Two Meme Stocks Headed Below $5

The markets finished slightly down today – but watch out, because my VIX traffic light is YELLOW…

Which means I expect to see wild moves in volatility, making today the perfect day to do research to set up our next trades.

Now, listen – a yellow light makes trading a lot more tricky than usual – because the market could make a wild move in either direction.

But that’s exactly why I’m here – to show you what to trade… and what not to trade.

There are three meme stocks on my radar today for one reason and one reason only:

They’re UGLY.

If you have positions on these names, you should get out now – or considering going short:

1. Virgin Galactic Holdings Inc (NYSE:SPCE)

SPCE is currently trading at $6.76… and I think it is heading down to $5 soon.

Image from wallstreet.io

Because the 30-day Implied Volatility (IV30 – RED LINE) is HIGHER than the 10-day Historical Volatility (HV10 – GREEN LINE), if you have some puts open on SPCE, it would be the best time to SELL some of your short positions to take off some profit.

You could roll some of your profits into another short position if you agree that this is heading lower.

But listen – SPCE isn’t the only meme stock that you should sell right now.

2. Luminar Technologies Inc (NASDAQ:LAZR)

LAZR is at $6.03 currently, and I think it could also dip down to touch $5…

Image from wallstreet.io

Similarly to SPCE, the 30-day Implied Volatility (IV30 – RED LINE) is also HIGHER than the 10-day Historical Volatility (HV10 – GREEN LINE) for LAZR, so it would also be a great time to SELL your short positions at a profit here too.

Currently, we are taking off some profits on a LAZR play in the Profit Revolution Lifetime portfolio.

3. ChargePoint Holdings Inc (NYSE:CHPT)

CHPT is falling fast… now at $12.25.

Image from wallstreet.io

CHPT, however, might have “cheaper” IV since the 30-day Implied Volatility (IV30 – RED LINE) is also HIGHER than the 10-day Historical Volatility (HV10 – GREEN LINE) BUT the IV30 is lower than the 30-day Historical Volatility (HV30 BLUE LINE), so you might find a cheap way to short here.

These meme names are all heading lower…

So if you haven’t taken profits or had a chance to go short on these, now is the time.

Until next time,

Mark Sebastian

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