New Watch List Entries

BG - Bunge Limited

CNX - Consol Energy Inc.

ERJ - EMBRAER - Empresa Brasileira de Aeronáutica


Active Watch List Candidates

BEAV - BE Aerospace Inc.

IGT - Intl. Game Technology

LNN - Lindsay Corp.

MEE - Massey Energy Corp.

MICC - Millicom Intl. Cellular

WLT - Walter Energy Inc.


Dropped Watch List Entries

None. We did not drop any watch list candidates.


New Watch List Candidates:

BG $69.97 +0.53 -- Bunge Limited

BG has been steadily channeling higher since its October 2008 lows. The market's recent strength has allowed BG to hit new highs for 2009. Now the stock is short-term overbought and due for a correction. We want to hop on board this bandwagon on a correction near $60.00. If triggered we're going to aim for the $85-90 zone. Currently the Point & Figure chart is bullish with a $94 target.

Company Info:
Bunge Limited (www.Bunge.com, NYSE: BG) is a leading global agribusiness and food company founded in 1818 and headquartered in White Plains, New York. Bunge's 25,000 employees in over 30 countries enhance lives by improving the global agribusiness and food production chain. The company supplies fertilizer to farmers; originates, transports and processes oilseeds, grains and other agricultural commodities; produces food products for commercial customers and consumers; and supplies raw materials and services to the biofuels industry. (source: company press release or website)

Buy-the-Dip trigger: $61.00

BUY the 2010 January 70 calls (BGW-AN)

Chart of BG:


CNX $35.53 +1.28 -- Consol Energy Inc.

Shares of CNX have formed a significant bottom over the last several months. July's dip in the $29-30 zone tested the longer-term bullish trendline of higher lows. We want to buy LEAPS on another test of that trendline. If triggered our long-term is the $48.50 level. We'll use a stop loss at $24.40.

Company Info:
CONSOL Energy Inc. (NYSE: CNX) is the largest producer of high-Btu bituminous coal in the United States. Named one of America’s most admired companies by Fortune magazine, CONSOL Energy has evolved from a single-fuel mining company into a multi-energy producer of both high-Btu coal and gas. Together coal and gas fuel two-thirds of the nation's power. (source: company press release or website)

Buy-the-Dip trigger: $30.50

BUY the 2010 January 35.00 calls (symbol: CNX-AG)

Chart of CNX:


ERJ $19.49 +1.17 -- EMBRAER - Empresa Brasileira de Aeronáutica S.A.

Brazil's premier builder of jet airplanes appears to be weathering the global economic slowdown pretty well. The company just reported earnings that were better than expected. Longer-term the stock has built an inverse head-and-shoulders pattern over the last year and poised for a long-term rally. I am suggesting readers buy LEAPS (or January 2010 calls since that's the longest we can find) on a dip in the $17.50-16.00 zone. I prefer to buy near $16.00 but ERJ may not correct that much. Our target is the $29-30 zone. Set your stop at $14.70 under the July low.

Company Info:
Embraer (Empresa Brasileira de Aeronautica S.A. - NYSE: ERJ; Bovespa: EMBR3) is the world's largest manufacturer of commercial jets up to 120 seats, and one of Brazil's leading exporters. Embraer's headquarters are located in Sao Jose dos Campos, Sao Paulo, and it has offices, industrial operations and customer service facilities in Brazil, the United States, France, Portugal, China and Singapore. Founded in 1969, the Company designs, develops, manufactures and sells aircraft for the Commercial Aviation, Executive Aviation, and Defense segments. The Company also provides after sales support and services to customers worldwide. On June 30, 2009, Embraer had a workforce of 17,237 employees -- not counting the employees of its subsidiaries OGMA and HEAI -- and its firm order backlog totaled US$ 19.8 billion. (source: company press release or website)

Buy-the-Dip trigger: $17.50

BUY the 2010 January $20.00 call (symbol: ERJ-AD)

Chart of ERJ:


Active Watch List Candidates:


BEAV $15.04 +0.18 -- BE Aerospace Inc.

BEAV reported earnings last week that beat the estimates by five cents and the company raised guidance. That was enough to push the stock back above the $16.00 level. As a high-beta stock there is still a good chance that when the rest of the market finally corrects BEAV will overshoot to the downside. I am raising our entry point to $13.00.

Buy-the-Dip trigger: $13.00

BUY the 2010 January $15.00 calls (symbol: BQV-AC)
or
BUY the stock at $13.00

Note: At $13.00 you could just buy the stock instead but the $15 calls will allow you more leverage on your investment.

Chart of BEAV:


IGT $19.75 +0.03 --- Intl. Game Technology

The rally in IGT has totally stalled. Shares closed nearly unchanged for the entire week. A 38.2% Fibonacci retracement of the July rally would be near $17.60. I am suggesting that readers buy LEAPS on a dip into the $17.50-16.00 zone. Our long-term target is the $25.00-30.00 zone.

Buy-the-Dip trigger: $17.50 (17.50-16.00 zone)

BUY the 2010 January $17.50 call (IGT-AW) -or-
BUY the 2010 January $20.00 call (IGT-AD) -or- BUY the 2011 January $20.00 call (VGG-AD)

Chart of IGT:


LNN $35.47 -0.89 -- Lindsay Corp.

After another failed rally near $38.00 shares of LNN are starting to correct. We have a good chance of being triggered at $33.50. Currently we have two different triggers. A breakout trigger at $41.55 and a buy the dip trigger at $33.50. If we are triggered we'll want to sell half near $50.00 and then the rest near $60.00. We'll use a stop loss under the June low at $29.65.

Buy-the-Dip trigger: $33.50 or Breakout trigger: $41.55

BUY the 2010 January $35.00 calls (NRR-AG)
or
BUY the 2010 January $40.00 calls (NRR-AH)

FYI: Readers might want to consider buying the 2010 March calls instead.

Chart of LNN:


MEE $26.60 +1.25 -- Massey Energy Corp.

MEE is helping lead the coal sector higher. The stock has gone almost straight up from its July lows near $16.00. Needless to say shares are very overbought and due for a correction. I am suggesting that readers buy LEAPS on a dip in the $20.50-18.00 zone. We'll use a stop at $15.75. Our long-term target is the $35.00-40.00 range. The P&F chart agrees and points to a $37.50 target.

Buy-the-Dip trigger: $20.50

BUY the 2010 January $25.00 call (MEE-AE)
-or
BUY the 2011 January $30.00 call (VHK-AF)

Chart of MEE:


MICC $74.15 -0.12 -- Millicom Intl. Cellular

The rally in MICC is finally starting to slow down. The plan is to buy LEAPS on a dip at $62.50. The $60.00 level and the rising cloud of moving averages should offer some support. It might take a while for MICC to correct that low so be patient. Buy-the-Dip trigger: $62.50

BUY the 2010 January $80 call (symbol: CQD-AP)

Chart of MICC:


WLT $49.36 +1.56 -- Walter Energy Inc.

WLT is another leader in the coal sector. The stock has broken out to new highs for the year. Eventually there will be some profit taking. Don't chase this move. Broken resistance near $40.00 should be new support. I'm suggesting we buy LEAPS in the $41.00-40.00 zone. We'll use a stop loss at $34.40. Our long-term target is $60.00.

Buy-the-Dip trigger: $41.00

BUY the 2010 January 50.00 call (WLT-AJ)

-or-

BUY the 2011 January 50.00 call (OZE-AJ)

Chart of WLT: