PLAY: Buy the BIDU March 210 Puts (BDU OB) at or under $4.00, good for the day.
Dear Bottarelli Research Member,
The NASDAQ’s golden-boy, Google (GOOG – NASDAQ), is losing its magic touch.
As you can see from the chart, shares of GOOG have dropped from $700 in late 2007 to $460 here in 2008, as the pay-per-click business model appears to be reaching a saturation point. If this is the case, shares of GOOG could continue to fall, and this opens up an opportunity to establish a new put play on Baidu.com (BIDU – NASDAQ).
Since they provide Chinese language Internet search services, Baidu.com is commonly known as the Google of China. And as you can see below, BIDU shares are finding resistance at their 200-day moving average, so let’s go ahead and profit off any further weakness by entering a new put position now.
PLAY: Buy the BIDU March 210 Puts (BDU OB) at or under $4.00, good for the day. Place a sniper sell order at $5.00 and a protective stop limit at $2.10.
Lock and load!