Trade Alert: Selloffs Improve Two Setups
Doubling down on an asymmetric biotech binary, and re-entering a previous winner.
One Retry and One Lower-Risk Add-On
Today’s alert revisits two stocks we’ve traded recently. We exited the first at a profit last month. When it passed our screens again last week, we tried to open a new long-dated bullish trade, but our limit orders didn’t fill. The second trade supplements a bullish position we opened last week.
The missed fill turned out to be fortunate. Friday’s decline improved the setup heading into Monday. A separate pullback in the second stock created a lower-risk way to add exposure.
The headline behind the first decline weakened one part of that company’s longer-term pipeline, but it didn’t change the near-term earnings outlook or core commercial franchise. The second company’s update reaffirmed its key catalyst and extended its expected funding runway, while dilution remained the principal negative. The first stock no longer offers a textbook technical setup, so we’re treating it as an explicit catalyst-driven exception.
The first stock has been recommended by two members of our Multibaggers X List—a subset of our Market Watchers X List made up of accounts with multiple recent 100%+ winners.
Two Trades That Don’t Require Perfect Outcomes
We’re using event volatility in both trades. Both pay us to enter and can be profitable if their stocks merely move sideways. The first can also withstand a slight post-earnings decline, while the second supplements existing upside exposure with smaller defined risk.
Full details below include both stocks, the exact options structures, the minimum credits we’re requiring and the pre-set exit orders so we can profit automatically if the trades go our way.
Today’s First Multibaggers Trade
Theme: A post-selloff earnings rebound in a leading obesity-drug franchise.
RSI: 43; Chartmill Technical Rating: 5; Setup Rating: 3; Fundamental Rating: 6 (we note these stats in trade alerts and in spreadsheets to track how well they correlate with trade performance)
