Big Gainer Alert: Trading today’s 7.4% move in CLOUDFLARE INC $NET

Quantchabot has detected a promising Bull Call Spread trade opportunity for CLOUDFLARE INC (NET) for the 20-Jan-2023 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

NET was recently trading at $56.08 and has an implied volatility of 74.59% for this period. Based on an analysis of the options available for NET expiring on 20-Jan-2023, there is a 34.17% likelihood that the underlying will close within the analyzed range of $56.47-$77.69 at expiration. In this scenario, the average linear return for the trade would be 13.85%.

Big 7.41% Change: After closing the last trading session at $52.21, CLOUDFLARE INC opened today at $55.00 and has reached a high of $56.90.

Trade approach: A movement as big as 7.41% is a significantly bullish indicator, so this trade is designed to be profitable if NET maintains its current direction and does not revert back to pricing on the bearish side of $56.08 on 20-Jan-2023. If possible, the trade has been padded such that slight movement against the trade would still return a profit.

Upside potential: Using this bullish strategy, the trade would be profitable if CLOUDFLARE INC closes at or above $46.35 on 20-Jan-2023. Based on our risk-neutral analysis, there is a 73.24% 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.