Crowdstrike stock is currently sporting low implied volatility (IV)
The shares of Crowdstrike Holdings Inc (NASDAQ:CRWD) are moving in the right direction this afternoon, up 3.5% for a fresh all time high of $239.49. The cybersecurity company recently bounced off multiple layers of support, including the 20-day moving average and $220 level. The security also boasts an incredible 266.1% year-over-year lead, and a historically bullish signal now flashing on the charts could push CRWD even higher in the coming weeks.
Specifically, Crowdstrike stock's recent peak comes amid historically low implied volatility (IV), which has been a bullish combination for the security in the past. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, there have been three other times in the past five years when CRWD was trading within 2% of its 52-week high, while its Schaeffer's Volatility Index (SVI) sat in the 20th percentile of its annual range or lower -- as is the case with the security's current SVI of 47.4%, which sits just above the first percentile of its 12-month range.
White's data shows that a month after these signals, the security was higher 67% of the time, averaging a healthy 13.6% gain for that period. From its current perch, a similar move would put Crowdstrike stock above at $272 mark -- well above its fresh record high.
More gains could come from a shift of sentiment in the options pits. CRWD’s Schaeffer's put/call open interest ratio (SOIR) ratio of 1.79 stands higher than all but 6% of readings from the past 12 months, indicating short-term option traders have rarely been more put-biased.
That bearish sentiment is echoed in the options pits today, where puts are running at double the average intraday amount. Of the 19,000 puts that have exchanged hands so far, the monthly April 195 put is the most popular, followed by the 200 put from the same series, with new positions are being opened at both.
Though shorts are starting to hit the exits, with short interest down 31% in the most recent reporting period, there is still plenty of pessimism left to be unwound. The 10.62 million shares sold short account for a staggering 51.3% of the stock's available float, or over two days' worth of pent-up buying power.