The $2.90 Setup Nobody's Talking About Right now, ABSI is sitting near $2.90 after their latest secondary offering drama. They recently raised $15 million between $3.00 and $3.25. Classic biotech move: Get everyone excited, pop the stock, then immediately dilute shareholders with discounted shares to fund operations. But here's what the complainers miss—this creates our entry opportunity. The Covered Call Sweet Spot Instead of betting everything on AI drug discovery miracles, I'm using covered calls to generate returns while we wait for the next move. The Trade: - Buy ABSI stock at current levels
- Sell November $4 calls against the position
- Target net debit: $2.60-$2.65
The Math: At a $2.65 net cost, we make money if ABSI is above $2.65 at November expiration. That's it. If it runs to $4 by November, we get called away and make about 50% in a few months. If it stays flat around $3, we still profit from the time decay on the calls we sold. If it crashes back to $2.50, we're only down 15 cents from our cost basis instead of the 45 cents someone who bought at $2.95 would lose. Why This Beats the Hype Game Look, ABSI might eventually develop some miracle drug using AI. Or it might burn through investor cash for years like most biotechs do. I don't need to predict the future of artificial intelligence drug discovery. I just need to trade the pattern. This stock has shown me the same behavior four times this year. Each time, patient entry points and covered call strategies generated profits while the buy-and-holders rode the roller coaster. Position Sizing Reality Check: Nothing in my portfolio except income-generating positions exceeds 4% allocation. This is speculation money, not retirement money. ABSI has tremendous beta and backing from major companies, but it's still burning cash on unproven technology. Size accordingly. YOUR ACTION PLAN Range trading ABSI is just one type of opportunity we exploit in Catalyst Cash-Outs LIVE. While the crowd chases AI hype and earnings surprises, we're systematically trading the patterns they ignore. Ready to stop gambling on hope and start profiting from what actually works? Join Catalyst Cash-Outs LIVE and see exactly how we do it. |
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