It's somewhat a lather, rinse, repeat of last week, given the fact that we're kind of in-between earnings seasons, with the next to kick off here in a couple of weeks. XOP:* With the underlying somewhat in the middle of its range, I'm more inclined to go directionally neutral here, either via short strangle or iron fly. The 27 delta-ish May 18th 33/38 short...
Even though earnings season is winding down to a few names (BB, GME) next week, there's stuff to play in sectors or broad market, with the May expiry (54 days until expiry) coming into view for plays. The XOP May 18th 31/39 short strangle (19 delta) is paying .98 at the mid with the slightly more aggressive 25 delta 32/38 paying 1.38. If you're looking to go...
The only earnings play coming up next week that currently interests me from a premium selling/volatility contraction standpoint is MU -- with a background implied volatility in the 60's -- which announces earnings on Thursday after market close. Neither ORCL nor FDX -- which announce Monday and Tuesday respectively -- have sub-30 implied volatility, although...
WLL seems to be breaking higher today! If above 30 very constructive for further strength.
With the VIX dropping hard below 15, some of the juice has poured out of the cup ... . Even so, there remain a few plays in the market. ADBE announces earnings on the 15th (Thursday) after market close. The volatility metrics don't quite meet my criteria for a volatility contraction play (56/32), but the March 23rd 210/323.5 short strangle is paying 3.80 at the...
... for a 2.49/contract debit. Metrics: Max Profit: $51/contract* (20.5% ROC) Max Loss: $249/contract** Notes: As with any diagonal, there aren't many metrics to look at. If you just leave the setup alone, however, your max loss is $249/contract, and your max profit is $51/contract. Max profit is realized with a finish above the 35 strike at expiry; max...
A trio of retail names, TGT, ANF, and COST announce next week ... . TGT announces on 3/6 before market open. Preliminarily, the March 16th, 11-day, 20-delta 69.5/81 short strangle pays 1.54 at the mid, with its defined risk counterpart, the 66.5/69/81/84 iron condor paying under 1/3rd the width of the wings at .83/contract, slightly shy of the credit I like to...
... for a .15/contract credit. As with any diagonal, there aren't many metrics to provide, since max profit is dependent on the number of rolls undertaken, the credit received for each, as well as whether the long maintains value. However, the max loss is the width of the spread (3) minus the credit received for the setup (.15) or 2.85. This is the max I can...
P announces earnings on 2/21 after market close; HLF on 2/22 after market. Any vol contraction plays you choose to pull the trigger on should be put on shortly before the close before which earnings are announced, when the background implied volatility is likely to be at its highest. With background implied volatility over 100%, the obvious play in P is a...
With the shortened holiday week, I'm not expecting much out of the market in terms of volatility, so don't anticipate on putting on anything unless we get some exogenous event pop in the VIX. However, there are a few that might be worth working possible setups in: KRE (regional banks), with an implied volatility rank of 60 and an implied volatility of 22. GDXJ...
I'm a buyer above top level resistances. C is optional for gamblers
... for a .49 ($49)/contract credit. Metrics: Probability of Profit: 63% Max Profit: $49/contract Max Loss: $151/contract Breakevens: 33.51/40.49 Delta: 1.64 Theta: .99 Notes: Going small, defined, neutral assumption here, since the implied volatility isn't as high as I would like. Shooting for 50% max ... . The full on naked 34/40 in the same expiry...
Something that you can predict is nice. XOP prices surging, should roll along in a channel pattern. Heiken-Ashi has been pretty good at predicting trend swings here.
XOP appears to be looking to re-test the top of a massive wedge. Looking for contact around $38.50. Crude prices are providing a massive tailwind, I think we see $60 crude by December and $XOP will follow to the upside.
If you like this idea leave a like and follow me to get all of my updates :) I would love to talk to you so send me a message or comment! Underlying: USOIL (WTI) Time frame: 1W Last week I posted about oil continuing on its up trend. Although last week was a declining week I am still looking at it to increase in price over the long term. Why? The Bolling...