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Price Forecast:

Bullish Case: SERA's recent price performance suggests resilience, supported by strong trial results and upcoming product launches. Rising call volume indicates bullish sentiment, potentially driven by anticipated payor coverage for the PreTRM test, enhancing revenue prospects.

Bearish Case: Despite positive trials, SERA faces significant financial hurdles, with revenues down 80%. High implied volatility and a history of steep declines raise concerns about future price stability, especially if market conditions shift negatively.

Potential Outcomes:

1. Strong Revenue Growth (40%): Successful insurance coverage for PreTRM.

2. Continued Decline (30%): Ongoing financial struggles and negative sentiment.

3. Sideways Movement (30%): Mixed signals amid high volatility.

Trading Oracle: Consider a bullish debit spread using the SERA 10/18/2024 $7.50 call (IV: 108.4, ask: $2.0) and sell the $10.00 call (IV: 87.9, ask: $0.65). This limits risk while capitalizing on potential short-term upside as the PreTRM launches approach.

August 24, 2024