Following earnings report, NOW crashed around $120 (around 10%) and crossed under the 50 SMA with huge volume.
We are taking this oppurtunity to sell a near month Bear Call spread expecting that this stock will not breach $1100 on the upside in the near team.
| SELL | -10 | TO OPEN | NOW | 21-Feb-25 | 1100 | CALL | 4.40 | .40 | 25TRD-005 |
| BUY | 10 | TO OPEN | NOW | 21-Feb-25 | 1105 | CALL | 4.00 | CREDIT |
The spread will expire in around 23 days and we do not think it will touch $1100 which is the strike of the sold call.
We are looking at a potential full credit of $400 on $4600 investment, resulting in around 8.5% approx returns if price does not breach upper threshold of $1100.
