New bull market in software stocks hinges on this report
A significant increase in options trading for Salesforce indicates a bullish sentiment among traders. The data shows that more calls than puts were purchased, suggesting expectations of a large price movement. Traders are particularly focused on the upcoming earnings report, with some betting on a notable rise in stock price.
- ▪Salesforce saw more options contracts traded than the IGV on Tuesday.
- ▪Over 10,600 calls were bought compared to just over 4,100 puts.
- ▪Implied volatility is indicating a 7.8% price swing for Salesforce stock.
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More options contracts traded in Salesforce alone than in the IGV on Tuesday, and total premium exchanged was almost three times more, with 61% of premium in Salesforce traded around call contracts, according to SpotGamma data. More than 10,600 calls were bought, compared to just over 4,100 puts.Options traders are expecting an abnormally big move for the stock. Implied volatility is pricing in a 7.8% swing, more than twice the realized move after the past four earnings reports, according to Cboe LiveVol data.Many of the biggest trades by dollar amount were done in the June 18 expiry, but at least one trader in Salesforce has short-term high hopes: They spent $650,000 buying 2,000 of the 195-strike calls expiring Friday, looking for an almost exactly 10% move into the weekend.
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