The cybersecurity firm's software update spurred tech outages
CrowdStrike Holdings Inc (NASDAQ:CRWD) stock is down 12.9% to trade at $298.66 at last glance, after the cybersecurity firm disclosed a product update that spurred outages in IT systems across the globe. The issue grounded aircrafts, impacted banks and healthcare offices, and led Microsoft (MSFT) users to experience errors.
The 200-day moving average looks poised to contain today's pullback, but CrowdStrike stock is pacing for its fourth-straight daily dip and its biggest single-day percentage loss since November 2022. The shares earlier slipped to their lowest level since May, and are distancing themselves from a July 9, all-time high of $398.92. CRWD is still up 19.3% in 2024, though.
Options traders are viewing today's headlines as an opportunity. So far, 79,000 calls and 93,000 puts have swapped hands -- 22 times the intraday average volume. The July 300 put is the most active, indicating bears expect additional downside for CRWD by today's close, when those contracts expire.
This points to a shift in the options pits, as investors were bullish in the past two weeks. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 50-day call/put volume ratio of 1.73 ranks higher than 83% of annual readings.
It's also worth noting that premiums are affordable amid low volatility expectations, per the stock's Schaeffer's Volatility Index (SVI) of 39% that stands higher than just 12% of readings from the past year.