Two weeks ago, I raised the prospect here of shorting this gas-bag if it reached a promising trendline connecting peaks that go back to January. This proxy for U.S. real estate companies and REITs has gotten there a week ahead of schedule, but we’ll stick with the original plan nonetheless. The trendline comes in very close to the 77.66 secondary Hidden Pivot shown. Taken together, the two resistance points should offer fairly precise stopping power. Accordingly, I’ll recommend offering 400 shares short at 77.64, stop 77.84, implying initial theoretical risk of $80. You can substitute eight Nov 21 77 puts for stock, applying the stop-loss I’ve given for the underlying stock, but bid the puts cautiously, midway between bid/asked. If we get stopped out, we can try again at D=79.06. ______ UPDATE: Friday’s plunge left our short offer choking on dust. (See inset, a new chart) Although we’ll keep trying to short this hoax, it may require an entry strategy more labor-intensive than simply offering shares at the trendline.
