Walt Disney is on a wild Roller Coaster

DIS_D

The 200 SMA is Rising from below and we should see price test it very soon. The RSI is under 30 but there still hasn’t been any convincing floor put in the stock yet in my opinion. The MACD remains in a free-fall.

This breakout back-test looks to have a target of $102.50 so one could consider buying a Put Ratio. Why? For these reasons:

  • capture any additional short-term weakness
  • If the “meat” of the Put Ratio gets ITM then you still have the lower short Puts that you can manage (you will get a bounce eventually so getting Put stock at that strike is just fine)
  • lower cost than just buying Puts outright (depending on structure, can get a credit)

An example structure:   long the August 28 weekly 105/102 Put Ratio. Cost is under $.30 and can make $3 if at $102 on expiration.

– DM 9:40 AM CST

Gourmet Burgers

I have an Earnings trade for $RRGB (reports BMO 8/11) and here are the details:

  • Long the August 90/95/100 1×2 Split Call Ratio
  • Short the August $75 Puts
  • Cost: ┬átiny credit
  • Takes margin

My Risk starts at $100 on the topside and $75 below. Quite a range to work with. This trade has a sweet spot of $95 at expiry.

RRGB

EPS graph courtesy of Estimize (I added the Red lines)

– DM 11:10 PM CST