I think Trina Solar is looking pretty vulnerable here. Sure, it's down about 25% in the past couple weeks, but I still think it has further to fall. I see a momentum stock that has broken down technically. I'm looking to get short here through some puts as it rallies back towards its 50-day EMA. Note the declining volume on the advance following a solid week plus of selling. Massive, high-volume breakdowns like this are often the first shot across the bow to tell us that a stock that's had a monster run is getting ready to reverse and head lower. You can also see TSL hasn't traded consistently below the 50-day EMA in almost a year, so the level was solid support, and I now believe it will be solid resistance. TSL has support for now at the most recent low around $21, but I think this will yield and TSL won't find steady support again until the 200-day EMA around $18.
TSL doesn't report earnings again until March.
I think the February puts are pretty fairly priced, especially compared to the March ones. This should come as no surprise since the March puts would have extra premium baked into them due to the longer time duration and the earnings catalyst. I like the February $24 puts the best here, and even more on a low-volume rally up towards the 50-day EMA around $24.
Position: none
Disclaimer: This is not a recommendation and is presented for informational purposes only.
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