Subscribers to Schaeffer's Weekend Trader options recommendation service received this GE commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.
General Electric Co (NYSE:GE) stock just marked a new all-time closing high after clearing a peak call open interest (OI) level into the close, giving it potential to run overhead call strikes to the 300 level. Furthermore, large multi-legger put sell OI at the 260-strike and some build in the buy-to-open 270-strike puts could provide a floor for pullbacks.
An unwinding of bearish sentiment could provide tailwinds. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), General Electric stock’s 50-day put/call volume ratio ranks in the 93rd percentile of its annual range.
The equity is seeing attractively priced premium at the moment, too. GE’s Schaeffer’s Volatility Index (SVI) of 27% ranks in the low 9th percentile of its annual range, meaning options traders are pricing in low volatility expectations at the moment.
Our recommended call option has a leverage ratio of 11.3 and will double in a 9.5% pop in the underlying equity.
