Share prices in Rite-Aid (RAD) continue to be stuck in the mud and this suggests most of the market is waiting for the next shoe to drop in what has been a long and complicated story for the company. As traders both long and short contemplate the next direction in RAD, we continue to watch for the next reversal catalysts that are on the horizon as any moves from here could conceivably match the proverbial "powder keg" event for the company's share prices. Most immediately, these will be seen in the next steps to be taken by the Federal Trade Commission (FTC) and in the company's next round of earnings numbers, which will be released on Sept. 28. If we do not see an approved deal with Walgreens Boots Alliance, Inc. (WBA), traders should expect some additional downside in RAD. Traders should also expect a greater level of importance paid to the next earnings release, as it will be a key indicator of Rite-Aid's future ability to attract another buyer for the company. In any case, we should see some volatility in the stock relatively soon, and since the upside is the current path of least resistance, we recommend against holding short positions with this side of the market already showing extended levels.

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