Leading biotechnology company Clovis Oncology (NASDAQ:CLVS) is is focused on developing and commercializing anti-cancer agents globally. This stock has been under pressure since peaking on July 1, 2017. At that time, CLVS traded as high as $99.45 a share. Today, it's trading around $59. That represents a near 40 percent decline in the past six months.
The Trade
The stock is now trading down toward its important 200-week moving average, around $55. This area should serve as major chart support when tested and is a very attractive area for a bounce in the stock. Keep in mind that all biotechnology stocks have a lot of risk in them, so I'd trade the stock with a call option. By using options, the only risk is the premium paid for the call option, which means I already know my maximum loss if I'm wrong on the trade. The positive upside of using a call options is that the potential percentage gain will be much greater than if I actually bought the stock outright.
