Yahoo! Inc (Nasdaq: YHOO)

Market Sentiment: Bearish

Yahoo shares are falling today after outraged Icahn refocuses on ousting Yahoo board. Icahn, who owns a 5 percent stake in Yahoo, also accused the board of misleading shareholders about some aspects of the proposal, which was rebuffed late Saturday.

Yahoo chart looks bearish at this moment. This could be a good time to play bearish options, if yahoo share won’t rise too much in coming three to four weeks.
As per the technical chart analysis:

• Stock price is forming downward pitch fork, and price is testing middle pitch fork(around $21).
• Stock is trading below 200 MA and nearest resistance is seen around $25.
• If middle pitchfork gives resistance (price around $21) then there is a better chance that price will move towards lower pitch fork (around $19-$18)

Now Yahoo is trading at $21.77. By looking into the above chart pattern and considering current situation, we can do August bear-call credit spread above $27.50 range. This trade will give 8.4% profit in five weeks time as long as Yahoo is below $27.50 at august expiration.