Initiating coverage on Abercrombie & Fitch Co. [ANF]: laughably obvious sell.

ANF is a store that does well when the social mood is soaring.  When the social mood rolls over, it will collapse.  The chart is already predicting a massive break down which has already begun to happen.  Because of the stutter step it has been doing (1-2, 1-2) I believe that it is now entering a 3rd of a 3rd of a 3rd.  Below is the chart:

This is the perfect condition for a massive gap down which is why I like put options on ANF right now.  As always, don't try to cut it too closely.  The last sale on the Feb 2015 27's was only 45 cents.  Talk about underpricing risk!  I expect these will fetch 10-20x if bought at this price.

Put Options

Expire at close Friday, February 20, 2015

Strike	Symbol	Last	Chg	Bid	Ask	Vol	Open Int
27.00	ANF150220P00027000	0.45

Want more time in the horizon for safety?  Consider the Jan 2016 18's with last at 44 cents:

Put Options

Expire at close Friday, January 15, 2016

Strike Symbol Last Chg Bid Ask Vol Open Int 18.00 ANF160115P00018000 0.44

This massive underpricing of risk happens only a couple of times in a lifetime.

Note: This is not investment (gambling) advice.  You don't pay me and I don't give free advice.  This is just my kind of financial entertainment.  If you don't know what options are, stay away from them because they are not for you.  The leverage is extreme and the liquidity is low.  But, like craps, when an options play wins it wins big.  And with an Elliott wave chart providing a tail wind, the odds of winning go up astronomically.

Enjoy!