52-Week Low Alert: Trading today’s movement in SPDR CONSUMER DISCRET SELECT $XLY

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Quantchabot has detected a promising Bear Call Spread trade opportunity for SPDR CONSUMER DISCRET SELECT (XLY) for the 13-May-2022 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

XLY was recently trading at $162.91 and has an implied volatility of 42.02% for this period. Based on an analysis of the options available for XLY expiring on 13-May-2022, there is a 34.31% likelihood that the underlying will close within the analyzed range of $151.12-$162.93 at expiration. In this scenario, the average linear return for the trade would be 28.01%.

52 week low: SPDR CONSUMER DISCRET SELECT recently reached a new 52-week low at $160.39. XLY had traded in the range $161.49-$215.06 over the past year.

Trade approach: Reaching a new 52-week low is a bearish indicator, so this trade is designed to be profitable if XLY maintains its current direction and does not revert back to pricing on the bullish side of $162.91 on 13-May-2022. If possible, the trade has been padded such that slight movement against the trade would still return a profit.

Upside potential: Using this bearish strategy, the trade would be profitable if SPDR CONSUMER DISCRET SELECT closes at or below $162.98 on 13-May-2022. Based on our risk-neutral analysis, there is a 50.17% likelihood of this return.

Downside risk: As with any options trade, there is a substantial downside risk where you may lose most or all of your investment.

To analyze this trade in depth, please visit the Quantcha Options Search Engine.