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BIDU

THE WEEK AHEAD: UBER, BIDU, ROKU EARNINGS; USO, XOP, /CL, VIXHIGH RANK/IMPLIED EARNINGS: UBER (--/74):* Monday, After Market Close. BIDU (59/42): Wednesday, After Market Close. ROKU (72/85): Wednesday, After Market Close. The Plain Jane ROKU December 20th 120/190 short strangle camped out at the 20 delta pays 8.55, but there is some call side skew there that you may want to accommodate in some fashion, for example, via ratio (the December 20th 2 x 105/185, 8.79 credit, -1.64/26.15 delta theta) or by going half as wide on the call side as on the put with a defined risk iron condor (e.g., the December 20th 110/120/185/190 pays 2.09). The BIDU December 20th 90/120 short strangle pays 2.33 and the UBER December 20th 25/39 pays 1.45. Naturally, you'll probably want to adjust strikes a smidge running into earnings, depending on how much these move between now and their respective announcements. EXCHANGE-TRADED FUNDS: SLV (51/24) GDXJ (40/31) GLD (40/12) GDX (38/27) TLT (34/11) USO (29/35) XOP (24/34) First Expiries In Which At-the-Money Short Straddle Pays >10% of Stock Price: SLV: April (165 Days), 2.10 versus 16.92 spot (12.4%) GDXJ: January (75 Days), 4.75 versus 39.40 spot (12.1%) GLD: January '21 (439 Days), 17.48 versus 142.56 (12.3%) GDX: January (75 Days), 2.91 versus 28.01 (10.4%) TLT: January '21 (439 Days), 15.43 versus 140.56 (11.0%) USO: January (75 Days), 1.38 versus 11.69 (11.8%) XOP: December (47 Days), 2.25 versus 21.85 (10.3%) I'm naturally not going to go out 439 days in either TLT or GLD to sell premium, but set them out there to show where the best "buck bang" is. If anywhere, it's shorter duration in GDXJ, GDX, USO, or XOP. BROAD MARKET: As with last week, <45 Day duration broad market (SPY, QQQ, IWM) isn't paying here. The shortest duration in which the at the money short straddle pays greater than 10% of where the underlying is trading is out in June (228 Days) in either IWM or QQQ. I reluctantly put on some QQQ last week (see Post Below), with the intent to manage these longer-dated setups far more aggressively than I would a shorter-dated one, taking profit at 25% max as opposed to waiting for a full 50 or more. Pictured here is an IWM June 19th 135/2 x 185 ratio'd short strangle with the short put around the 16 delta, the short calls doubled up at the 8's to accommodate skew. It pays 3.77 with break evens at 131.23/186.89 and delta/theta of 2.55/.73. FUTURES: The premium selling picture is basically the same as last week and mirrors that in the exchange-traded funds, with /CL paying in shorter duration, but not much else. VIX/VIX DERIVATIVES: There are viable term structure trades in VIX in the December, January, and February expiries where the correspondent /VX contracts are trading at 16.16, 17.37, and 18.02 as of Friday close. It is otherwise one of those rare moments where it might be worthwhile to consider a bullish assumption play in VXX or UVXY with VIX approaching 2019 lows around 12 (See Post Below). * -- UBER hasn't been around for 52 weeks yet, so there is no percentile/rank for where the 30-day lies.
AMEX:IWM
by NaughtyPines
Baidu's temporary bullish outlookThis analysis doesn't talk about Baidu's general downward trend, but rather of a temporary upward "re-testing" if you will. Baidu's earnings release is expected by end of the month which will be announced shortly. There are still more than 2 weeks worth of performance until a probable upward breakout. To investors trading it, this chart will reveal the most important points to consider before entering a position. At this point in time, the stock is not required to create higher highs, but you're definitely looking for higher lows. The stock is bullish as long as it remains above 100.25. The stock is expected to touch or break the 125MA by end of this month. Baidu's general downward trend is to continue at least end of 2020, possibly through all of 2021 with lows of sub 70's.
NASDAQ:BIDU
by UnknownUnicorn5323213
THE WEEK AHEAD: BIDU EARNINGS; GDXJ, EEM, VIX/VXX/UVXYEARNINGS BIDU (97/55) announces earnings on Monday after market close, so look to put on a play in the waning hours of the New York session ... . Pictured here is a September 80/120 short strangle paying 1.65 as of Friday close with delta/theta metrics of 1.57/8.07. You can naturally go defined risk, but you'll have to go in a smidge tighter with the shorts to collect one-third the width of the wings and being surgical with your strikes will be tough with 5-wides in that expiry. The September 20th 80/85/110/115 is paying 1.62 with delta/theta metrics of .26/3.20. EXCHANGE-TRADED FUNDS Precious metals keep on grinding in a high implied volatility state for yet another week, with the ideal rank/implied metrics remaining in GDXJ and nearly ideal ones in GDX: GLD (80/16) GDXJ (77/38) SLV (77/25) TLT (76/17) GDX (72/33) BROAD MARKET EFA (53/17) EEM (52/22) IWM (36/22) SPY (35/18) QQQ (27/22) Since I don't have anything on in EEM, I may consider putting on something longer-dated there. Using the delta neutral at-the-money short straddle test and looking for a setup that pays greater than 10% of the value of the underlying, it looks like I would have to go out to January where the 40 short straddle is paying 4.54 versus 39.54 the shares were trading at as of Friday close. The January 17th 40 short straddle pays 4.54 with break evens at 35.46/44.54 and has delta/theta metrics of 1.96/1.13 and a 25 max of 1.13; the 16 delta 34/44 short strangle pays 1.05 (.52 at 50 max) with break evens of 32.05/45.05 and delta/theta metrics of -.15/.86. I'm fine with either, but there's something to be said for having room to adjust without going inverted with the short strangle. VIX/VIX DERIVATIVES VIX finished Friday at 18.47 with the /VX term structure still in backwardation from September to December, with the August contract settling next week. I will continue to look to add at-the-money bearish assumption setups (short call verticals or long put verticals) in VIX in the front month (September) should we get additional pops to >20 and/or the same type of setup in UVXY and VXX using VIX levels as a guide. As of Friday close, the VIX September 18th 18/21 short call vertical was paying 1.10 at the mid with a break even of 19.10 versus 18.47 spot, but will probably wait for another pop to >20 to put on a similar setup.* * -- Short call verticals: short in the money, long out of the money, paying one-third the width of the spread. Long put verticals: short out of the money, long in the money, paying less than one-third the width in debit. Short call verticals with the same strikes as a long put vertical have the same risk, so it's a matter of taste and/or the practicalities of having a bunch of different plays on in the same expiry as to which you use. For example, you can layer on same strike long put verticals over short call verticals without inadvertently "stepping on" the short call verticals you have on. As compared to VIX options -- which settle to cash, with UVXY and VXX, there's naturally some assignment risk, so I lean toward short call verticals in those particular instruments, since I'd rather be short shares if assigned.
NASDAQ:BIDU
by NaughtyPines
THE WEEK AHEAD: AAPL, GILD, X, BIDU; GDXJ, /NGEARNINGS On initial screen for high rank/high implied, here are next week's potential winners for earnings-related volatility contraction plays: AAPL (31/27) (Tuesday after market close), X (52/54) (Thursday after market close), GILD (30/27) (Tuesday after market close), and BIDU (50/41) (Tuesday, but unspecified as to before or after market close). Because background implied on both AAPL and GILD are <50% (not what I like to see to play an earnings-related volatility contraction), those are cut from the list, leaving X and BIDU. Pictured here is a tight short strangle in the September cycle paying 1.11/.56 at 50 max as of Friday close, with break evens at 12.89/18.11, and delta/theta metrics of 2.59/1.74. You can naturally go full on short straddle, but giving the setup some room between the put and call will give you the ability to adjust the strikes intra-trade without going inverted to do so, as you might have to if you went with the September 20th 15 short straddle, which is paying 2.29/.57 at 25 max with break evens at 12.71/17.29, and has delta/theta metrics of -10.62/1.99. The rather unfortunate thing about BIDU is it's an ADR, so the precise announcement date and time is always up in the air until the last moment. That being said, the Sept 20th 95/100/130/135 iron condor is paying 1.46 at the mid (.73 at 50 max), has break evens at 98.54/131.46, and has -.17/1.82 delta/theta metrics. Naturally, I'd ordinarily like to collect one-third the width of the wings in credit, but it's hard to see what that will actually pay with markets showing wide in off hours. BROAD MARKET IWM (11/15) EEM (7/16) QQQ (6/15) SPY (6/12) EFA 0/11 VIX 12.16 Because of low implied in "local expiries" (<45 days 'til expiry or less), I've been going out a little farther in time than usual, taking advantage of implied volatility term structure,* which currently slopes from longer-dated expiries into this current state of affairs, (See RUT Iron Condor Trade, below), with the small added bonus being that longer-dated expiry implied volatility tends to expand less relative to shorter-dated implied volatility in the event of a "local" volatility pop, which is the usual concern with selling premium in low volatility environments. Naturally, I'm not going all crazy with these longer-dated setups, but staying small and keeping powder dry for more favorable volatility metrics in shorter duration expiries. SECTOR EXCHANGE-TRADED FUNDS Top Funds By Rank: GDXJ (78/35), GDX (53/29), SLV (48/20), GLD (39/12), TLT (25/10), SMH (25/24), USO (23/32), XOP (20/30). GDXJ continues to have ideal exchange-traded fund metrics of >70 rank, greater than 35 implied for premium selling ... . IRA TRADES I pulled the trigger on a couple of "not a penny mores" last week in XLP and XLU. Suffice it to say, I did not get stellar credit collection/cost basis reduction for these, since we're far away from the prices at which I want to acquire, but will look to roll out on weakness and/or in increased volatility. It's either stick something out there and get paid to wait or wait for lower and get paid nothing ... . HONORABLE MENTIONS /NG, UNG: Natural gas is around 52-week lows here. Generally, I look for a seasonality play where "peak injection" has historically set up, but it's generally a crap shoot as to where that will occur (that pesky Mother Nature), and it's usually later in the year. I'm watching it, but won't get particularly excited to enter something bullish until we break 2.00. Ideally, I'm looking to get in at around that 2016 low ... . * -- You can see this in RUT, with August implied at 15.3%, September at 16.1%, October at 16.7%, and December at 17.6%.
NYSE:X
by NaughtyPines
BIDU Long - long term target 220 & short term 190Jumped up 13% from $167 to $185 share on April 9th, then dropped 9% to today April 15th. IS THIS headed upwards trajectory again towards $190? 60 billion Market Cap, PE around 14, this sure looks like a screaming buy with the population of China. Worlds one third population will be using BIDU not Google. How ingrained is this company in the modern Chinese way of life? Is it comparable, at all, to the way Amazon and Google were ingrained 20 years ago here in the U.S. and are ingrained today?
NASDAQ:BIDULong
by raja4u
THE WEEK AHEAD: M EARNINGS, XOP, TSLA, FCX, X, TWTR, BIDUPictured here is the only earnings announcement-related volatility contraction play with the metrics I'm looking for: greater than 70% rank and greater than 50% 30-day (it was 68/55 as of Friday close). Setup Metrics: 3.40 credit, break evens at 20.60/27.40, -8.20 delta, 3.1 theta. Obvious alternatives would be the April 18th 21/27 short strangle paying 1.21 with break evens at 19.79/28.21, a delta of -4.5, and theta of 2.43 and -- for those with a defined risk bent -- the 19/22/26/29 iron condor in the same expiry, paying 1.23 with 20.77/27.23 break evens, a -2.64 delta, and a theta of 1.15. On the exchange-traded fund front, the highest volatility remains in petro, with OIH, XOP, and USO taking the top three spots for 30-day implied at 31, 30, and 29, respectively, followed by EWZ at 29, and GDXJ at 26. With the exception of GDXJ, however, all of these are in the lower one quarter of their 52-week range (GDXJ's in the 31st percentile). As with last week, I'll continue to sell premium in XOP, albeit smaller than usual, reserving buying power for a richer volatility environment. Single names with earnings in the rear view ranked by 30-day: TSLA (12/49), FCX (24/43), X (18/43), TWTR (8/38), and BIDU (24/35). I'm in a FCX slightly bullish short straddle at 14 as a kind of quasi-bullish copper play, and have gone with a "not a penny more" short put in X (See Posts Below). As alternative plays, the X April 18th 24 short straddle is paying 2.83 (.71 at 25% max) with the 21/27 short strangle paying .84 (.42 at 50% max) The TWTR April 18th 32 short straddle is paying 3.61 at the mid (.90 at 25% max) with the 28/35 short strangle paying 1.19 (.60 at 50% max) in the same expiry. Spreads in both TSLA and BIDU are unattractively wide.
NYSE:M
by NaughtyPines