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

Earnings reaction in Walt Disney

Let’s look at a Daily chart first:

DIS_C

A Doji for $DIS has formed under the Rising 50 SMA but above the Breakout back-test level (defined by the horizontal Black line).

Now for some perspective – a Weekly chart:

DIS_weekly

Up trend remains in tact so likely an opportunistic Buy entry here for traders who have been waiting on a pullback.

 

Disclosure: I traded the stock in after hours on 8/4 but have switched to an August 28w 111/116/110 Risk Reversal Call Spread today for a post-Earnings trade.

– DM 9:10 AM CST

A look at Disney EPS

One of the steps that I take when reviewing information for a ticker for Earnings is to spend time on the Estimize website in order to gather data for analysis. I often will take the time to chart the EPS – here is an example on $DIS:

DIS_EPS

The green line represents the actual EPS reported and the other lines represent the Wall Street consensus as well as the Estimize consensus and my own estimate.

Helpful?

Tickets to Disney, lotto style

Last Friday I elected to buy 100 contracts of the November 50 Call in $DIS based on the OI (Open Interest) at the 50/52.5/55 Call strikes. Here is how it looks today:

This was a $300 bet ($.03 per, my defined risk) and was done under the context of knowing that this really is a lotto ticket bet. However, The fact that so many contracts sit in the OI for the above strikes lends me to think that there is quite a bit of incentive to drift up to there by Friday expiration.

Come on Mickey …