Here’s your trade in BioNTech ($BNTX) (December 18, 2020)
BNTX
I want to look at BioNTech ( NASDAQ: BNTX ). This is the company that is in partnership with Pfizer ( NYSE: PFE ) on the whole COVID vaccine thing. You can see how the stock has done pretty well here but it has really taken a shellacking over the last several days or a week or so, it’s down 22 almost 23 percent.
This is the volatility of this stock; the last time when it was up here the thing fell down 23-24 percent. I am not drawing a correlation in terms of the percentage that the stock moved down. But what I am doing is just telling you we have seen this thing a time or two before.
I am looking at this now and the sense that I get is, this could be a pretty good opportunity to buy this stock on a low-risk position. You are very close to $100.00. You are very close to the 50-day moving average, and those are two natural support levels. You see 103.60 here, you are buying the stock close to this support level, and then you are putting a stop just a little bit below that.
And so right now you are risking 4-4.5 percent on this trade and if it does what it’s done before this thing can run up 20-25 percent or more. I don’t know whether it’s going to do that or not. The one thing that I have to note is, when a stock sells off this fast; we had one volume spike here that was really big.
What this does is, it leaves a lot of pain in the chart because be mindful, anybody that sold stock here, they sold it to somebody, they are happy they sold. The person who bought it, they are not happy that they bought. And so this gives us a real sense of what’s happening here and I would just say this stock is pretty heavy. And so any rally probably won’t amount to much, maybe something but it won’t amount to much.
If we use that line of reasoning then we would have said the same thing here and we would have said the same thing here. But what happened to the stock? Well, the stock ran up into this red box and kept going. It comes up here, runs into this red box and keeps going. So what am I looking at here? Well, IF the stock runs up a bit more we could see it keep going up here too.
The point of this video is really to just tell you that this is a low-risk entry on a stock that is very volatile. And this is what we want to see, if it’s volatile in the right direction for you, you are going to make really, really good money. If it’s volatile in the WRONG direction for you, well you are not going to get hurt too bad.
3.49
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