NEW BEARISH Plays

BJ's Restaurants, Inc. - BJRI - close: 38.04 change: -0.36

Stop Loss: 39.35
Target(s): 35.10
Current Gain/Loss: unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
BJRI operates about 120 casual dining restaurants across the country. The stock appears to be in a significant bearish trend of lower highs and lower lows. Friday's decline looks like a breakdown from the most recent sideways consolidation pattern.

Let me warn you now that being short BJRI is a popular position with the most recent data listing short interest at 22% of the very small 24.5 million share float. That does raise the risk of a short squeeze. Readers may want to keep their position size small or play the options instead.

Friday's low was $37.84. I am suggesting a trigger to open bearish positions at $37.75. We'll use a stop loss at $39.35. Our first target is $35.10.

Trigger @ 37.75

Suggested Position: short BJRI stock @ (trigger)

- or -

buy the Jul $40 PUT (BJRI1221S40) current ask $2.60

Annotated chart:

Entry on June xx at $ xx.xx
Earnings Date 07/19/12 (unconfirmed)
Average Daily Volume = 496 thousand
Listed on June 23, 2011


Kohl's Corp. - KSS - close: 43.32 change: -0.46

Stop Loss: 44.26
Target(s): 40.10 & 38.00
Current Gain/Loss: unopened
Time Frame: 3 to 6 weeks
New Positions: Yes, see below

Company Description

Why We Like It:
An economic slowdown doesn't bode well for consumer spending. KSS operates over 1,130 department stores. Investors have taken a bearish view on the stock. KSS has been consolidating sideways the last three weeks albeit with a bearish trend of lower highs. Now KSS is poised to accelerate lower.

I am suggesting a trigger to launch bearish positions at $43.20. We'll use a stop loss at $44.26. Our first target is $40.10 and our second target is $38.00.

Trigger @ 43.20

Suggested Position: short KSS stock @ (trigger)

- or -

buy the Jul $42 PUT (KSS1221S42) current ask $0.85

Annotated chart:

Entry on June xx at $ xx.xx
Earnings Date 08/09/12 (unconfirmed)
Average Daily Volume = 4.75 million
Listed on June 23, 2011