|Advanced Micro Devices, Inc. (NASDAQ:AMD)is gaining pace ahead of earnings. |
Tech savvy traders seem to be playing the 130min chart but looking for a run higher into earnings and specifically buying the calls that expire the week of earnings.
The idea here is that we’ll get a rise in the price of the option through the delta (if we are right and AMD goes higher) and we’ll also get a rise in the price of the option due to the increasing IV (implied volatility) due to the fact that the IV tends to go up into earnings. If you don’t know, the IV determines the amount of premium in options. Anyway, here is the trade and the chart setup:
A perfect trade would be Earnings Run: AMD 31 JAN 20 50 CALL @1.47