For today’s Trade of the Day, we will be looking at Novavax Inc. (NVAX).

Before analyzing NVAX’s chart, let’s take a closer look at the company and its services.

Novavax, Inc., a biotechnology company, focuses on the discovery, development, and commercialization of vaccines to prevent serious infectious diseases and address health needs. Novavax, Inc. was incorporated in 1987 and is headquartered in Gaithersburg, Maryland.

The chart below is a weekly chart with an ADX indicator at the bottom.  The description coming up next explains how to use the ADX.

Average Direction Index (ADX) – Strength Indicator

The Average Directional Index consists of 3 lines:  Green, Red and Black.

  • Green = +DI (Bullish)
  • Red = -DI (Bearish)
  • Black = ADX Strength Line

The DI line that is on top is in control.  If the ADX line is heading up, strength is supporting the DI line that is on top and in control.

Each candle on the chart represents price movement over a 5-day (week) period; therefore, it takes weeks for trades to play out.  When the -DI crosses over the +DI line, it gives a buy signal for Puts as the -DI line (red) appears as if it is in control and rising to head up on the ADX indicator, and as the ADX turns up that is even more bearish, suggesting a downward move is gaining strength.  When the +DI (green line) crosses the red and the black line points up it shows an upward trend and Calls can be considered.

Let’s look at NVAX’s weekly chart.

The ADX -DI (red line) has crossed the +DI and the black ADX line is curling up.  As long as the -DI is above the +DI, price should fall. 


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Potential NVAX Trade

This signal could give a quick payout if it continues the downward move, and the strength of this pattern continues.  I am typing this on Wednesday, and NVAX costs about $19.61.   If NVAX’s price moves to $19 and the -DI (red line) stays above the +DI, and the black line is heading up, you could consider a Put trade.  The short-term price target for NVAX is $14 and then, perhaps, lower. 

Check Out How an Option Trade Could Pay Out Big Time

Option trading offers the potential of a lower initial investment and higher percentage gain.   Let’s take a look and make a comparison.

To buy shares of NVAX stock you would pay about $19.61. You would wait until the price reached a bottom before buying stock.

If you bought 1 Put option covering 100 shares of NVAX with an Oct 21st expiration date for the 14 strike, the premium would be approximately $ .62 today, or $62 for 1 option.  If price fell $5 over the next few weeks, the premium would likely increase $2.50, giving $250 profit on your $62 investment. This is a 303% gain.  

Trading options is a win, win, win opportunity.   Options often offer a smaller overall investment, covering more shares of stock and potential for greater profits.

I like to stress when trading options, you don’t need to wait for the expiration date to close the trade. You can close anywhere along the way prior to the expiration date.  It is never a bad idea to take profit.

Trading options is like renting stocks for a fixed period of time. The potential to generate steady income with options is real, and it can be transforming.  

Routinely remind yourself – I believe in myself and my ability to succeed. I believe in an abundance of unlimited possibilities. The future will be awesome!

I wish you the very best,


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Past potential trade update:

Last week, we discussed buying AMZN puts. On 9-23 the premium for the Oct 21st 110 put was $3.95. We will continue to monitor this trade.

Two weeks ago we talked about buying HD 120 puts with an Oct 21st expiration date. On 9-16 the premium was $4.50. On 9-26 you cold have sold for $7.20, a 38% profit.