Apple Stock Short Strangle

Bloom Energy has gone from $55 to $280 in a year on the AI infrastructure story. It's down today with an IV rank of 72 and monthly implied volatility over 120%. That means the options market is pricing in a stock that can double or go to zero inside of a year. The trade is a 1x2 put spread: buy the 165 put, sell two 150 puts in July, for a $1.50 credit. POP sits at 95% and the break-even is around $135.

Nine days of gains. Then this. All four indices are in the red and Microsoft is lagging on top of that down today without having participated much in the rally either.   That setup is exactly what this trade looks for. IV rank on MSFT is at 58, which is high for this name. The trade: buy the 405 put, sell two 395 puts in the July cycle with 44 days to go. That gets filled for a $3.30 credit, an 82% probability of profit, and a break-even at $382, a level that would represent all-time lows on the chart. Max profit sits at $1,340 on $5,600 of buying power. The real goal is a couple hundred dollars in the next week or two.

ServiceNow is down almost while the market sits at all-time highs. That kind of divergence is exactly what options traders look for. The trade: buy one 110 put, sell three 100 puts for a net credit of $190. That structure gives you a break-even near $95, right where the stock was trading just a few weeks ago. Probability of profit sits at 86% and theta decay runs at $10 a day. The only catch is buying power this one uses about $7,600. But buying a 75 put as a wing brings that down under $3,000 with almost no impact on the credit or the probability.

Apple is down nearly 2% today and IV rank is climbing toward 40. That combination is exactly what you look for before selling a strangle. The trade: sell the 280 put and the 335 call in the July cycle with 46 days to expiration, both at one standard deviation. The credit collected is over $400, theta decay runs at $13.50 a day, and the break-even on the downside sits near a level Apple has not traded at since its late May gap up. Both strikes are outside the expected move and the upside has never even been tested.

Gold and Apple have almost the same correlation to the stock market. Apple is at all-time highs. Gold is sitting at $415 doing nothing. Tony Battista thinks gold is about to catch a bid. The trade structure turns that thesis into a bullish put ratio spread with an 87% probability of profit and a break even below a one standard deviation move. Anywhere above that break even, the trade wins. If gold dips slightly into the sweet spot between the two strikes, it wins bigger. And if it keeps doing nothing, Jamal still collects the credit. One of the cleanest asymmetric setups on the show this week.

Robinhood stock dropped from $120 to $75. Most traders would either hold and hope or cut the loss. Jamal bought it and immediately sold a call against it. A covered call turns a stock position into an income trade. You buy the stock, sell an upside call, and collect premium that lowers your cost basis every single cycle.

Google is down three dollars on a day when the market is ripping higher. That kind of relative weakness is exactly the setup Jamal looks for before putting on a neutral iron condor trade. The logic: Google has a $26 expected move. The short strikes are placed outside that range on both sides. If the stock just does nothing for the next 29 days, the trade works. Defined risk, limited buying power, and a clear exit plan. A textbook iron condor setup walked through live from strike selection to fill.

The market is selling off but the VIX is down 30 cents. No capitulation, no volatility expansion, nothing worth selling in equity indexes right now. So Jamal is going to crypto. IBIT is the Bitcoin ETF, it is sitting at the lower end of its recent range, and selling a strangle around it gives you almost $5 a day in theta decay with relatively cheap buying power. When you do not know what to do in equities but you still want your account working, this is the kind of trade that parks your money and collects premium while you wait.

Tesla has traded between $350 and $500 over the past six months. Jamal is going outside that entire range on both sides with a short strangle in June. The logic is simple: if the stock could not break out of that range during one of the wildest six months in recent market history, why would it do it in the next 34 days? IVR of 16 makes this a cheaper setup than usual, but volatility has been ticking up with the stock, and the theta decay on this position is over $38 per day. High buying power required, but high probability of success.

Bonds are crashing and rates are going higher. That is not what the administration wants. And if you think bonds stay near the low end of their recent range, there is a simple short put trade that pays you $11 a day in theta to wait. Jamal walks through a live short put on the 108 strike of the US Treasury bond futures with 44 days to go. The bond is trading at 111-16, sitting at the very low end of its range. The 108 strike is about one standard deviation away, 18 deltas, 87% probability of profit, and $390 in max credit for roughly $2,700 in buying power. A bond point is worth $1,000 and each tick is $15.62, all explained live on the tastytrade platform.