By Chris McKhann, an analyst at OptionMonster.

AutoNation ( AN) has fallen 13% today, and one trader is using options to take a further bearish position.

Shares of the national car dealer were above $14 yesterday but are at about $11.95 after UBS downgraded the company today from "neutral" to "sell." AutoNation has been in a steady uptrend since hitting a low of $3.97 last fall, but that $14 level has been a resistance since last June.

The options trade was all the way out in October, where 10,000 of the Oct. 15 calls were sold for $1.70 and 10,000 of the Oct. 10 puts were purchased for $1.80, according to OptionMonster's tracking systems. The net debit is just $0.10, which is the risk if the stock finishes between $10 and $15. Above $15, the position has unlimited risk, and below $10, it can make highly leveraged gains.

This is clearly a bet that AN cannot hold this level and will be at least another 20% lower from here over the next seven months.

The writer has no holdings in the securities mentioned.

More from Options

Here's a Better Way to Hedge Using Stock Options

Here's a Better Way to Hedge Using Stock Options

Let the Najarian Brothers Crash-Proof Your Portfolio

Let the Najarian Brothers Crash-Proof Your Portfolio

Let the Najarian Brothers Help You Generate Income With Options

Let the Najarian Brothers Help You Generate Income With Options

Learn Options Trading from the Najarian Brothers, the Best in the Business

Learn Options Trading from the Najarian Brothers, the Best in the Business

All Investors Can Trade Options, Just Ask the Najarian Brothers WATCH VIDEO

All Investors Can Trade Options, Just Ask the Najarian Brothers WATCH VIDEO