Editor's Note:

I found a number of bullish candidates tonight. Here's a group of stocks currently on my watch list: WCRX, PCS, RRD, MAR, JNPR, WM, BLL, CTL, DISCA, CAH, MKC, DRI, GPC, YUM, R, and FLIR. Plus the many of the REIT stocks look poised to move higher.

- James


NEW BULLISH Plays

Covidien Plc. - COV - close: 57.40 change: +1.28

Stop Loss: 55.40
Target(s): 63.50
Current Gain/Loss: + 0.0%
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Healthcare related stocks have been showing relative strength. COV just broke out from a three-wee consolidation sideways near resistance at its all-time highs. I am suggesting we buy this breakout now. More conservative traders could wait for a dip near $56.50 instead. The $60 level might offer some resistance but I'm setting our target at $63.50.

Suggested Position: BUY COV stock @ current levels

- or -

buy the July $60 call (COV1116G60) current ask $0.70

Annotated chart:

Entry on May 19 at $xx.xx
Earnings Date 07/28/11 (unconfirmed)
Average Daily Volume: 3.5 million
Listed on May 18th, 2011


Danaher Corp. - DHR - close: 54.89 change: +1.34

Stop Loss: 52.65
Target(s): 58.00-60.00 zone
Current Gain/Loss: + 0.0%
Time Frame: 8 to 10 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
DHR is a conglomerate and its stock has been marching slowly higher for months. Shares just broke out from a two-week consolidation lower without violating its long-term up trend. I am suggesting bullish positions now. We'll set our stop loss at $52.65, just under the rising 50-dma. DHR doesn't move super fast so we'll need patience. Our target is the $58-60 range.

Suggested Position: buy DHR stock @ current levels

- or -

buy the September $57.50 call (DHR1117I57.5) current ask $1.80

Annotated chart:

Entry on May 19 at $xx.xx
Earnings Date 07/21/11 (unconfirmed)
Average Daily Volume: 3.5 million
Listed on May 18th, 2011


Ecolab Inc. - ECL - close: 52.86 change: +1.50

Stop Loss: 50.95
Target(s): 57.00, 59.90
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
ECL is bouncing toward the top of its current trading range. A breakout past resistance at $53.00 would be a new all-time high. I am suggesting a trigger to launch bullish positions a $53.25. If triggered we'll use a stop loss at $50.95. Our targets are $57.00 and $59.90.

Trigger @ 53.25

Suggested Position: buy ECL stock @ 53.25

- or -

buy the July $55 call (ECL1116G55) current ask $0.60

Annotated chart:

Entry on May x at $xx.xx
Earnings Date 07/26/11 (unconfirmed)
Average Daily Volume: 1.5 million
Listed on May 18th, 2011


Kansas City Southern - KSU - close: 55.97 change: +1.52

Stop Loss: 53.45
Target(s): 59.75, 63.50
Current Gain/Loss: + 0.0%
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
The railroad stocks could outperform if there is any follow through on this bounce today. The group hit new highs back in late April. Now the railroad index and KSU are both bouncing from technical support at their 50-dma. I am suggesting we open bullish positions on KSU now with a stop loss at $53.45. If KSU doesn't produce some follow through on this bounce soon we'll consider an early exit in a day or two. Our upside targets are $59.75 and $62.50.

Suggested Position: buy KSU stock @ current levels

- or -

buy the June $60 call (KSU1118F60) current ask $0.55

Annotated chart:

Entry on May 19 at $xx.xx
Earnings Date 07/27/11 (unconfirmed)
Average Daily Volume: 1.0 million
Listed on May 18th, 2011