Watson Pharmaceuticals hit the Street with some good news this morning. The drug company announced that it has received its first Food and Drug Administration (FDA) product approval at its Goa, India, facility. The company stated that during the next several months it plans to seek FDA approval to manufacture additional solid dosage products at the facility. The company said by early 2008, the Goa facility is expected to be producing more than 1 billion tablets and capsules annually for the U.S. market

The stock bounced off support at the 29 level this morning. This area halted the stock's pullbacks in late July and early August. However, the equity's rebound has been halted by resistance at its declining 10-day moving average. The shares have dropped under their 10-day and 20-day moving averages since July 20.

Options speculators have placed some heavy bets against a rebound in the shares. Schaeffer's put/call open interest ratio rests at 1.27, as put open interest outnumbers call open interest among near-term options. This reading is also higher than 94% of all those taken during the past 52 weeks. Meanwhile, short sellers maintain hefty bets against the shares, as more than 5% of the company's float has been sold short.