If you’re looking at trending stocks on Reddit, Yahoo and other social media outlets, you’ll see that CrowdStrike Holdings, Inc. (CRWD) is trending this morning. Social media mentions are up 367% in the last 24 hours. We have an idea of how to play it based on the implied volatility of the options.

We wanted to give you a different perspective using the data from our multi-trillion data point database. This graph shows the implied volatility of 1-week options for expirations that do not include an earnings release.

You can see on the far left where there were still lingering fears of inflation.  During the rest of 2023 you can see that those fears diminished for CRWD just like the rest of the market. The red line shows current implied volatility. It is low if you expect more pain, like we saw during the outage in July. But the current implied volatility is high compared to recent history if you don’t expect another big event in the next week.

This MDM graph  compares the modeled expected distribution for future stock prices (the orange line) with the actual distribution of CRWD’s share prices since the bottom after the recent collapse (the blue histogram). You can see that the actual stock movement is very close to the modeled expectations. But these expectations are still high if we do not expect a big event before next Friday’s options expiration.

CRWD is trending in social media this morning. With the implied volatility data from our huge database, it looks like current expectations for CRWD options expiring next week are higher than they should be. This creates an opportunity for a high-probability trade. 

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

To access Odds Online Daily and be able to see any stock you are tracking in this software, click here.

Thank you,

Don Fishback