Another Afternoon Bloodbath

Add PTR Puts Now!

By Bryan Bottarelli
Wednesday, August 01, 2007 3:20 PM EDT
Wed, 1 Aug 2007 19:20:00 GMT

Dear Bottarelli Research Member,

We’re once again looking at a bloodbath as we close out the trading session — so let’s immediately add puts on PetroChina (PTR – NYSE). As you can see by the chart, PTR is just now breaking underneath its 50-day moving average, which means that some massive downside action could soon be on the horizon.

PTR

PetroChina is a company that engages in petroleum and natural gas activities in the People’s Republic of China. As a point of reference, just look at what some U.S. based companies, like Valero Energy (VLO – NYSE), are doing today and you’ll see the power of this trade.

VLO

As you can see, VLO is quickly moving down to its 200-day moving average — and this could be the same pattern that PTR follows in the upcoming days. If that’s the case, PTR could shed $20 in a blink of an eye, so let’s take advantage of this situation using PTR August puts. Here’s the play:

PLAY: Buy the PTR August 140 Puts (PTR TH) at or under $3.20, good for the day. Place a protective stop limit at $1.80.

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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