On Watch 2/11/20 from Dante

by | Feb 10, 2020

 

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DAO: Crazy one last couple days. Super squeezy close look, so watching tomorrow ideally for higher out of the gate low 30s and will be eyeing sellers to step in there and wanting to fade it. As always with these types, No add add add, wait till clear top in, lower high, then get involved after that with a clear spot to stop at.

CODX: What an absolute nightmare of a name. Up down up down up down. They’re absolute pros with the PRs, which really shows their hand even more of how much of an absolute piece of garbage this thing is. The volume into 3pm was everyone getting squeezed out who started in on the first push at 2pm, but I don’t love the a/h action for the short trade. Need to see this shove higher tomorrow to have any interest in trying the short just yet. Anywhere over 3.50 it’s still a problem.

LJPC: I initiated a long swing starter position on this recently in the high 7s, for a few reasons. One, I like the daily a lot, I think it roped in some shorts through the end of January as well, and it has clear resistance points of $10 11 and 14 to go after. The majority shareholder of this name Kevin Tang is one of the sketchiest dudes out there and has a history of running pharma names far further than they have any business going (His fund did this LJPC into the 40s in the past and HRTX into the 40s as well). I’ve said it before and I’ll say it again, I think this sees double digits sooner rather than later. Kevin owns over 8 million shares now, it’s a low floater at 12 million shares, and he was buying more as recently as last week in the 6.70s. His only way to get rid of any of his position will require much higher prices and much more volume. I’m risking off of 7, with a target unknown yet and adds unknown yet, will dial that in more if it starts to play out how I think it will. We’ll see what happens, but solid r/r in playing the action and fund involved here. No guarantee by any stretch of the imagination, but reward should be worth it if it happens the way I think it will. Don’t chase and be smart if it starts to play out higher.

Shoot me a message anytime in chat (DGTrading101 is my IU handle) and I’m happy to discuss your trade ideas with you. If you’re not an IU member and would like to become one, you can join us here.

See you out there!

– D

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