Editor's Note:

The one thing Wall Street hates the most is uncertainty. Right now we're swimming in it. Stocks collapsed last week thanks to bearish economic data, fallout over the debt ceiling deal, worries over a U.S. credit downgrade, and a serious concerns over Europe.

Many of these issues remain. We do not know (yet) how the market will react to the S&P downgrade of the U.S. credit rating. The downgrade could already be priced in or the market could plunge another 500 points on Monday. We really don't know. That's why I am suggesting a lot of caution and patience when it comes to new LEAPS positions. There is too much uncertainty in the air. I suspect the market will calm down a bit after the FOMC meeting on Tuesday.

We are not adding new watch list candidates tonight. However, I am sharing some of the stocks on my radar screen. Here's what I'm watching for a potential entry point assuming the markets finally stop falling on a daily basis.

On my radar: ENR, PVH, BCR, KFT, HAL, HSY, DRI, DLTR, RRC, RL, ANF, VFC, and IBM. (aggressive traders could watch stocks like AAPL and AMZN).

Three stocks that I was really tempted to add to the watch list tonight were AGN, HUM, and PM.

AGN dipped to support near $75.00 and its 200-dma on Friday. This is also the long-term trendline dating back to the 2009 lows. I would be tempted to buy calls on another dip near $75.00 and try and use a tight stop loss.

HUM has seen a significant correction with healthcare stocks falling sharply the past two weeks. HUM is currently testing support near $70.00. I would be tempted to buy calls on a dip near its 200-dma around the $67.50 area and use a stop loss just under $65.00.

PM has held up very well compared to the rest of the market. Shares still have a bullish trend of higher lows and they're not that far from their highs. Investors might want to consider buying a dip near the June lows or near the $64 level and its rising 200-dma.

- James

New Watch List Entries

None, no new watch list candidates

Active Watch List Candidates

EMC - EMC Corp

ESV - Ensco Plc.

MMR - McMoRan Exploration

Dropped Watch List Entries

AXP and WNR graduated to the play list last week.

Active Watch List Candidates:

EMC Corp. - EMC - close: 26.08

08/06 update: EMC plunged more than -11% last week. The breakdown under the $25.50-25.00 zone and its 200-dma is very bearish. The stock has also broken below its long-term trend of higher lows. The likelihood of EMC hitting our entry point condition of a close over $28.70 seems very farfetched at the moment.

EMC still offers plenty of opportunity. Their business did not plunge -10% in a week. However, the market craziness may not be over yet. I am removing our entry point strategy but we'll keep EMC on the watch list. Consider this a one-week probation as we wait to see where things shake out following the U.S. credit downgrade. If EMC can find support and hold it near $22 then maybe we'll reconsider a lower entry point. For the moment the $25.00 area should be new resistance. Who knows? Maybe a week from now we'll be looking at EMC near support at $20.00.

Temporarily Removing Our Entry Point on EMC.

Just wait and watch for this week.

Originally listed on the Watch List: 07/23/11

Ensco Plc. - ESV - close: 53.25 change: +0.62

08/06 update: At the low on Friday ESV was down -17% for the week. The sell-off is overdone and share are trying to find support near $45 and its long-term trendline of higher lows (see chart). Aggressive traders may want to buy calls now. I am concerned about how low the market might dip on Monday in reaction to the U.S. downgrade news. Thus, I'd rather wait until next weekend and re-evaluate our entry point strategy.

We will temporarily remove our entry point to buy calls on ESV. We will re-add an entry point next weekend or remove ESV as a candidate.

FYI: Investors will want to note that ESV does report earnings on August 8th. Wall Street is looking for a profit of 70 cents a share.

Temporarily removing our entry point on ESV. We just want to wait and watch this week.

Chart of ESV:

Originally listed on the Watch List: 07/30/11

McMoRan Exploration Co. - MMR - close: 16.84

08/06 update: The story has not changed for MMR even though shares just dropped -18% last week. The breakdown through the bottom of its trading range, the break under $14.00, and the breakdown under its long-term trendline are all very bearish. I suspect the move lower is very, very overdone but I would not buy the dip here.

I am suggesting readers just wait and watch to see how MMR performs this coming week. Will it bounce back above prior support at $14.00 or will it collapse toward potential support near $12.00? We will either adjust our entry point strategy next weekend or remove MMR as a candidate.

Temporarily Remove the Entry Point Strategy on MMR.

Just wait and watch this week!

Chart of MMR:

Originally listed on the Watch List: 07/23/11