Editor's Note:

In addition to tonight's new candidate, several stocks caught my eye as potential bullish plays. Consider adding these to your radar screen to see if they produce an entry point: BYD, RYL, TOL, WOLF, and C.

- James


AnnTaylor Stores - ANN - close: 23.80 change: +0.10

Stop Loss: 20.95
Target(s): 25.90, 27.85
Current Gain/Loss: unopened
Time Frame: 6 to 8 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
The RLX retail index is surging toward new three-year highs. I suspect that as it climbs it could drag shares of ANN with it. Actually, I'm expecting ANN to play a little catch up. The January drop paused at technical support near the 200-dma. This was also a 50% retracement of the late summer rally higher. I am suggesting we launch bullish positions on a dip at $23.00. If triggered we'll use a stop loss at $20.95. Our targets are $25.90 and $27.85. FYI: The P&F chart is still long-term bullish in spite of the January correction.

Trigger @ 23.00

Suggested Position: Buy ANN stock @ $23.00

- or -

Buy the March $22.50 calls (ANN1119C22.5) current ask $2.35

Annotated chart:

Entry on February xx at $xx.xx
Earnings Date 03/11/11 (confirmed)
Average Daily Volume: 3.0 million
Listed on February 8th, 2010