A trader’s strategy for the new public gaming app


As the Roblox children’s games app finds its way into the public market, it may be ripe for a trade, said Todd Gordon of TradingAnalysis.com.

The company’s shares jumped nearly 6% on Thursday. Inventory has risen since Roblox announced a partnership with Hasbro on Tuesday to create new merchandise around the Monopoly and Nerf franchises.

Roblox went public via a direct listing on March 10 and has a market cap of nearly $ 44 billion.

On his chart, “the pattern I like here is that we have a series of inner bars,” which means today’s price range has stayed within yesterday’s, Gordon told “Trading Nation” of CNBC Thursday.

“All that means is a little bit of consolidation” ahead of what will likely be a pass over previous highs, Gordon said.

“We will let the market take us long here.”

One way to do this could be to use a buy stop order of around 10 cents above the stock’s previous high to capture the movement, reducing losses if the stock falls below 73. $, said Gordon.

Another way could be to trade monthly options expiring in June – buying the $ 80 call and selling the $ 90 call in a bet on a clear but contained rise after the May 19 earnings report, did he declare.

“This is more of a breakout game on a newly released name,” he said. “I will look to add this to my portfolio during an escape.”

Roblox finished trading at $ 79.66 on Thursday.

Warning


Back To Top