Editor's Note:

In addition to tonight's new candidate check out these stocks that caught my eye. You might want to put them on your radar screen:

DHR - After several weeks of consolidating sideways a breakout past $52.00 might be a bullish entry point.

SUN - SUN set a new 52-week closing high. Readers might want to consider bullish positions with the move over $44.00.

BBY - I am not suggesting positions on BBY. The company has earnings in just a couple of days. Shares of BBY are trying to hold support near $31.00. A breakout past $32.00 could signal a change in trend but the key will be the market's reaction to their earnings results and guidance. I'd keep an eye on it and see how it trades after earnings.

DFS - This financial stock has broken out to new three-year highs. It might be an entry point.

SVU - This grocery store stock has been underperforming the market. However, it looks like SVU might be in the process of forming a bullish double bottom. For now the tend is still down but I'd keep an eye on it.

NE - A rally past $46.00 might be a bullish entry point for this energy stock.

Potential candidates from the weekend editor's note: PLL, HSY, HAS, DPS, SWY, and PBCT.

- James


Tesoro Corp - TSO - close: 25.63 change: +1.01

Stop Loss: 23.95
Target(s): 29.90
Current Gain/Loss: unopened
Time Frame: 4 to 6 weeks
New Positions: Yes, see trigger

Company Description

Why We Like It:
TSO is an oil refiner and the stock is trading near multi-year highs. Shares did not see that much of a sell-off during last week's market decline. A breakout past resistance should herald a new leg higher after four weeks of consolidating under the $26.00 level. Readers can choose to open bullish positions on a move past $26.00 or wait for a move past the March 14th high of $26.72.

I am suggesting we buy TSO at $26.15 and we'll put our stop loss at $23.95. Given the stock's recent volatility over the last month or so I would consider this a higher-risk trade. Keep your position size small.

FYI: The most recent data listed short interest in TSO at more than 13% of the stock's 141 million-share float. A breakout past resistance could spark another short squeeze.

Trigger @ 26.15

Suggested Position: Buy TSO stock @ 26.15

- or -

Buy the May $27.00 calls (TSO1121E27) current ask $1.55

Annotated chart:

Entry on March x at $xx.xx
Earnings Date 04/25/11 (unconfirmed)
Average Daily Volume: 8.2 million
Listed on March 21st, 2010