NEW DIRECTIONAL PUT PLAYS

Decker's Outdoor Corp. - DECK - close: 74.91 change: -2.23

Stop Loss: 80.25
Target(s): 70.50, 65.50
Current Option Gain/Loss: Unopened
Time Frame: 3 to 4 weeks
New Positions: Yes, see Trigger

Company Description

Why We Like It:
The once high-flying DECK appears to have run out of gas. This shoe company soared to all-time highs in December. The first half of January saw it consolidate sideways in the $77-82 zone. Now the stock is breaking down. More aggressive traders may want to buy puts right now. I am suggesting we wait for a bounce to $77.00 to open bearish put positions. Broken support near $77.50 and $80.00 should be new overhead resistance. If we are triggered at $77.00 I'm suggesting a stop loss at $80.25. Bear in mind that DECK can be somewhat volatile and readers may want to keep their position size small. Our targets are $70.50 and $65.50.
The Point & Figure chart for DECK is bearish with a $65 target.

Trigger @ $77.00

- Suggested Positions -

Buy the 2011 February $75.00 PUTS (DECK1119N75) current ask $4.00

- or -

Buy the 2011 March $75.00 PUTS (DECK1119O75) current ask $6.00

Annotated Chart:

Entry on January xxth at $ xx.xx
Earnings Date 02/24/11 (unconfirmed)
Average Daily Volume = 1.5 million
Listed on January 20th, 2010