Don't Overlook These Shorts

This has been a tough market to short, but one space, retail, has presented opportunities. There has been variant weakness throughout this group and most folks have spent so much time just looking at the long side of the market that short-side plays have gone somewhat unnoticed and with little discussion.

At the top of my list is Bed Bath & Beyond (BBBY). Interpreting these support trendlines as lifelines, I'd say BBBY is down to its last lifeline. A close below $71.70 has me focused on October $72.50 puts. The stock should minimally test $69 with a possible push to $67. BBBY carries modest 4.7% short interest, but it is large enough where I don't feel comfortable holding the stock short outright on anything more than an intraday basis. I prefer not to see the CCI move back above -100, but I definitely do not want to see it above zero. Any close above $74.50 would kill the short-trade thesis....156 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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