SBFM Trade on Apr 5, 2022 09:16 from BanalityOfEvil: Tradervue User Stock Trades.

PLAY

SBFM – PREMARKET SCALP WITH OPENING DRIVE

CATALYST

7:30:06AM
SBFM
EXCLUSIVE: SUNSHINE BIO REPORTS TWO OF ITS NEWLY-DESIGNED MRNA MOLECULES EFFECTIVE AT DESTROYING CANCER CELLS GROWN IN CULTURE

TRADE IDEA

SBFM could touch 7 in premarket and has a small chance of going parabolic if volume is extreme enough

SETUP QUALITY

B – Bullish drug progress news. However, closing of private placement on March 14th may affect the stock’s ability to go higher intraday. There are most likely holders of privately placed shares that will be chomping at the bit to unload their shares (which are priced @ 2.22) during this serendipitously convenient bullish news release today. There has not been a major liquidity event since March 15th 2022 which leads me to think there will be a lot of sellers today. Holders of the private shares also have the option to allocate their shares to short sellers, which could dampen the bullish effects of this drug milestone.

I doubt this goes parabolic intraday. Main target is $7, but it needs to break and hold cleanly with large volume. It would be bonus to see a lack of algo presence.

BIG PICTURE

• Recent IPO
• Closure of private placement on March 14th
• Float 3.9M
• RVOL 177x
• ATR .34
• Fresh News
• Spy over 450
• VIX @ 19

PLAN

Enter position in premarket after price consolidates around 5.75, scalp a break of 6 and re-add with small size for move up to 7. If target 7 is hit in premarket then take 80% of position off and hold feeler into the open, looking for price to pull back to $6 area before adding back in. Sell into strength and leave a runner for a potential parabolic move. If price quickly breaks $7 and holds with strength, then consider adding small size for a momentum play into blue sky territory.

Stop areas are 5.75 and 6

REASONS TO SELL

• Tape is sluggish and heavy around target areas, offers will not lift
• Volume is extreme, but algos are holding the name sideways
• Price reaches target
• Price is stopped out

EXECUTIONS AND PRICE ACTION

@9:15- 9:20 price has reclaimed 5.75-6 area, double topping @ 6, got long on pullback to 5.75, trying to catch a move up to 7, volume is increasing

@9:20 took some profit at HOD and re-added on dip
@9:21-9:33 volume is coming in but price is heavy and extended, not liking the tape or aglo presence, starting to scalp out of my position and re-add small size on dips. Massive volume prints on the open but price struggles to lift, exited 90% of position into strength.
@10:02 massive seller unloads in a dark pool, 2nd largest volume candle of the day. Sold runner after I gave it chance to pop back up, but it looked like it was going to be done for the day. Only gave back a few bucks. ALL OUT. No surprises here.

KEY TAKEAWAYS

• good job taking note of potential sellers of private shares and managing risk with a scalp approach in late premarket when you noticed the tape was heavy. Price was already extended when you got involved so holding large size at these levels could have been risky. This was a “sell the news” type of open.
• try to be at desk earlier, as we are seeing early premarket have the best follow through and cleanest moves in small caps names for the past week before algos can sink their claws in.

Premarket Prep

Symbol

SPY

VIX