Headline risk remains high, but my indicators are giving bullish readings for the second week in a row. The major indexes continue to rally off of their panic lows, and I want to take advantage by using a bullish position on Inovio Pharmaceuticals, Inc. (NASDAQ:INO), the biotechnology company.

There are select companies that may do well in this type of environment, and this is not the time to get complacent. Earnings and economic data are weak, so if traders are going to follow the tape, or the action in the market, looking at vaccine and immunotherapy companies like INO is more promising.

Any company developing a vaccine for COVID-19 is a target for bullish trades, and INO is making significant progress.

Short-Term Bullishness

Over 70 COVID-19 vaccines are being developed, and according to a press release from INO, the company just received $6.9 million of funding to work with the Korea National Institute of Health for phase 1 and phase 2 trials of its COVID-19 vaccine.

The company already started a phase 1 trial in the U.S., testing healthy adults before expanding the study to older candidates.

Though the market continues to rise, it’s difficult to say whether it will experience another crash. Some business leaders and health officials think a vaccine is necessary to fully reopen the U.S., and I don’t think the COVID-19 headline risk will dissipate until then.

Any progress in INO’s research is, therefore, very valuable. Short-term trades on the stock are an excellent way to take advantage of the enthusiasm around the company.

In the next few weeks, while multiple companies are working on vaccines, no one knows who will come out on top. In a short-term option trade, you don’t need to. You can collect a profit before any big discoveries are made because the sector is attracting new investors and pushing higher.

INO’s Spike and Drop Conceal its Strength

The chart below shows a company that jumped higher on good news and dropped when investors realized they overreacted. INO announced an accelerated timeline for developing a vaccine for COVID-19 in a press release on March 3. That pushed the stock too far too fast.

Daily Chart of Inovio Pharmaceuticals, Inc. (INO) — Chart Source: TradingView

Such a massive fluctuation can make INO appear too volatile to trade. But you have to consider its current trend and how long you’ll hold the trade.

In this case, I am recommending a short-term bullish call option because INO is making higher lows, following its 50-day moving average up. If you ignore the spike, which is unlikely to repeat while investors are looking at the dozens of other companies working on a vaccine, you can see that INO’s technical formation is strong.

The stock is inching toward resistance at $9.50, and I believe its recent funding success could help give it the extra momentum it needs to break out.

Buy to open the Inovio Pharmaceuticals, Inc. (INO) Aug. 21st $10 Calls (INO200821C00010000) at $1.95 or lower.

InvestorPlace advisor Ken Trester also brings you Power Options Weekly, which delivers 5 new options trades and his latest trading advice to you each Friday. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.