Saved by small cap biotech.

04/28/2022

You can almost smell the reversal coming…

And quite a few stocks in certain market caps within specific sectors are already making moves.

These are the ones handing over the intraday gains right now and I’m more than happy to trade them…

(Source: tenor.com)

In particular, I’ve been in and out of small cap biotechs.

They’re a bit volatile for me to hold over extended periods of time, but if the setup is right, it’s worth the risk…

Today’s chart might be one of them. Let’s check out Atossa Therapeutics, Inc. (ATOS):

We’ve got another split view of the daily and hourly charts, again taking in the more recent price action…

You’ll notice a theme here lately in Before the Bell: Every chart is a bottomed-out chart.

When the markets turn down, you can expect small caps to get booted first… But this makes for great short-term trades.

The daily volatility has picked up more in the past few weeks. This is a sign that buyers are stepping in and shorts are either covering or trying to maintain their hold on the position.

The bearish market action certainly helps their cause.

Yesterday, the shorts were crushed as you can see from the massive bullish volume to finish the day near the highs (white arrows)…

If I’m short on this, I’m looking to load up for today with investors being as skittish as they are right now, so I’d watch for a move down.

The dotted white line shows that ATOS isn’t out of the woods yet, but if the interest continues, the shorts will have to cover sooner than later.

The MACD looks ready to turn, although I’d want to see more confirmation with a climb above the 21ema (neon green stepline).

On the hourly chart, there’s a gap left behind on the Volume Profile after yesterday’s strong move. Look for that to fill soon… maybe even today.

If ATOS can maintain the white curved line without closing below it more than a day or two, it could be ready to move higher, topping out near ~$1.25…

Watch it closely because it will move fast.

Keep moving,

(Disclosure: I hold no position in ATOS.)

This material is not an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Any performance results discussed herein represent past performance, not a guarantee of future performance, and are not indicative of any specific investment. Due to the timing of information presented, investment performance may be adjusted after the publication of this report. There can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this communication will be profitable, equal any corresponding indicated historical performance levels or be suitable for your portfolio.

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