follow-up news my 10/18 comments. MYL is hanging tough and is holding onto its upward trend line that began on 8/31 and its 20-day SMA. I've adjusted the targets slightly.

10/18: MYL got hit hard today on news that a preliminary injunction against GlaxoSmithKline and Apotex pertaining to the generic drug Paxil CR was denied in US District Court of New Jersey. After the initial reaction the selling subsided and MYL bounced after the company said they are appealing the decision. Regardless of the outcome, this is a new development and readers should use caution, especially considering the overbought broader market conditions. Our stop is in the right place if MYL breaks lower as this will signal a break in trend.

10/16: (James) MYL is a short squeeze candidate. Bigger picture the generic drug makers are facing a potential boom for the next few years as more brand name drugs lose their patent protection. On a short-term basis MYL just broke out over heavy resistance at $19.00 and its 200-dma following news the FDA has approved to generic versions of Merck's Hyzaar and Cozaar blood pressure drugs. Now don't get too excited here since TEVA has already begun selling generic versions of these drugs months ago but it does mean MYL can try and grab its slice of the pie. Technically MYL is seeing a bullish breakout and could see a short squeeze. The most recent data available listed short interest at almost 29% of the 260 million-share float.

I do consider this an aggressive trade so keep your positions somewhat smaller. Buy the stock now (or the calls) and target a move to $20.00, $21 and beyond. FYI: The P&F chart is forecasting at $33 target.

Current Position: Long MYL stock, entry was at $19.25
Options Traders: Long November $20.00 calls

Entry on October 18, 2010
Earnings Date 10/28/10 (unconfirmed)
Average Daily Volume: 4.5 million
Listed on October 16, 2010

PerkinElmer, Inc - PKI - close 22.79 change -0.81 stop 22.05 *NEW*

Target(s): 23.60, 24.25, 24.85
Key Support/Resistance Areas: 25.40, 24.40, 23.30, 22.50
Current Gain/Loss: -1.34%
Time Frame: 1 to 2 weeks
New Positions: Yes, on pullbacks

10/19: Our +2% gain in PKI has turned into a loss with today's -3.4% decline. PKI has broken through its upward trend line from the July lows and its 20-day SMA, so now we have to turn to support levels. The stock has support at $22.50 and the rising 50-day and 200-day SMA's at $22.30 and $22.13. I suggest we protect the trade here and lower our stop $22.05 as PKI may be headed to test one of the SMA's just below. If support is not found at one of the three aforementioned levels the new stop still keeps losses relatively small while giving the trade room to work. Conservative traders may want to consider exiting positions now.

10/18: PKI regained all of Friday's losses and closed at new multi-month closing highs that haven't been seen since early May. However, the broader market is overbought so readers should use caution. Tighter stops in the $22.75 area could be considered to limit downside risk. James' comments below remain valid.

10/16 (James): There hasn't been any news on PKI lately and shares aren't moving much as they consolidate sideways. Traders bought the dip again at short-term technical support near the 10-dma and 20-dma on Friday. The trend is up but stochastics are suggesting this rally is losing steam. Yet that doesn't mean PKI can't keep climbing. Cautious traders might want to tight stops closer to the $22.50 level. I am a little concerned that PKI appears to be forming a bear-wedge pattern. Readers may want to keep their position size small. FYI: This company is due to report earnings on Nov. 4th. Analysts are estimating a profit of 29 cents a share.

Current Position: Long PKI stock, entry was at $23.10

Entry on October 12, 2010
Earnings 11/4/10 (unconfirmed)
Average Daily Volume: 1.4 million
Listed on October 11, 2010

Thompson Creek Metals - TC - close 10.76 change -0.82 stop 10.45

Target(s): 11.10, 11.75 (hit), 12.40
Key Support/Resistance Areas: 12.60, 11.80, 11.00, 10.55
Current Gain/Loss: -3.50%
Time Frame: 1 to 3 weeks
New Positions: Yes, on pullbacks

10/19: Ouch, the profit taking we feared came in full force today and our gain in TC was reversed into a loss. The Peoples Bank of China unexpectedly rose interest rates which caused the US Dollar to surge higher, and the whole commodity sector took a lambasting. It is too early to tell whether today's sell-off in commodities is the start of a bigger decline or a knee jerk reaction. Only time will tell but readers should use caution. TC found support at $10.64 today and also has support at $10.55. Our stop is just below these levels. I've added a lower target of $11.10 where readers should consider exiting positions or tightening stops on bounces.

10/18: TC drifted sideways in a fairly tight range on Monday. The stock closed near its highs and continues to look bullish, however, be aware of some possible profit taking in the coming days which I would use an opportunity to launch new positions. If TC breaks above last week's highs there is little resistance until the $12.50 area which is just above our final target. Tighter stops could be considered in the $10.80 area to limit downside risk.

10/16 (James): There is no change from my Thursday comments on TC. The stock saw a little volatility on Friday morning but consolidated sideways into the weekend. A pull back toward the $11.15-11.00 zone should be a new bullish entry point.

10/13: TC hit our first target at $11.75.

Current Position: Long TC stock, entry was at 11.15

Options Traders: Long November $11.00 CALL

Entry on October 12, 2010
Earnings 10/4/2010 (unconfirmed)
Average Daily Volume: 1.7 million
Listed on October 9, 2010

TJX Companies - TJX - close 44.56 change -0.64 stop 43.35

Target(s): 46.95, 48.20
Key Support/Resistance Areas: 48.50, 47.00, 45.40, 43.50
Current Gain/Loss: Unopened
Time Frame: 2 to 4 weeks
New Positions: Yes, see entry point below

Comments :
10/19: I suggest we play this conservative and keep the set-up in place with a breakout trigger of $45.52. A dip towards $43.75 would catch my eye as another possible bullish entry point.

10/18: TJX has been consolidating above its rising 20-day SMA for the past couple of weeks and is forming an ascending triangle along the way. Resistance is $45.40 and I suggest readers use a breakout to enter long positions. Let's use a trigger of $45.52 and target a move back towards the stock's 52-week highs. Our targets are $46.95 and $48.20 and our stop is $43.35. More nimble traders may want to try to time an entry on a pullback in the $44.50 area.

Suggested Position: Long TJX stock if it trades to $45.52

Entry on October xx
Earnings Date 11/16/10 (unconfirmed)
Average Daily Volume: 3 million
Listed on October 18, 2010

BEARISH Play Updates

FLIR Systems - FLIR - close 25.06 change -0.70 stop 27.05

Target(s): 24.40, 23.70, 21.60
Key Support/Resistance Areas: 28.00, 27.00, 26.50, 25.50, 24.00
Current Gain/Loss: +2.91%
Time Frame: 4 to 6 weeks
New Positions: Yes, see below

10/19: FLIR continues to look vulnerable and if the correction continues our first two targets could be hit relatively quick. I suggest being ready to take profits or tighten stops to protect them as they approach. I've made some adjustments to the targets.

10/18: FLIR has rallied right into resistance (prior support from February) which also happens to be its 20-day SMA. FLIR also has a downtrend line and its declining 50-day SMA just overhead in the $25.25 area. I like new positions here and suggest playing for a pullback of $1.50 to $2.50.

10/16 (James): On Thursday night I adjusted our entry point to launch bearish positions immediately. FLIR gapped open higher on Friday morning at $25.81 (Thursday's high and our new entry point). The rally failed at $26.00 but FLIR still managed a +0.9% gain, showing some relative strength. I still think this is just an oversold bounce and the overall trend is down. I would still launch positions at current levels. More conservative traders could wait and watch for a failed rally near the 50-dma instead as their entry point. FYI: FLIR is due to report earnings on Oct. 21st, before the opening bell. Analysts are expecting a profit of 38 cents a share. We normally don't like to hold over earnings. Readers may want to adjust their stops prior to the report.

Current Position: Short FLIR stock, entry was at $25.81

Entry on October 15, 2010
Earnings Date 10/21/10 (unconfirmed)
Average Daily Volume: 1.7 million
Listed on October 2nd, 2010

Xilinx, Inc. - XLNX - close 26.33 change -0.00 stop 27.42

Target(s): 25.35, 25.00, 24.60
Key Support/Resistance Areas: 26.75, 26.00, 25.30, 25.00, 24.00
Current Gain/Loss: -2.05%
Time Frame: 1 to 2 weeks
New Positions: Yes

10/19: This is turning out to be a frustrating trade as the dips in XLNX keep getting bought. The company reports earnings tomorrow after the bell so if you are not comfortable holding positions close them tomorrow. I've adjusted the targets and suggest readers use weakness to consider exiting positions. My comments below have not changed.

10/18: XLNX was down nearly -2.5% in early trading today but the stock found support at its 50/200 day SMA and drifted higher into the close, regaining most of those losses. XLNX has not performed as well as the broader market since its April highs and is at resistance levels. If the broader market corrects here XLNX and the Semi's could fall hard and this is when readers should exit positions and book profits. If XLNX takes out today's lows I believe the selling could quickly gain momentum.

10/16 (James): I am still neutral on XLNX as a bearish trade. The semiconductor index is still trying to dig its way out of a bearish trend. Bigger picture XLNX actually has a more bullish posture than the SOX index. Depending on your time frame and bias XLNX is rising in a new bullish channel or consolidating in a bear flag pattern. It is true that the 50-dma just crossed under the 200-dma (a "death cross), which is normally a very bearish development. I'll repeat my comments from Thursday: If you're going to launch new bearish positions consider using a very tight stop loss!

10/14 (James): I am somewhat neutral on XLNX at the moment. I do see plenty to worry about. The MACD is about to roll over into a new sell signal. The simple 50-dma is about to perform a "death cross" and slip under the 200-dma, which is normally a very bearish event. RSI is rolling over. On Wednesday the stock produced a failed rally at $27.00. However, at the same time XLNX has a bullish trend of higher lows dating back to late August. If you're going to launch new bearish positions consider using a very tight stop loss!

Current Position: Short XLNX stock, entry was at $25.80

Options Traders: Long November $25.00 PUT

Entry on October 7, 2010
Earnings: 10/20/10 (unconfirmed)
Average Daily Volume: 7.3 million
Listed on October 6, 2010


SanDisk Corp - SNDK - close 38.13 change -0.78 stop 42.20

Target(s): 38.25, 37.55 (hit), 35.60
Key Support/Resistance Areas: 41.00 to 40.00, 38.00, 36.00
Final Gain/Loss: +7.49%
Time Frame: 1 to 2 weeks
New Positions: Closed

10/19: Per last night's comments, we took profits on SNDK for a much needed +7.5% gain when the stock hit our $37.55 target. We are flat the position. Readers who may still have positions should protect profits and refer to the comments below as they remain valid.

10/18: After gapping higher SNDK sold off the entire day. Our gain is currently more than +4% and I expect to see more selling in the coming days. The stock has a lot of overhead resistance and considering the broader market's overbought conditions SNDK could fall fast. However, James' comments regarding M&A activity in the space should not be ignored. As such, I suggest readers use weakness to take profits or tighten stops to protect them. SNDK is down nearly -1.50% in the after hours as of this writing. Therefore, our first target of $38.25 (raised 10 cents) is likely to get hit tomorrow morning. I've also adjusted the 2nd target up to $37.55 and will close positions if this is reached.

10/16 (James): Some of the storage device stocks have been rising on buyout rumors. SNDK hasn't been mentioned lately as a target but the M&A rumors in the sector could lift shares anyway. I don't see any changes from my comments on Thursday. There are a lot of conflicting signals and cross currents with SNDK so we're not suggesting new positions at this time. However, the $40.00 level should be significant resistance and more aggressive traders can look for failed rallies in this area as possible entry points. FYI: SNDK is due to report earnings on Oct. 21st. The street expects a profit of $1.05 a share.

Closed Position: Short SNDK stock at $37.55, entry was at $40.59

Annotated chart:

Entry on October 13, 2010
Earnings: 10/21/10 (unconfirmed)
Average Daily Volume: 11 million
Listed on October 12, 2010