No, that’s not a typo, today I am indeed going to be going over a trade I had, on the SHORT side.

You see gang, the market and opportunity are constantly shifting, and sometimes It’s necessary to go over to the dark side and place a short trade.

As you know, I don’t go short often, however, when the opportunity presents itself I won’t ever pass it up.

If this is a new concept to you, let me explain what I mean by going short.

If I short a stock, I am betting that it is going to go lower. Just like if I get long a stock, I am betting that it is going to go higher. 

So going short is simply the opposite of going long. 

When I short a stock, I sell shares I don’t own, hoping to repurchase them at a cheaper price. That price difference will either represent a profit or a loss.

So why did I go short and not long?

Well, let’s get into, gang.

Lixte Biotechnology (LIXT)

The company, according to Yahoo, operates as a drug discovery company that uses biomarker technology to identify enzyme targets related to severe common diseases and designs novel compounds to attack those targets.

Catalyst

Following fresh news, the stock gapped higher yesterday morning and traded up in the pre-market. 

LIXT announced that in preclinical studies its lead clinical compound, LB-100, a protein phosphatase (PP2A) inhibitor, was found to increase the responsiveness of diverse cancers to immunotherapy.

My Initial Thoughts

When I looked at the stock in the pre-market, I noticed that the stock has been in a long downtrend, trading light volume.

I also noticed that each time the stock broke out of the downtrend, it closed at the low. The pop has consistently failed.

With that in mind, I did some more digging.

On September 20, 2021, the company filed a Form 424B5 Prospectus. In other words, LIXT announced an offering.

LIXT entered into an At The Market Sales Agreement for up to $10m. This ultimately means that their sales agent can sell up to $10m worth of stock on the open market.

Not only did the daily chart make me lean towards the short side, but the filing also made me even more bearish.

The Trade

My exact plan, which I posted in the room before I took the trade:

Alright, gang, with my above thought process in mind, let me show you exactly how I traded this.

In the morning, I got short in the stock and had an average entry price of $2.50 (see first highlighted area).

As the stock traded lower, approaching the afternoon, and the volume dried up, I covered ⅔ of my short position at $2.29.

When the stock broke down in the afternoon, I sold the last ⅓ of my position and closed the trade at $2.19.

I don’t often go short, but I make sure it counts when I do!

We’re two days into the new year, and so far, I love what I see in this market.

Not only in the market, but I also love the contribution and great vibes of my members in the chatroom.

Shoutout to my moderators in the chatroom as well, who have been on fire lately! Let’s keep up the good work, gang! 

Gang, sometimes a particular stock just has my number on the day.

Sometimes I can be prepared and correct but still miss the trade.

As I touched on yesterday, I like to wait for a solid entry point and confirmation before getting into a position.

Two days ago, this happened.

I planned to enter a position. However, the price did not pull back to my desired entry point.

Fast forward to the end of the day and the after-hours, and the stock was up almost well over 100% on the day.

Of course, I am talking about GNPX.

Genprex (GNPX)

What is GNPX?

According to Yahoo, GNPX is a clinical-stage gene therapy company that focuses on developing therapies for patients with cancer and diabetes.

The Catalyst

Two days ago, the stock more than doubled and traded significant volume.

There was news behind this move, however.

On Monday, GNPX announced that its Reqorsa Immunogene Therapy was granted Fast Track Designation (FTD) by the U.S. Food and Drug Administration.

Key Stats

Market Cap: 132.47M

Float: 45.14M

Short Interest: 4.83%

GNPX was a stock that I had spoken about all morning in the chatroom on Monday.

As I mentioned that morning, I was looking at the break of the 50d MA in the $1.70s for a potential move higher.

My exact plan, from my Mid Day Watchlist, was the following:

“I am watching for a possible pullback and hold of $1.90 area for entry with a sell target of $2.20s to $2.40 area previous highs and a stop around $1.70”.

The highlighted zone represents the area I was looking for the stock to pull back and put in a higher low.

That is the area I was targeting for a possible entry.

I liked how the stock was trading and holding above the 50d MA breakout zone and consistently trading large volume.

As it sometimes goes, gang, the stock did not pull back to my entry zone. Instead, the stock broke higher and never looked back.

It traded to my profit target levels and higher. However, it never gave me the opportunity I was looking for to enter the position.

The Bottom Line

Sometimes a stock just goes without me, without providing a substantial risk: reward entry opportunity.

As a trader, I have to be ok with not catching them all because that’s just how it goes in this game.

The key takeaway is that I always do my best to stick to my plan, which keeps me out of trouble!

The stock faded off in the pre-market and closed the day down 20.29% yesterday. 

So, by missing that trade and sticking to my plan, I might have avoided a potentially losing trade if I had chosen to swing the position overnight, based on the solid close on day one of the move.

Just three more days left of the trading year!

As I said yesterday, there are no signs of this market slowing down or letting up on opportunities.

I am as zoned in as ever before as my watch lists are packed with promising setups.

Over the last two days, the XBI, which tracks small-cap biotechs, has pulled back slightly after putting in a higher high on the daily chart.

Yesterday the XBI closed down 1.7%. Going into year-end, I will be looking for the XBI to put in a higher low in the area of yesterday’s close to $110, which could further confirm a reversal on the daily chart.

Even with the slight selloff and pullback in the XBI yesterday, I still noticed relative strength in two biotech stocks on my watch list and that I have been paying close attention to lately.

Petros Pharmaceuticals (PTPI)

According to Yahoo, PTPI focuses on men’s health therapeutics. The company engages in the commercialization and development of Stendra, an approved PDE-5 inhibitor prescription medication for the treatment of erectile dysfunction (ED).

PTPI is a story of two halves this year. The stock is up 23.89% over half the year but down 11.59% year to date.

More recently, the stock is up 86.12% on the month and 14.41% on the week.

Market Cap: 61.54M

Shares Outstanding: 9.83M

Short Ratio: 0.17

Recent News: PTPI announces closing of $7.5M offering

PTPI, as I mentioned yesterday in the chatroom and on my video recap, has a classic higher high higher low pattern on the daily chart.

The stock also has a double top on the daily chart, at $5.20.

I am watching PTPI for a possible trade on the long side if the stock can break above $4.09 and hold above.

If the stock can break above $4.09, confirm the higher high and hold, I would be targeting mid to high $5s.

OPKO Health (OPK)

According to Yahoo, OPK engages in the diagnostics and pharmaceuticals businesses in the United States, Ireland, Chile, Spain, Israel, Mexico, and internationally. 

OPK is a stock that I have covered recently and written about.

Now that the stock has traded over $5 and reached my target levels, the opportunity going forward becomes different, as the setup has changed.

Going forward with OPK, I will look for the higher high, higher low setup to form.

The stock previously consolidated near resistance and broke out above the $4.60 area.

As the stock pulls back, I will be looking for support and a higher low to be placed near this level.

If the stock can find support and continue to uptrend, I might look for a long entry and target low $5s. Therefore, waiting for confirmation and having the necessary patience will be critical as I wait for this setup to form.

Welcome back! I hope you all had a wonderful Christmas and holiday weekend.

It’s been three weeks in a row now of the XBI closing the week green. Indeed, the action and opportunity over the past few weeks reflect the performance of the XBI. 

Gang, if this action is anything to go by, 2022 might be a great year for trading and learning!

Last week, the XBI closed up 2.26% and inched closer to the 50d MA, currently around $121.

Last week I mentioned I would like to see the following in the XBI:

“Going forward, I would like to see the XBI hold above the 20d MA and make a push towards the 50d MA, which is currently at $121.33.”

Since then, the XBI has reclaimed and held above the 20d MA. 

Going forward, I would like to see the same pattern exist above the 50d MA, and then I will set my sights on the 200d MA.

While I am on last week’s topic, one stock that I spoke about outperformed the sector and remained on my watch list.

OPKO Health, Inc (OPK)

According to Yahoo, OPK engages in the diagnostics and pharmaceuticals businesses in the United States, Ireland, Chile, Spain, Israel, Mexico, and internationally. 

Market Cap: 3.14B

Float: 410.71M

Short Interest: 11.98%

Last week OPK closed the week up 19.55% at $4.77. 

When I first spoke about the stock, it traded near $4.40 and had just broken above the converged moving averages.

My exact words from a week ago were:

“I like how OPK could hold above all essential MA’s and then broke out on Friday on the daily chart. This signals, to me, that the stock has the potential for momentum to the upside.

Going forward, I will be watching to see if the stock can continue to base over $3.60s firstly and $4 as the most immediate level of support.

If the stock provides an opportunity to get long for a continuation move higher, I will look for a target of $5 -$5.50, targeting the highs from March, and have a stop placed around $3.45.”

I was referring to this chart:

I was indeed correct about the potential for further upside, as the stock has traded almost 20% higher since I wrote those words a week ago.

Going forward, however, there might still be opportunities as the stock has still not reached my target levels. 

It is important to note, though, the stocks recent and upcoming catalysts:

Recent News: 

• 29 November 2021 BioReference Laboratories Announces Readiness for COVID-19 Testing if the Omicron COVID-19 Variant Emerges in The U.S.
• 8 December 2021 OPKO receives U.S. FDA approval for the 4Kscore Test.

Upcoming News: 

• RAYALDEE (REsCue) Mild-to-moderate COVID-19, Phase 2 trial enrollment completed, topline data expected by the end of 2021. Somatrogon (hGH-CTP) Children- growth hormone deficiency. PDUFA date extended three months to January 2022.

Whether or not OPK will become the next or one of the heavy-hitters in the sector will largely depend on how successful the company is in its trials and upcoming catalysts.

Going forward and in the short term, I would still be looking for the stock to reach the highs from March, around $5 – $5.50.