Editor's Note:

October 31st is only five weeks away. Not only is that Halloween it is also the fiscal year end for many mutual funds. What sort of moves will these money managers be making between now and then? Will they be selling their winners to lock in gains? Or will they feel compelled to chase the market higher? Odds are very good October could see a lot of volatility.

Currently the market remains very overbought with the S&P 500 up +9% and the NASDAQ up +12% for the month of September. We don't want to chase stocks at these levels so I'm not adding any new plays tonight. Yet the trend is up. Our challenge is picking an entry point. We want to buy dips but if fund managers are looking for an entry point then dips may be a lot shallower than normal.

I've added three new candidates to the watch list tonight.