Posted on May 27, 2021
A declaration of war is not a thing to be taken lightly.
So when the holy tribe of Levi issues a warning to the denizens of Shechem to prepare for battle, one would surmise that those with an operating cogitative function would take heed, prepare for the worst and – at the very least – pray.
But it’s not so.
Heedless as they ever were, they appear to prefer the fate of their forebears.
So let it be written.
And in the midst of that initial fog of war, let us now take a closer look at the descendants of the warrior tribe, LEVI, the better to examine their pant-making acumen…
Speak only in whispers.
And may G-d be with you.
The cryptic nature of today’s posting is necessary only to throw off the evil Erev Rav.
Surely, you understand.
Levi Strauss Inc. (NYSE:LEVI) has been selling jeans and other casual apparel for better than a century and a half. For a much briefer period, however, their stock price has lacked the rivets and durability that made the original product so legendary.
Today, she’s detached, frayed and ready for an embarrassing rip lower.
Consider the fundamentals –
Don’t say it…
But have a look at the daily –
This is a year’s worth of LEVI chartitude, and it presents the following –
We’re going to leave it to the market to decide where this one ends up.
And we’ll play it like this –
A Jew and His Gold recommends you consider setting the LEVI October 15th 31 synthetic short** for a debit of $4.20 (5.20/1.00). Set a STOP buy order on the shares at $31.
Rationale: with the downside waiting, our trade offers open-ended, unlimited profit potential.
Maximum loss (with proper STOPs in place) is limited to our initial debit.
Breakeven on the trade arrives at $26.80 (just 1.4% below the current price of $27.20).
After that, it’s a stone-washed bank robbery.
As mentioned above, 23/24 is a likely first stop. Depending upon how fast that target is reached – and the technical condition of the stock at that hour – we’ll determine whether to close.
The 31 strike was chosen because it resides above the stock’s all-time high, and therefore out of reach at this stage of the rally. All the same, should our STOP buy be triggered, be sure to reset a STOP sell at the same level, in order to keep the trade square. Should that STOP get activated, reset a STOP buy at 31. And so on, until the trade is closed.
Many happy returns,