ONTY presents us with an interesting situation. On one hand, publishers are talking up the stock promotionally, sending the stock to the moon.
On the other hand, the stock is moving on big excitement surrounding its coming presentation at the American Society of Clinical Oncology (ASCO) meeting, May 29 to June 2, 2015. That’s where it will present information on ONT-380 for the treatment of breast cancer. If all goes well, the stock could go to the moon.
There are two ways to trade ONTY here.
My favorite way is to hedge with one put for every two calls picked up. As we move into ASCO, the stock has the potential to move higher.
But we could also face a sell-the-news reaction… and selling pressure when publishers begin to issue their sell alerts, patting themselves on the back for pushing momentum.
At $3 a share, consider buying the stock up to $3.60, and / or the July 2015 3 call up to $1. At the same time, consider buying to open the ONTY 2015 2 put up to 50 cents. We may have a great opportunity to profit from both sides.
I just ask that you invest reasonably. Don’t mortgage the house on this. This is a higher risk way to trade news flow and the death of news.