$CRSP $181 H&S Invalidation Play

19 feb 2021

Coming in as the 13th largest position in the ARKG ETF with a 2.68% weight (as of 02/18/2021), CRISPR Therapeutics AG is arguably one of Cathie Wood's favorite play in this space.

Since hitting the Highs of $220.20 on 01/15/2021, CRSP has been on a steady decline to the lows of $142.15, forming a clear Head & Shoulder pattern on the daily chart in the process. Over the last 2 days, CRSP has been attempting to break the neckline of the H&S, but with no success - as we see rejection off the neckline and volume picking up with an upward push in price.

Today, we see price trading upwards of $147.12, stabilizing at $150.

Next, I expect CRSP to continue closing above the neckline, subsequently testing and breaking the next 2 resistance to complete the invalidation of the H&S.

My target is $181.42. Please set SL based on your own risk tolerance.

This is not investment advice so please do your own due diligence!
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23 feb 2021

Trade chiuso: stop raggiunto

The stop-loss that I set for myself for the H&S invalidation play was absolutely obliterated today. We have broken below both the neckline of the head & shoulder and the support of the bullish channel . This puts the level of $84 to $110 absolutely in play.

Unless we are able to break back above the bullish channel and the neckline, the H&S pattern will complete itself. The daily RSI may be in the oversold territory now, but considering the nature of our correcting market, CRSP earnings miss, ARK not adding to their position, lack of short-term positive catalyst, absence of media exposure, and a high probability bearish price action pattern, there is very little reason for CRSP to sustain a higher price in the short-term.

As such, the downside risk for CRSP is extremely huge. I will avoid entering a CRSP position for the time being as I would like to wait for a re-test of the key levels before confirming a directional bias for a position. If we re-test the bullish channel's support-turn-resistant and H&S neckline but fail to break above either of them, we will likely be heading for the $84 to $110 level to complete the H&S pattern. Otherwise, if CRSP manage to stay above them, I expect either a consolidation or a push for the resistance of the bullish channel .

This is not investment advice so please do your own due diligence!
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