Two companies reporting earnings this week have very bearish chart formations that imply a significant move to the downside for each after their reports.
On one of these stocks: I've already purchased a few puts and, like the $GRMN upside 400%+ trade last week, I like this one for 400%+ to the downside via these OTM options.
$DLTR looks like it's setting up for a move to the low $40's. I sent out the private alert this morning via twitter and in the chat room for the $50 puts I entered at $.50 that expire in March.
I am trading against the option activity with over 14k in call volume vs 2k in put volume, an almost 7:1 ratio.
The chart has a nice topping pattern and is sporting another bear flag in the shorter term time frame.
$ANF is also poised for continued downside. I think the stock trades into the $20s the next few months. The only issue is, the options are pricing in a possible sharp move, meaning you will have to risk more capital to get in on the trade. I have not entered $ANF puts yet, and I may not. Currently, I am in the $DLTR $50 puts. Both are high risk earnings trades, but I feel confident that they will resolve much lower post earnings.