Option Strategies: NKE& CCL

Hello everyone! Today I want to share some option strategies with you!

Trade idea on: $Nike(NKE)$

Earnings date: Sep 28 after market close

Expected move: 5%

Entry: Retail has been getting killed, and considering current economic environment and market sentiment, it is easy to see how NKE could guide down and come in with lackluster numbers. Look at the daily chart on NKE … its been in a downfall. The question is ... has selling exhausted itself? That said, tutes and hedgies don't want retail to win, so if too many retail folks are betting on downside, then the tutes and hedgies could burn puts but also may not necessarily pump the stock to reward call holders. Hence, the best thing to do here in our opinion is to sell the options (versus buying) and take advantage of IV crush and theta burn. Because we’re betting on downside, we’re going to sell naked calls targeting the 97-99 strikes. There is strong overhead volume resistance at 105-110. If we sell puts, we will be conservative and target the 80 strike.

Exit: The goal of this trade is to capture premium as profit. Buy-to-close or let expire worthless our position if the trade stays below the call strike sold (or above the put strike sold). If NKE breaks the call strike or put strike, then buy-to-close out for a loss the jeopardized leg.

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Heard a saying last night that I've never heard before (in relation to financial analysis), but feel like I should have known already. The last part I did know. "Revenue is vanity. Result is sanity. Cash is king."

Going to battle with this call spread on $Nike(NKE)$ to play for earnings today. Sold the 98 strike and bought the 106 strike. Wider spread ... got weak belief in NKE pushing past 98.

Maybe should have waited to sell the calls as NKE is pushing up on the 5m timeframe, but we set the order and walked away and it filled ... so ... we're in the game. Not sure if we're going to sell puts.

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For anyone optionselling on $Carnival(CCL)$ today to play it for earnings before market open tomorrow ... good luck to you.

We're sitting this one out. Expected move is ~7% and IV is high, but the premiums for the strikes we want are not good enough to justify us taking a position. R/R isn't there for us.

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Remember ... optionselling isn't a for-sure win-win thing. Sometimes trades do go against you.

For example, this NKE trade might very well go against us tomorrow. We shall see. But just wanted to put out the friendly reminder.

Thank you for patience! Follow me to learn more about analysis!!