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The Expected Move
How a new listing like COIN will behave in early trading is unknown, but we can look to the options market to uncover how traders are positioning themselves. With the
Options AI chart we can visualize the expected move (from option implied volatility) to get a sense of the magnitude of move, up or down, that traders are expecting over time.
At the time of writing, we see that options are pricing about a 12% move for the stock (in either direction) by May 21st. With COIN trading near $311, the move corresponds to about $348 for a bullish consensus and $274 for bearish.
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Tesla (NASDAQ: TSLA) stock is back in the news following a sell-off over the past few weeks and a bounce higher in the past few days. We ll look at what the options market is expecting in terms of the magnitude of upcoming stock moves. We ll also look at how spreads might be used in a high-premium environment to reduce capital outlay – whatever your trading view.
Tesla options are pricing about a
10% move by March 19th, about $65 in either direction
Options are pricing
14% move into April 1st, a little more than $90 in either direction.
Here s the bullish and bearish consensus with the stock near $665, via Options AI:
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ZM options are pricing about a 9% move, or just under $40 in either direction.
Zoom was lower by -15% on its most recent earnings report and saw moves of +40% and +8% in the two prior.
A full calendar of expected and recent earnings moves can be found on the Options AI Earnings Calendar. Links to Zoom here.
Zoom: Using The Expected Move To Help Create Options Spreads
Using Zoom as an example, we can see how the expected move might be used to help guide strike selection on options spreads, both debit, and credit. We can also see how option spreads can be used to help reduce capital outlay and potentially improve probability of profits (versus buying outright calls or puts).