NEW BEARISH Plays
Digital Realty Trust Inc. - DLR - close: 45.93 change: -1.31
Stop Loss: 47.25
Current Gain/Loss: unopened
Entry on December -- at $--.--
Listed on December 30, 2013
Time Frame: 6 to 8 weeks
Average Daily Volume = 1.7 million
New Positions: Yes, see below
Why We Like It:
DLR is in the financial sector. The company operates as a REIT focused on technology-related real estate. This stock has been underperforming the market for months. Yet this past October the stock crashed to new lows following its earnings report. DLR missed estimates and lowered its guidance. Since then DLR has tried to bounce but the oversold bounce failed a couple of weeks ago. Now DLR is poised to breakdown to new multi-year lows.
I do consider a more aggressive trade because there are already a lot of shorts. The most recent data listed short interest at 25% of the 128 million share float. Readers may want to try and limit their risk and buy puts options instead of shorting DLR stock.
Tonight we're suggesting a trigger for bearish positions at $44.90. If triggered our target is $40.25. More aggressive traders may want to aim lower since the point & figure chart is bearish with a $33 target.
Trigger @ 44.90 *small positions*
Suggested Position: short DLR stock @ (trigger)
- (or for more adventurous traders, try this option) -
buy the 2014 Jan $45 PUT (DLR1418m45) current ask $1.80