Smithfield Foods Could Be A Short Opportunity (SFD)

Shares of Smithfield Foods

have fallen 2.95% to $16.12 during Wednesday's trading session. Despite today's weakness, however, the stock had rallied from around $14 at the beginning of August to over $17 last week. That uptrend, however, may be in jeopardy as the stock appears to be rolling over. Food producers have been under pressure recently as the result of rising raw commodity prices. These trends will undoubtedly affect Smithfield. Yesterday, ConAgra

reported a 12% drop in its fiscal first-quarter profit. Dean Foods

is another related stock that has seen a big drop in recent months. In August, DF issued weak forward looking guidance, and the share price has not been able to recover from the attendant drop. Similar weakness could become a tradeable trend in Smithfield. The stock briefly broke through its 200-day moving average in the middle of September. It is now trading back below that level. Traders interested in shorting SFD should set a stop at the 200-day moving average and see if they can't catch a breakdown in Smithfield.