Chewy, Inc.Short
CHWY Bearish inclined naked calls 9 Dec expiry
Whats The Plan/Trade/Thought
For the Month of Dec, I am looking to avoid the week of the 15 Dec, where there will probably be wilder price movement due to the Dec Fed rate hike. This is probably the start of the turning point and my strategy doesn't generally do well at turning points. I have no idea how the crowds will intemperate whatever news comes up.
While I still expect CHWY to post good earnings on the 8 Dec (One day before the expiry) I believe the 32% strike distance should be enough cushion. Option prices for 9 Dec, was also very good due to the earnings. Overall I am still bearish on the market and I do expect people to start tightening up their purchases and this includes their pets. They will focus on the necessities and not the extras.
What worries me is the CHWY's founder is Ryan Cohen and a meme stock drive would be very dangerous
Risk Mitigation
I see 47.51 as my indicator that my direction is wrong and I should exit
Can You Trade The Opposite Side (Y/N)
N
Trade Specs
Sold 210 Calls @ 0.24
Strike 55
32% to Strike
BP Used: 88k
Max Gain: 5040
For the Month of Dec, I am looking to avoid the week of the 15 Dec, where there will probably be wilder price movement due to the Dec Fed rate hike. This is probably the start of the turning point and my strategy doesn't generally do well at turning points. I have no idea how the crowds will intemperate whatever news comes up.
While I still expect CHWY to post good earnings on the 8 Dec (One day before the expiry) I believe the 32% strike distance should be enough cushion. Option prices for 9 Dec, was also very good due to the earnings. Overall I am still bearish on the market and I do expect people to start tightening up their purchases and this includes their pets. They will focus on the necessities and not the extras.
What worries me is the CHWY's founder is Ryan Cohen and a meme stock drive would be very dangerous
Risk Mitigation
I see 47.51 as my indicator that my direction is wrong and I should exit
Can You Trade The Opposite Side (Y/N)
N
Trade Specs
Sold 210 Calls @ 0.24
Strike 55
32% to Strike
BP Used: 88k
Max Gain: 5040
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