NEW BEARISH Plays

Rentech Nitrogen Partners - RNF - close: 29.20 change: -0.84

Stop Loss: 31.05
Target(s): 25.15
Current Gain/Loss: unopened

Entry on June -- at $--.--
Listed on June 13, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 159 thousand
New Positions: Yes, see below

Company Description

Why We Like It:
RNF makes nitrogen-based fertilizer products. The stock is in the basic materials sector. Unfortunately for investors RNF has been in a down trend since it peaked in January this year. The stock bounced off the $30.00 level in April but the rebound failed at the 38.2% Fibonacci retracement level and its 200-dma. Now RNF is breaking down. Closing below support on a bullish day for the market is definitely a sign of relative weakness. RNF's 6.4% dividend yield is obviously not helping the stock.

I am suggesting small bearish positions if RNF hits $29.00. We want to keep our position size small because RNF is arguably already oversold. Of course it can remain oversold for months but we still want to limit our risk.

Trigger @ 29.00 *small positions*

Suggested Position: short RNF stock @ (trigger)

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

Buy the Jul $27.50 PUT (RNF1320s27.5) current ask $0.65

Annotated chart: