Editor's Note:

In addition to tonight's new candidates, consider these stocks as possible trading ideas and watch list candidates:

(bullish ideas) TDG, FDX, WYNN, CSGP, WFM, MNST, ULTA, VSI, NBL, CRR

(bearish ideas) BDX, MCD,


NEW DIRECTIONAL CALL PLAYS

Cliffs Natural Resources - CLF - close: 52.40 change: +2.12

Stop Loss: 50.75
Target(s): 57.25
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Many of the steel and coal names were in rally mode today. CLF is involved in both industries with its iron ore production and metallurgical coal operations. The steep sell-off in shares of CLF paused a week ago when the stock hit its October 2011 lows. Now the stock could be building a bottom. However, it could also be forming a bear-flag pattern. Thus I consider this an aggressive, higher-risk trade.

We want to keep our position size small. I am suggesting a trigger @ 52.75. If triggered we'll start with a stop loss under the 10-dma at $50.75. Our target is $57.25. More aggressive traders could aim for the $59-60 zone, which should be resistance.

Trigger @ 52.75 (small positions)

- Suggested Positions -

buy the Jun $55 call (CLF1216F55) current ask $1.11

- or -

buy the Jul $55 call (CLF1221G55) current ask $2.72

05/29/12 this is an aggressive trade. small positions only.

Annotated Chart:

Weekly Chart:

Entry on May xx at $ xx.xx
Earnings Date 07/25/12 (unconfirmed)
Average Daily Volume = 3.7 million
Listed on May 29, 2012


NEW DIRECTIONAL PUT PLAYS

Baxter Intl. - BAX - close: 51.57 change: -0.42

Stop Loss: 52.51
Target(s): 48.00
Current Option Gain/Loss: Unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
BAX produces a variety of medical supplies and instruments. The stock's oversold bounce is failing. Shares underperformed today with a -0.8% decline. Now BAX is back at the bottom of its recent trading range.

I am suggesting a trigger to buy puts at $50.95. If triggered our target is $48.00.

Trigger @ 50.95

- Suggested Positions -

buy the Jun $50 PUT (BAX1216R50) current ask $0.44

- or -

buy the Jul $50 PUT (BAX1221S50) current ask $1.19

Annotated Chart:

Entry on May xx at $ xx.xx
Earnings Date 07/19/12 (unconfirmed)
Average Daily Volume = 2.4 million
Listed on May 29, 2012