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LULU

TRADING IDEA: LULU APRIL 8TH 54/68.5 SHORT STRANGLEI'm going to go with a nondirectional bias here (pretty much always do). Here are the metrics for both a run of the mill one standard deviation short strangle, as well as an iron condor: April 8th 54/68.5 short strangle Probability of Profit: 70% Max Profit: 1.30/contract ($130) Buying Power Effect/Max Risk: ~$616/undefined Break Evens: 55.30/67.20 April 15 50/54/68.5/72.5 iron condor Probability of Profit: 68% Max Profit: 1.00/contract ($100) Buying Power Effect/Max Risk: $301/contract Break Evens: 53.01/69.49 Notes: I had to go a touch farther out in time for the iron condor to get the long options strikes I wanted, but it'll still yield about $100/contract ... . Look to take either setup off at 50% max profit on the volatility contraction that is likely to occur post earnings.
NASDAQ:LULU
by NaughtyPines
1
NEXT UP: LULU EARNINGS -- WEDNESDAY BEFORE MARKETLULU announces earnings on Wednesday before market open, so look to put on your setup before close on Tuesday. This is what I'm looking at tentatively right now: April 8th 53.5/68.5 short strangle Probability of Profit: 73% Max Profit: $124/contract Buying Power Effect/Max Risk: $616/undefined Notes: This is a tentative setup. Naturally, a lot depends on how much LULU's volatility rises here, as well as how much its price moves before the announcement. Also, I don't think I'm going to see $1.24 come Tuesday, although you never know (.92's the low; 1.24 the mid; 1.55 the high for this setup). I'll also try to post a defined risk iron condor if I can work out a setup that'll yield something close to a $1.00 credit ($100/contract) ... .
NASDAQ:LULU
by NaughtyPines