How To Short Relypsa Stock The Right Way To Make Thousands RLYP $RLYP

How To Short Relypsa StockThis is how to short Relypsa stock the right way in order to make the money you need.  It is another day and yet another stock that has gone through the roof.  This time we are looking at Relypsa Inc. (RLYP) as our blowout stock of the day.  Unlike the articles I have written in the last few weeks that made us a fortune, such as Galmed, Argos, Genocea, and Acadia, this one is not a pharmaceutical stock that just received good news from the testing or the Food and Drug Administration.
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Why Is Relypsa Stock Up So Much?

Why is Relypsa stock up today so much you may be wondering?  Well kids, it seems that the big boys are considering buying them out. Take a look at today’s trading session and see how it let loose around lunch time.

How To Short Relypsa Stock



Take a look at some of the recent mergers and acquisitions and you find a very interesting tidbit of information about one of their competitors.  In 2015, AstraZeneca plc paid an astronomical amount of $2.7 billion for ZS Pharma.  They bought them because of a late-stage hyperkalemia drug that they had.  Now we know that Relypsa has their own late-stage hyperkalemia drug and that they could be a target in the very near future for an acquisition.  With that being said, this is driving force behind today’s skyrocketing price.  But the question remains, do they really deserve that kind of price appreciation.  If they don’t we need to figure out how to short Relypsa stock the right way.



This stock is a major play based on if comes alone.  In other words, there are no firm offers on the table that the public is aware of as of yet and the explosion of price today was base on nothing more than hope.  A few people talking about this company being bought out or shopping itself out and the stock goes nuts.  This is something I have witnessed a few times throughout my trading career and I am expecting this to play out very similar to those instances.  This stock is set to go through a few stages at this particular moment.

  1. Stage 1 is when the stock goes way up based on the actions of greedy traders hoping to turn a quick buck.  They hear some news and inflate the stock very quickly.
  2. Stage 2 is when the people who have now have made some big money on the sudden price appreciation start to realize that they should lock up some of their money and sell some of there shares.  This is usually the next day after the breakout day.
  3. Stage 3 is when we actually start getting news based on fact and not rumor.  The stock either returns to where it started as Hershey did back when they were looking at selling the business or it continues to go higher based on real offers that are released to the public.
We are looking at Relypsa right now entering stage 2 in my mind and that is why it is a major short for me.  I have shorted this stock at close (RLYP $25.38), just as I have with quite a few stocks that have acted similar over the last few months.  This play will be just like many of the recent pharmaceutical stocks that have done similar takes.  I fully expect the next day or two to be down days.  I am looking at locking in 50% of the stock at the 10% down mark or more based on the action.  Then it goes by the normal plan at that point, which you can read about on many of my other posts.
UPDATE 4-8-16:  Once again we are looking at a closing bell and making a ton of cash.  This keeps the winning streak alive a very high number.  If you have been following along with me over the last few weeks, then you are already planning a HUGE Christmas.  With that being said, let’s take a look at RLYP and how it played out today.  As predicted it never went above my 10% stop loss barrier.  It did however drop down to $21.72 throughout throughout the day and allowed me to cover much of the short position for another substantial gain.  I expect this stock to retreat another 5 to 10 percent on Monday ORRRR go up 10 to 20 percent depending on news.  That is why I covered most of the position today.

How To Short Relypsa Stock

Comments

  1. Wallman says:

    You have been nailing these big time. Seriously impressed with your transactions.

    • Stock Moe says:

      Thank you. It is getting pretty straightforward when it comes to the short plays. Good luck and happy trading…Stock Moe

  2. Rebecca says:

    I shorted this as well. Your reasoning only makes me more happy I did. How long though should I hold it? (Your opinion) Thank you ahead of time.

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