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By: Tom Gentile
on July 7th, 2022
Often times when people are educated on the Morning Reports list a common question is what to do with it?
First, decide if you want to work off the call options or put options data.
Once you make that decision look at the security and look up the chart on the ticker symbol looking for technical setups on the chart that give you an indication the stock may move in the direction the type of option it is on the list.
I.E., if the stock is showing a call option the implication is a higher pending move is possible and the opposite for a put.
If one likes to look at the fundamentals on a stock that can be done. If there is a security on the unusually high call option volume or put option list, maybe research if there is a news story out that could be a reason such activity on it is taking place.
Lucid Group, Inc. (NASDAQ: LCID)
LCID makes the Unusually High Call Options Volume list.
LCID is a Consumer Cyclical stock. They are an auto manufacturer and technology company specializing in electric vehicles.
Right now, there isn’t any recent articles to be found that may speak for a ‘why’ behind this options activity, but it does have an interesting chart pattern.
There is a horizontal resistance price area at $20.
The pivot lows you see on the chart from mid-June are getting higher (higher lows).
The green lines on the chart image show this and what is happening is a forming of what’s called a horizontal triangle pattern.
What one looks for is a break out above resistance of the triangle, preferably on greater than normal volume.
We’d normally like a bit more of a pinch at the right of the triangle before the breakout. That may happen, but the stock is trading up near resistance as of the close of trade today and it remains to be seen if it breaks out above that resistance.
Price Target Projection on LCID
If LCID breaks out one way to project a possible price target for it is to take the widest width of the triangle and add it to the price of the breakout and that could be the target price on the stock. The widest width shows about 6-points. If the stock breakout from $20 and runs higher one could anticipate it going to $26.
The Morning Report list shows where bullish option activity is taking place if you at least want to paper trade or track that option.
App: Toms Option Tools
Market Insight articles may show images of lists of stocks meeting a variety of options parameters like Unusual Call and or Put activity or Expensive IV found on my app Toms Option Tools.
Other times I will have other charts may work to amplify my educational points.
Those options data lists, however, can be found on my app Tom’s Option Tools. Use your device to search up and download this app and get free access to the Morning Reports section of the app.
Other parts of the app are available at a premium subscription rate, but the Morning Reports Lists are yours free.
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