How Bears Doubled Their Money With Wayfair Stock

It took just one week for put traders to win with W recommendation

Digital Content Manager
Oct 24, 2023 at 3:10 PM
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Subscribers to our Schaeffer's Players service saw a 103% profit with our Wayfair Inc (NYSE:W) October 47 put in just one week. Below, we will break down our reasoning for entering this position, and see how it delivered big gains to options bears.

At the time of our recommendation on Oct. 13, Wayfair stock had breached its 200-day moving average, as well as its 80- and 52-week trendlines. The shares had also broken a 38.2% Fibonacci retracement of their 2023 highs and lows, in addition to a trendline connecting a series of lower lows dating back to Aug. 2, which pointed to its selloff accelerating.

There was plenty of room for optimism to unwind as well. Of the 28 analysts in question, 15 considered W a "buy" or better. Plus, the security's Schaeffer's put/call open interest ratio (SOIR) of 1.39 was in the low 17th percentile of annual readings, indicating short-term options traders leaned bullish. 

It's also worth noting that Wayfair stock was also trading below all major open interest (OI) strikes, indicating there was very little in terms of options-related support below it.

Though the shares were last seen up 2.3% to trade at $43.36 at last check, they are just now beginning to bounce back. The security is eyeing only its third gain since our recommendation, and logged only two wins since our subscribers closed their positions on Oct. 20, fully maximizing their profits. Quarter-to-date, W is down 28.7%.

W 200 Day




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