The Short case for Potash

Posted by downtowntrader | 5/14/2010 12:11:00 AM View Comments

The fertilizer stocks have really been weak over the past two months. Monsanto Company (Public, NYSE:MON) has just been am absolute train wreck and The Mosaic Company (Public, NYSE:MOS) has also been pretty sorry. One stock I have been watching for a breakdown in sympathy is Potash Corp./Saskatchewan (USA) (Public, NYSE:POT). I have been short this stock a few times over the past couple of weeks and am currently short again via a put vertical spread. While POT has held up better than some of its peers, it hasn't exactly been a pillar of strength. POT failed on a breakout attempt in May off of a loose and sloppy base. POT is close to breaking down from a large double top which could have POT trading several points lower if it happened. However, it must be noted that POT is technically sitting on support, and thus still in a larger trading range. The key for POT will likely be the action in the general markets. If the markets head lower for another leg down, its doubtful that POT will be able to hold support.

I'd also like to take the opportunity to introduce a new product from a great trader to my readers. Jeff White from the recently introduced a training series for Advanced traders, in addition to his original Trading University Course. This Advanced Trading Course provides specifics on Day Trading, Swing Trading, and Position Trading. It also includes a host of strategies and methods for trading today's markets in each of those time frames. There is a 7 day money back guarantee so there is no risk to try it. I've checked out some of the lessons and highly recommend it.

Good Trading,


TheStockBandit University

blog comments powered by Disqus