Before I jump in and share the three SPACs I’m eyeing to play on the long side…allow me to give you some background information of what’s happened in the space over the last few months. 

Late 2020 to the first two months of 2021 were all SPACs. Get in early, wait for an announcement, and boom!

It didn’t matter if the proposed company had any profits or was years away from generating revenues…it was all about the TAM (total addressable market), baby!

Names like Virgin Galactic, Nikola, QuantumScape, Churchill Capital, CIIG Merger, DraftKings, and Social Capital Hedosophia—dominated the scene. 

Everyone knew the party would be over…but no one knew when. 

However, in late February, when a threat of rising rates entered the narrative, SPACs took a massive dump. A sell-off that most haven’t recovered from. 

Some SPACs have recovered from their lows…but still off significantly from their yearly highs. 

But with the Nasdaq back at all-time highs, it seems like investors’ appetite for risk is coming back into the market. 

And while I do think most SPACs won’t get back to their yearly highs, let alone make it as publicly traded companies. 

There will be a few that rise to the top. 

Today I want to walk you through 3 SPACs I’m eyeing for potential longs. And how I intend to play them. 

BARK 

This stock is on my radar since it’s had a wild up and down trading session from the middle of May.

Finally, all of the sellers are exhausted and will soon be looking to cover their positions at these levels.

I would expect to see some buyers start to come into BARK once the price gets above the 13/30 hourly momentum averages, and the push higher to the 200 hourly moving average.

The strategy I’m looking to put on here is with options. But instead of buying calls, I’d look to sell naked puts. I prefer to sell naked puts on cheaper stocks. I want to sell enough puts that I’m willing to own shares. In other words, I’m selling puts in companies I want to own. 

SKLZ 

The stock is creating a consolidation pattern above the 200 hourly moving average and in an Ascending Triangle pattern.

If the stock can continue to hold the 13/30 hourly momentum average I expect to see higher prices.  A break of the resistance level will most likely spur additional momentum in this stock with a target around $21 where the gap occurred. 

The way I want to get involved is by selling slightly OTM puts. Same deal here…I don’t mind owning the stock if the puts go in-the-money. I’ll be happy to take shares at a lower price. And if it doesn’t drop to my price, at least I collected some premium. 

CCIV

This stock is starting to pull back with an RSI in the overbought zone.  

I think that if we can see prices come back down to the 13/30 hourly momentum average, there will be accelerated upward movement in this name.

If buyers step in and push the stock higher around the momentum averages, I am targeting the $27.50’s as a possible place the stock will head towards.

I have also noticed that there have been a ton of options action in the symbol today. 

The most active options all expire on Friday. I haven’t decided on how I will play this yet. But I wouldn’t mind buying the stock outright or even buying some calls here. 

Bottom Line

Over 500 SPAC IPOs were announced between last year and this. Trading SPACs seemed like easy money in 2020 and early 2021…but have seen a massive correction over the last few months. I don’t believe they will regain their late 2020 glory. But I think there are some terrific bargains out there—three of which I mentioned above.