Editor's Note:

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

(bullish ideas) EBAY, TUDO, SBUX, Z, PATK, CMS, AVD, BSFT

(bearish ideas) DPM, LRE, BVN, BCOV,


Teva Pharmaceuticals - TEVA - close: 38.10 change: -0.51

Stop Loss: 40.05
Target(s): 35.25
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
Most of the market managed an oversold bounce last week to end a three-week slide. Shares of TEVA did not and is now down four weeks in a row. Today's underperformance could be signaling a fifth week of losses. Not only has the oversold bounce failed at resistance but TEVA could see additional selling pressure due to index changes. TEVA is getting booted out of the NASDAQ-100 index tomorrow.

I am suggesting bearish positions at the open tomorrow. We will start with a stop loss at $40.05 but more conservative traders could use a stop closer to the 10-dma instead. Our multi-week target is $35.25. The $35.00 level should be support.

Suggested Position: short TEVA stock @ (the open)

- or -

buy the Jun $37.50 PUT (TEVA1216R37.5) current ask $0.87

Annotated chart:

Entry on May xx at $ xx.xx
Earnings Date 07/25/12 (unconfirmed)
Average Daily Volume = 4.8 million
Listed on May 29, 2011