Subscribers to Schaeffer's Weekend Trader options recommendation service received this VIAV 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.
Viavi Solutions Inc (NASDAQ:VIAV) gapped higher after its third-quarter earnings report on April 30, and has since pulled back to the $50 floor. With short interest at an all-time high, representing 6.4% of the stock’s available float, now looks like a good time to weigh in.
The stock has strong momentum, with underlying support at the 20-day moving average. Furthermore, there is a big chunk of calls expiring at the overhead 55 strike this Friday, while the stock’s implied volatility (IV) is in line with 63-day historical volatility (HV).
Our recommended call has a leverage ratio of 2.7 and will double on a 44.1% rise in the underlying equity.
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