Gene Editing Stocks Pull Back On New CRISPR Study

CRSP and NTLA could be finding chart support, though

by Josh Selway

Published on Jul 16, 2018 at 2:28 PM

U.S. stocks are sluggish today, as lower oil prices weigh on the major indexes. One group in particular that's under pressure is gene editing stocks, following another concerning study on CRISP/Cas9. As such, CRISPR Therapeutics AG (NASDAQ:CRSP), Intellia Therapeutics Inc (NASDAQ:NTLA), and Editas Medicine Inc (NASDAQ:EDIT) are all lower. Below, we'll take a closer look at the fallout surrounding shares of CRSP, NTLA, and EDIT.

CRSP Falls Back Below 50-Day Moving Average

CRSP stock is trading down 7.5% at $60.80, and while it's fallen back below the 50-day moving average and onto the short sale restricted list, it remains atop a line of higher lows that's been in place all year. In fact, the 200-day moving average for CRISPR Therapeutics still sits all the way down near $40. Many traders have continued to bet against the company, however, potentially hoping for more negative headlines in the futures. Short interest rose another 10.8% in the last two reporting periods, and now represents 18% of the security's total float. In a similar vein, the July 50, 55, and 60 put options are all home to heavy open interest.

Calls See Action Amid NTLA Slide

NTLA shares are down 7.2% at $30.25, but are also holding their recent channel of higher highs and lows. They also earlier found strong support from the 20-day moving average. Some options traders are expecting the stock to hold above the $30 level, too, with buy-to-open action seemingly taking place today at the January 2019 30-strike call.

Sentiment in the analyst community is also very upbeat toward Intellia, with all but one covering brokerage firm handing out anything lower than a "strong buy" rating. Moreover, the average 12-month price target stands up at $48.75.

July Puts Popular on EDIT

Finally, EDIT stock has shed 5.3% to trade at $35.89, but remains above the 100% year-over-year level. Unlike NTLA, puts are popular, trading at more than double the expected pace, led by action at the July 35 put. Elsewhere, recent short sellers should be happy about the shares' decline, since short interest on Editas rose by 11.4% in the last reporting period to 5.7 million shares -- or 5.5 times the equity's average daily trading volume.


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