CLOV continues to move within the symmetrical triangle while being encapsulated by a bearish channel. As we approach the end of the symmetrical triangle, I am expecting a breakout to by next week, as early as Monday.
I believe the upcoming earnings on 03/01/2021's post-market to be a major catalyst to which direction the breakout will be.
Bear Case: In the event that we get a negative earnings surprise, CLOV will be headed further down into unchartered territory. The sell-off will likely be exacerbated by weakening market conditions and the lack of PR by Chamath Palihapitiya, Vivek Garipalli, and Clover Health Corp. Throw in the FUD created by the Hidenburg Research's short-seller report, and you have a recipe for a sell-off into the $7 and $8 territory. How soon we recovery from that will likely depend on the impact of the fiscal stimulus, whether there are any positive news released by Clover/Chamath/Vivek, and how long it takes for the short-seller report to be cleared up by the SEC.
Base Case: Earnings data come out as expected and there was no deviation compared to what was expected. Due to technical factors such as RSI pointing towards CLOV being incredibly oversold, volume picking up again, and CLOV currently being in an area of multiple huge support level, we see a push back to the dynamic resistance of the bearish channel. However, breaking above could prove to be challenging without positive sentiments around CLOV. We might start consolidating between $10 to $11 or even re-test the dynamic support of the bearish channel.
Bull Case: Clover Health Corp releases a positive earnings surprise and Clover/Chamath/Vivek takes the opportunity to boost PR to create more positive sentiments around CLOV. The aforementioned, supported by bullish technical indicators, pushes CLOV back to the dynamic resistance of the bearish channel, subsequently breaking beyond it and holding above the bearish channel. As the fiscal stimulus comes in, we see money flowing into the stock market, and CLOV continue to grow towards $14 and beyond.
TLDR: $7-$8 Bear Case, $10-$11 Base Case, >$14 Bull Case.
This is not investment advice so please do your own due diligence! Support this idea with likes and share your thoughts below.
Short term, if ER on May 1st is bearish, I can see an immediate crash to $7.90 area within a day or two following the ER.... after that, like you said, its all uncharted territory. I believe sentiment is so incredibly negative surrounding the stock, that a bearish ER could see the price collapse to book value, given its relatively expensive valuation at its current level of $9.50.
AntrePoint
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@colindepew, Yes, I agree. At the current juncture, CLOV is surrounded by nothing but negativity. If the earnings is anywhere close to a bearish signal, CLOV will tank heavily followed by a slow bleed until a positive catalyst shows up or until it finds a bottom - in which case, we have no idea where it will be at because it is all uncharted territory.
@jackr70, More than reasonable price target for a bull case
stockpigeon
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@AntrePoint, The strong close Friday after hours was an interesting push to top of trendline.. I closed my position from 9.50 ah, but will certainly be playing this one as an intraday trader next week.
AntrePoint
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@stockpigeon, Was indeed an interesting push. Very excited to see how it will perform soon, especially once it gets more clarity.