Editor's Note:

In addition to tonight's new candidates, here are a few stocks that caught my eye:

CBOE - shares are holding up pretty well. The company has reported that trading volumes have been soaring, which should mean a strong quarter. I'd be tempted to launch bullish positions now or you could wait for a new rise past Friday's high (26.11).

HSP - the stock has broke down from its $43-47 trading range. Friday's breakdown could be used as a new bearish entry point or you could wait for a failed rally in the $42.50 area.

CSX - some of the railroad stocks are struggling due to market weakness, recession fears, and a labor dispute. CSX has broke down under psychological support near $20.00. This could be a new bearish entry point. I'd target a drop toward $18 or $16.

- James


NEW BULLISH Plays

Stamps.com Inc. - STMP - close: 19.44 change: +0.87

Stop Loss: 17.90
Target(s): 22.25, 24.50
Current Gain/Loss: unopened
Time Frame: 6 to 10 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
Struggles for the U.S. Postal Service could be bullish news for STMP. This stock has rallied to new five-year highs. The stock accelerated higher back in late July on a much stronger than expected earnings report. Management also raised their earnings guidance.

You may have heard that the USPS is running out of money and they're considering cut backs and closing locations. Less competition at the local post office should help drive new business toward STMP's online services. Shares of STMP have definitely been showing relative strength.

I am suggesting bullish positions now but only if STMP and the S&P 500 index both open positive on Monday morning. If you prefer, readers may want to wait for a new high over $20.20 or a close over the $20.00 mark before initiating positions. Please note that if our original entry conditions are not met but we see STMP rally anyway, then we'll buy a breakout at $20.25 instead. The newsletter will start with a stop loss at $17.90. Our upside targets are $22.25 and $24.50.

*See Play Details for Entry Point Strategy*

Suggested Position: buy STMP stock @ the open

- or -

buy the OCT $20 call (STMP1122J20) current ask $1.40

Annotated chart:

Entry on September xx at $ xx.xx
Earnings Date 10/27/11 (unconfirmed)
Average Daily Volume = 248 thousand
Listed on September 10, 2011


NEW BEARISH Plays

Greif, Inc. - GEF - close: 47.38 change: -2.05

Stop Loss: 50.60
Target(s): 44.00, 40.50
Current Gain/Loss: +0.0%
Time Frame: 6 to 8 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
GEF makes industrial packaging products. The stock's August rebound was cut short by a disappointing earnings report. The company missed earnings and lowered guidance. Shares reacted with the big drop on September 1st. Now after four days of consolidating sideways the sell-off continues and GEF is at new lows for the year.

I am suggesting small bearish positions now with a stop loss at $50.60, which is just above the Wednesday high. The $45.00 level might offer some round-number support but I'm setting our profit targets at $44.00 and $40.50. FYI: The Point & Figure chart for GEF is bearish with a $30 target.

NOTE: I am not suggesting the options. The spreads are too wide.

*Small Bearish Positions*

Suggested Position: short GEF stock @ the open

Annotated chart:

Entry on September 12 at $ xx.xx
Earnings Date 12/07/11 (unconfirmed)
Average Daily Volume = 247 thousand
Listed on September 10, 2011