Etsy, Inc. (ETSY) is an online marketplace seeking to connect individuals to aid the buying and selling of goods. The company’s stock is currently trading towards the bottom of the 52 week range of $19.15-$35.74 around $21.17. The stock has been relatively weak this year with shares falling around $9.37 or 31.23% year to date. ETSY is set to report earnings after the bell today and the stock is looking fairly strong ahead of the release. ETSY stock is higher on the session by around $0.48 or 2.33% ahead of the report.

However, the stock is likely under pressure this year due to Etsy’s recent controversy over the selling of counterfeit goods where the stock tumbled 10%. Etsy has been under fire to this date for withholding information about the company’s business operations and its counterfeit products. Over the past year Etsy has increasingly been brought to public attention for trademark and copyright infringement. This will be ETSY’s first earnings ever. The stock also looks weak on a chart with a downward trend ever since the company’s IPO in the middle of April this year. With a bearish historical performance record and a weak technical setup it is difficult to justify anything but a short in ETSY.

The options market is currently implying a move of around $3.65 or 17.30% in ETSY by this Friday’s close giving us a downside target around $17.52.

Andrew Keene

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