In this market, it’s becoming clear that some of the best opportunities are coming from the underdogs—those lagging groups finally starting to turn things around.
One name that stands out to me is Lovesac $LOVE.
The stock is setting up nicely, breaking out of a textbook inverted head-and-shoulders pattern.
The price didn’t just break out of the range—it also reclaimed the anchored VWAP from its all-time high in 2021. I love how these levels of interest coincide, adding conviction to this pattern resolution.
This kind of price action tells us buyers are stepping in and taking control of the primary trend for the first time in three years, suggesting the path of least resistance is now higher.
What makes this setup even juicier is the 29% short interest paired with a 14x days-to-cover ratio. This scenario bodes well for a short squeeze, fueling the rally and creating a tailwind for even higher prices in the future.
LOVE checks all the boxes for a home run trade: Trend reversal. Big short interest. Asymmetric risk vs reward.
A few weeks ago, we got long the 12/20 $35 callsas part of our Breakout Multiplier system, betting on this bottom playing out. On Friday, we locked in profits by selling half for a double and are now letting the rest ride risk-free.
This trade is playing out exactly as planned. And the best part is that it’s just breaking out.
That’s what I love about the Breakout Multiplier strategy—it lets me start small and use options as a driver to ramp up as the trade develops.
JC and Strazza are hosting a special event tomorrow at 4:00 pm ET, where they’ll be showing how to find trades using Breakout Multiplier strategy. If you want to be part of it, make sure to reserve your spot for FREE!
