This article notes that Travelers Companies (TRV: sentiment, chart, options) pleasantly surprised Wall Street with its Oct. 22 earnings report, as its per-share profit of $1.61 blew past analysts' expectations for $1.30 per share. Additionally, TRV increased its quarterly dividend, making it a rare standout in the struggling insurance sector, and the company is also rewarding shareholders with substantial share-buyback programs. "Travelers has put itself in a position of relative strength after outperforming in 2008, giving it opportunities to steal profitable business," observed Morningstar analyst Drew Woodbury.

However, cautions the author, "That's not to say Travelers isn't feeling the effects of the recession." Due to an uncertain economic outlook, the insurance issue could struggle under the weight of anemic growth in premiums. Plus, earnings comparisons are likely to get tougher during the next few fiscal years, as the market environment stabilizes and more of TRV's peers get their bottom lines back in shape. "Travelers," concludes the author, "…may have the advantage for now in the fiercely competitive insurance industry, but it might be moving into some strong headwinds."

TRV is currently climbing higher on the charts, with the equity tagging a new 52-week high of $52.22 earlier in today's session. The stock is enjoying support from its 10-week and 20-week moving averages, but the shares will have to prove their mettle in the mid-50s. Since 2000, the equity's rally attempts have consistently been rejected by the $52-to-$56 neighborhood. If this region continues in its historical role as resistance, potential upside from TRV's current levels could be severely limited.

However, Wall Street is displaying a relatively healthy level of pessimism toward the Dow member. During the past 10 days, traders on the International Securities Exchange (ISE) have bought to open 1.28 puts for every call on TRV. This ratio ranks higher than 75% of comparable readings taken during the past 52 weeks, revealing that bearish bets have been more popular than usual in recent weeks.

Overall, the technical outlook for TRV seems just as uncertain as its fundamental outlook. The stock has performed respectably well and boasts multiple layers of support, but it should be facing some serious challenges during the near future. Traders might want to wait and see how the shares perform in the mid-50s before pulling the trigger on a Travelers trade.

While many tech-trendy Americans await anything iPhone with bated breath, Chinese consumers were rather indifferent to the latest smartphone's Far East debut. Data from The Press Association indicates that China Unicom (CHU: sentiment, chart, options), Apple Inc.'s (AAPL) partner in China, managed to unload a mere 5,000 iPhones during its launch over the weekend. In comparison, earlier iPhone rollouts have typically resulted in daily sales of about 20,000 handsets, the data estimates. However, this Motley Fool columnist isn't surprised.

For starters, the Fool points out that China Unicom's iPhone is facing staunch competition from "cheaper, Wi-Fi capable gray market models." Furthermore, "unlike AT&T (T) here in the U.S., China Unicom is partnering with and competing with Apple," since the CHU models come with an app store from each company. The only way China Unicom can buck the lethargic sales trends, opines the Fool, is with a Chinese government crackdown on gray market iPhones, or stepping up to "earn the 20% or so price premium it's demanding of buyers."

Considering China Unicom's partnership with tech phenom AAPL, it's no surprise that the Street has grown increasingly optimistic toward the shares of CHU. In fact, half of the six ranking analysts currently deem the stock worthy of a "strong buy" rating, according to Zacks. On that same note, Thomson Reuters pegs the consensus 12-month price target at $17.13 – rather lofty, considering CHU hasn't breached the $17 threshold since August 2008.

Meanwhile, during the past couple of weeks, speculators on the International Securities Exchange (ISE) have bought to open almost 10 times as many CHU calls than puts. The stock's 10-day call/put volume ratio of 9.90 ranks in the 68th annual percentile, implying that option traders on the ISE are more bullishly biased than usual toward the shares. What's more, the optimistic uprising has pressured the security's Schaeffer's put/call open interest ratio (SOIR) to 0.55, in the 30th annual percentile.

Technically speaking, it's difficult to justify the high expectations on the Street, as the shares of CHU have underperformed the broader S&P 500 Index (SPX) by 13% during the past 60 trading sessions. In fact, since early June, the stock has remained confined between support at its 50-week moving average and resistance from its descending 80-week trendline.

From a contrarian perspective, the widespread optimism among investors, juxtaposed with China Unicom's aforementioned fundamental follies and technical troubles, makes for a potential bearish argument. Should the overseas iPhone issues continue, extending CHU's status as a broad-market laggard, the bulls could abandon ship. A reversal in sentiment among option traders, or a round of downgrades and/or price-target cuts, could exacerbate the stock's recent challenges on the charts.

This Barron's article takes a bullish look at automaker Ford Motor Co. (F: sentiment, chart, options) following the company's stronger-than-expected earnings report. The firm is operating more effectively than it was a year ago, with more cash on the books and free cash flow for the first time since 2007. However, there are still some dark clouds overhead. The United Auto Workers union has rejected the company's proposal to cut wages, a development that hinders the company's return to profitability next year.

However, the firm expects to be "solidly profitable" in 2011, its press release stated, with positive operating cash flow, an improvement, it said, from a previous outlook of "break-even or better." Helping to boost the company's bottom line was that it kept producing new models right through the recession, giving it the freshest line-up of new cars while "cash for clunkers" was luring buyers to the lots. And the company implemented big production cuts early on, rather than incrementally, to meet the reduced sales outlook for North America. The article points out that the company has figured out how to make a profit even in a down market, something General Motors (GM) and Chrysler have yet to demonstrate, despite massive restructuring.

Technically speaking, it appears that the stock has earned this article's optimism. The equity has soared more than 220% since the beginning of the year, easily outpacing the broad market. In addition, the security has gained ground along the support of its 10-week and 20-week moving averages since March.

Meanwhile, not everyone has jumped on the stock's bandwagon. The Schaeffer's put/call open interest ratio comes in at 0.78, which is higher than two-thirds of the readings taken during the past year. Plus, the International Securities Exchange (ISE) has seen an uptick in put trading. The ISE 10-day put/call volume ratio is higher than 76% of all those taken during the past year, pointing to growing skepticism.

Wall Street is giving the stock a mixed review, at best. According to Zacks, the stock has earned three "strong buy" ratings, four "holds," and one "sell." Any upgrades from this group could add some lift to the shares.

Amazon.com Inc.'s (AMZN: sentiment, chart, options) recent post-earnings surge caught many investors off guard. In fact, with the shares now trading with a price-to-earnings (P/E) ratio in the 68 region, some traders are downright concerned. However, as author Mark Hulbert states in this recent article from MarketWatch, "we might not want to be too quick to dismiss Amazon.com's recent strength." For his reasoning, Hulbert cites the "so-called Nifty Fifty stocks from the early 1970s."

Per a recent study by Jeremy Siegel, finance professor at the Wharton School of the University of Pennsylvania, "a portfolio that bought all 50 stocks at the stock market's peak in December 1972, and held them for at least two decades, would eventually have taken the lead over the broad stock market." To be sure, Hulbert states that some of these results could have been impacted by impressive gains by Wal-Mart Stores (WMT), "whose gargantuan percentage gain since then (north of 10,000%) would skew the results particularly strongly in favor of the long-run performance of the Nifty Fifty."

He also emphasizes diversification in your portfolio, and notes that it took years for the Nifty Fifty to justify their elevated P/E ratios from the early 1970s. Still, Hulbert believes that "Amazon.com's new record high is a harbinger of good things to come many years down the road for those beleaguered investors who are still nursing the wounds they suffered earlier this decade from the bursting of the Internet bubble."

In the long run, Hulbert may eventually be proven correct in his bullish leanings toward AMZN, but there are some serious short-term concerns that must be considered before jumping on the bandwagon. While we tend not to focus on P/E ratios at Schaeffer's Research, let's take a moment to put AMZN's current ratio in perspective. The highest P/E ratio among the company's competitors, according to Google Finance, lies with Google Inc. (GOOG), which sports a ratio of 34.34.

Furthermore, Netflix Inc.'s (NFLX) P/E ratio arrives at 29.09, while Hasting Entertainment Inc.'s (HAST) ratio comes in at 22.78. Just so we're clear, AMZN's P/E ratio comes in at somewhere near twice the next highest reading from a related company, which, from a contrarian perspective, has to send up at least a few warning flags for potential investors.

Other warning flags can be seen in the stock's sentiment backdrop. Specifically, AMZN's Schaeffer's put/call open interest ratio (SOIR) of 1.00 ranks below 72% of all those taken during the past year, meaning that options traders have rarely been more bullish toward the shares. What's more, 12 of the 21 analysts following AMZN rate the shares a "buy" or better.

In fact, the only group that wasn't all warm and cozy in AMZN's pocket was the short-selling community. Currently, more than 5% of the stock's float is sold short, following a 9.5% plunge in short interest during the prior two weeks. In all likelihood, these bears were blasted out of their positions in the wake of the company's better-than-expected quarterly earnings report, creating a short-squeeze situation that contributed to AMZN's 26% post-report rally.

Going forward, at least from a short-term perspective, AMZN traders will want to keep a keen eye trained on the 118-118.50 region. The shares have begun to pull back following their earnings-induced euphoria, and a breach of the 118-118.50 region, which marks AMZN's earnings-gap close, could send the shares quickly down for a test of support near 111-110 -- the security's earnings-gap low on Oct. 23. Such a development would be especially true if short sellers begin to reestablish their bearish positions following the stock's recent peak.

This Motley Fool article argues the potential risks of investing in tobacco titan Philip Morris International (PM: sentiment, chart, options), highlighting the "demand-killing effects of cigarette taxes" and valuation concerns.

While Uncle Sam-imposed taxes tend to be associated with domestic tobacco names like PM parent Altria (MO), the author notes that higher international taxes are beginning to pose a threat to Philip Morris. Reflecting the ramifications of higher international taxes were the company's own third-quarter statistics, which attribute "nearly two-thirds" of its organic volume weakness to Spain, Pakistan, and Ukraine – all of which recently raised excise taxes. Furthermore, the columnist notes that Latin American volumes declined 3.8% in the third quarter, after Brazil upped its excise taxes by 20% earlier in the year.

In addition, the Fool warns that "valuation is the second reason that investors should consider going on the patch program." The shares of PM currently trade at a forward price-to-earnings ratio of 12.9, which is substantially higher than rival companies Altria, Reynolds American (RAI), and British American Tobacco (BTI). As such, the writer warns that persistent "tax- and recession-driven volume woes" could reduce PM's premium to domestic players.

Technically speaking, after riding its 10-week moving average higher during most of 2009, PM has recently retreated into the red. As such, the shares have surrendered their aforementioned perch atop their 10-week trendline for only the second time since mid-March, and are now flirting with the $47.40 level.

However, the equity's pullback could be contained by its 20-week moving average, which has descended into the $46.50 area. This trendline played the part of resistance during late 2008 and early 2009, and could now switch roles and act as support. Furthermore, the security could find a foothold in the $45.50-$46 neighborhood, which supported the stock from late July to mid-September.

Should the shares of PM rebound off these potential layers of support, there's plenty of pessimism levied against the stock left to unwind and spark additional buying pressure. In fact, the equity's Schaeffer's put/call open interest ratio (SOIR) currently stands at 1.06, only one percentage point shy of an annual bearish climax. In addition, short interest rose by 6.2% during the past month, with more than 28 million PM shares now sold short. At the stock's average daily trading volume, it would take nearly a week for all of these pessimistic positions to unwind, presenting a sufficient short-squeeze opportunity.

This optimistic article observes that IBM (IBM: sentiment, chart, options) "has been on a tear lately, up almost 41% since [the market's] March 9 lows." However, the author notes that Big Blue's bounce has been relatively small in comparison with the gains collected by the Nasdaq Composite (COMP) and the S&P 500 Index (SPX) during the same time frame. As a result, the stock "has some room to rise." In fact, Barclays Capital analyst Ben Reitzes recently boosted his price target on IBM to $140, surpassing the security's current all-time high of $138, which was tagged back in 1999.

As a caveat, the author notes that IBM is still struggling against weakness in its hardware business. Despite the apparent dominance of the company's software and services divisions, "all of IBM tends to do well when its hardware business is on a roll." If the firm's own forecast can be believed, this critical unit could be on the road to recovery -- CFO Mark Loughridge recently predicted that the hardware business would enjoy double-digit profitability growth in the fourth quarter. "So," concludes this optimistic write-up, "if you start to see an uptick in sales of servers, storage systems, and mainframe computers, you're also likely to see continued upside for Big Blue."

While IBM's hardware business might be on the road to recovery, it seems wildly optimistic to predict that the shares will revisit the lofty heights they attained during the peak of the dot-com bubble. In fact, from a technical perspective, IBM has been consistently stymied by resistance in the $130 to $135 neighborhood since 2000. This troublesome region could easily continue in its role as a roadblock during the near term.

Plus, most of Wall Street is already crowded on Big Blue's bandwagon. A slim 1% of the equity's float has been sold short, and eight out of 15 analysts maintain a "buy" or better rating, according to Zacks -- with not a single "sell" to be found. Among option traders, IBM has racked up a 10-day International Securities Exchange (ISE) call/put volume ratio of 1.91, which ranks higher than 90% of other such readings taken during the past year. In other words, speculative investors have shown a greater preference for bullish bets over bearish only 10% of the time.

Overall, it's hard to get too excited about the growth prospects for IBM. The company will surely benefit from a recovery in IT spending, but the combination of long-term technical resistance with widespread complacency among investors doesn't usually add up to stellar price action.

As The TJX Companies Inc. (TJX: sentiment, chart, options) wins "even more fans on Main Street during the recession, on Wall the highflying stock is regarded as one of the best values in retailing," according to this Barron's article. TJX shares are up more than 90% in 2009, the author notes, so "the easy money has already been made." However, he thinks the stock still has another "15%-plus" upside this holiday shopping season.

Credit Suisse analyst Paul Lejuez, who rates TJX "outperform," calls the stock "one of the best combinations of defense and offense in all of retail." Elsewhere, MKM Partners analyst Patrick McKeever calls TJX management the "best in class in retailing." Fundamentally, the company raised its third-quarter and full-year earnings outlook last week, marking the second time the company has done so in less than two weeks. What's more, Barron's reports that some analysts believe management may raise fourth-quarter earnings estimates when results are reported Nov. 17.

But there are some naysayers out there, as Morningstar analyst Kimberly Picciola sees thin long-term growth prospects. "Although we think there is room for TJX to expand in new and existing international markets, we aren't convinced it will move the needle in terms of top-line growth," she argues.

Picciola is in the minority in the brokerage bunch, as only four of the 10 analysts following TJX rate the shares a "hold"; there are no "sells." What's more, Thomson Reuters reports that the consensus 12-month price target for TJX rests at $43.60 per share, a premium to the stock's close on Friday at $39.78.

The optimism doesn't end at the borders of the analyst community either. Options traders have accumulated nearly three calls for every one put among options with less than three months until expiration, as TJX's Schaeffer's put/call open interest ratio (SOIR) arrives at a reading of 0.35. This ratio also ranks higher than all but 2% of those taken during the past year. And if that wasn't enough, data from the Chicago Board Options Exchange (CBOE) and the International Securities Exchange (ISE) reveal that more than eight calls have been bought to open for every one put purchased during the prior two weeks.

TJX has rallied more than 90% so far this year. Furthermore, the shares tagged a fresh all-time peak earlier today, despite lingering concerns over the strength of the U.S. economy. The company is also clearly doing something right on the fundamental front as well. While the excessive investor optimism is disturbing from a contrarian perspective, as long as TXJ maintains its strong uptrend, the bulls should have little to worry about.

Ener1, Inc. (HEV: sentiment, chart, options) designs and manufactures rechargeable battery systems for energy storage, and is developing systems to power the next generation of hybrid electric vehicles. This Motley Fool article highlights the Street's excitement over green-tech opportunities like HEV, with investment in the sector remaining hot despite recent volatility. In fact, data from Cleantech Group showed that venture capital investment in green tech jumped by 38% in 2008 to $8.4 billion. Plus, as the Fool notes, "Support of clean, renewable energy and energy independence has become one of the key strategies in the new federal budget."

But, in true contrarian form, the author questions whether the Street's expectations for green tech are too high, with most analysts covering the sector in the bullpen. In fact, HEV currently harbors no "sell" or worse ratings, compared to five "buy" or better ratings.

What's more, the Fool points to several fundamental concerns plaguing the industry, including significant government involvement, which tends to distort market forces. In addition, green-tech development cycles are becoming increasingly rapid, which "means that what seems like a great idea today could be obsolete tomorrow," the columnist states. Finally, the author opines that the investing public still hasn't decided what the ultimate goal of green tech is – increasing efficiency or reducing demand.

Technically speaking, it's difficult to justify the optimism surrounding HEV, which has surrendered 10.6% year-to-date. In fact, the stock has struggled to keep pace with the broad market, underperforming the S&P 500 Index (SPX) by 15% during the past 20 trading sessions. Furthermore, the shares of HEV are flirting with the $6.50 level, with the $8-$8.50 neighborhood looming just overhead. This area has rejected the stock's rally attempts during the past couple of years, and could once again smack the security lower.

However, the aforementioned brokerage bunch isn't the only group with high hopes for HEV. The stock's Schaeffer's put/call open interest ratio (SOIR) currently stands at 0.13, suggesting that call open interest significantly overshadows put open interest among options slated to expire within three months. In fact, the equity's SOIR ranks in the 28th annual percentile, implying that short-term speculators have been more bullishly biased toward HEV only 28% of the time during the past year.

In conclusion, HEV's technical troubles, juxtaposed with the widespread optimism surrounding the stock (and the sector, for that matter), make for a potential contrarian bearish play. Should the security fail to penetrate long-term resistance, the bulls could eventually abandon ship. A wave of downgrades or a reversal in sentiment in the options pits could exacerbate the stock's challenges on the charts.

Jos. A Bank (JOSB: sentiment, chart, options) is a growing favorite on Wall Street due to its strong expense controls, savvy promotions, robust sales, and comfortable cash cushion. Analysts have been won over. William Rutherford, president of Rutherford Investment Management, says, "Sales of men's clothing have been brisk, and Jos. A. Bank has done a terrific job selling them in a tough economic environment." In fact, large institutional investors continue to add to their portfolios, including Fidelity Management, which has accumulated a stake of 11.6% as of June 30, according to Bloomberg.

Furthermore, strong control of expenses has added to the company's bottom line. "Management has been very successful at driving sales through aggressive promotions and consistent advertising through all channels (its stores, the Internet, and catalogs)," says Richard E. Jaffe, retail analyst at investment firm Stifel Nicolaus. The clothier beat the Street's estimates in the second quarter. It features a strong balance sheet, ending the quarter with $126 million in cash, or $6.80 a share, and no debt. That provides a comfortable cushion as the company increases its store base amid a weak economy. As a result, analysts expect the share of JOSB to perform well this year and into the near future.

Technically speaking, the shares have definitely earned these accolades. The stock has gained more than 77% since the beginning of 2009. The equity has created a series of higher highs and higher lows since late November, and has recently begun to benefit from the steadfast support of its ascending 10-week moving average.Meanwhile, option players are quite smitten with the shares. The Schaeffer's put/call open interest ratio for JOSB stands at 1.41, which is lower than 86% of all those taken during the past 52 weeks. In other words, options players have been more skeptical of the shares only 14% of the time during the past 12 months. In fact, the International Securities Exchange has reported 2.5 calls purchased to open for every one call purchased to open during the past two trading weeks.

However, the stock could benefit from an unwinding of shorted shares. More than 18% of the company's total float has been sold short, providing the stock with ample sideline money. In addition, only four brokerage firms offer up ratings on the security. Any fresh positive coverage could give the shares a boost.

A recent article in Barron's focused on the largest independent builder and operator of the big pumps that drive natural gas out of wells and send it along pipelines, Exterran Holdings (EXH: sentiment, chart, options). While the security has edged higher during the past few months, the author raises the concern that surplus compressors have crushed the firm's manufacturing backlog. In fact, the article points out that "Exterran's rental business has more horsepower idled in North America than its next-ranked competitor owns in total."

Furthermore, the CEO acknowledges that times are tough. "It's a difficult North American environment for service providers to the natural gas business," said Chief Executive Ernie Danner. The compressor industry has excess capacity, he says, and Exterran has priced aggressively "where it makes sense." Meanwhile, big capital expenditures have hurt Exterran's free cash flow. But, even excluding capital spending, earnings for the builder of natural gas machinery are on the decline, according to Barron's Bill Alpert.

Technically speaking, the shares of EXH have rallied from their July lows below $14 and are up more than 19% since the beginning of the year. However, the stock still has to overcome some long-term road bumps. The equity has stalled in the 25 region, which has hindered the security's rally attempts for the past several months. The equity is also facing resistance in the form of its declining 20-month trendline, which EXH has not finished a month above since June 2008.

Meanwhile, despite the negative Barron's article, not everyone is skeptical of the company. The Schaeffer's put/call open interest ratio for EXH stands at 0.39, as call open interest nearly triples put open interest among options slated to expire in less than three months. This reading is also lower than two-thirds of the readings taken during the past 12 months. What's more, action on the International Securities Exchange (ISE) and the Chicago Board Options Exchange (CBOE) have favored calls. During the past two trading weeks, more than five calls have been purchased to open for every one put purchased to open. This ratio of calls to puts is higher than 92% of all those taken during the past year.

A rejection at long-term resistance in the 25 region, matched with the stock's weak fundamental backdrop, could shake loose the last of the bulls, sending the security sharply lower.