The biggest winner of the COVID era is setting up for another run.
I'm talking about Moderna $MRNA.
The stock went from a niche biotech company to one of the biggest winners of the pandemic as demand for its vaccine sent revenue, earnings, and investor enthusiasm soaring.
From its 2019 lows near $11.50, MRNA rallied roughly 4,000%, eventually peaking just shy of $500 per share in August 2021.
What followed was a painful reality check.
As vaccine demand faded, sentiment deteriorated. The stock spent the next several years unwinding one of the most dramatic advances of the cycle, falling more than 90% from its highs.
After years of disappointment, most investors stopped paying attention.
And that's what makes the current setup so interesting.
Fast forward to today, and MRNA is no longer going down.
Instead, the stock has spent the last nine months building a rounding bottom, a classic bearish-to-bullish reversal pattern that often marks the transition from a downtrend to a new uptrend.
Take a look at the chart:
Price is now pressing against the upper bounds of this base. If buyers can absorb the overhead supply and push through this ceiling, the path of least resistance shifts higher.
The setup becomes even more compelling when you look at positioning.
Roughly 16% of the float is sold short, meaning a meaningful group of investors is still betting on lower prices. If the stock breaks out, those short sellers may be forced to buy shares to cover positions, creating additional demand and potentially accelerating the move higher.
That's fuel.
For that reason, I like the idea of owning the common stock only on strength above $60.
That's my level.
Above that, I'm long MRNA.
At the same time, I also like the idea of adding leveraged exposure if this move starts to accelerate.
Yesterday, I bought call options in our Breakout Multiplier portfolio, giving us upside exposure to a potential breakout while clearly defining risk from the start.
If you’re interested in how we identify setups like this, I’d recommend checking out Steve Strazza’s live event, where he breaks down the process behind finding high-probability opportunities before they fully emerge.
