Now that Black Friday and Cyber Monday are past, is peak holiday shopping over? I think that the post-Thanksgiving buying frenzy of days gone by has given over to a more skeptical approach to shopping. Bargains have been advertised in a while, and price comparisons are the name of the game. And the place that provides both is Amazon (AMZN). AMZN’s stock price had been struggling in November, but it bounced back over the last week and managed a small rally yesterday despite weakness in the broader market. And any signs of consumer strength this season could keep it moving higher. AMZN’s OTM calls are trading over equidistant OTM puts, indicating that the market sees risk to the upside. That might be enough for a trader to consider a bullish strategy. AMZN’s IV has been falling as the stock has gone up, and its 33% overall IV and 15% IV rank make debit spreads attractive choices for speculative trades. If you think AMZN might continue to rally over the next few weeks, the long call vertical that’s long the 230 call and short the 235 call in the January expiration with 45 DTE is a bullish strategy that has a 60% prob of making 50% of its max potential profit before expiry, and that generates $.03 of positive daily theta.
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