NEW BEARISH Plays

Stifel Financial Corp - SF - close 47.95 change -1.59 stop 50.10

Company Description:
Stifel Financial Corp is a financial services holding company. It provides securities related financial services to approximately 1.0 million client accounts of customers throughout the United States and Europe. The Company operates in three segments: Global Wealth Management, Capital Markets and Other. Its subsidiaries include Stifel, Nicolaus & Company, Incorporated (Stifel Nicolaus), a full service retail and institutional brokerage and investment banking firm; Century Securities Associates, Inc. (CSA), an independent contractor broker-dealer firm; Stifel Nicolaus Limited (SN Ltd), and Stifel Bank & Trust (Stifel Bank).

Target(s): 46.05, 45.05, 44.05
Key Support/Resistance Areas: 50.00, 48.00, 45.75, 45.00, 43.50
Time Frame: 1 to 2 weeks

Why We Like It:
The financial services sector looks terrible across all industries, from banks, to lenders, to broker dealers. A study released today said that the 85% of Americans do not trust the financial markets and have therefore reconsidered their investment activities. Retail trading volumes are way down which will hurt firms like SF. I suggest readers initiate short positions in SF using one of two triggers. Let's use a trigger to short SF if it trades up to $48.45 or if breaks down to $47.52. The stock may find support at some of its moving averages but ultimately SF should head down to test its recent lows if the broader market cooperates. If triggered at $48.45 our targets range from -4.5% to -9% lower. Our stop is above Tuesday's high.

Suggested Position: Short SF stock if it trades to $48.45 or $47.52

Options Traders: Buy November $45.00 PUT, current ask $1.50

Annotated chart:

Entry on September xx
Earnings: 11/09/2010 (unconfirmed)
Average Daily Volume: 250,000
Listed on September 22, 2010