This series of Trading Tips is brought to you by the Market Gear for Mac trading platform.
iVest+ creators of the Market Gear trading platform today released new data analysis in the options contracts of Citigroup (NYSE: C) that suggests investors are bullish on Thursday’s earnings but bearish after Friday’s expiration.
iVest+ examined current open interest and put/call ratios on Citigroup, specifically filtering out expiring contracts and focusing on forward-looking contracts that expire after April 16, 2021, which is the next key expiration.
The data shows that investors for the contracts that expire this Friday, only 36.5% of open interest is in the puts.
However, by eliminating the current contracts and looking forward to contracts that expire after April 16, 2021, the data shifts significantly, to the point that around 54.8% of open interest lies in the puts.
Citigroup reports earnings on Thursday, one day before the April 16 expiration.
“That’s a pretty big shift,” said Rance Masheck, CEO of iVest+.
“Clearly, investors are confident in the current numbers that are about to be released, but the outlook after that is much less positive. You don’t often see such a big swing in just two days, although earnings can obviously be a key turning point.”
The stock price of Citigroup has been holding between about $70 and $74 a share for several months, which is the high of the last year and near all-time highs on the stock, which peaked at $80.70 in January of 2018.
“We are going to watch how the market reacts after Citigroup’s earnings release with great interest,” added Masheck. “Our traders are constantly on the lookout for such big shifts in sentiment.”
You can analyze and even trade Citigroup Options using Market Gear on your Mac.
Check out our full review of Market Gear for more.