ROIV - BioTech reporting 2/13 as a LONG earnings trade

Updated
Roivant Scientes, on the 15 minute chart is experiencing increase volatility and volume now two

days out from its earnings report. The MACD with zero lag shows a bullish inflection in the lines

On the daily chart, ROIV gained 38% in 2023 but has been down 4 %YTD. The volume and

volatility show both are heightened in the pre-earnings run- up. The last report in November

was a double beat which is good prognosis for the one upcomings. This is a risky earnings

play, ROIV does not yet make money. However, because it lost less than forecasted, buyer

interest has increased. The call option for 2/16 for a strike of $12.50 is priced at $ 5.00

per contract. I suspect a long trade in shares may gain to $ 11.50 targeting the double top

at the turn of the year for a projected gain upside of about 7% (with a stop loss of 2.5%).

Considering that ROIV has gained 12% this past week, 7% in the next two days is about the

same trend angle. As to the call contract, I have considered 100% return as my expections

for the two days before the earnings. If earnings disappoint trader expectations and price fades

I will sell to close the contract. If earnings is as expected, I will roll the contract forward into

the March monthly and add a bit more capital into the trade.
Trade active
Sideways for now. Full position.
Trade active
Price is holding up on a down market day.
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