Alphabet (GOOGL) – Bearish Earnings Play for Feb 4th, 2019

On Friday’s Options Action, the crew analyzed the performance of Alphabet. Alphabet has been in a strong bullish uptrend for 10 years but broke that trend in late 2018. Coupled with a head & shoulders formation suggests a higher risk of a move lower with earnings next week. Expecting GOOGL to trade slightly lower on earnings and volatility to collapse, Michael Khouw suggests buying a Feb/April 1110 Put Calendar for a $19 Debit. As of Friday’s close, these puts were trading at an $18.30 Debit.

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