Editor's Note:

The market ended the second quarter on a high note. Short covering probably played a big part of Friday's rally so I wouldn't be too optimistic here. Yet if the market's major indices can keep the momentum alive and breakout past resistance then it might inspire some real buying interest.

Unfortunately the EU's newest plan to make a plan to solve their problems doesn't really fix anything. It could be six months before these new proposals are ratified and implemented (if not longer). Thus the situation in the Eurozone hasn't changed much and remains a significant risk for the markets.

Closer to home we're nearing the Q2 earnings season. Corporate guidance will set the tone for the rest of our summer. If you consider the recent trend of disappointing economic data it does not bode well for corporate earnings. Thus I am cautious when it comes to launching new positions in the LEAPS newsletter.

I will point out that we had three watch list candidates graduate to our active trade list this past week. I just added three more new watch list candidates.

Here is a list of stocks currently on my radar screen as potential candidates to keep an eye on:

BRK.B, WFM, SODA, CSX, GE, MDR, SHLD, CREE, SHAW, PHM, CIEN, JDSU, EMC, SCHW, JBHT