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CODX: Hopeful this is weak tomorrow and sets up something absolutely nuts for Monday. It’s taken over MRNA’s spot as the lead turd for virus names, and has a ton of very angry shorts staring right down the barrel at it. Let them win tomorrow and roast everyone again Monday is the ideal scenario. This is not a market for prediction though, it’s a market for reaction and locking in gains. If you look for the bigger picture trade right now, you’re likely to get burned both ways. So it’ll be reactive tomorrow morning – we’re almost sure to gap $1-2+ either direction, so will have open bias based off that. Gap up, will be eyeing 21-22 out of gate for a short scalp, otherwise gap down eyeing 14-15 for the hold and long scalp. The coronavirus headlines aren’t going anywhere anytime soon, so there could be a full blown black swan name at some point, it’s the perfect opportunity. Not to say it’s CODX, but just be aware anytime volume like this is thrown around in one of these, madness ensues.
APT: This one is less potent in my opinion regarding longevity in the virus space, because anyone can make protective gear. The narrative of a company creating an actual drug is a lot easier to sell long(er)term than the ones making protective gear. Thinking this gets a hard dose of reality tomorrow. Higher the better in the morning 35+ then looking for sellers to step in and hit pops once lower highs confirm. Again though on these names, don’t assume anything and be locking in gains should you catch a nice piece in the right direction.
TVIX: The melt here will be unreal on the first market rally day. Today faked everyone out midday – but when the actual relief rally happens, it should be pretty sharp and this bleed will be astronomical. Keeping close tabs on SPY tomorrow and any signs of a rally day, will be running straight to catch a few short here.
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See you out there!
– D
Thank you Dante!