An unwinding of pessimistic sentiment could provide tailwinds
Subscribers to Schaeffer’s Weekend Trader options recommendation service received this IRM 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.
This week, Iron Mountain Inc (NYSE:IRM) stock’s post-earnings drop had it pulling back to the $114 region, which provided resistance in August. Shares of the real estate investment trust (REIT) also tested support at the 80-day moving average after the event — a move that has proved to be a buying opportunity over the past year.
With technical support in place, now looks like a good time to bet on IRM’s next move higher, and options look like a good way to go. Premium is reasonably priced at the moment, as Iron Mountain stock’s implied volatility (IV) is in line with its historical volatility (HV).
An unwinding of pessimistic sentiment could provide tailwinds. In the options market, put open interest (OI) outflanks call OI. Plus, though shorts have been in covering mode since the stock’s mid-July 18-month high, it would still take shorts more than trading five days to cover, at IRM’s average pace of trading.
Our recommended January 17, 2025 call has a leverage ratio of 9.4, and will double on a 10.1% rise in the underlying security.