By Dan Darrow

August 29, 2022

Intraday Update: NVAX, BIIB, KSS

Two afternoon updates on two Biotech positions:

  • NVAX 's slide to 35 gave a shot to roll down the Sep16 strangle last week, but the stock's breakdown stalled around the June low. NVAX has held steady above 35 for the past few sessions, and the ~5% rally today is sending the stock up near the key 8day ema. With the pattern starting to resemble a double bottom now, the smart thing to do is close out the remainder of the short-term strangle:
    • Close Sep16 $50 - $55 call spread
    • Close Sep16 $32.50 - $30 put spread
  • We need to adjust the contracts of the BIIB Oct21 strangle due to the large recent drop on the stock. Liquidity is still pretty poor, and the bid/ask spreads remain fairly wide, so this will be a work in progress. If by early next week the volume has still not picked up on the contracts, we will need to reevaluate the overall strategy. The new trade will be:
    • Long Oct21 $260 - $275 call spread
    • Long Oct21 $170 - $160 put spread
    • The action area is $4.00 - $5.00

The KSS Oct21 $30 - $22.50 put spread was initiated this morning, and now in late afternoon trading, the stock is within a couple of cents of the initial target range (28.25). The plan will be to close the current spread and roll down to a tighter Oct21 $27.50 - $22.50 put spread. The next target will be <26.75.

Open Positions

* The following Open Positions pertain to the Options In Play trade ideas from this and previous editions. Disclosure of the Trader Co-Author’s actual portfolio holdings, as of the date of each publication, is made below under "Trader Author Portfolio Holdings.".

Trader Author Portfolio Holdings

**As of the date and time of publication