We recommended an EBAY call option Sunday night
Subscribers to Schaeffer's Weekend Trader options recommendation service received this EBAY commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.
eBay Inc (NASDAQ:EBAY) stock is on track to close above its post-May options expiration week (OPEX) open interest (OI) balance at the 70-strike and break out above a key weekly wick resistance area. A close at these levels would mark a new 52-week high and confirm strong technical momentum.
Despite a 15% year-to-date gain and a 65% rally since the start of 2024, sentiment remains overwhelmingly cautious. Just three analysts rate EBAY a “buy,” while 20 call it a “hold” and three recommend a “sell.” This skepticism is echoed in the equity’s 50-day put/call volume ratio of 1.43 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks in the 97th annual percentile -- suggesting plenty of negative sentiment that could unwind and add fuel to the rally.
Short interest continues to fall, down 6.3% over the last two weeks. With short interest still representing 4.6% of the stock’s float, additional covering could keep bulls in control.
Our recommended call option carries a leverage ratio of 10.6 and will double on a 9.3% move in the underlying shares.