Academy Sports and Outdoors Stock Lined Bears Pockets

At the time of our recommendation, ASO faced multiple technical barriers

Jake Scott

Deputy Editor

May 25, 2023 at 3:13 PM

Last week, Schaeffer's Weekend Trader subscribers doubled their money with our Academy Sports and Outdoors Inc (NASDAQ:ASO) July 65 put. Below, we'll dive into the telling points for this bearish bet on the energy drink giant.

When the recommendation was made on May 15, Academy Sports and Outdoors stock had just pivoted lower at the $65 level, and, earlier in the month, broke below a trendline connecting higher lows since early December -- where it eventually failed a retest. Further, during the week of the recommendation, ASO broke below its key 80-day moving average, as well as its pre-earnings March close that preceded a gap higher.

The stock also failed to capitalize on falling short interest. What's more, the shares fell below the put-heavy 60-strike, setting it up for moves down to put-heavy strikes at the $50 and %55 levels.

From May 15 to May 24, Academy Sports and Outdoors stocked managed to turn in just two winning sessions, losing more than 14% over that time span. We closed the position on May 25, allowing subscribers to collect the 100% target profit.

ASO Chart May 252023

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