Bulls Pile on VXRT After Covid-19 Vaccine Update

The stock looks to have technical support in place after a period of volatility

Deputy Editor
Aug 2, 2021 at 11:10 AM
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The shares of Vaxart Inc (NASDAQ:VXRT) are up 7.2% at $7.71 this morning, following news that the U.S. Food and Drug Administration (FDA) cleared the drug maker to start a clinical trial for its S-only oral tablet Covid-19 vaccine candidate. The firm said its Phase 2 trial will begin in the second half of the year. 

VXRT is up a healthy 36.3% year-to-date, despite volatility on the charts, including a spike to the $24 level in February. While the $9 region has acted as a rejection level since June, the 100-day moving average has contained most of Vaxart stock's pullbacks in recent weeks.

Should today's positive price action continue, VXRT could be primed for a short squeeze. Short interest rose 4.8% in the last reporting period, and now makes up 21.1% of the stock's available float. 

Elsewhere, sentiment towards VXRT is more bullish. Of the four analysts covering the equity, three say "strong buy." Plus, at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock sports a 10-day call/put volume ratio of 13.33, which stands higher than 91% of readings from the past 12 months. This means long calls are being picked up at a much quicker-than-usual clip. 

This sentiment is bleeding into today's options trading, with 17,000 calls across the tape so far -- nearly double the intraday average -- compared to 2,454 puts. The most popular is the weekly 8/6 8.50-strike call, followed by the 8-strike call in the same series, with positions being sold to open at both.

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