Hello friends.
Eli Lilly has been catapulted into an extraordinary bubble, spurred on by the narrative of their weight loss drug being taken up by America's obese population. The price just seems to go up and up forever, and many traders likely think that it will go to infinity. But all bubbles must pop at some point, and we think that it's the perfect time for the Eli Lilly bubble to come to an end right about now.
We have found that one of the best ways to get in on the collapse of a bubble is not to short the pico-top, but rather to have some patience, and wait for a peak followed by a sharp impulsive looking movement to the downside, and then a corrective pullback to that move. Finally, we can short. This is what Eli Lilly looks like right now for us. According to our view of the wave count, we could expect an impulsive wave 3 downwards, which would be a very big and volatile move down. As a result, the best way of trading this is to buy puts on LLY expiring in around 45 days. It's a risky trade that could get wiped out entirely, or could make a huge profit. We will see!
Thanks for playing.
Eli Lilly has been catapulted into an extraordinary bubble, spurred on by the narrative of their weight loss drug being taken up by America's obese population. The price just seems to go up and up forever, and many traders likely think that it will go to infinity. But all bubbles must pop at some point, and we think that it's the perfect time for the Eli Lilly bubble to come to an end right about now.
We have found that one of the best ways to get in on the collapse of a bubble is not to short the pico-top, but rather to have some patience, and wait for a peak followed by a sharp impulsive looking movement to the downside, and then a corrective pullback to that move. Finally, we can short. This is what Eli Lilly looks like right now for us. According to our view of the wave count, we could expect an impulsive wave 3 downwards, which would be a very big and volatile move down. As a result, the best way of trading this is to buy puts on LLY expiring in around 45 days. It's a risky trade that could get wiped out entirely, or could make a huge profit. We will see!
Thanks for playing.
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Idea invalidated