Some earnings of note after the close. Expected moves from the options market give an immediate sense of how traders are pricing earnings events. Using OptionsAi technology we can see those moves visually, to spot risk or opportunity. Strike selection and having the right trades is crucial in and around events. Below are the 2 week expected move charts, bullish and bearish consensus and comparison to the previous 2 weeks (as of today).
Ways to Play
Uber is an interesting earnings event in that the stock is up nearly 10% on competitor Lyft's earnings (LYFT is up ~20% today). UBER's 2 week expected move is around 10%. For those looking for a similar move higher like LYFT saw, the conditions are obviously different as UBER is already higher. (the charts are very similar). So a bullish price target of ~$34 (about 10% higher in the stock) for May 15th looks like this on OptionsAI technology:
The call spread lowers the breakeven of the call and selling the put spread increases the overall probability but costs more to make less. The choice of trade depends on both a potential move higher, and the magnitude of that move.
Looking at ROKU, the stock started the year in the $130s and now finds itself back in that area, having completed a round trip from its March lows in the $60s. What does a neutral target look like, with expectations that the stock doesn't move beyond its expected move? Here's a neutral target of ~ $135 for May 15th, from OptionsAI technology:
The Condor looks like this on the chart, notice the bands looking to take advantage of anything within the expected move:
The Butterfly is priced to make a lot of money, but needs the stock to be $135 to make that, profits trail off in either direction. The Condor establishes a range at which the max profit is the same.
See a part of OptionsAI technology with your own price target and demo trades in AAPL HERE