Dedicated Short / Put Thread

Lots of long-biased threads on here. The idea behind this one is to focus on bearish ideas. I had some good results buying puts on Navios Marine (NM) last week once conditions became overbought and technicals suggested the rally was losing steam. With the market acting a bit jittery due to rates backing up, I think overbought, speculative names with declining volume will continue to act as a good short-term bearish trading signal. Feel free to use this thread as a repository for information and ideas for trades expected to perform well on the short side in general or during periods of broad short-term market weakness. My general bias right now is towards small-caps in non-yield-based industries, giving me a screen criteria of:

1. Optionable
2. No dividend yield
3. Market cap < 2 billion
4. RSI > 70

I’m also remaining very disciplined by not taking a position until the rally appears to be fading, as evidenced by high RSI (not just 70, but that’s where I start to look) and plateauing volume. I won’t take a position until the first red day, preferably on the heels of a green day in which the stock closed well off intraday highs. You can see Navios met all of these criteria intraday on Mar. 23. That’s the kind of setup I’m looking for a repeat of. Bonus points if the setup coincides with the market also testing previous highs.

Currently, the only name meeting these criteria is Daseke (DSKE), but note I still think it’s early after Friday’s convincing rally on high volume. If that rally continues but then starts to show exhaustion this week, I’ll be looking at May puts.