The 160-day moving average has pushed NLOK higher several times before
Cybersecurity stock NortonLifeLock Inc (NASDAQ:NLOK) has faced a roller-coaster of volatility this year, trading as high as $28.91 on June 10 after drifting below $20 earlier in the spring. Sporting a 23.6% year-to-date lead, there is reason to believe NLOK could surge even higher in the coming weeks, after broad market September seasonality has put the stock near a trendline with historically bullish implications.
At last check, NLOK was up 3% at $25.70. But earlier in the week, the stock came within one standard deviation of its 160-day moving average, after staying well above this trendline since May. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, at least eight similar signals have occurred in the past three years. The equity enjoyed a positive return one month later in 75% of those cases, averaging a 7.7% gain. From its current perch, a similar move would put NLOK back over the $27 mark -- just shy of its record peak.
While calls outnumber puts on an absolute basis, puts have been rising in popularity. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), NLOK's 50-day put/call volume ratio sits higher than 85% of readings from the past year, meaning long puts have been getting picked up at a quicker-than-usual clip in the last two months.