Editor's Note:

Additional Trading Ideas:

In addition to tonight's new candidate(s), consider these stocks as possible trading ideas and watch list candidates. Many of these need to see a break past key support or resistance:

(bullish ideas) SEMG, STI, CTAS, FRP, BBG, OFC, CRK, VNR

(bearish ideas) BRE, LECO, NTAP, JDSU,


Sohu.com - SOHU - close: 39.58 change: -1.12

Stop Loss: 41.40
Target(s): 36.00
Current Gain/Loss: unopened

Entry on October 10 at $ xx.xx
Listed on October 9, 2012
Time Frame: 6 to 8 weeks
Average Daily Volume = 472 thousand
New Positions: Yes, see below

Company Description

Why We Like It:
On Monday the World Bank cut their growth estimates on Asia. Today it was the IMF who lowered their forecast for China's growth. Naturally Chinese stocks are under pressure with these headlines. We did see Chinese Internet stock SOHU breakdown under support near $40.00 and its 50-dma.

I have to warn you that SOHU can be a volatile stock so we need to limit our position size to reduce our risk or consider trading the options. I am suggesting small bearish positions at the open tomorrow with a stop loss at $41.40. Our target is $36.00. More aggressive traders could aim for the $34.00 area.

*Small Positions*

Suggested Position: short SOHU stock @ (the open)

- (or for more adventurous traders, try this option) -

buy the Nov $37.50 PUT (SOHU1211w37.5) current ask $1.85

Annotated chart: