Trade Alert: Taking Advantage Of Today's Drop

An options trade on an undervalued small cap ahead of earnings. Plus, a double-down trade on a crypto play.

Adding Small Cap Exposure

I had been thinking about adding some small cap exposure since last week’s market rotation, and came across one this week that looked promising. I haven’t been using LikeFolio’s social data as much these days, but I do read their emails, and they mentioned this company had an earnings score of +52 ahead of its release this week (the higher the number, the more bullish).

So I pulled up the stock on Chartmill and it looks compelling. It’s down single digits year-to-date, but its Technical Rating ticked over to positive (6 out of 10), and it has a Valuation Rating of 9 (on a scale of 0-to-10) and a Piotroski F-Score of 9 (on a scale of 0-to-9).

My plan here is to bet on it with longer-dated call options instead of a spread, so we can take profits on half if we get a nice pop in the short term, as we did with Rivian ( RIVN 0.00%↑) recently.

Doubling Down On A Crypto Play

The other trade is doubling down on this picks & shovels crypto play we placed a trade on last month.

This trade is more aggressive and essentially a bet on its earnings release next week.

Details below.

Our Small Cap Trade