Will BBIG share continue to rise?
- BBIG stock remains at the top of social media stock trends.
- The stock also remains bullish, breaking above $ 12 on Wednesday.
- The volume of options on BBIG shares is extremely high.
Vinco Ventures continues to venture higher as the new retail favorite closed again 6% higher on Thursday. The stock took to social media this week, and performance matched BBIG’s which rose from $ 8 to over $ 12 this week. A 50% gain isn’t too bad even for a stock of memes and so far this one does exactly what many retail traders had hoped for. We must add a note of caution here before going any further. This is a highly speculative type of trading and not suitable for everyone. This is not a traditional buy and hold investment or a fundamental type investment like Warren Buffet. This is speculation, so knowing your risk and using proper risk management is paramount. We always like to advocate for using stops on FXStreet, but options are also a good way to manage risk, assuming you buy them. The premium is then your only risk.
Speaking of options, BBIG was among the most active stocks in the entire US equity universe in terms of option volume on Thursday. Vinco Ventures (BBIG) options were the fourth most traded Thursday, according to Barchart.com, with more than half a million options contracts changing hands. Only AAPL, AMC and TSLA traded more options on Thursday. It is also good to note that 87% of options traded were call options with only 13% put options. It is highly likely that these calls were bought by retail traders eager to move. This could lead to another gamma compression, which has become a more familiar term in the world of memes stocks. The higher the price of BBIG shares, the more options market makers have to buy shares to cover their short buy positions. Be careful. Eventually, gamma compression leads to an inflection point, and the exact opposite occurs. The volume of BBIG options and the open interest on the options is more than double their 30-day average.
BBIG’s social media mentions also turned more positive on Thursday if Refinitiv’s latest social media data is to be looked at. While examining this type of data is extremely volatile with a huge and varied data source, it is nonetheless interesting. BBIG’s social media mentions peaked on Wednesday, but were still high on Thursday and remain above last week’s levels. There is a correlation, but it’s more for informational purposes as tracking social media mentions and sentiments is extremely difficult. Just use it for information, not just any trading strategy.
BBIG stock forecast
Again we want to stress how volatile this one is and trade cautiously and use stops or risk management. Technical analysis on something so volatile is difficult with levels exploding albeit steadily. Looking at the 15 minute chart since the price break last week, the checkpoint is $ 8 which is the price with the highest volume. A small trendline has formed from the August 31 low to the September 3 low. The Volume Weighted Average Price (VWAP) for the week is $ 10.40. Tuesday’s move upward from $ 8 to $ 11 has seen a period of consolidation since, with the range tightening between $ 10 and $ 11.