Furniture Brands International - FBN

A stock we are watching for a swing trade on the -short- side is FBN, Furniture Brands International.

Last months short interest was an astonishing 40%. In the middle of January it appears that FBN was squeezed and the price gained 55% in the course of 2 weeks. This type of price move has historically shown to be unsustainable.

Currently FBN is near strong resistance levels. From these current price levels we would expect to see some new shorting of the stock along with selling of those who were playing the short squeeze. On January 30 FBN reported Q4 earnings and they were terrible, reporting negative $0.86 vs the expected negative $0.02. The company also cut their quarterly dividend by 75%.

FBN appears to be a company in trouble, and the price move over the past couple of weeks appears to be unsustainable and is why we are viewing this as a potential short trade. Price target would be 8.75, which is a 17% gain from the current price.

On the chart observe the two trend lines, these are stop loss points should you decide to take a position in this trade.