PTON Trade on May 5, 2021 15:39 from Marius: Tradervue User Stock Trades.

Markets rebounding from yesterday's sell off in tech and growth. It's notable noting these areas have been weaker compared to other areas of the markets. This breadth deterioration is seen in QQQ with more rotation into other sectors ie. XLF, XLB, XLV, XLI and other value areas.

Fundamental Analysis

PTON is a growth company that had benefited in the pandemic closures as training facilities were closed. The in-home bikes, treadmills, and training was a notable change. There are other similar companies that are seeing similar changes ie. ZM, PINS, and similar technology areas. They report earnings tomorrow after the close but more notably the company has recalled all their treadmills including stopping sales of current ones due to serious safety concerns. They had delayed a response to the incidences which should have been responded with more urgency for the health and safety of their customers.

Quantitative Analysis

Intraday Fundamentals

RVOL 9.61
AVOL 9.81M
ATR 6.18
Short Float 8.21%
Shs Float 261.13M
Inst Own 78.80%
Market Cap 24.47B

Options Statistics + Tape Reading

SI 7.275
IV 85.65%
IVP 30%
P/C 1.599
VWAP 85.564

Elevated options order flow and increased IV with the move and before earnings. Heavy put orders and on the ASK confirming momentum. Seeing larger orders leaning more towards selling momentum reading the call writes.

Options data stats/notes day prior to catalyst (n/a)

Options Positioning

OI 867
VOL 409
Delta .02
Theta -.08
Vega .00
Gamma .00
Prob T 3.11%
Prob ITM 1.51%
MMM +/- 9.915
IV Series 173.25%

Elevated IV with the momentum and pre-earnings. Still positioned with current parameters but scaled higher due to the opportunity and increased conviction. My position is within 10% of today's volume specific strike. Excellent liquidity and tight spreads in addition to the wide OTM positioning.

Options data stats/notes day prior to catalyst (n/a)

Technical Analysis

Historically outstanding RVOL with strong momentum with high down on the BID's. Key HTF inflection 100 breakdown. Technical H&S pattern. Notable supply overhead and a fading opportunity if price bounces. Keeping in mind the high 78.80% institutional ownership.

Weekly HTF breakdown with price testing IPO AVWAP. 61.8% retrace is around 75. Anticipating some buyers here with earnings and possibly a bounce but less likely due to the combined FA, QA, and TA.

Trade/Risk Management & Review

1DTE update : I did not factor in earnings as the RVOL from the news was notable already. It explains the IV higher. ER's reaction initially went lower but then reversed aggressively clearing lower time frame R's. Will be decreasing risk exposure by scaling out if buyers continue to show up aggressively. Alerts set and prepared to exit or hold if the market shows it in the pre-market and opening session. Noting the model is still indicating a 2% ITM probability for my position.

ODTE : Trade executed as planned with adjusted exit plans in place. Sellers took aggressive control at the open stuffing 90. Clear heavy seller in place. Noting the high institutional ownership. Price under AVWAP from initial recall. 80 is a shorter-term key BID support level for buyers.

Grading overall trade process as B+. I sized into the trade with half my buying power. Noting my Kelly % is higher than this at around 70-80%. The notable error I made was not factoring in ER. The RVOL and breaking news had more of an impact on the sentiment and price dynamics overall. Keeping in mind to note the ER and or other important dates when placing these trades as I have been solely executing my post earnings playbook. Noting that this news was announced the day before earnings.