July 19, 2022

Today's Trade Ideas

Symbol: TTD

Style: Event

Strategy: Strangle


Long Aug19 $51 call

Short Aug19 $60 call

Long Aug19 $40 put

Short Aug19 $30 put

Action Area: $2.95 - $3.60

Comments: TTD is an interesting candidate for a volatility strategy. With a busy two-week stretch of Ad Tech and Social Media reports ahead of us, TTD is setting up for a large swing. Since TTD topped out in November above 114, it has been riding a steady downtrend lower, with the fast flush in May to ~40, marking a temporary bottom. The stock has formed an increasingly tight pennant above 40 over the past two months, and with key moving averages (and key downtrend resistance) now in the mid-40s, it is quickly nearing a resolution point. Historically, TTD has been sensitive to numbers out of SNAP, META, and GOOGL, and all three are due to report by the end of next week. TTD’s earnings date is not confirmed yet (tentatively expected to be on 8/09), but it also has a history of greater volatility on its own numbers. A clean break of 47.50 (50day sma) or 40 should trigger a major mover higher/lower, and the Aug19 strangle will be targeting an initial move of 6+ points in either direction to begin locking in money. The strategy will use a 30-40% net debit loss as a stop (with a technical stop likely after the end of next week).

Symbol: UNG

Style: Swing

Strategy: Put Spread


Long Aug19 $24 put

Short Aug19 $21 put

Action Area: $.90 - $1.25

Comments: UNG is a speculative bearish trade idea. After topping out close to 33 in June following the massive year-to-date surge, UNG promptly fell apart. By early June, UNG had fallen to the high teens to wipe out all of its gains from mid-March, and it looked ready to fall further as it traded below the key 200day sma. A sharp bounce two weeks ago helped it reset in the low-20s, and it has made steady progress on a rebound since then. UNG hit the 50day sma on Monday after a strong start to the week, and it came close to testing it again this morning before rolling over. The bounce marks a 50% retracement of the drop from 32+ to ~18, and with it stalling initially at the 50day sma, it sets up an opportunity for a fast bearish trade. The Aug19 put spread will be targeting a move back below 23 to lock in money on the trade, and the swing trade will use a tight 30-40% net debit loss as a stop.

On The Radar

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Open Positions

* The following Open Positions pertain to the Options In Play trade ideas from this and previous editions. Disclosure of the Trader Co-Author’s actual portfolio holdings, as of the date of each publication, is made below under "Trader Author Portfolio Holdings.".

Trader Author Portfolio Holdings

**As of 4pm ET July 19, 2022