Editor's Note:
Shares of BRCM hit our upside exit target on Friday. Meanwhile the action in NPO and UNH on Friday was not very inspiring. Investors need to stay defensive and trade small.


Current Portfolio:

BULLISH Play Updates

Bristol-Myers Squibb - BMY - close: 32.38 change: -0.07

Stop Loss: 30.75
Target(s): 33.50
Current Gain/Loss: +3.9%
Time Frame: 6 to 8 weeks
New Positions: see below

10/08 update: BMY is still trading near multi-year highs. The stock has spent the last couple of session consolidating sideways and digesting Wednesday's big gain. I would not chase it here. Wait for a dip back toward the trendline of higher lows.

Our exit target is $33.50. You could aim higher if you have a longer-time frame. Cautious investors could take profits now, especially on the call option, which is up +43.8%.

current Position: Long BMY stock @ $31.15

- or -

Long 2012 Jan. $30 call (BMY1221A30) Entry $2.26

10/04 new stop loss @ 30.75
09/27 new stop loss @ 29.90
09/26 trade opened


Entry on September 26 at $31.15
Earnings Date 10/26/11 (unconfirmed)
Average Daily Volume = 13.6 million
Listed on September 22, 2011

PowerShares Gold Double Long - DGP - close: 53.25 change: -0.94

Stop Loss: 50.50
Target(s): 60.00
Current Gain/Loss: -3.6%
Time Frame: 8 to 10 weeks
New Positions: see below

10/08 update: Gold and silver are struggling to build on their up days. These precious metals appear to be consolidating sideways. We won't know yet if it's a consolidation before the next leg down or a rebound higher. The DGP failed at resistance near $55 again.

Traders can choose to either try and buy a dip in the $51.00 area or wait for a breakout past $55.00 on the DGP. I am adjusting our exit target to $60.00.

- Small Positions -

current Position: long the DGP @ $55.26

10/08 adjusted exit target to $60.00
10/04 new stop loss @ 50.50
09/27 trade opened
09/26 reload this trade. Buy the open tomorrow, new stop 49.40
09/26 Trade opened on gap down at $51.96.
Trade stopped out at $51.45 (-0.9% loss)


Entry on September 27 at $55.26
Earnings Date --/--/--

1st Attempt:

Entry on September 26 at $51.96
Exit on September 26 at $51.45 (-0.9%)

Average Daily Volume = 1.3 million
Listed on September 24, 2011

EnPro Industries - NPO - close: 30.06 change: -0.77

Stop Loss: 29.25
Target(s): 34.50
Current Gain/Loss: - 2.6%
Time Frame: 2 to 4 weeks
New Positions: see below

10/08 update: Hmm... lack of follow through on NPO's rally is a bit worrisome. Our trade is open. NPO opened in positive territory at $30.87 and then immediately reversed lower at $31.00. Shares erased Thursday's gain. The only consolation on Friday was the low volume, which might suggest there was no conviction behind the selling and it was just a lack of buyers instead.

If the market pulls back on Monday we could see NPO hit our stop loss. We knew this was an aggressive, higher-risk trade. Readers may want to wait for the next bounce (near $30.00 or near $29.50) before considering new positions.

More conservative traders might want to raise their stop loss.

Earlier Comments:
We want to keep our position small to limit risk.

(Small Positions)

current Position: Long NPO stock @ $30.87

- or -

Long Oct $30 call (NPO1122J30) Entry $1.75
- there are only 2 weeks left for October options -


Entry on October 07 at $30.87
Earnings Date 11/03/11 (unconfirmed)
Average Daily Volume = 282 thousand
Listed on October 06, 2011

UnitedHealth Group - UNH - close: 44.89 change: -0.05

Stop Loss: 41.25
Target(s): 46.50
Current Gain/Loss: +3.1%
Time Frame: 6 to 8 weeks
New Positions: see below

10/08 update: It seems like the rally, or more correctly the oversold bounce, in UNH is losing some steam. Shares struggled near the exponential 200-dma on Friday. My concern is that a failed rally here would look like a new bearish entry point.

Readers may want to take profits on the October call now, which is currently up +45%.

I am not suggesting new positions at this time. Our target is $46.50. More conservative traders may want to exit near $46 and its 200-dma instead.

current Position: Long UNH stock @ $43.54

- or -

Long OCT $43 call (UNH1122J43) Entry $1.88

10/08 readers may want take profits on the October $43 call now (+45%)


Entry on October 05 at $43.54
Earnings Date 10/18/11 (confirmed)
Average Daily Volume = 8.9 million
Listed on October 04, 2011

BEARISH Play Updates

None. No bearish plays currently.


Broadcom Corp. - BRCM - close: 35.27 change: -0.08

Stop Loss: 31.75
Target(s): 35.90
Current Gain/Loss: + 8.0%
Time Frame: 6 to 8 weeks
New Positions: see below

10/08 update: Target achieved. BRCM saw a late Friday morning rally toward $36.00 and hit our exit target at $35.90. There was another rally attempt late in the day before the market rolled over in the last 30 minutes. At our target, the call option was trading with a bid near $2.30 (+155%).

Current Position: Long BRCM stock @ $33.24, exit $35.90 (+8%)

- or -

OCT $34 call (BRCM1122J34) Entry $0.90, exit $2.30 (+155.5%)

10/07 target hit at $35.90
10/06 adjust target to $35.90


Entry on October 05 at $33.24
Earnings Date 10/25/11 (unconfirmed)
Average Daily Volume = 9.3 million
Listed on October 04, 2011