Put Open Interest Piles Up as Splunk Buy Signal Flashes

A long-term moving average says to get behind SPLK shares

Oct 31, 2019 at 12:39 PM
facebook X logo linkedin


Splunk Inc (NASDAQ:SPLK) is trading 1% lower today at $119.31, but the shares could be flashing a buy signal right now. Data from Schaeffer's Senior Quantitative Analyst Rocky White highlights a recent pullback to the 80-week moving average, and the previous nine meet-ups with this long-term trendline have yielded an average three-month gain of 7.9%. However, checking the options data on SPLK shows a major build-up in put open interest in the front-month November series.

splk oct 31

Jumping in, outside of the January 2020 100-strike put and the January 2020 170-strike call, puts in the November series account for the top four open interest positions on the equity. The 105-, 110-, 115-, and 120-strike puts are all heavily populated, and these positions are likely behind the security's Schaeffer's put/call open interest ratio (SOIR) of 0.89 -- a reading that's less call-skewed than normal.

However, if you look at just the past 10 days, the November 122 call saw the largest increase in open interest, with data confirming buy-to-open activity here. In other words, some bulls are still out there, expecting Splunk to rise above $122 in the coming weeks.

The software company doesn't report earnings for roughly another month, so volatility expectations remain low. For instance, the Schaeffer's Volatility Index (SVI) of 32% ranks in the 9th annual percentile.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI