I would simply avoid DSW or look for short-biased trades if after earnings it fails to trigger that breakout and then drops back below some key near-term support at $68 a share with high volume. If we get that move, then DSW will set up to re-test or possibly take out its next major support levels at its 50-day moving average of $65.98 a share to its 200-day moving average at $65.41 a share. Any high-volume move below those levels will then put its next major support level at $63.15 into focus for shares of DSW.
To see more potential earnings short squeeze plays, check out the Earnings Short Squeeze Plays portfolio on Stockpickr.
-- Written by Roberto Pedone in Madison, Wis.
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