NEW BEARISH Plays
Vitamin Shoppe, Inc. - VSI - close: 44.36 change: -0.64
Stop Loss: 45.75
Current Gain/Loss: unopened
Entry on May -- at $--.--
Listed on May 20, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 587 thousand
New Positions: Yes, see below
Why We Like It:
Shares of this specialty retailer appear to be in trouble.
Two quarters in a row VSI has sold off on its earnings report even if results were better than expected. Right now the oversold bounce from the early May sell-off has reversed. Shares appear to be failing at short-term technical resistance at the 10-dma.
The trend is definitely bearish and there are plenty of investors bearish on the stock. The most recent data listed short interest at 11% of the 29.0 million-share float. That does raise the risk of a short squeeze.
I am suggesting small bearish positions at the opening bell tomorrow. We are a little concerned that VSI might bounce at its May low of $43.16 but the trend would suggest a pattern of lower lows. We will target a drop to $40.25.
FYI: The Point & Figure chart for VSI is bearish with a $26.00 target.
Suggested Position: short VSI stock @ (the open)