Bluebird Stock Reverses Gains, Down Nearly 12%

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BLUE is crumbling after its premarket surge

Bluebird Bio Inc (NASDAQ:BLUE) is in the spotlight today, after the U.S. Food and Drug Administration (FDA) approved SKYSONA, its gene therapy for the treatment of Cerebral Adrenoleukodystrophy (CALD) — a rare neurological disorder found in children’s brains ages three to 12. BLUE has pulled back from its premarket surge, however, down 11.9% at $5.58 at last glance. The stock is on the Short Sell Restricted (SSR) list amid the broad market volatility.

Though today’s drop now has Bluebird stock at its lowest level since late August, the $5.50 level, which coincides with the 60-day moving average, still lingers below as support. Year-to-date, the equity is down 42.7%. 

Options bulls are on the hunt already this morning, with 5,647 calls exchanged so far — three times the intraday average. The October 7.50 call is the most popular, followed by the 5 call in the same monthly series. 

This bullish sentiment has held true for the past 10 weeks. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), BLUE sports a 50-day call/put volume ratio of 15.92, which stands higher than 94% of readings from the past year. Given a healthy 25% of BLUE’s total available float is sold short, its possible some of this call bias could be shorts seeking an options hedge.