Price Forecast:

Bullish Case: A bullish sentiment arises from the potential for positive clinical trial outcomes and increased investor interest. A favorable regulatory decision could catalyze price recovery, as evidenced by past performance showing substantial returns for investors holding NERV for 1-2 years.

Bearish Case: The bearish outlook is driven by persistent weak fundamentals, high implied volatility, and possible negative trial results. Market sentiment may further decline if upcoming earnings disappoint or regulatory approvals stall, as illustrated by recent downward trends.

Potential Outcomes:

• 1. Positive clinical trial results: 40% chance.
• 2. Regulatory approval: 30% chance.
• 3. Continued price decline: 20% chance.
• 4. Broader market recovery boosting biotech stocks: 10% chance.

Trading Oracle: Implement a bullish strategy using a debit spread by buying NERV $2.50 calls and selling $3 calls, targeting Q1 2025 for potential upside from expected catalysts. This strategy provides a favorable risk-reward ratio with limited downside and leverages anticipated volatility spikes.

November 22, 2024