Signal: Software Stock Could Soon See More Gains

Asana Inc (NYSE:ASAN) stock is 2.5% lower to trade at $11.72 this afternoon, missing out of the broader tech surge, rejected at the $12 level. ASAN tapped a 10-month high of $12.07 on Friday and logged a five-day win streak before suffering today's rejection. The software giant remains 14.5% lower year-to-date, but a historic bull signal could indicate more gains are on the way.

ASAN sports a 10-day put/call volume ratio of 1.50 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands in the 99th percentile of readings from the past year. Over the last three years, there have been two instances in which the equity's 10-day buy-to-open put/call ratio crossed above 1.0 and moved into the 90th percentile.

Per Schaeffer's Senior Quantitative Analyst Rocky White, the stock was higher one month later every single time after these signals, averaging an 10% gain. A move of similar magnitude would place the shares back near $13.

There is plenty of room for upgrades as well. Heading into today, 10 of the 15 covering brokerages sport a "hold," "sell," or "strong sell" recommendation.

Plus, ASAN's Schaeffer's Volatility Scorecard (SVS) sits at 75 out of 100, suggesting the equity has tended to outperform options traders' volatility expectations during the past year.