NEW BEARISH Plays

Best Buy Inc. - BBY - close: 17.31 change: -0.70

Stop Loss: 18.45
Target(s): 13.50
Current Gain/Loss: unopened

Entry on August xx at $ xx.xx
Listed on August 25, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 12.6 million
New Positions: Yes, see below

Company Description

Why We Like It:
Have you seen a weekly chart of BBY lately? This stock seems to be in a terminal decline. The company recently reported earnings and the results were not good. Net income in the most recent quarter has fallen to $12 million. That's down from $150 million a year ago. Revenues were down. Same-store sales were down. The company is losing business to online competitors without the cost of a brick-and-mortar store.

We are suggesting a trigger to launch bearish positions at $16.90. Our target is $13.50 but don't be surprised to see a temporary bounce at the $15.00 level.

Trigger @ 16.90

Suggested Position: short BBY stock @ (trigger)

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

buy the Oct $16 PUT (BBY1220v16) current ask $0.95

Annotated chart:



Navistar Intl. - NAV - close: 22.98 change: -0.15

Stop Loss: 24.35
Target(s): 20.25
Current Gain/Loss: +0.0%

Entry on August 27 at $ xx.xx
Listed on August 25, 2011
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.7 million
New Positions: Yes, see below

Company Description

Why We Like It:
NAV makes commercial and military trucks. The stock has been struggling with resistance near its descending 50-dma for days. This past week saw a new breakdown under the $24.00 level, which has been both support and resistance in the past. I suspect we'll see NAV retreat toward the $20.00 level again.

I am suggesting bearish positions at the open on Monday. Our target is $20.25.

Suggested Position: short NAV stock @ (the open)

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

buy the Sep $20 PUT (NAV1222u20) current ask $0.95

Annotated chart: