IPO Trading Review for the Week of May 9, 2022 – May 13, 2022

Written by hammondish on May 13, 2022. Posted in Weekly Recaps. No Comments on IPO Trading Review for the Week of May 9, 2022 – May 13, 2022

IPO Trading Review for the Week of May 9, 2022 – May 13, 2022

May 13, 2022

In a week that started with panic-stricken sell-offs on Monday that carried into Tuesday, the outlook for pending IPOs appeared bleak. But by Friday’s turnaround, we saw conditions ripe for a mainstream IPO to offer a relatively easy debut trade setup, and a low-floater from one of or favorite lower-tier underwriters failed to perform as hoped (which was clear in the pre-debut imbalance).

Another concept that was re-enforced with the low-float IPO offering, which are commonly available on WeBull for pre-order, is that the IPO trading strategy I generally employ is NOT reliant on getting any shares allocated at the IPO price, and there’s a reason for this: mainly, that when I do get a full allocation, then it’s a bad sign for the opening. When I only get a small allocation of what I requested, that’s generally a good sign for demand. So the takeaway on this is not to request a large allocation regardless of what I think about the setup: and instead, read the pre-debut indication setup to determine my trading strategy.

+++

Catch me live at 12:00 PM EST (noon) on Benzinga Live to review last week’s winning IPO trade and preview the IPO Calendar for the week ahead:

https://www.youtube.com/watch?v=ku9m-LA5JJw

+++

Ok, Let’s take a look at what happened last week in IPO Land:

Hanover Bancorp (HNVR) – May 11, 2022 | 1.36M Shares
IPO Price: $21.00
Debut Price: $21.44
Day 1 High: $22.00
Day 1 Low: $20.11
High Since Debut: $24.68
Low Since Debut: $20.11

Day 1 Action: On a day when the market was on its knees, HNVR bravely debuted and managed to open at $21.44 – slightly above the IPO price of $21.00, but after a quick pop to touch $22.00, it proceeded to slide down to a bottom of $20.28 in the opening minutes of trading: rather unusual volatility for a bancorp IPO, but given the ultra-low float, perhaps somewhat expected. It quickly rebounded back up to $21.98, and from there, it acted more like a typical bancorp IPO, trading in a relatively tight range of $21.00 to $21.40 until an unusual small print at the close dropped it to $20.11 on just 2.7k shares, so nothing too remarkable there.

Day 2 Action: Day 2 started out in a typical baseline at $21.20 but then abruptly triggered an uncharacteristic rally right after Noon EST, that shot the share price up as high as $24.68, but after a few minutes of choppy trading, it returned to trading in a tight zone of $21.20 to $21.70 for the remainder of the day.

Looking Ahead: This appears to have stabilized in the $21.00 to $22.00 range, as we would expect from a bancorp stock, with the float having risen to 6.5M shares. I don’t expect much volatility from here: at least, not anything predictable, and I generally don’t trade bancorp IPOs to begin with

+++

Actelis Networks (ASNS) – May 13, 2022 | 3.75M Shares
IPO Price: $4.00
Debut Price: $3.90
Day 1 High: $3.94
Day 1 Low: $2.60
High Since Debut: $3.90
Low Since Debut: $2.60

Day 1 Action: Full allocation requests on WeBull are rarely, if ever, a good sign for an IPO debut, and this was no exception. The pre-debut indication dropped to as low as $3.11 at a volume of roughly 350k shares, before a buyer jumped in for roughly 300k shares at $3.90 to pull the debut price out of the basement. Savvy allocation recipients dumped on the debut, sending the share price falling into a halt at $3.19 that opened lower at $2.79, and bottomed at $2.68 before reversing into a minor recovery run back up to $3.29. But the reversal was short lived, and it again returned to the $2.60 level before climbing back to $2.90 and after baselining around $2.80, fell again down to $2.60. It seems to have found some support at $2.60, as it returned above $2.80 before falling off into the close at $2.40

Day 2 Action: Day 2 is Monday, so we’ll have to wait for the weekend to see what comes.

Looking Ahead: Low float debuts that fall and fail to run on Day 1, often get accumulated and run on Day 2 or Day 3 by trading groups and algorithms. So at this point, the setup would be to wait for dips below $2.60 and build a position from there until we see a spike. These runs have varied momentum: but keep the $4.00 IPO price in mind as bag holders will look to dump anywhere near that level.

+++

ProFrac Holding Corp (PFHC) – May 13, 2022 | 16M Shares
IPO Price: $18.00
Debut Price: $17.60
Day 1 High: $18.90
Day 1 Low: $17.60
High Since Debut: $18.90
Low Since Debut: $17.60

Day 1 Action: After pricing the IPO at $18.00 – well below the anticipated range of $21.00 – $24.00, the weak pre-debut indication price that dropped to as low as $17.15 presented an relatively safe entry even as it climbed back up to $17.60 for the opening print. While such a setup for low-float IPOs from more dubious underwriters would indicate further downside, when have a mainstream offering underwritten by top-tier underwriters going live in rough market conditions, we typically see IPO pricing and debut pricing set at levels that are generally ‘kind’ to both institutional and retain traders. So when we see a debut that is more than 15% below the initial price range, we often see an easy upside move off the opening trade. We saw a similar setup with BLCO last week, which also set its range at $21-24, priced at $18, opened in the mid-$18s and ran to just over $20 on Day 1.
PFHC opened at $17.60 and moved steadily up to a high of $18.90, falling back to support around $18.40 before running into the end-of-day to touch a high of $19.45.

Day 2 Action: Day 2 is Monday, so we’ll have to wait for the weekend to see what comes.

Looking Ahead: Hard to tell what Monday will bring, but I expect support to remain at $17.60, and any dip significantly below that to rebound accordingly. If oil continues to rise, then Day 2 could bring more upside to this, bearing in mind that the original price range was as high as $24.00. If we happen to be on the doorstep of a rebound rally, then this one could move substantially higher from here, and has a relatively low float to boot.

+++

Play A Song Save A Dog at TheSound.com
Royalties support animal rescue efforts in Ukraine.

Listeners who support our project, play our music 24/7 by setting it to shuffle and repeat.

You can play the music quietly (but not on mute) to generate royalties for helping animals.

This does not interfere with other audio you may want to hear at the same time.

Spotify has all the albums on TheSound
https://open.spotify.com/user/uw5745prqofetdszrhmv71ar8?si=6defa19777794f2f

Also Apple Music
https://music.apple.com/us/artist/thesound/1539626449

Try the piano for soothing relaxation
https://music.apple.com/us/album/piano-at-sunset/1591784037

Please help promote IPOWarriors and like, follow/subscribe, retweet, share our social media content:

NOTE: this is not financial advice, and I am not a financial advisor: this information is just my opinion and is for informational purposes only. I may have or take positions in the equities mentioned in this article in the next 72 hours. Trading equities is risky. Do your own research,and trade your own trade.

IPO Trading Review for the Week of May 2, 2022 – May 6, 2022

May 8th, 2022

The market got wrecked all week, culminating its worst day for as long as many traders can imagine: but you wouldn’t know it from how IPO debuts performed this week. Ok, so a bunch of them rescheduled due to market conditions (or in one case, a question from the SEC), but those that did debut continued to show strong upside for debut plays… even the first brand-name mainstream IPO we’ve seen this year.

We’ve seen a string of low float / off-brand IPOs run in the past few weeks: going back to GNS, JCSE, OST, HLVX, and now AUST While most of these owe their runs to withheld volume on the debut, at least one of them appears to have run simply on retail enthusiasm around this setup. I expect that we may see this trend continue for the next low-floater to debut, until we reach a point where the debut premium gets over-inflated by high demand, and the opening price proves too tempting for allocation holders to hold. This will produce a front-loaded opening trade with no follow-through buyers to produce the pump. One or two of those should cool off the trade for a while: at that point, we can look for Day 2 rallies to re-emerge until the cycle of opening debut pops resumes.

+++

Help rescue dogs in Ukraine simply by streaming our content (it costs you nothing). More importantly, please SUBSCRIBE so we can monetize our YouTube Channel:

https://www.youtube.com/watch?v=Rpivxrn-iOI

+++

Ok, Let’s take a look at what happened last week in IPO Land:

Failed to Launch:

Actelis (ASNS) – Moved to May 10, 2022
SOS Hydration (SOSH) – Moved to May 10, 2022
Novusterra (NOVS) – Pulled, no further information
Wytec (WYTC) – Pulled, no further information
SaverOne (SVRE) – Moved to May 11, 2022

Last Week’s Debuts:

Austin Gold (AUST) – May 4, 2022 | 3M Shares
IPO Price: $3.00
Debut Price: $6.50
Day 1 High: $29.00
Day 1 Low: $4.15
High Since Debut: $29.00
Low Since Debut: $.88

Day 1 Action: This extreme runner caught everyone by surprise: though if you had insight into the pre-debut imbalance on AMEX (which I have not yet figured out how to view), the ultra-low volume and high debut premium would have been an obvious tip-off to the run that ensured the opening trade. With just under 35k shares exchanged on the opening print at $6.50 the halt up to $7.15 was immediate, and after over an hour of haltage time, it then opened at $12.04 and immediately halted again at $13.20. The halts weren’t done yet, and several more would culminate in a peak at $29.00 before it leveled out in the $27.00 to $29.00 range before a fire sale brought the stock crashing down nearly as fast as it had ascended. There would be no meaningful reversal on the bleed out into the close. At the end of Day 1, a stock that had priced at $3.00, opened at $6.50 and run to a high of $29.00 would close the day at just $4.35.

Day 2 Action: After a monstrous run on Day 1 followed by an extreme sell-off, Day 2 was setup for accumulators to run the price again in pre-market and we saw a 4:00 AM rally peak at $6.15 with an secondary push up as high as $5.80 following the opening bell. But that was as much of Day 2 rally as AUST could muster, and the share price quickly returned to the mid-$3s for most of the day. A weak rally around 2:00 PM EST couldn’t get past $4.20, and the share price closed at $3.72

Looking Ahead: This one as been played out, but is still a low-float IPO that can fly on any sort of PR catalyst. I’d watch this one to drop below $2.00 before starting to accumulate any kind of position, and likely won’t bite unless I see it drop significantly below that before its LPX. At $1.30 or below prior to LPX, it’s likely to be a relatively safe bet: at some point they’ll announce a permit to dig, contract of some sort, or in the dream scenario for bag holders and swing traders alike: that they’ve struck gold.

+++

Edible Garden (EDBL) – May 5, 2022 | 2.93M Units
IPO Price: $5.00
Debut Price: $3.00
Day 1 High: $3.00
Day 1 Low: $2.46
High Since Debut: $3.00
Low Since Debut: $2.40

Day 1 Action: After increasing the share offering from 2.14M units to 2.93M units, and pricing below range at $5.00, this one may have looked interesting to day traders who had picked up on the recent trend of ripping low-float IPO debuts. Experienced low-float debut traders would have seen the writing on the wall, with a heavy sell-side imbalance in the pre-debut pricing, and volume up at 296k shares lined up for the opening print. The stock proceeded to drop all the way down to $2.46 before climbing back up to $3.00 and traded in this range for the remainder of the day, closing at $2.89. While not a particularly damaging play for anyone who got duped into buying the debut, and easily mitigated if followed up with buys down at $2.50 – $2.60 to bring your average down, this was not a debut where I saw any clear entry points. The opening dip was simply not low enough to interest me in a play: I had my target at $2.15, and the end of the day did not produce a significant sell-off.

Day 2 Action: Day 2 did not deliver any early pre-market spike, and based on the Day 1 pattern, none should have been expected, since traders kept jumping on any dips and selling off any moves approaching the Day 1 opening price. It actually sold off into the open, hitting a low of $2.40 about 10 minutes before market open, which then setup a run back up to just over $2.80 before volume began to wane.. still, the price held $2.55 for the rest of the day, and it walked its way back up to a close at $2.83 on Day 2. Some interesting after-market trades including 5,000 shares bought up in the $2.95 – $3.00 range could indicate a further action on Day 3.

Looking Ahead: We haven’t seen this one make any kind of serious move yet, while holding its trading range pretty tightly in the $2.50 – $3.00 range, which indicates that some traders may be accumulating a position with the intention of pumping it in the near future. Day 3 is Monday, so keep an eye on this one… Remember that the IPO price was $5.00, so insiders – including the underwriter – would love to see this run up to $5.50 in the near future: It won’t surprise me at all if we see a pump into this range at some point this week.

+++

Bau(PEPG) – May 6, 2022 | 7.2M Shares
IPO Price: $12.00
Debut Price: $15.60
Day 1 High: $15.60
Day 1 Low: $11.50
High Since Debut: $15.60
Low Since Debut: $11.50

Day 1 Action: I don’t call these “Biotech Busts” for nothing: and this one lived up to its designation as one: debuting at $15.60 after pricing at $12.00 and immediately selling off in the opening minutes down through a halt to a bottom at $11.50. Brave traders who attempted to catch a reversal off the IPO price at and below $12.00 were rewarded with a bounce back up to VWAP at $13.27, and an eventual carry-through that touched $13.88. It then base-lined around the $13.00 range for the rest of the day.

Day 2 Action: I’m not a big fan of biotech stock IPOs in general, as they are difficult to predict and don’t really follow the same trends as ultra-low float IPOs when the float is above 5M shares. It’s still trading above the IPO price, but in the $13.00 range and over 7M shares in the float, I doubt this gets much attention from day traders, and I have no clue as to where to value this in terms of how institutions might see this: short of saying that above $12.00, it’s not a value buy based on where they priced the IPO.

Looking Ahead: Not the kind of stock I’d trade. Maybe if it gets obscenely low: like $2.30 or below before LPX. Otherwise, it’s not something I can predict and if I had to make a guess one way or another, I’d put my money on it going down from here long before it proves any value to legitimize a move to the upside.

+++

Bausch + Lomb (BLCO) – May 6, 2022 | 35M Shares
IPO Price: $18.00
Debut Price: $18.51
Day 1 High: $20.17
Day 1 Low: $18.40
High Since Debut: $20.17
Low Since Debut: $18.40

Day 1 Action: As the first brand-name mainstream IPO of the year, there was a lot of pressure on the underwriters to price and debut this stock to minimize upside: given market conditions on Friday, that meant pricing it at just $18.00 – well below the stated range of $21.00 – $24.00. The lead underwriter on this deal: Morgan Stanley, has a generally positive reputation for leaving some room on the table for retail traders to get in on the debut: and the relatively conservative opening print at just $18.51 on a volume of 2.69M shares gave this stock some room to run, with an opening climb that reached $19.34 before profit taking saw it fall slightly down to $18.75 before rebounding back to $19.35 and base-lining around $19.00 into the afternoon. The final 2 hours of Day 1 saw this one rally up into the high $19’s and a final push in the closing minutes saw it breach $20.00 at a high of $20.17. The total volume for Day 1 reached 15M shares.

Day 2 Action: We’ll see what Monday brings to the general market, but if the market can’t shake off the downward trend, this may begin to follow suit with little demand to support any selling pressure. On the otherhand, at any price below $20, it appears to be slightly undervalued, at least based on the IPO prospectus valuations, and we should expect some support at the $18.00 IPO price. So any dips below that could be opportunities to scalp quick turnarounds.

Looking Ahead: I’ll keep an eye on this one for any dips below $18: particularly if we see anything touching significantly below that, for a scalp on a reversal. The underwriter is likely to protect the downside at some level, and given the initial price range at $21-24 and IPO price at just $18, I think this can come back up to the $22-23 range if the market rebounds at all.

+++

IPO Trading Review for the Week of April 25, 2022 – April 29, 2022

April 29, 2022

A week that delivered a brutal blow to the SPY and major indices was shrugged off by the mid-week low-float IPOs that delivered substantial win opportunities, including a traditional Stealth IPO setup that was so user friendly that just about everyone who traded it made money (so long as they didn’t hold beyond the open on Day 2).

The rest of the week continued to deliver tradeable IPO debuts with minimal downside though the plays clearly started to appear to get played out. I doubt that market conditions helped much: as many traders were either busy shorting just about everything or nursing margin calls.

+++

To catch the replay of the live stream where I traded OST and TNON with Aly Angel, follow this link here (please Like/Subscribe if you havn’t already):

https://www.youtube.com/watch?v=Ci6enlB8Oro

+++

Also…

If you feel that my research and ideas helped you take some profits this week on IPO trades, please consider a contribution to my GoFundMe campaign:

https://www.gofundme.com/f/getting-back-on-our-feet-after-evacuating-ukraine

+++

Ok, Let’s take a look at what happened last week in IPO Land:

Tenon Medical (TNON) – April 27, 2022 | 4M Shares
IPO Price: $5.00
Debut Price: $22.05
Day 1 High: $28.00
Day 1 Low: $13.50
High Since Debut: $29.81
Low Since Debut: $13.50

Day 1 Action: As expected, this one opened up at a significant premium to the IPO price, on a very small volume of just 18k shares, and jumped up into a halt at $24.26 – looking like it might be on it’s way to triple digits along the lines of $AERC.
But the excitement was short lived for any debut buyers, as the dreaded “Halt of Death” reversal ensued, and the share price opened up down at $17.40 and closed almost immediately again into a downward halt at $15.66. The pain wasn’t over yet, as the next halt opened at $14.00 and touched $13.50 before instantly reversing back up into a halt at $15.40… diamond handed believers and scalpers who ventured to pick up shares on the way down were rewarded from there, however, as a choppy spread and a series of halts culminated in a top at $28.00. From there it traded between $23 and $27 for the remainder of the day, on volume of 880k shares

Day 2 Action: TNON was all over the place on Day 2, dropping down into a halt in the opening minutes that touched as low as $20.11 before reversing back up through halts to hit the ATH at $29.81, bouncing around a bit more until it dropped out to the low of the day at $17.69 and immediately rebounding to $25.59… it then sporadically traded for the rest of the day between $20.50 and $24 and closed the day at $24.04
Rough trading waters for anyone who ventured into this one mid-stream, with Bidders and Sellers jockeying under and over one another to catch each successive trade.

Looking Ahead: This on is too chaotic for me to predict beyond the fact that it is nearly certain to head back down to the sub-$5 level in the not-so-distant-future. I wouldn’t touch this with my worst enemy’s account, and the trading pattern on TNON already makes me a bit sea-sick.

+++

Ostin Technology (OST) – April 27, 2022 | 3.4M Shares
IPO Price: $4.00
Debut Price: $10.10
Day 1 High: $43.97
Day 1 Low: $10.10
High Since Debut: $56.11
Low Since Debut: $3.90

Day 1 Action: We absolutely nailed this one, calling out the Stealth IPO setup well in advance, and adding to the WeBull allocations we received on the debut. A fortuitous string of upward halts brought us from the opening halt at $11.11 which opened at $16.10 and immediately halted up at $17.71, to the second halt at that opened at $20.22 (a 100% win on a debut trade right there), to a series of slightly choppy halts that presented no real fear of a reversal reaching a high of $28.73 – the opening move on OST was the stuff we dream about as IPO traders. It then setup a classic baseline pattern that ascended from a post-peak-low at $21.60 to an end of day run that closed at $40.00 and briefly touched $43.97 in the first minute of after-hour trading. This was a tremendous day for a debut: reaching 1000% over the IPO price and offering almost no downside for those who held out for a chance to take profits at any point after they entered their trade.

Day 2 Action: The opening move in early pre-market jumped to the all-time-high on OST, with shares traded for as much as $56.11, but the volume on that candle was only 534 shares, so it’s not a very realistic measuring stick of ‘what-could-have-been’ had you attempted to cash out at that price. Following the initial early pre-market spike, the share price came back to ‘just’ $35.00 and floated around in the $35.00 to $40.00 range until markets opened for regular trading hours. An halt down in the 3rd minute of trading was probably enough to scare off any holdovers from the day before, but it quickly reversed and climbed to the all-time-high of regular trading hours at $47.76. It managed to cling to the $40.00 level for about 20 more minutes…
… and then, things got really ugly, very fast.
What ensued was the fastest reversal off a 1000% gainer that I can recall in IPO debuts: with a BASE jump from $40.00 that landed all the way down at about the $6.00 through a series of halts featuring brutal gaps between halt price and opening. There would be no meaningful bounce from there, as shares sold off down to a low of $3.90. A meaningless rally into the close as shorts closed their positions offered little remorse to bag-holders who failed to cash out on the drop, and even an after-market rally that touched just over $5.00 was of no real consequence to anyone who attempted to time the bottom on the way down.
This was by far the worst Day 2 I can recall, reaching over -90% down from the previous close.

Looking Ahead: Yeah, no thanks. This one could rally, or randomly spike up from whatever depths it sinks to in the future. Set your calendars for 180 days from the debut, as this one could potentially get run again once the lockup period expires. But until then, I’ll wait for it to fall below $1 before even thinking about taking a position. Maybe it gets a pump now and then… but I’m happy to just shake my head from the sidelines and chuckle regardless of which way it goes.

I trusted this one to run up off the debut, and eventually crash out. Not gonna go playing in traffic while this one continues to make a mockery of the notion of market regulation.

+++

Belite Bio (BLTE) – April 29, 2022 | 6M Shares
IPO Price: $6.00
Debut Price: $12.50
Day 1 High: $17.46
Day 1 Low: $9.64
High Since Debut: $17.46
Low Since Debut: $8.70

Day 1 Action: The pre-debut indication gave away the setup on this one as it showed pricing at $10.00 and inched up to an opening trade at $12.50 on a robust volume of 250k shares with an ensuing insta-halt up to $13.75. Dreams of a series multiple upward halts were dashed after it opened at $15.50 and reversed after touching as high as $17.04 ( $0.01 away from halting), and then reversed downward into a halt at $13.95. The less-greedy trader who got out after the first halt was rewarded with a solid $3/share win: I tried to get a sell order out before the halt but couldn’t fight my way through the confirmation screens in time, and ended up taking an exit right at my entry price of $12.50 out of the second halt. From there it continued to sell off down to a bottom of $9.64, which would have made a $10.00 entry a nice place to get onboard before the IPO allocation sellers finished offloading their positions and retail day traders brought on a rally that peaked at $17.46. That was the end of the ride, however, as it then trailed off for the remainder of the day, to close down at $10.59 and further petered out into after hours.

Day 2 Action: This was a Friday IPO, so we’ll have to see what Monday brings for Day 2. Despite all the volatility, we only saw volume of 3.4M shares on a float of 6M shares, so a Day 2 rally is not out of the question.

Looking Ahead: Like the others, this eventually joins the rest of the dollar-bin rubbish that makes up 99% of low-float IPOs and those with the patience to read through the F-1 to understand the lock-up period restrictions and follow the FDA announcements could put themselves in a position to load up for an eventual spike on potential approval. Bear in mind that their lead candidate is in Phase III already.

+++

Hillevax (HLVX) – April 29, 2022 | 10.3M Shares
IPO Price: $17.00
Debut Price: $18.76
Day 1 High: $20.57
Day 1 Low: $17.00
High Since Debut: $20.57
Low Since Debut: $17.00

Day 1 Action: The pre-debut indication on this started just above $18.00 and was steadily increased to the opening debut price of $18.76. The book runner clearly maxed out what they could grab on the debut, and despite early allocation sellers taking advantage of the opportunity to get out with a small profit, the opening sell-off sustained the $18.30 support level before the low float kicked in and sent the share price on a run up to a high of $20.57. It would than retract to a baseline at the $18.50 level – with a random 1-minute spike down to $17.00 that looked more like a dark-pool print than active trading, and the stock managed a rally at the turn of power hour to a peak at $20.35 before trailing off into the close at $19.09

Day 2 Action: This was a Friday IPO, so Monday will bring us the Day 2 action.

Looking Ahead: Most biotechs simply fade away as their debut trails off into the past, and are mostly forgotten about until they have some news to report. There were only 2.34M shares traded on a float counted as 11.77M shares according to WeBull. Their lead candidate is a norovirus vaccine, which could be pretty big news if they received approval, but it’s far more likely that this one drops significantly over the next several weeks or months before news is dropped that would pump this stock again. I don’t generally play biotech IPOs to begin with, and once volume falls off, they are best left to settle out and accumulate sparingly into any lock-up period on hopes that they run the share price on headlines to pop it to give insiders a chance to profit on the bump.

+++

Catch me on Benzinga LIVE at Noon on Monday, May 2, 2022 to review the winning trades from last week and to preview the IPOs for the week ahead:

https://www.youtube.com/watch?v=7vz-RwImK40

Live Streamed IPO Debuts from This Week

IPO Trading Review for the Week of April 18, 2022 – April 22, 2022

April 24, 2022

The market was in free-fall, but there were still a pair of IPOs brave enough to endure the foul weather conditions and, as we talked about last week: those that do so in a poor climate, are generally worthy of our attention.

Of course, we have to assume that anything coming out of Asia under such circumstances would be a Stealth IPO type of setup, and the more outlandish the company description, the more likely we’d see a pumped debut. And of course, the biotech bust that goes live almost knowing that it will certainly see nothing but downside. Anyway, we had opportunities to take significant wins on both setups if played diligently, but of course, the Stealth Setup is always the prime focus of my attention when I see it lined up for a debut trade, and this past week brought us a grooved fastball right down the center of the plate.

Worth watching the replay with https://twitter.com/tradingfitgirl if you would like to relive the winning action.

Ok, Let’s take a look at what happened last week in IPO Land:

JE Cleantech (JCSE) – April 22, 2022 | 3.75M Shares
IPO Price: $4.00
Debut Price: $14.20
Day 1 High: $23.99
Day 1 Low: $14.20
High Since Debut: $23.99
Low Since Debut: $14.20

Day 1 Action: This was a Stealth IPO setup from the start: I mean, dishwashing services out of Singapore with a virtually unknown underwriter? All we were waiting to see was the absurd indication price in the pre-market debut to tip us off to the play: and as long as it didn’t get ‘too absurd’, we knew we had multiple upward halts on deck.
JCSE priced at $4.00 and started indicating at $8.00 – it only went from there, and climbed steadily up to an opening trade at $14.20.
This is where I’d like to stop and make some note about trading the debut on these setups. The key point is that you can’t be greedy and go try to play these for like 10,000 shares: consider that there were only 77.7k shares traded on the debut, and that your 10,000 shares will require an additional 12% more sellers to fill your order: you’ll end up pushing the price up to the point where there will be no further upside, as remaining IPO holders will happily sell once the share price reaches a certain threshold. So as a retail trader buying in on the debut, I limit my action to no more than 2,000 shares (having brutally damaged my portfolio learning this lesson the hard way on SIDU back in December 2021).
Ok, public service announcement aside, this one opened at $14.20 and ripped up into its first halt at $15.62. It then opened at $17.50 and ran into a second halt at $19.25. At this point, I was happy to lock in profits, and set my limit order during the halt at $18.00 and was please to get out at the halt open at $20.60 – though it bumped up to $22.00 before reversing, the downward action resulted in a halt at $18.54, and it would have been a nervous hold from there to remain in the trade. It opened at $19.00 but dropped as low as $17.55 before oscillating in what turned out to be a bullish pennant leveling out in the $18.50 to $19.50 range before breaking out again to a halt at $21.53, which opened at $23.01 and jumped to the high of the day at $23.99 before settling into a baseline right above the $19.50 mark until it broke down through VWAP and traded the remainder of the day in the $17.00 to $20.00 range. It closed the day at $19.00 having only traded 1.2M shares of the total 3.75M float.

Day 2 Action: This was a Friday IPO, but my guess is that we’ll have more action on Day 2.

Looking Ahead: This only traded 1.2M shares out of the 3.75M share float, and given that this was a Singaporean company, my guess is that we see some heavy selling in early pre-market trading: much like what we saw in GNS the week before on Day 2. I’ll be looking for an early pre-market sell-off for an opportunity to buy into a rally towards the market open, with an eye on a spike up into a halt in the opening minute of trading. If this happens, and I’m able to get in, then I’ll be looking to exit there. At some point this falls off a cliff, and I don’t wanna be in it when it does.

+++

Aclarion (ACON) – April 22, 2022 | 2M Units
IPO Price: $4.25
Debut Price: $2.90
Day 1 High: $3.29
Day 1 Low: $2.16
High Since Debut: $3.29
Low Since Debut: $2.16

Day 1 Action: This was a low-float biotech IPO with warrants that was destined to get dumped by IPO buyers when it debuted at $2.90 – and it might have been even uglier were it not for the recent rebound rallies that other low-float IPOs showed that likely drew in retail traders hoping for a quick pop off the debut.
While there was a short jump from the opening trade at $2.90 up to $3.29 in the third minute of trading, it was short-lived and sold off quickly down to a baseline around $2.60. From there we saw a small bounce back up to VWAP at $2.95, but as expected, it fell off from there down to a baseline around $2.40 and a knife down to the day’s low at $2.16 around 1:45 PM EST.
But it seems that day traders were too eager to accumulate positions for a possible Day 2 rally, and the price never fell below the $2.00 threshold that I was looking for to make an entry, and the Day 1 volume of 1.71M shares was a bit more than I was hoping to see for the ideal Day 2 rally setup.
A premature rally through Power Hour saw the share price close the day at $2.72, just $0.18 below the debut price, which typically means we won’t see much of a Day 2 pop at all. I could be wrong, but it’s not the setup I’m looking for on a Day 2 (or Day 3, in the case of STSS) spike setup.

Day 2 Action: This was a Friday IPO, but my guess is that the day traders who would otherwise send this on a Day 2 run already built up their positions, which is likely to mute any potential Day 2 spike. Perhaps a 4:00 AM spike, but I’d expect that to be the high of the remainder of the short term upside run on this one.

Looking Ahead: This one still hasn’t had a halt to the upside, so maybe one comes, but don’t expect this to rally like STSS – more likely that it peters out like RVSN, given the EOD rally we saw on Day 1 and volume of shares traded so far. Better bet for this one is to hold off for a few weeks and pick up shares in the $1.00 zone for an LPX play.

Live Trading from Last Week

IPO Trading Review for the Week of April 11, 2022 – April 15, 2022

April 16, 2022

Despite weakness in the overall market, we still had 3 IPOs debut last week, including a rare mainstream IPO opening at a robust price. For the most part, we got what we had expected in each of the debuts, despite issues with many trading platforms mishandling the ticker symbols on the opening day of trading for a couple of these.

Generally speaking, when one or more major trading platforms fumbles the handling of a new ticker symbol on an IPO, I take that as a sign to stay away from a debut buy-in, simply because it stands to reason that demand will be reduced. There are exceptions: particularly if I feel that a Stealth IPO is in the works (as we saw last week).

+++

Catch me live at 12:00 PM EST (noon) on Benzinga Live to review last week’s winning IPO trade and preview the IPO Calendar for the week ahead.

Watch my Twitter feed for the link:
https://twitter.com/WarriorIpo

+++

Ok, Let’s take a look at what happened last week in IPO Land:

Genius Group (GNS) – April 12, 2022 | 3.27M Shares
IPO Price: $6.00
Debut Price: $15.11
Day 1 High: $36.55
Day 1 Low: $13.08
High Since Debut: $36.55
Low Since Debut: $6.60

Day 1 Action: As expected, this turned out to be a ‘Stealth IPO’ – and fortunately, it didn’t debut at an absurd premium (relatively speaking). After pricing at $6.00 per share, this one opened up for trading at $15.11, giving retail traders an opportunity to get in before it went on its hectic run of halts up to a high of $36.55.
Unfortunately, for me anyway, I underbid the debut, as it was an AMEX listing where I was unable to get an accurate pre-debut price indication. In reality, it wouldn’t have been possible to take a large position on the debut without affecting the opening price anyway, since only 9,617 shares were traded in the opening minute before the halt.
Unlike other Stealth rippers, GNS halted back down below the initial debut price before embarking on a second string of upward halts to reach its Day 1 apex. Perhaps the fact that it was untradeable on platforms like WeBull played some role in this, though Stealth IPOs are one of the rare instances where I will go against the axiom that IPOs where the tickers are not supported on all platforms are best avoided for debut trades.
After GNS reached the pinnacle of its halt action at $36.55, it sustained a downtrend that saw it establish a base at the $27 level before briefly falling down as low as $22.88 before climbing back as high as $32.00 to level off the day to close at $30.90 with not much action in post market trading.

Day 2 Action: GNS got dumped like a lead boot in early pre-market trading on Day 2, and those who acted quickly (and had access to 4:00 AM EST trading) were able to pick up shares down as low as $11.73. Surprisingly, this was a relatively high conviction trade for those who have seen this setup before, and as expected, it sustained a run all the way through the market open: culminating in a halt in the opening minute of trading at $31.75, which opened at $34.98. But it was a heat-attack inducing free-fall from there: with two halts down to a bottom of $18.50, saved by a sharp reversal back up to $28.47 that petered out to trade a in a choppy range from $20-$25 for the remainder of the day, closing on a sell-off that saw it drop from $23 in the final minutes of trading to a close at $19.43

Looking Ahead: This one already died on Day 3: opening at $19.57 and rolling downhill all day long, with little sympathy for any traders who tried to call a bottom at any point along the way. It bottomed out at $6.60 and then baselined in the range of $7.00 to $7.50 for most of the remainder of the day, with an end of day rally that pushed it back up to $8.45 before closing the week at $7.95.
With the float having ballooned up to 21.52M shares – accounting for 100% of all shares outstanding according to WeBull stats, it seems safe to assume that it’s time to move on from this IPO.

+++

Excelerate Energy (EE) – April 13, 2022 | 16M Shares
IPO Price: $24.00
Debut Price: $28.12
Day 1 High: $28.30
Day 1 Low: $26.61
High Since Debut: $28.50
Low Since Debut: $26.61

Day 1 Action: The debut of Excelerate Energy was no doubt hampered by restrictions on its ticker by none other than Etrade… particularly ironic because Morgan Stanley (they own ETrade), was one of the underwriters on the deal. Supposedly, whomever placed the restriction on the “EE” ticker prior to the trading debut, which is standard for IPOs that are offered to retail clients but which is typically lifted prior to the actual debut, placed a “caveat emptor” restriction on the symbol: a mistake that could not be undone for 24 hours.
Anyway, as I was unable to trade it on Day 1 in my primary account, I simply watched the debut drop off as expected, and from an open at $28.12, was able to start a position down at $26.85 (the bottom of the opening drop was $26.61).
From there it quickly rallied back as high as $27.51 before again dropping down to $26.66 and yo-yoing between $26.80 and $27.40 for most of the day, with an end of day rally that reached $27.80 that was sold-off into the close where it finished the day at $26.85.
Seems the book runners on this deal managed to deliver a decent win for IPO buyers who got in at $24.00, but didn’t leave any room for retail traders to profit from a debut trade: though again, ETrade messing up the ticker listing could not have helped demand materialize for this one.

Day 2 Action: With full access to the ticker, the stock rallied in pre-market to open at $27.38, and after initially stumbling out of the gates to a low of $26.89, rallied to a high of $28.50 before closing at $28.00.

Looking Ahead: This one could be just getting started, particularly if gas prices keep escalating alongside turbulence in the Russia/Ukraine war theater. I’m a bit salty at Etrade for messing up the Day 1 trading, as my intention had been to take a sizeable position on the Day 1 dip, and hold it for several weeks. I did attempt to enter on Day 2, but my $26.65 limit order was too low, and I was trading away from my work desk so had to kind of ‘set-it-and-forget-it’ on the trade. If I can get into this one under $27 in the next week, I’ll probably take a stab at getting in on it: I believe it runs into the $30’s in the not-so distant future.

+++

Sharps Technology (STSS) – April 15, 2022 | 3.75M Units
IPO Price: $4.25
Debut Price: $2.65
Day 1 High: $2.70
Day 1 Low: $1.98
High Since Debut: $2.70
Low Since Debut: $1.98

Day 1 Action: This was hot garbage from the start: after pricing the units at $4.25 it opened for trading at a pithy $2.65 and pretty much dropped from there: initially entering free-fall in the opening seconds to a bottom of $2.11 from which it managed a bounce back to $2.67, but the was all downhill from there. I bottomed out at $1.98, but essentially baselined between $2.00 and $2.20 for most of the day. Appears that pumpers may have been accumulating a position around the $2.05 mark, which is where I entered a swing trade for a hopeful Day 2 spike. I’ll be up at 4:00 AM EST trying to catch an pre-market opening surge to sell my shares in the WeBull account, and look for a spike into the market open for a chance to sell out of my ETrade account. If we don’t see any action in pre-market, I will still expect a halt up at some point on this ticker on Monday.

Day 2 Action: These super-low float plays that fall hard on Day 1 have recently experienced a jump at some point on Day 2: usually in early pre-market (4:00 AM EST), and into the market open, if not shortly thereafter. The key here is not to be greedy, so don’t expect more than one halt up. I’ll be getting out after any upward halt, and don’t intend to be holding this by the end of the day regardless.

Looking Ahead: This one should die off for a while, untill it becomes an LPX play: so keep an eye on the lockup expiration dates (hint: follow Aly Angel ). I’ll be watching this one to build a position down near the $1.00 – $1.20 level if I get a chance before it pops. With warrants involved and an ultra low float, you have to expect they debuted this IPO with an ace up their sleeve. Won’t take more than a distribution contract or FDA type announcement to pop this thing back up to the exercise price, which I believe will be in the $4-$5 range.

+++

Please help promote IPOWarriors and like, follow/subscribe, retweet, share our social media content:

IPO Trading Review for the Week of March 28, 2022 – April 1, 2022

April 3, 2022

The market appears to have stabilized a bit after a mostly depressing initial 3 months of the year, and as expected, we finally saw some life in IPO debuts. Though we still haven’t seen a mainstream IPO debut since CRDO in late January, we have seen a rush of the low-float variety over the past couple of weeks, and those that have debuted have been fairly predictable.

Up until this past week, the play on these low-float IPOs was to wait for an initial drop, and then accumulate shares on further drops throughout the day: KSCP, MTEK, HTCR, AKAN, and LCFY all more or less followed this script. But as I mentioned at the start of last week in the IPO Preview newsletter, day traders were likely to start piling into the Day 1 play – and this seems to have washed out the Day 2 rally play to some extent. But this also indicated the potential for a strong debut for a well-positioned IPO that could run, and we were able to confidently predict a breakout play on which I hope you were all able to take profits.

+++

Catch me live on Monday at 12:00 PM EST (noon) on Benzinga Live to review last week’s winning IPO trade and preview the IPO Calendar for the week ahead:

https://www.youtube.com/watch?v=MgeAV3AiX2E

+++

Ok, Let’s take a look at what happened last week in IPO Land:

Rail Vision (RVSN) – March 31, 2022 | 1.97M Shares
IPO Price: $4.13
Debut Price: $3.14
Day 1 High: $3.15
Day 1 Low: $2.45
High Since Debut: $3.09
Low Since Debut: $2.45

Day 1 Action: This one opened with a predictable drop from $3.14 down to as low as $2.63 in the opening minutes, but didn’t fall as dramatically as some of the other recent low-float IPOs: indicating that traders were eager to establish positions early, but not in a rush to do more than accumulate. A slight run back to VWAP at the $2.84 mark failed to breakout, and the price subsequently dropped out to a low at $2.45. At this point, accumulation bids started showing up, and the price stabilized in the $2.50 to $2.70 range: not the kind of weakness we’d seen in previous Day 1 disasters that then ran on Day 2. At around 2:00 PM EST, we saw a marked rally that nearly touched $3.00, but was sold off at $2.98. The pull-back was not all that dramatic, as the stock found buyer support at the $2.65 level, and made another run at the turn of power hour back up to $2.97. This run again was capped before hitting the $3 mark, and once again, the price fell as far as $2.65 before regaining strength into the closing bell to get back to $3.09.
At this point, I had seen enough to recognize that we had not seen the same script that had led to Day 2 runners in many of the previous debuts, and decided to take profits in the early minutes of after-hour trading. I try to stick to a trading strategy, and am happy to exit with a win if I don’t see the ideal setup I had been looking for when I entered the trade.

Day 2 Action: Due to an overabundance of Day 1 buyers, along with a float that appears to have ballooned to 18.66M shares from the debut offering of just 1.97M shares, there was no Day 2 pop on this one. Even the early minutes of pre-market didn’t provide much of a spike (just $3.15), and then things faded out from there. RVSN opened at $2.61 and couldn’t get higher than $2.75 until the very end of the day, and not before visiting $2.45 again on about half the volume of Day 1.

Looking Ahead: I’m not thoroughly convinced that we’ve seen the end of this one’s opening runs: should the number of actively traded shares be obscured by the total free float, the price could still get pumped. But otherwise, this stock is likely to be relegated to the LPX bin for a few weeks (or months), until insider lockups expire and the price could then get pumped to new highs. I’ll be putting this one on the back-burner until it drops below $2, and then may pick off some lots on any dips or knifes down at that point. My hypothesis on these is that they execute their IPOs with an ace up their sleeves in terms of a headline they know the can drop a month or so down the line when they want to run the share price so insiders can sell out at a premium. There are plenty of potential catalysts for this pre-revenue company: any contract with a major railway or manufacturer would be enough to run the share price, though it already doesn’t really have the ultra-low float profile I would ideally like to see for this kind of setup.

+++

Expion360 (XPON) – April 1, 2022 | 2.145M Shares
IPO Price: $7.00
Debut Price: $7.90
Day 1 High: $11.29
Day 1 Low: $7.26
High Since Debut: $11.29
Low Since Debut: $7.26

Day 1 Action: We finally got a debut runner in XPON, with a debut at $7.90 that took a few minutes to get going – in fairness, it did dip as low as $7.29 in the opening minutes, but not far enough to have instill panic in any debut buyers nor trigger any 10% stop lossesl off the open. From there it began a steady march through a halt up at $8.48 that opened at $8.80, sustained a halt down from $8.28 that opened at $8.23, followed by a steady rise up to a high for the day at $11.29. After that, it lost momentum, and trailed out to a mid-day baseline at $7.60 that attempted but failed to rally into power hour: reaching $8.38 before falling again to $7.47 and regaining a bit of composure to come fill-circle and close at $7.93 (just $0.03 above the debut price).

Day 2 Action: This was a Friday debut, so we’ll see what happens on Monday.

Looking Ahead: We often see two spikes in the first two days, and we already saw one spike off the debut rally, so this one seems like it could make a run on Day 2 at some point. I expect we see a spike on the 4:00 – 4:05 AM EST candles, but where it goes from there will determine my strategy for trading this for a possible Day 2 play on Monday. If there’s a 4:00 AM spike that slowly trails off – as opposed to immediately reverting to the $7.50 – $8.00 range, then I would expect an opening dip with a rally at some point in the morning during regular trading hours. If the early AM spike pretty much disappates right away, I will be looking for any kind of upward movement to indicate a pre-market run to take a trade, but will likely take any profits before the opening bell. It feels like this one got pumped over the weekend, so I’ll be watching for an opportunity to buy in under $8.00 for an expected pop. Not something I’ll hold long term, but there are a lot of eyeballs watching this one, and it feels like Day 1 may have just been a preview of further action to the upside.

+++

Uplistings:

Iveda Solutions (IVDA) – April 1, 2022 : This one reminded me to never buy an uplisting: either as a secondary offering on WeBull nor as an OTC going into the uplisting. Having traded around the $1 for much of the week, IVDA shares dropped to around $0.60 on Thursday before the 8:1 reverse split and subsequent pricing well below the indicated $9.68 at just $4.25… oof.
As I’ve seen countless times before, the wheels fell off this one from the start, opening at just $3.38 and falling as low as $2.88 before a strong rally into the close at $3.77 and a peak at $4.00 in after hours. Having played many of these uplistings off the opening dip, was reminded that it is never a good idea to get involved in these until AFTER they drop hard off the uplisting: as catching the reversal has been a solid move. Further, many of these have made strong moves on Day 2, so hopefully there will be some upside action on this on Day 2 so I can minimize my losses (wasn’t a big position anyway, but still a good reminder to stick to the proven strategy for any setup).

JOIN THE LIST, GET THE IPO TRADING GUIDE