Editor's Note:

The stock market's intermediate trend is down. Yet the S&P 500 has not yet broken long-term support at the 200-dma nor one its key trendlines of higher lows in the 1260-1250 area. The index could go either way here. Stocks might bounce on end-of-quarter window dressing, or they could churn sideways as investors wait for the beginning of Q2 earnings season, or they could renew the correction lower.

Whatever your bias I would take a cautious approach to new positions. In addition to tonight's new candidates I'm presenting a list of stocks that caught my eye.

CRM - shares might be a bullish candidate here or wait for a rally past $145.50.

EL - a rally past $104 could be a new bullish entry point.

PPG - the bounce from its 200-dma has potential. Do you buy another dip near $85 or wait for a rally past the 50-dma?

DVA - a rise past $85.75 could be a new bullish entry point.

FMC - shares have been showing relative strength. A move past the 50-dma might be an entry point.

NOC - this defense contractor looks like a buy right here but readers may want to wait for another dip near $65.00.

ORLY - shares have been showing lots of strength. I wouldn't chase it. Wait for a correction.

FSLR - the oversold bounce has failed. The stock looks poised to drop toward $101 again.

CERN - a new breakdown under $115.00 could be a bearish entry point.

APA - oil stocks are trending lower. A drop under $115.00 could be a bearish entry point.

BCR - I would seriously consider a bearish entry point right now with a stop above $110. Target the 100-dma.

PH - shares are flirting with a breakdown under support near $85 and the 200-dma.

NKE - keep an eye on it for a breakdown under $79.50.

V - shares of Visa are on the verge of breaking a major trendline of support.

BHI - looks like it could drop toward the 200-dma near $60.

- James


NEW DIRECTIONAL CALL PLAYS

Teradata Corp. - TDC - close: 57.43 change: -0.61

Stop Loss: 53.45
Target(s): 59.75, 64.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
I have mentioned TDC in my editor's note before. Shares have consistently outperformed the market as traders buy the dips near the stock's rising 50-dma. Recently shares broke out to new highs. I don't want to chase it here but a dip back toward prior resistance could be an entry point.

I am suggesting a trigger to buy calls on TDC at $56.50. If triggered we'll use a stop loss at $53.45. Our targets are $59.75 and given enough time $64.00. FYI: TDC's P&F chart has produced a new triple-top breakout buy signal with a $79 target.

NOTE: As an alternative entry point readers could wait for another dip close to the simple 50-dma instead.

Trigger @ $56.50

- Suggested Positions -

buy the July $55 call (TDC1116G55) current ask $3.10

- or -

buy the Aug. $60 call (TDC1120H60) current ask $2.10

Annotated Chart:

Entry on June xx at $ xx.xx
Earnings Date 08/04/11 (unconfirmed)
Average Daily Volume = 1.8 million
Listed on June 25, 2011


NEW DIRECTIONAL PUT PLAYS

Goldman Sachs - GS - close: 130.91 change: -1.45

Stop Loss: 135.25
Target(s): 121.00, 116.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
Earlier this month I was speculating that GS might dip toward support near $130 and bounce. Now it would seem GS could breakdown below this key level of support. Analysts are starting to lower their earnings estimates again for the financial companies and investors are still concerned over GS' potential legal troubles with the U.S. government.

I do consider this an aggressive trade. GS can be a very volatile stock at times. I'm suggesting a trigger to buy puts at $129.00. If triggered our targets are $121.00 and $116.00. We do not want to hold over the mid July earnings report. FYI: The Point & Figure chart for GS is bearish with a $102 target.

Trigger @ $129.00

- Suggested Positions -

buy the July $125.00 PUT (GS1116S125) current ask $1.53

- or -

buy the Aug. $125.00 PUT (GS1120T125) current ask $3.70

Annotated Chart:

Entry on June xx at $ xx.xx
Earnings Date 07/19/11 (unconfirmed)
Average Daily Volume = 6.0 million
Listed on June 25, 2011


Schlumberger Ltd. - SLB - close: 80.92 change: -2.15

Stop Loss: 84.65
Target(s): 76.00, 71.00
Current Option Gain/Loss: Unopened
Time Frame: 4 to 5 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
Oil service stock have been growing weaker and shares of SLB have been suffering under a bearish trend of lower highs and resistance at the 50-dma. Yet so far SLB has been able to hold support near 480 and now at its 200-dma. It looks like that could change soon. A breakdown under $80.00 would be very bearish. Back in December and January there were a couple of dips to $79.75ish. I am suggesting a trigger to launch bearish positions at $79.65. If triggered our targets are $76.00 and $71.00. We do not want to hold over the late July earnings report.

Trigger @ $79.65

- Suggested Positions -

buy the July $77.50 PUT (SLB1116S77.5) current ask $1.18

- or -

buy the AUG. $75.00 PUT (SLB1120T75) current ask $2.03

Annotated Chart:

Entry on June xx at $ xx.xx
Earnings Date 07/22/11 (unconfirmed)
Average Daily Volume = 7.5 million
Listed on June 25, 2011