Nikola CorporationShort
NKLA Is Nikola puting in a bottom ?
Updated
NKLA is trying to make an all time low. Fundamentally, the last earnings were okay. Some members of
the board are retiring soon. Technically, the relative selling volume is much higher than the moving 50 day average.
The zero lag MACD shows no bullish divergence suggesting that that there is no impending reversal. The
indicators K/D lines have not crossed indicating the moving average compression / convergence are continuing.
Price has fallen outside the Bollinger Bands. NKLA finished out the week with some engulfing bear candles
on the news of instability on its governing board. This is unlike the candlestick pattern when NKLA did minor
pullbacks on the downtrend foreseen by small body red candles to setup up the minor pullbacks.
All in all, as a penny stock, this is probably not shortable but it does have put options for $23.00 per contract
for the $1.00 strike DTE 5 with a spread of 5% with high volatility and open interest ( reasonable liquidity) I will
take a put option trade of several contracts targeting 50% return and setting a stop loss at 10%.
I have always found it helpful to have some naked puts in the portfolio so when the general market of SPY / QQQ reverses t
o the downside they can help the put options capture some profit in the synergy.
the board are retiring soon. Technically, the relative selling volume is much higher than the moving 50 day average.
The zero lag MACD shows no bullish divergence suggesting that that there is no impending reversal. The
indicators K/D lines have not crossed indicating the moving average compression / convergence are continuing.
Price has fallen outside the Bollinger Bands. NKLA finished out the week with some engulfing bear candles
on the news of instability on its governing board. This is unlike the candlestick pattern when NKLA did minor
pullbacks on the downtrend foreseen by small body red candles to setup up the minor pullbacks.
All in all, as a penny stock, this is probably not shortable but it does have put options for $23.00 per contract
for the $1.00 strike DTE 5 with a spread of 5% with high volatility and open interest ( reasonable liquidity) I will
take a put option trade of several contracts targeting 50% return and setting a stop loss at 10%.
I have always found it helpful to have some naked puts in the portfolio so when the general market of SPY / QQQ reverses t
o the downside they can help the put options capture some profit in the synergy.
Trade active
Call options are up 40% early in the trade. I have cashed out 1/2 of them and bought 50 more contracts at the 4/28 expiration ( strike $1.00) to realize part of the profits and reinvest them rolling into the next DTE.
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