NEW BEARISH Plays

Lowe's Companies - LOW - close: 44.90 change: -0.70

Stop Loss: 46.85
Target(s): 40.15
Current Gain/Loss: unopened

Entry on February -- at $--.--
Listed on February 04, 2014
Time Frame: Exit PRIOR to earnings on February 26th
Average Daily Volume = 6.9 million
New Positions: Yes, see below

Company Description

Why We Like It:
LOW is in the services sector. The company is one of the largest home improvement chain stores with over 1,800 locations in the U.S. Shares look like a bearish candidate given its recent weakness. LOW peaked in November last year. After a $6.00 correction from $52.00 the bounce failed near round-number resistance at $50.00 in January. Since then the path of least resistance has been down and LOW is breaking down through multiple layers of support.

Today saw shares of LOW fail to participate in the market's widespread rally and breakdown below its simple 200-dma, which should have been technical support. I am suggesting bearish positions now at current levels. Our target is $40.15 but we will plan to exit prior to their earnings report on February 26th.

FYI: The Point & Figure chart for LOW is bearish with a $40.00 target.

Suggested Position: short LOW stock @ (at the opening bell)

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

Buy the MAR $45 PUT (LOW1422o45) current ask $1.81

Annotated chart:

Weekly chart: