NEW DIRECTIONAL PUT PLAYS
eBay Inc. - EBAY - close: 50.43 change: -0.18
Stop Loss: 51.75
Current Option Gain/Loss: Unopened
Time Frame: exit PRIOR to September option expiration
New Positions: Yes, see below
Why We Like It:
We are bringing EBAY back for another shot at a bearish trade. The last time we tried our EBAY trade did not open. Yet it looks like the stock's bounce from technical support at its simple 300-dma is failing. Shares closed below this long-term moving average for the second day in a row. EBAY is now approaching major support near $50.00. A breakdown here could be very significant (see the weekly chart below).
We are suggesting a trigger to buy puts at $49.75. If triggered our target is $46.00. More aggressive traders may want to aim lower.
NOTE: We are listing the September puts, which expire in less than four weeks. You might want to play the Octobers instead.
Trigger @ 49.75
- Suggested Positions -
Buy the Sep $50 PUT (EBAY1321u50) current ask $1.04
Entry on August -- at $---.--
Average Daily Volume = 8.2 million
Listed on August 28, 2013