Price Forecast:

Bullish Case: AXTA's recent flat price suggests potential for recovery, driven by low implied volatility and positive market sentiment. Historical data indicates strong upside potential with a favorable earnings report on the horizon.

Bearish Case: Persistent market uncertainty and elevated implied volatility could hinder AXTA’s price growth. Ongoing tariff threats and economic headwinds loom large, risking downside momentum.

Potential Outcomes:

1. 60% chance of price rebound due to earnings exceeding expectations.

2. 30% chance of stagnation due to tariffs affecting profits.

3. 10% chance of sharp decline from adverse economic developments.

Trading Oracle: Consider entering a bullish debit spread by buying the AXTA 01/17/2025 42.00 C and selling the 43.00 C. This strategy leverages low implied volatility, allows for a high reward:risk ratio, and aligns with a positive outlook on upcoming earnings. Focus on capturing the upside while mitigating risk.

November 13, 2024