AST SpaceMobile, Inc. (ASTS), Trending Stock Report

AST SpaceMobile, Inc. (ASTS) is trending in the news, and social media mentions are up 427% in the last 24 hours. This comes after the company reported its earnings. In their report they boasted that they have completed building 5 new satellites that will serve as the largest communication arrays ever deployed commercially. They say these new satellites are ready for launch, and they expect that launch vehicles will be ready in early September.

ASTS has some notable partners in their attempt to make satellite cell phones a common product. They mentioned industry partners like AT&T (T), Alphabet (GOOG), Verizon (VZ), Vodafone (VOD), and Rakuten (RKUNY).

Investors are speculating that ASTS will be successful in launching these new satellites and that satellite service will be the solution to dead zones for cell phone coverage. Apple (AAPL) has already put phones on the market that can use satellite bandwidth for emergency contact in locations that don’t have cell tower service.

With volatility expectations so high, we are not going to bet that this new technology is going to be the next big thing. We’re not going to bet that the stock will move higher. We are simply going to bet that the stock is not going to fall more than 11% today.

This Volatility Term Structure for ASTS shows us the implied volatility of options for the at-the-money options for each expiration. To learn more about Volatility Term Structure, click here. This graph tells us that options expiring today are relatively expensive compared to every other expiration. Because we want to sell options using a limited-risk, high-probability strategy, we will use this shortest-term in a zero-days-to-expiration (0DTE) trade idea.

This MDM graph compares the modeled expectations of current options prices (the orange line) to the actual movement of ASTS’s stock price over the past year. You can see that the actual behavior (the blue histogram) doesn’t look at all like the modeled expectations. This graph tells us that options expiring today are ridiculously overpriced. That’s good news for option sellers.

This Volatility Cone shows us the implied volatility of options for each term compared to the average historical volatility (the blue line) of ASTS options at each term. To learn more about the Volatility Cone, click here. It also shows the high and the low historical volatility for each term. This graph confirms volatility expectations for every term are above the 1-year historical average.

With volatility expectations this high, and news that has been driving ASTS stock higher, we have an opportunity for a limited-risk, high-probability bet that the stock will not fall more than 11% today.

To get the specific details and prices on today’s trade ideas, be sure to read today’s ODDS Online Daily Option Trade Idea.